Budget Resolutions

Debate between Angela Eagle and John Redwood

Wednesday 22nd November 2017 Commons Chamber

[Ms Angela Eagle (Wallasey) (Lab)]

It is a pleasure to follow the right hon. Member for Wokingham (John Redwood). The Office for Budget Responsibility forecast, which was published today, has demonstrated that we are in a downgraded economy. Real wages are down, business investment is down and productivity is downgraded now and far into the future. It is therefore no wonder that growth is down from the Chancellor’s modest forecast in March of this year. He has presented news today of a slowing economy for the next three years—an economy that is forecast to be £65 billion smaller in 2020 than was expected early last year. Aside from setting apart £3 billion to plan for Brexit, which is more than he gave to the NHS, he made no mention of the £40 billion or so divorce payment that is presumably going to be agreed with the EU soon. He used headroom and some reclassification of housing association debt to announce some tinkering, but, fundamentally, nothing has changed with this Budget.

This is the eighth Tory austerity Budget in a row, and it is taking place against a backdrop of an economy in the doldrums. We were told by George Osborne in the first austerity Budget that we all had to make sacrifices in order to eliminate a deficit caused by the global financial crisis. Entirely predictably, that five-year plan failed, so the pain was extended for another five years. Now we are told that the second five-year plan has failed too, so this Chancellor is extending austerity for another five years until 2025. That is already a 10-year delay on what was meant to be a five-year recovery plan. That means 15 years of austerity, cut after cut and pressure on the public services year in, year out, with no end in sight. This austerity policy has a huge human cost that we on this side of the House see daily in our constituency advice surgeries. Homelessness and destitution are on the rise, food bank use is soaring and the benefit system is failing most of those who have to rely on it through no fault of their own.

The Conservative party is in thrall to a right-wing, libertarian ideology. It wants to shrink the size of the state as a deliberate political aim. It wants state expenditure to be as low a percentage of GDP as possible, despite the increasing demands of an ageing population and the need to make our economy fit for the future in rapidly changing times. It expects people to sink or swim, and it is not that not concerned about providing them with any lifeboats—

[John Redwood]

rose—

[Ms Eagle]

The right hon. Gentleman has just spoken; he can go off and advise his clients on investing their money abroad.

The Conservative party saw an opportunity to pursue a minimal state agenda in the aftermath of the global financial crash, and it has done so at great cost to many. It made a deliberate choice that cuts to public spending would bear 80% of the cost of eliminating the deficit and that only 20% would be accounted for by tax changes, and we now know that the cuts have fallen disproportionately on the most vulnerable and those least able to look after themselves. The Chancellor’s predecessor liked to claim that we are all in this together, but he cut the top rate of tax for his super-rich friends at the same time as ensuring that public sector workers had a decade of pay freezes and falling real living standards.

Meanwhile, the Government have systematically reduced the social safety net to tatters for some of the most vulnerable people in our society. By 2021, Wirral Council, which is my local authority, will have had its funding cut by 40% since 2010. Efficiency savings cannot cover cuts on that scale, and it is no surprise that that level of cuts has decimated council services such as adult social care, which for a second time was not mentioned in the Budget and saw a 26% cut between 2011 and 2016, meaning that essential social care for the elderly is not available and people in dire need are being left with little or no help. In education, real-terms funding cuts have led to a loss of £149 per pupil and 29 teachers in Wallasey alone. Cheshire and Wirral Partnership NHS Foundation Trust is being told to cut £1 billion in the next five years. Merseyside fire and rescue service used to have 40 fire engines to save lives; it now has 28.