Cost of Living
Debate between Catherine McKinnell and Geraint Davies
Geraint Davies (Swansea West) (Lab/Co-op)
It is a pleasure to follow the hon. Member for Elmet and Rothwell (Alec Shelbrooke), although I do not think that the spot price of oil should be the determining factor in whether we intervene in a country where 70,000 people have been slaughtered and 1 million more have been made into refugees. That should not have been a consideration in Libya either.
The centrepiece of the Queen’s Speech, with respect to the cost of living, should have been a strategy for growth. That was sadly missing from the rag-bag of old ideas that we have seen before. Contrary to what was said by the hon. Member for North East Somerset (Jacob Rees-Mogg), who is no longer in his seat, under this Government, the debt to GDP ratio will have gone up from 55% in 2010 to 85% in 2015, debt is rising by £245 billion and we have lost our triple A rating. The idea that all is rosy in the garden is farcical.
What we need is growth. To his credit, the Prime Minister is in Washington trying to negotiate an EU free trade deal with the United States. At the very same moment, the Eurosceptics—or should I say Euroseptics—are busy undermining that prospective agreement with a great trading partner. That is very sad.
Catherine McKinnell
My hon. Friend is making a powerful point about our international position. Does he share my concern over the figures from the Office for National Statistics that came out today, which show that the UK has plummeted to 12th in the league table of household incomes? That shows that not only are people suffering, but we are falling behind our international neighbours and competitors.
Geraint Davies
That is a key point.
We are always hearing that everything is all right in the UK and the problems are someone else’s fault. The EU does have problems, but there are emerging opportunities in China, India, Brazil and elsewhere. The Queen’s Speech should have provided a strategic platform for international trade to help us access the newly emergent and massive middle classes who want to take our consumer goods and who form the basis of inward capital investment. But no, we are busy being the one nation, fish and chip shop, Eurosceptic Britain—the nation of shopkeepers that Napoleon described us as. It is frankly pathetic. The Conservatives are not fit to be in government.
Between 1997 and 2008, we saw growth of 40%. Not enough Labour Members stand up and defend that. If our debt to GDP ratio is going from 55% to 85%, how can we sort it out? One way is to cut debt and to stamp on the poor for the recklessness of the bankers, which is what the Tories are doing. The other is to increase GDP so that the ratio goes down. Under Labour, GDP went up by 40% up to 2008. In 2008, my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown) and President Obama put together the fiscal stimulus. The EU’s fiscal stimulus was 2% of GDP. In the United States, it was 5% of GDP. Indeed, the United States put in $2 trillion of quantitative easing, whereas the EU put in nothing. Britain did put in something, but we still have the economics of austerity here and in Europe. In the United States, where the economy was stimulated, growth is projected to be 3% in the next year. In the EU, it is projected to be 1%. Why was nothing done about that in the Queen’s Speech?
We have seen the emergence of massive youth unemployment. In Greece, the rate is more than 60% and in Italy it is 38%. In Greece, people are moving towards the Nazis and extreme communists. In Italy, 25% of people voted for a comedian. I notice that that is the same percentage of people who are voting for UKIP here. The British National party’s support has gone up fourfold from 1% to 4%. The response of the Tories is to run for the hills and emulate UKIP.
Why has support for UKIP gone up? The first reason is that the Prime Minister has given it credibility by saying that he will hold a referendum. People who used to say to me when I knocked on their doors, “You must be joking. We’ve got millions of jobs involved in trade with Europe. It’s the platform into China, India and the United States”, are now thinking, “Hold on. Cameron’s offering us this option, so it must be a credible choice.” That gives oxygen to UKIP.
Infrastructure
Debate between Catherine McKinnell and Geraint Davies(11 years, 9 months ago)
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Catherine McKinnell
Indeed. My hon. Friend makes that point very well. Infrastructure investment fell off the cliff when this Government came to power and we are seeing the economic consequences of that today. Many Members have referred to the Chancellor’s 2010 spending review. It took place in the fourth quarter of 2010 and the UK’s economy has grown by just 0.4% since then. During that time, the USA economy has grown by 4.2%, Germany’s by 3.6% and France’s by 1.5%. Our economy, however, has been stagnating for the past two years, and borrowing is now rising, not falling, as a result.
Geraint Davies
Does my hon. Friend agree that the United States strategy for the top 2% to pay more towards reflating the economy and getting 1% extra growth is a good idea and that we should not be hitting the poor to pay for debts?
Catherine McKinnell
This Government’s choices on spending and tax have resulted in millionaires being given a tax cut while the poorest bear the brunt. We are seeing the results of that, not just in the suffering that we see at our constituency surgeries, but in the lack of economic growth. That is why it is so disappointing—indeed, unforgiveable—that the coalition Government have been asleep at the wheel on the issue of infrastructure investment.