Public Expenditure: Deficit Reduction

Lord Renton of Mount Harry Excerpts

Tuesday 6th September 2011 Lords Chamber

[Lord Sassoon]

I do not know to which “he” the noble Lord is referring, whether it is me or my right honourable friend the Chancellor, but we all believe in it and we are sticking to it. However, as I have explained, the cyclically adjusted nature of the mandate which the Chancellor has set means that, in times of economic uncertainty, factors such as varying levels of employment and inflation feed through so that the economy benefits, for example, from increased social security benefits and we do not in some slavish way have to cut back on other expenditure. The flexibility is there for very good reasons and it is operating.

[Lord Renton of Mount Harry]

My Lords, could I ask my noble friend perhaps a rather simpler question? Despite the dreadful headlines in today’s newspapers, to what extent does the Chancellor of the Exchequer feel that he is on course in deficit reduction?

[Lord Sassoon]

My Lords, I remind noble Lords, lest they forget it, that we have introduced an independent Office for Budget Responsibility so that we can no longer keep fiddling the numbers and restating the cycle like the previous Government did. The Office for Budget Responsibility’s latest numbers, produced at the Budget, confirmed that we are on track to meet the Chancellor’s fiscal mandate on the rolling five-year period.

Economy: Government Policies

Lord Renton of Mount Harry Excerpts

Thursday 24th March 2011 Lords Chamber

[Lord Renton of Mount Harry]

My Lords, it is always a great pleasure to follow a speech by my noble friend, who I have known for many years. I do not disagree with him, either with the pessimism or the optimism. However, I want to talk about a different matter in my few minutes. Before I do that, I join in what he said about the noble Lord, Lord Hussain, and his speech. It was a very great pleasure to hear him, and it was particularly good to hear about his small business. I wish him every continuing success both in his business and here in the House of Lords.

The Times has an article today about the Chancellor’s speech. The article said that the Chancellor has chosen the right sectors of the economy to dominate the world as London’s financial services do: advanced manufacturing, life sciences and creative industries. It is on that subject that I should like to speak. There are some aspects of the Budget that very much fit in, particularly in relation to the workforce, with the comments that the Times makes. Here we have the need to create a more educated workforce that is the most flexible in Europe. The next paragraph says that youth unemployment rose by 100,000 between 2004 and 2008 and has risen by a further 250,000 since the start of the recession. That, of course, is extremely bad news. It has to change and has to be helped to change. But then we hear that the Government will find an additional 80,000 work experience places for young people, ensuring that up to 100,000 places will be available over the next two years. That is a very important statement in the context of the Budget, to which we may not have paid enough attention. I very much welcome that. It gets down to the case of the additional apprentices. I was told earlier today that Nissan has reported that in making cars in north-east England it employs more apprentices than all the other manufacturers in the area put together. Surely this is the time when manufacturers have to get back to the habit of employing young people—those aged between 16 and 18—who have everything to learn.

I also welcome very much what is in the Budget speech about the expansion of university technical colleges. That is extremely important if we are to be at the top of the world in the new production about which we are hoping. Here I say a word about my own local university, the University of Sussex, which was founded exactly 50 years ago to concentrate on arts and sciences—about 50:50. I was lucky enough to be on the council for 10 years. The noble Lord, Lord Briggs was the first vice-chancellor, and he very much developed the arts side of the university. Now we have a scientist as the vice-chancellor, Professor Farthing, who has turned the university back to being into science—exploring and trying to help by finding out new opportunities in the scientific world. In one of his recent reports, he said:

“Research expenditure at our university has grown over the past few years, leading to the employment of enormously skilled and talented individuals and the promise of substantial future economic impact as much of the research will be commercialised. Our programme has recently expanded to include internships in the environmental, engineering, finance and accounting, pharmaceutical and media sectors”.

The point I end with is that if we can do that in Sussex, surely other universities should be following us into doing much the same. If we are to compete with the likes of India, China and Brazil, if we are to be at the top of the league, as the Chancellor put it yesterday, in advanced manufacturing or life sciences, we have to get closer to our universities and share with them the aim, the intelligence and the plans that will be necessary for us to be successful in the future manufacturing world. I regard that as a major but very important challenge, and I hope that universities will follow what my own university is doing at the moment.