Economic Affairs and Work and Pensions

Adrian Bailey Excerpts

Tuesday 8th June 2010 Commons Chamber

[Mr Darling]

I am grateful to the hon. Gentleman for accepting what is obvious: the fact that during a recession Governments do have to borrow in order to support their economies. However, I should remind him that during the earlier part of the previous decade the Conservative party supported our spending programmes, saying that they would stick to our spending levels. The Prime Minister, when he was Leader of the Opposition, said that as recently as 2008. The hon. Gentleman was not here during the previous Parliament, but I can assure him that I do not recall any Conservative standing up to say, “Don’t build a new school in my constituency. Don’t build more housing. Don’t open a new hospital.” Conservative Members were not saying that at all; they wanted more spending in just about every area. So the idea that the Conservative party was behaving in a way that would have meant that there was no borrowing and that the Conservatives would have behaved any differently is absolute nonsense. The hon. Gentleman just has to accept that.

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

Does my right hon. Friend agree that some of the measures that have now contributed to the deficit were being demanded by manufacturing industry in order to sustain the corporate manufacturing base needed for us to grow out of recession, the car scrappage scheme being one case in point?

[Mr Darling]

I agree with my hon. Friend. The new Government will find that for every industrialist or manufacturer who says that public spending needs to be cut, in areas that benefit from such spending people take a rather different view. The car scrappage scheme is an example of that, and it made a huge difference to the car industry and the motor vehicle industry in general. As the hon. Member for North West Leicestershire (Andrew Bridgen) said, the action that we took did involve more borrowing and it does result in increasing debt. However, the point is that the cost of failing to act would have been far greater.

The Chancellor was talking about the international consensus. I know something about that, and I can tell hon. Members that over the past three years it was very much in favour of our continuing to support our economies; of course, as we come through to recovery we have to get the borrowing down. Nobody disputes that, and at least two of the parties that fought the previous election were absolutely clear about it—it was never clear what the third party was in favour of, and its position remains something of a mystery even today.

--- Later in debate ---

[Mr Osborne]

I am probably going to regret this, but I am quite attracted to the idea that my hon. Friend has proposed, not just in the Chamber today but to me privately; I think he has also written about it. The key thing that he proposes is that Select Committees should be able to recommend reductions, rather than increases, in Government Department budgets. I would certainly welcome that if we were ever to proceed in that direction.

I honestly mean it when I say to my hon. Friend that I am attracted to his idea. I will come back to him and see whether we can take it forward. Obviously, it would be the collective decision of the Government, rather than mine alone. My hon. Friend is right to say that we are trying to get away from it simply being the Treasury that conducts the spending review, imposing its decisions on everyone else.

I believe that when Tony Blair was Prime Minister, he and the right hon. Member for Kirkcaldy and Cowdenbeath would simply agree a total. Every Secretary of State would then receive the number in an envelope, before it was announced to the press about 20 minutes later. We are going to have a more collegiate approach and we are genuinely seeking to engage as many people as possible—the brightest civil servants across all the Government Departments and the best people from the devolved Administrations, pressure groups, independent think-tanks and front-line public services. There will be a Cabinet committee to chair and oversee the process and its membership will be restricted to those Cabinet Ministers with very small budgets of their own. Other Cabinet Ministers will be eligible to be members of the committee once they have settled their departmental allocations. That will create an incentive structure within the Cabinet.

Finally, over the summer we are going to conduct a wide public engagement exercise so that the whole country has a chance to get involved. We have already begun to implement the most radical transparency agenda that the country has ever seen. The hon. Member for West Bromwich East (Mr Watson) and I were talking earlier about the £25,000 disclosure limit for central Government expenditure. The previous Chancellor refused my freedom of information request to publish the Treasury’s combined online information system, or COINS, database of public spending. But the current Chancellor of the Exchequer has accepted that request and the raw data in the COINS database are now available online.

[Mr Bailey]

rose—

[Mr Osborne]

I will give way on this point, if the hon. Gentleman likes, but just let me say this. We have published the database as quickly as we have been able to. By August, we will be able to publish a more user-friendly version of the data; the current version is quite difficult to operate. We need a couple of months to get the computer software to enable people to search the database.

[Mr Bailey]

In his list of those who would be consulted on the budget cuts, the Chancellor omitted to mention manufacturing industry. Will he undertake to talk to representatives of manufacturing industry about his proposals on investment allowances, as portrayed in the run-up to the general election?

[Mr Osborne]

My team and I are in regular discussions with manufacturing industry, representatives of which were vocal supporters of our proposals during the general election to avoid the jobs tax.

Let me conclude by saying that all parts of government and society—and all parts of this Parliament, if they want to take the opportunity—will have a chance to make their voices heard. This is the great national challenge of our generation. After years of waste, debt and irresponsibility, we have to get Britain to live within its means. It is time to rethink how the Government spend our money. We did not choose the terrible economic situation that we inherited; the Labour party chose that for us. But we can work to put it right—deal with our debts, set our country on a brighter economic course and show that we are all in this together. I commend the Gracious Speech to the House.