Oral Answers to Questions

Debate between Alison McGovern and George Osborne

Tuesday 27th January 2015 Commons Chamber

[Alison McGovern (Wirral South) (Lab)]

Will the Chancellor confirm that he has ruled out a further VAT increase in the next Parliament?

[Mr Osborne]

Our plans do not involve a VAT increase, because we are prepared to make difficult decisions on public expenditure, including decisions on the welfare budget. The hon. Lady and her colleagues voted for £30 billion of consolidation. If they are not prepared to do that by achieving expenditure savings, they must be contemplating big tax rises. With 100 days to the election, we know the choice: it is between a competent Conservative plan that is delivering growth, and a return to economic chaos under the Labour party.

The Economy and Living Standards

Debate between Alison McGovern and George Osborne

Thursday 12th June 2014 Commons Chamber

[Mr Osborne]

I was wrong? This is the man who presided over the deepest recession in British modern history and the biggest banking crisis since the Victorian age. He has the nerve to get up and say to the team that is turning the country around that we got it wrong. The truth is that he is the person who got it wrong.

There was a very interesting observation this week by Charles Clarke, who was the Home Secretary when Labour were in office. This is what he said:

“we have rested a great deal on assuming that the Conservative strategy wouldn’t succeed, that ‘plan A’…would not work and that has proved to be an unwise judgment because in fact, the Conservatives have succeeded in getting the economy onto a more positive path which leaves us”—

the Labour party—

“very little place”.

[Alison McGovern]

I think the Chancellor gave himself away at the beginning of his speech when he described “long-term economic plan” as just a catchphrase. He said he would close the budget deficit and he has not. If his policies are such a success, why not?

[Mr Osborne]

It is not a catchphrase; it is a plan that has cut the claimant count in the hon. Lady’s constituency by 45%. That is a plan that is working. The budget deficit has been halved. If her argument is that we should be cutting faster or trying to get the deficit down faster, that is a novel argument because it is not one I remember being made at any one of the economic debates when she and the rest of the Labour party trooped through the Division Lobby against every single change we have made to try to bring the public finances under control.

Autumn Statement

Debate between Alison McGovern and George Osborne

Thursday 5th December 2013 Commons Chamber

[Mr Osborne]

My hon. Friend is right. It is not just that they got the predictions wrong: it is what that says about their governing philosophy—that they could go on spending and borrowing and running up the deficit with no consequences whatever. Unfortunately they were let near the door of No. 11 in the last decade and that is one of the reasons we are all clearing up this mess at the moment.

[Alison McGovern (Wirral South) (Lab)]

The Chancellor told us in 2010 that he would close the deficit gap by 2015 and he has told us today that it will be 2018-19. What happened?

[Mr Osborne]

As we have now discovered, the recession was even deeper than we knew at the time, with a 7% fall in national income. The financial crisis had an even bigger effect on our economy and its recovery and, at the same time and as is obvious to everyone, our nearest neighbours in the eurozone almost had their currency fall apart and remain in recession. During this period, we were also told repeatedly that if we stuck with our plan and went on trying to reduce the deficit, there would be no economic recovery. We have still had no explanation from a Labour Member as to why we now have a recovery.

Spending Review

Debate between Alison McGovern and George Osborne

Wednesday 26th June 2013 Commons Chamber

[Mr Osborne]

We set out the school commitment in the direct school grant and the pupil premium. We have invested in the education of young people as well as the education of young adults.

[Alison McGovern (Wirral South) (Lab)]

Does the Chancellor believe that since he came to office the average British family is better off after inflation—yes or no?

[Mr Osborne]

I think that they have better economic prospects than they did under the previous Government.

Economic Policy

Debate between Alison McGovern and George Osborne

Monday 25th February 2013 Commons Chamber

[Mr Osborne]

Last week we had the good news that unemployment had fallen again and employment had gone up, and we had the forecasts from the European Commission. Although we would of course want UK growth to be higher, they show that it is actually forecast to be higher than that of France, Germany and many of our European neighbours. We are in a tough neighbourhood—it is a tough economic situation—but we are confronting our country’s economic problems.

[Alison McGovern (Wirral South) (Lab)]

The Chancellor’s response to the questions today has proved that, as ever with him, it is politics first before economics. Now that he has failed the test he set himself, will he turn his attention to the test that Wirral people set him, specifically on under-employment? What is he going to do to help people who cannot get the hours they need in work to put food on the table?

[Mr Osborne]

Of course we want to help people who are not currently working the hours that they want to work; we want to help them by helping businesses to expand to take on more people. As well as jobs going up by 888,000 in total and private sector jobs going up by 1 million or more, the number of hours worked in our economy has also gone up. Labour argues that it is all to do with under-employment, but that is not the case. Of course we want to help people who are working part time but want to go full time and people who want to work more hours. The best way to do that is to create an environment in which businesses want to expand and take people on.

Oral Answers to Questions

Debate between Alison McGovern and George Osborne

Tuesday 29th January 2013 Commons Chamber

[Mr Osborne]

Of course, we are clearing up the mess that Labour left behind. As we do that, the private sector has created over a million new jobs, unemployment has been falling, employment is at a record high, and female employment is at a record high. I would have thought the right hon. Gentleman should celebrate that, rather than talking it down.

[Alison McGovern (Wirral South) (Lab)]

Private sector job creation is not working for young people. In January 2011 I asked the Government how many young people they would be paying out the dole to by the end of this Parliament. They said 279,000. In December 2012 they had to up that figure to 310,000, an extra 31,000 young people who they predict will be on the dole by the end of this Parliament. Who does the Chancellor blame for that planned increase in welfare spending—himself or the Secretary of State for Work and Pensions?

[Mr Osborne]

The claimant count has fallen on the most recent measure, which was published last week. As I said, 1 million jobs have been created in the private sector. We are also, as my hon. Friend the Member for Erewash (Jessica Lee) reminded us, creating the apprenticeships to give these young people the skills they need, which the previous Government were not providing, to compete in the modern economy. I would ask the hon. Lady to get behind the education and welfare reforms needed so that people have the right incentives to work and the right skills to get a good job in future.

Bank of England

Debate between Alison McGovern and George Osborne

Monday 26th November 2012 Commons Chamber

[Mr Osborne]

Depositor preference does not exist in the UK, but it does exist in countries such as the United States and Switzerland. It is something that we are planning to introduce and it was one of the recommendations of the Vickers commission.

[Alison McGovern (Wirral South) (Lab)]

I thank the Chancellor for his announcement and associate myself with the warm words of welcome from both him and the shadow Chancellor. He has already mentioned the ring fence between investment and retail banking. Will he go a little further and tell the House what specific conversations he has had with Dr Carney about the ring fence?

[Mr Osborne]

I think that that would breach the confidentiality of the interview process, but Mr Carney will come before the Select Committee and will no doubt be asked about his views on the Vickers reforms. As I have said, he supports them and it is important—this comes back to a point made by my right hon. Friend the Member for Louth and Horncastle (Sir Peter Tapsell)—that we now have consensus across our regulatory system. John Vickers has provided that consensus. We will introduce a Bill next January. Let us get on and make that important change. We are leading the world and, interestingly enough, a lot of the rest of the world is thinking of following us in that direction.

Jobs and Growth

Debate between Alison McGovern and George Osborne

Wednesday 12th October 2011 Commons Chamber

[Mr Osborne]

Okay. The motion tears up the Darling plan—it is £27 billion off the plan set out in the March 2010 Budget. That is the truth.

[Alison McGovern (Wirral South) (Lab)]

rose—

[Mr Osborne]

I shall give way to the parliamentary private secretary to the former Prime Minister to defend his record.

--- Later in debate ---

[Alison McGovern]

I will defend the record of our former Prime Minister any day of the week, but will the Chancellor defend his own record, and tell the House how far away he is from his deficit payback plan?

[Mr Osborne]

The hon. Lady has to defend the record of the former Prime Minister because he never turns up in this House to defend it himself.

The one thing that we want to avoid in a debt crisis is a sharp rise in interest rates, but that is what the motion would bring about. Let me give the House some new information.

Eurozone

Debate between Alison McGovern and George Osborne

Monday 10th October 2011 Commons Chamber

[Mr Osborne]

I am sure the hon. Gentleman can put in his bid for things he would like to see repatriated. Perhaps there would be some trade union powers, so that a Government led by the union man, the leader of the Labour party, could get their way more easily. But we will have that debate in due course; it is not active at the moment in European circles. I suggest that we focus on the immediate issue at hand, which is resolving the eurozone crisis.

[Alison McGovern (Wirral South) (Lab)]

In response to the right hon. Member for Wokingham (Mr Redwood), who is no longer in his place, the Chancellor described the Bank of England’s analysis of the impact on inflation of the last round of quantitative easing. At a time when British people have less and less cash in their pockets, few issues could be more important. [Interruption.] [Hon. Members: “It’s Gordon Brown ringing for you!”] Will the Chancellor tell the House, perhaps by telephone, or by e-mail, whether he has requested any analysis from his civil servants in the Treasury of the forecast for the impact on inflation of the current round of QE?

[Mr Osborne]

I think the phone would have been flying through the air rather than ringing, if it had been the last Prime Minister. Of course we have made our own examination of the impact of QE. When I became Chancellor, I set out the procedures I would follow if there were a request from the Monetary Policy Committee. I set it out within weeks of coming into office and I said I would follow exactly the procedures set out by my predecessor—that if there were a request, we would accede to it. I also believe that the MPC has come to the right judgment; its judgment was independent, but I believe it was right.

Global Economy

Debate between Alison McGovern and George Osborne

Thursday 11th August 2011 Commons Chamber

[Mr Osborne]

My hon. Friend is absolutely right. In January last year the largest bond investor in the world said that UK gilts

“are resting on a bed of nitroglycerine.”

Today I could read out a whole string of comments from market participants saying that the UK has been a safe haven in this sovereign debt crisis because of the decisions that we took.

Standard & Poor’s, the rating agency that has just downgraded the United States, took the United Kingdom off “negative outlook” and reaffirmed our triple A credit rating. The practical consequence of that is much lower interest rates. If we pursued the policy proposed by the Opposition of more spending and more debt, the immediate response would be higher interest rates which would kill off any recovery. That is why such a policy is economic madness.

[Alison McGovern (Wirral South) (Lab)]

Given poor and worsening United Kingdom growth, at what point will the Chancellor advocate further quantitative easing? If he will not answer that question, will he tell us whether he believes that there is no chance that rapidly rising sterling will hurt our exports?

[Mr Osborne]

Both those matters are properly for the Bank of England. It is for the Governor to comment on the value of sterling, if he chooses to do so. As for quantitative easing, the arrangements agreed by the last Government, which I have retained, remain in place. If the Monetary Policy Committee makes a serious request, of course we will consider it seriously, but we have received no such request.

The Economy

Debate between Alison McGovern and George Osborne

Wednesday 22nd June 2011 Commons Chamber

[Mr Osborne]

And he says that he is really worried about them.

So, there we have it: the shadow Chancellor is against putting the Bank of England back in charge of prudential regulation; against the financial policy committee; and against the financial conduct authority, which is going to be tougher on behalf of consumers. The independent banking commission, which includes experts from throughout the banking field, has been working on the issue and come forward with an interim report. We have backed the principles of that report, but what does the shadow Chancellor have to say? Absolutely nothing—absolutely nothing about the plan that he would put in place. That is the truth.

[Alison McGovern (Wirral South) (Lab)]

rose—

--- Later in debate ---

[Mr Osborne]

My hon. Friend is absolutely right, and I am glad that I gave way to him so that he could make that important point.

[Alison McGovern]

Will the Chancellor give way?

[Mr Osborne]

Let me conclude—

[Mr Osborne]

I think that the hon. Lady is the Parliamentary Private Secretary to the former Prime Minister, and given that he will never be here to speak for himself, she must speak for him.

[Alison McGovern]

I thank the Chancellor for giving way, and I am proud to be the PPS to my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown).

The Chancellor was so busy yesterday calling me “new” that he did not answer my question, and he did not listen to the shadow Chancellor just then or answer his question, either. Will he explain how his increased complication of the regulatory system will prevent further bank failure?

[Mr Osborne]

Of course, I welcome the hon. Lady to her—[Interruption.] I will answer the question that she puts. I have merely observed in the past that being the Parliamentary Private Secretary to someone who never comes to Parliament is not a very onerous job, but that is good, because she can think up important questions to ask me.

Our judgment, with which the hon. Lady is entitled to disagree, is this: what was missing from the tripartite system was an ability to assess systemic risks throughout the economy. No one was looking at overall debt or leverage levels—[Interruption.] The shadow Chancellor says, “Rubbish”. When the Royal Bank of Scotland wanted to buy ABN AMRO after the credit markets had closed and after the run on Northern Rock, the regulatory system allowed RBS to do so. That is what went wrong, and if the right hon. Gentleman wants to go on defending the system that led to the biggest banking crisis in our entire history he can be my guest.

Oral Answers to Questions

Debate between Alison McGovern and George Osborne

Tuesday 21st June 2011 Commons Chamber

[Mr George Osborne]

My hon. Friend is right. Manufacturing halved as a share of our economy under the Labour Government and financial services grew dramatically over that period. Since the last election, manufacturing output is up 4.2% and the private sector has created more than 500,000 new jobs net, which is all good news. The example he brings to the Chamber is just one of many companies that are investing and employing people, and despite a choppy recovery we should celebrate that.

[Alison McGovern (Wirral South) (Lab)]

T7. On 14 February the Governor of the Bank of England told the Chancellor that his VAT rise had caused inflation. On 16 May the Governor again told him that his VAT rise had caused inflation. Will he tell me how he is measuring the impact of his VAT rise on the rest of our economy and whether it was a rise too far, too fast?

Oral Answers to Questions

Debate between Alison McGovern and George Osborne

Tuesday 10th May 2011 Commons Chamber

[Mr Osborne]

Of course it is welcome to have the support of the US Treasury Secretary. It is interesting that we have been urged for some months by Labour to follow the US example. The Obama Administration, in the speech the President gave at George Washington university, set out a deficit reduction plan—it is not yet legislated for in Congress—that goes faster and deeper than the one we are promoting here in the UK. I suspect that we will not now hear the argument that we have heard for the past few months from the Labour party.

[Alison McGovern (Wirral South) (Lab)]

May I associate myself with the remarks about our much-missed colleague David Cairns that you, Mr Speaker, and others have made?

Recent commentators have suggested that it is possible that the Government will not meet their target to balance the cyclically adjusted current budget by 2015-16, by the end of this Parliament. If it becomes clear that Tory cuts are not working to reduce the deficit, at what stage will the Chancellor change course?

[Mr Osborne]

I have just been told by my hon. Friend the Member for Chelsea and Fulham (Greg Hands) something about the hon. Lady that I did not know: she is the Parliamentary Private Secretary to the previous leader of the Labour party. It is presumably not a job with onerous responsibilities, but it sounds as though he may have written that question for her. The Office for Budget Responsibility is the independent body that assesses our ability to hit the fiscal mandate. The reason we set it up was because under the stewardship of the person to whom she is PPS all credibility for Treasury figures was lost.

Oral Answers to Questions

Debate between Alison McGovern and George Osborne

Tuesday 8th February 2011 Commons Chamber

[Alison McGovern (Wirral South) (Lab)]

I was just checking and realised that the Government’s own business planning projections show that the proportion of young people on the dole by the end of this Parliament will be reduced by less than 1%. Will the Chancellor explain what his plan is to increase the number of jobs made available to those young people?

[Mr Osborne]

This country has a problem with youth unemployment that has been apparent for a decade. Even in the boom years during the middle part of the last decade, youth unemployment was increasing and a whole generation was being left behind. I hope that we can achieve some kind of cross-party consensus on trying to reform our welfare system so that people do not get trapped in poverty and work always pays. We are reforming the new deal and replacing it with the Work programme so that we are more effective at giving young people the training they need and the opportunities that have been lacking for the last decade.