Jobs and Growth

Andrew Bridgen Excerpts

Thursday 17th May 2012 Commons Chamber

[Andrew Bridgen (North West Leicestershire) (Con)]

The shadow Chancellor has used many quotes in his opening speech, so let us see whether he agrees with this one from Mervyn King, the Governor of the Bank of England, whom Labour appointed. He said that this Government demonstrated a

“textbook response to the situation”—

the economic mess we inherited from the previous Government.

[Ed Balls]

The Governor of the Bank of England was confident two years ago that the Chancellor was making the right calls on the pace of deficit reduction. Unfortunately, it has turned out that the Governor of the Bank of England and the Chancellor of the Exchequer have both got that wrong. We had gone back into recession even before the eurozone crisis. Let us consider recent entries from the website of the hon. Member for North West Leicestershire (Andrew Bridgen). They show him “criticising cuts” to “local health centres”, and reveal his wish to “Save Moira Fire Station” and for the “replacement” of local bus services. I am not sure that all that is entirely on message. Yet the Chancellor and the Prime Minister are still clinging to the view that they are right and everyone else is wrong. In his speech today, the Prime Minister seemed to be trying to claim that the choice between austerity and growth was a myth. [Interruption.] I think that the Chancellor should listen to this, because I am about to explain why he has got it so badly wrong. He should listen and learn, Mr Deputy Speaker, listen and learn.

If the Prime Minister meant that we should not choose between policies for growth and policies for deficit reduction, he was right. I agree. In fact, that is exactly what Lord Mandelson and I argued in our joint article in Monday’s Guardian. We argued for action now to boost jobs and growth, alongside tough medium-term deficit reduction plans. But that is not what the Prime Minister was saying today. He and his Chancellor are still clinging to the mistaken and, now, increasingly discredited view that cutting spending and raising taxes faster to cut the deficit is the route to economic growth, when all the evidence is to the contrary. Trying to cut the deficit faster has not boosted growth in recession; it has choked off confidence, unemployment is up, and we are borrowing more than he planned, not less. If the Prime Minister is really claiming that he is on the right course, he is even more complacent and out of touch than I thought.

--- Later in debate ---

[Ed Balls]

No, I will not.

What an eight weeks it has been! The transformation has been startling, with the Chancellor’s long-held dreams turning to dust. He dreamed that his brilliant economic plan would bring unprecedented growth and finally deliver a Tory majority in 2015, and that a grateful Prime Minister would then stand aside, as he was finally cheered into 10 Downing street. How far away those dreams seem now!

[Andrew Bridgen]

Will the right hon. Gentleman give way?

[Ed Balls]

I will not.

Last month YouGov asked 1,800 people whether they thought the Chancellor was very well suited to the job of Prime Minister. How many said yes? Just 1% did—18 people only. The question we must ask is this: who on earth were those 18 people? After that Budget, they must be vegan, health freak, cyclist millionaires who passionately hate cars, pasties and caravan holidays, and think that pensioners get a cushy deal. So, other than Steve Hilton, who are the other 17? Is this not the truth: that the Chancellor’s plan has failed, and he has been exposed not simply as unfair and out of touch, but as incompetent? This part-time Chancellor needs a new economic plan for jobs and growth. This part-time political strategist urgently needs a relaunch for him and for the Prime Minister. This Queen’s Speech delivers neither a new economic plan, nor an urgent relaunch. He and the Prime Minister should go back to the drawing board and think again.

--- Later in debate ---

[Mr Osborne]

My hon. Friend is absolutely right. That is precisely what businesses need—a stable economic environment in which we are not exposed to some of the financial problems that some eurozone countries face at the moment. The low interest rates and the credibility that our policy bring help every business, not only in Bedford but around the country.

[Andrew Bridgen]

Does my right hon. Friend agree that just as we need to rebalance our economy away from over-reliance on the public sector, we also need to rebalance our exports away from over-reliance on the eurozone at the moment? The latest figures suggest that this is already happening, with UK exports to non-EU countries up by 12% while those to the EU remain flat.

[Mr Osborne]

I agree with my hon. Friend that we need to diversify where our exports go, not just because of the problems in the eurozone but because this country should be taking greater advantage of the extraordinary growth in the Asian economies. It remains a staggering fact that we were exporting more to Ireland than we were to Brazil, Russia, India and China put together.

--- Later in debate ---

[Alison McGovern (Wirral South) (Lab)]

I shall start my remarks by talking about the announcement by General Motors about Vauxhall at Ellesmere Port. I represent many, many people who work there and I pay tribute to that excellent work force and the community around them who support them. Whilst I recognise the commitment of all politicians who have helped back Ellesmere Port, in Wirral all of us know somebody—a family member or a friend—who has worked incredibly hard for this, and it is those people I am thinking of most and congratulating today.

I would like to make a few remarks about unemployment. Our commentary on employment, I am afraid, often shows the limits of the way we do our politics. The news, and we ourselves, often obsesses about the figures—the monthly movement up and down—and whilst those are important indicators, of course, it is the trend that really matters. We often worry about the weather when we should be thinking about the climate that we are in, and sadly, the unemployment figures are worse than those for this time last year. According to the Library, the number of people claiming jobseeker’s allowance is now 106,000 higher than in April 2011. That is incredibly worrying. The Chancellor mentioned the figures for two years ago. Unemployment plateaued in 2010. It is growing again now and we need to worry about why.

To add to the problem that we have, our understanding of the impact of unemployment and the lack of the necessary jobs in our economy is limited. I recently tabled a parliamentary question, asking the Treasury what assessment the Department had made of the medium and long-term cost to the Exchequer of the current level of unemployment. That matters because unemployment has a wide range of impacts. The Treasury did not give me as full an answer as I would have liked. I would have liked to know how unemployment impacts on the health budget in the form of increased costs; how much funding is being made available for the regeneration that is needed; and the impact of unemployment on crime levels.

[Andrew Bridgen]

In the shadow Chancellor’s speech, he made much of the apparent increase in long-term youth unemployment. Is the hon. Lady aware of the cynical way in which the last Labour Government manipulated the figures for long-term youth unemployment by cynically bringing people in for a one-week training course and then restarting the clock immediately after, to keep the figures down? That was a cynical measure, which this Government have stopped.

[Alison McGovern]

I thank the hon. Gentleman for his intervention. I have thought a lot about youth unemployment over the past years. The former Government oversaw radical improvements, such as our intervention in the labour market with things like the new deal. I find it hard to characterise any of that work, which has been recognised around the globe, as cynical. I find that very difficult to believe.

E-Tabling of Written Questions

Andrew Bridgen Excerpts

Monday 26th March 2012 Commons Chamber

[Andrew Bridgen (North West Leicestershire) (Con)]

On a point of order, Mr Speaker.

[Mr Speaker]

The hon. Gentleman was a bit slow on the uptake. I told him that he should do his point of order before the Adjournment, but anyway we will give him a go.

[Andrew Bridgen]

What powers do you have, Mr Speaker, to censure Her Majesty’s Opposition, who spent five days opposing the cut in the top rate of tax from 50p and then abstained from voting in the Lobby?

[Mr Speaker]

None.

Amendment of the Law

Andrew Bridgen Excerpts

Wednesday 21st March 2012 Commons Chamber

[Chris Heaton-Harris]

As the hon. Lady knows from the Public Accounts Committee, where we have often talked about such matters, it would be lovely if Government Departments had a holistic approach to any area of policy. If we could start with small business, that would be fantastic, but I do not think we are quite there yet. That is something we would all support across the political spectrum and without political point-scoring.

I was speaking about the waving of Order Papers and the 2 million people being lifted out of paying tax altogether—a thoroughly good thing, which I would like to think is welcomed in all parts of the House. It benefits everyone who is working—people who are trying hard for themselves, have got on the job ladder and are moving forward. I benefit. From what I see on Twitter and other media sources, if people are earning around £60,000, have children and drive a car, they are not in a great place after the Budget. That includes most Members here. We have managed to produce a Budget that penalises MPs, which I am sure our constituents will be relatively happy with. Most people want to see the lowest paid in society not paying tax, and long may that continue.

I have one or two concerns and plenty of suggestions. The Treasury Minister will know of my long-running love affair with onshore wind turbines and what they do to my constituency. Although there was not much about renewables or the subsidy levels, I welcome the words spoken by the Chancellor in his speech. An investment in gas and in nuclear is proposed. If we chose that method to hit our 2020 carbon target, we would save more than £35 billion, compared with the route that we are currently choosing to go down, which involves other types of renewables that cost an awful lot more. The subsidy that is given to landowners and energy companies makes energy cost more, increasing fuel poverty at the other end of the cycle. I suggest wholeheartedly that we look carefully at the policy choices we are making when we talk about energy, green taxes and fuel poverty in the future.

Personally, I do not mind consumption taxes. I know that Labour Members take issue with that, so let me give an example. I would love to see the end of vehicle excise duty. Fuel prices are too high, as we all know because we all regularly fill up our fuel tanks. Getting rid of vehicle excise duty would add, I believe, roughly 1.5p to the cost of a litre of unleaded petrol and diesel. But we would not have to pay vehicle excise duty and we would pay as we drove, so if we drove a gas-guzzler we would pay a lot more. The old lady who drives hardly at all would pay a lot less. There would be a huge simplification of the tax system. That might not work, but I would like us to think outside the box and consider areas where we could simplify taxes.

[Andrew Bridgen (North West Leicestershire) (Con)]

Is my hon. Friend aware of the millions of vehicles that are not paying vehicle excise duty? Putting the tax on fuel would catch them all and bring them within the scope of taxation.

[Chris Heaton-Harris]

I am aware of that; it is one of the reasons I moot the idea at this point.

I would like to finish by talking about personal taxation and the general excitement across the House about the reduction in the top rate of tax from 50p to 45p, based on the Laffer curve. I have been reading the document that the Treasury has produced and note that the comparison has been made on the changes to the additional rate of income tax and the money that we might have expected to get in, or not to get in, as a result of increasing taxes. I humbly suggest that that completely underestimates the value of reducing taxes, because reducing taxes means that there is more of an incentive to pay and not to try to divert or put off paying them for a certain amount of time. I would love to see more work done in the Treasury on what those figures would end up like, because we want to encourage the creators of wealth, and one way of doing so is by saying to them, “You can keep more of the income you generate.” We want people to take a chance and a risk and to set up their own businesses, and this is one way of encouraging them to do so.

--- Later in debate ---

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

The Chancellor opened his statement by promising us that this is a Budget that “rewards work”, “backs business” and “is on the side of aspiration”. Fine words, but I remember the last Budget, which he said would

“put fuel into the tank of the British economy.”—[Official Report, 23 March 2011; Vol. 525, c. 966.]

I have an uncomfortable feeling that in one year’s time, I will be looking back on the Chancellor’s opening words today with the same scepticism and cynicism with which I look back on the words that he used to describe his previous Budget. The fact remains that this Budget is set against a background of increasing unemployment, a squeeze on living standards and flatlining economic growth. It was significant that Government Members were so enthusiastic about the revised Office for Budget Responsibility projection which showed that the economy could grow by an extra 0.1%, given the fact that the economy is performing way below the Chancellor’s original projections. I sensed a hopeless clutching of straws.

[Andrew Bridgen]

Is the hon. Gentleman aware of recent predictions that the UK economy will grow twice as fast as the German economy and three times as fast as the French economy this year?

--- Later in debate ---

[Andrew Bridgen (North West Leicestershire) (Con)]

I draw Members’ attention to my declaration in the Register of Members’ Financial Interests.

The Budget is set in the context of continued uncertainty in the global economy, but it is a Budget that binds many threads of Government policy as we seek to reward work and enterprise and to rebalance our economy. The House would do well to remember that it is only by virtue of the deficit reduction plan set out by my right hon. Friend the Chancellor in June 2010 that the UK has managed to achieve a relative safe haven status and achieve record low interest rates, which will save the taxpayer a projected £36 billion over this Parliament.

The Chancellor today announced measures that will allow companies and individuals further to share in the benefits of these low interest rates, achieved no doubt by international acceptance of the fiscal competence of this Government’s policies. The deficit reduction plan, however, is not just about reducing the size of the increase in Government spending; it is also dependent on achieving growth. Although the eurozone crisis has damaged economic growth rates across the continent and globally, it is a testament to this Chancellor and this Government’s handling of the public finances that the deficit reduction figure was ahead of target this year, while at the same time achieving a growth rate in the economy of 0.8%.

As we have heard during the debate, the Opposition try to argue that deficit reduction is being pursued at the expense of growth, and America has been mentioned. They should look at the International Monetary Fund’s fiscal monitor, which shows that fiscal policy in America was tightened by 0.8% of gross domestic product last year, at the same time as a growth rate of 1.7% was achieved. This fact completely contradicts the inaccurate claims of the Leader of the Opposition in his Budget response and those in the Labour party who still cling to the misguided mantra that the only way to obtain economic growth is through fiscal stimulus. When will they learn that they cannot borrow their way out of a debt crisis?

There is, however, no room for complacency and the economy needs to start growing at a faster rate. I welcome the measures outlined today that will stimulate the economy and see taxes cut for 24 million taxpayers through the increase in the tax threshold. That is another example of the Government’s commitment to the lowest-paid and stands in stark contrast to the actions of the previous Prime Minister, who removed the 10p starting rate of tax in his final Budget, hitting the lowest-paid the hardest. The increase in the personal allowance to £9,205 is very welcome and will lift an additional 66,000 people in the east midlands alone out of income tax and benefit more than 1.7 million individuals nationally. The Government will have lifted a total of 148,000 people in the east midlands out of tax at this rate.

Another damaging legacy of the previous Prime Minister was the 50p rate of tax—a purely political and cynical attempt to lay a bear trap for the Conservative party. As my right hon. Friend the Chancellor explained, it is raising little or no money and damaging the competitiveness of our economy. It was a Trojan horse of a tax. It raised no money and at the same time damaged our economy.

[Mr Stewart Jackson (Peterborough) (Con)]

Is it not the case that the Opposition have no credibility on this issue, because even though the shadow Chancellor knows that the 50p rate damaged entrepreneurship and collected very little revenue, he still refuses, even this afternoon, to confirm that the Labour party, if in office, would bring it back?

[Andrew Bridgen]

My hon. Friend is absolutely right; they have no credibility and will not confirm whether they would bring the rate back. I remind the House of the comments of their former leader, Tony Blair, who stated:

“I wanted to preserve, in terms of competitive tax rates, the essential Thatcher/Howe/Lawson legacy. I wanted wealthy people to feel at home and welcomed in the UK so that they could bring more business, create jobs and spread some of that wealth around.”

Whatever happened to new Labour? Even Mr Blair accepted that the top 1% of earners pay almost 30% of the taxes in this country, and many other countries certainly feel the same, but our top rate of tax was the highest in the 10 largest economies in the world.

[Mr Marcus Jones]

While my hon. Friend is on the subject of tax, will he join me in welcoming the comments of the Birmingham chamber of commerce today that the Chancellor’s tax reforms are a recipe for growth?

[Andrew Bridgen]

I certainly will. As my constituency is only 22 miles from Birmingham, I always listen to what its chamber of commerce has to say. I am sure that it also welcomes another signal that this country is open for business: the acceleration in the cuts to corporation tax. These changes will encourage business investment, support growth and create jobs. My only regret about the announced cut in corporation tax is that Ken Livingstone stands to gain from the devious arranging of his tax affairs. I also welcome the announcement of loans for young entrepreneurs, which displays a commitment, not always shown by the previous Government, to open up opportunities for young people who choose not to go to university.

We are all well aware of the over-complicated and incomprehensible tax system left by the previous Government. The Chartered Institute of Taxation stated shortly after the election:

“The UK now has the longest primary tax code, and one of the most complicated, in the world.”

We all know that this is stunts growth, and I welcome the tax simplification measures announced today in the Red Book, which abolish 28 reliefs and will make the tax affairs of small businesses, the lifeblood of our economy, much simpler. However, this Budget needs to be the beginning of the work on tax simplification, not the end. We have all become aware of the stamp duty loopholes that have been ruthlessly exploited through schemes such as subsale relief and individuals, through companies, avoiding stamp duty on multi-million pound houses. I welcome the action the Chancellor has taken to close this embarrassing loophole.

I welcome also the announcement on regional pay bargaining. The Opposition will argue that it widens the north-south divide, but I argue that the north-south divide is being perpetuated: areas have become so hooked and reliant on public sector jobs that the private sector, which cannot compete with the pay and conditions agreed nationally by the public sector, is stifled. We need more of our brightest and best to enter the private sector, which in many parts of the country struggles to compete with the pay and conditions on offer in the public sector.

I welcome the measures announced to help military personnel, particularly doubling the rate of council tax rebate and doubling the rate of family welfare grant. That is another example and extension of this Government’s commitment to the armed forces, and, although the announcement of £100 million of investment in military accommodation is long overdue, it will be welcomed by all service families.

We cannot tax our way into prosperity any more than we can borrow our way out of a debt crisis. This is a Budget that is symbolic of this Government’s principles—to promote fairness and to reward work and enterprise so that we can start to earn our way back to prosperity.

Financial Services Bill

Andrew Bridgen Excerpts

Monday 6th February 2012 Commons Chamber

[Mr Osborne]

Maybe we should just exchange our notes; then we could spare the House.

[Andrew Bridgen (North West Leicestershire) (Con)]

To take the Chancellor back to my experiences in 1997, I was in business, and my bankers at the time were at the Royal Bank of Scotland. Shortly after the general election in which the Labour Government were elected, I had a meeting with my bankers. I expressed my disappointment at the election result, but they were extremely upbeat. I asked them why, and they said, “Labour Governments are never any good at regulating the financial services industry. We’re going to make a lot of money in the banking industry.” Were not those words prophetic?

[Mr Osborne]

For a while, they did make an awful lot of money. Unfortunately, they then lost an awful lot of money, which is one reason why we are here talking about the legislation.

Before any Minister comes to the House of Commons to ask for an existing regulatory regime to be replaced, it is incumbent on him or her to explain why it is felt to be necessary, so let me explain. Another flaw of the current system is that when the crisis hit in 2007 and 2008, no one knew who was actually in charge. The Treasury Committee of the last Parliament, led by John McFall, said in its report:

“The biggest failings of the Tripartite’s handling of Northern Rock were that it was not clear who was in charge, and, because the Tripartite took a minimalist view of their respective responsibilities, necessary actions fell between three stools.”

The House of Lords Committee, which also did some excellent work on the matter during the last Parliament, said that

“the tripartite authorities in the United Kingdom…failed to maintain financial stability and were found wanting in dealing with the crisis, in part because the roles of the three parties were not well enough defined and it was not clear who was in charge”.

In other words, a whole system of financial regulation had been created by the previous Government, yet no one knew who was in charge.

That led to the third fatal flaw that became apparent. The Government of the day, accountable to Parliament and the public for the use of taxpayers’ money, simply did not have the powers to do what they felt necessary when the crisis hit. My predecessor as Chancellor said in his recent memoir:

“The whole system depended on the chairman of the FSA, the Governor of the Bank and the Chancellor seeing things in exactly the same way. The problem was that in September 2007, we simply did not see things in the same way.”

That, of course, led to the confusion in the autumn of 2007. As he said,

“I could not in practice order the Bank to do what I wanted”,

even when taxpayers’ money was at stake.

On top of all those flaws in the tripartite system, it is not as though customers were being better protected from the mis-selling scandals that have beset the industry for the past 30 years. The payment protection insurance saga happened on its watch. In 2001 alone, firms were forced to pay more than £1 billion-worth of redress to consumers who were mis-sold products.

Those are the flaws of the tripartite system—flaws that cost this country in output more than 10% of our entire gross domestic product, flaws that have led to hundreds of thousands of people losing their jobs, flaws that wiped out the savings of millions of small shareholders, and flaws that saddled an entire country with more than £1 trillion of debt. The British people need to be confident that mistakes have been acknowledged and that lessons have been learned. The legislation that we have put before the House today shows that they have been learned.

Autumn Statement

Andrew Bridgen Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Osborne]

Of course I am happy for the hon. Gentleman to be part of those discussions on enterprise zones. Many areas of the country put in bids for enterprise zones. We were able to give the go-ahead to only the 22 that we announced previously and the two now for Humber and Lancashire, which I have confirmed today. There is also the expansion of the north-eastern one to the Port of Blyth, which is warmly welcomed on the Opposition Benches. I am happy to meet the hon. Gentleman to discuss the problem. On the national loan guarantee scheme, he is right to say that we have to get the audit trail right. We are looking very closely and seeking to model a lot of what we are doing on the European Investment Bank’s scheme, which already delivers lower rates to small businesses in Britain. It is a small scheme but the procedures are already in place. I can confirm that the credit risk of the small business loan sits with the banks.

[Andrew Bridgen (North West Leicestershire) (Con)]

Does the Chancellor agree that the Government must continue to oppose the calls from the Labour party to adopt its plan B? When in government, it took our country to the brink of bankruptcy, and adopting its plan B would risk pushing it over the edge. The B in Labour’s plan B stands for bankruptcy.

[Mr Osborne]

It is indeed a plan B for bankruptcy. It is striking that no mainstream or centre-left party in Europe, other than the Labour party, currently advocates more spending. I can reach only one conclusion: the Labour party does so only because the man that it has chosen to be its shadow Chancellor is the man more identified than almost anyone else apart from the previous Prime Minister with the financial and economic mess that this country got into.

Northern Rock

Andrew Bridgen Excerpts

Monday 21st November 2011 Commons Chamber

[Mr Hoban]

I just point out to the hon. Gentleman that the mandate for UKFI was to maximise value for money for taxpayers, and that mandate was set by the previous Government.

[Andrew Bridgen (North West Leicestershire) (Con)]

Has the Minister noted that the deal agreed with Virgin Money represents 80% of the book value of Northern Rock, whereas RBS and Lloyds are currently trading at only 40% of book value? Does not the deal represent good value for the taxpayer?

[Mr Hoban]

My hon. Friend is absolutely right. If we measure this deal against the values at which other banks are trading at the moment, it is very clear that it is good value for money for the taxpayer. Rather than carping and criticising, Labour Members should welcome the fact that at a difficult time for the global economy we have been able to sell Northern Rock and get such good value for money.

Public Service Pensions

Andrew Bridgen Excerpts

Wednesday 2nd November 2011 Commons Chamber

[Danny Alexander]

I do not believe that that is a correct use of the term “accrued rights”. Of course we will protect the accrued rights in full. The RPI to CPI switch will have the effect that I described in my statement. That is the subject of a legal dispute at the moment, but it was the right decision by the Government.

[Andrew Bridgen (North West Leicestershire) (Con)]

Has the Chief Secretary received any constructive representations from the Labour party regarding this important topic or has its involvement been limited to the irresponsible words of the shadow education spokesman, who is no longer in his place, condoning teachers’ strikes?

[Danny Alexander]

I am yet to receive a constructive suggestion from the Labour party, but I live in hope.

Jobs and Growth

Andrew Bridgen Excerpts

Wednesday 12th October 2011 Commons Chamber

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

As ever, it gives me great pleasure to follow the hon. Member for Monmouth (David T. C. Davies), who talks about learning lessons. Following the erudite economic contributions that we have heard from many hon. Members, I am going to talk about the real lessons of human life in my constituency.

First, let me give some numbers. Over the past year, claims for jobseeker’s allowance in London increased by 10%, compared with the UK as a whole at 8%. Those figures are pretty bad, and today’s unemployment statistics underline the general trend. In my constituency, the figure increased by 18%. If one looks more closely, it gets worse. The number of claimants under the age of 24 increased by 18.1% in the past year, and for someone who is over 50 the outlook is bleak. The increase in the number of claimants in that group was 29.2%. That is right—nearly a third more over-50s are seeking work than a year ago.

I will focus on people and their lives, and on the families who are affected by this Government’s policies. About one in three residents in the borough of Hackney, which I represent with my hon. Friend the Member for Hackney North and Stoke Newington (Ms Abbott), are under the age of 24. Therefore, as well as the percentage increases, a significant number of young people in both constituencies are affected by the Government’s reckless programme.

[Andrew Bridgen (North West Leicestershire) (Con)]

Will the hon. Lady explain how abandoning our deficit reduction plans, losing our triple A credit rating, and forcing up interest rates to UK plc, homeowners and business will lower unemployment?

[Meg Hillier]

That question demonstrates the detachment of this Government and their Back Benchers from the reality of human lives. If the hon. Gentleman will let me develop my argument, I will point out that there are real challenges for people. There is an alternative plan, which my right hon. Friend the shadow Chancellor and his colleagues have laid out, and I back it.

I have met young people who have already been made redundant in their early 20s and others who have done everything that the Government have asked of them, such as working hard at school. Our borough has seen huge improvements in schools and education, and its results are improving. Our young people are increasingly going to university, which was pie in the sky for many young people when I was first selected for my seat. And still, there are no jobs. We risk having a lost generation, although not like the lost generation that the hon. Member for Sevenoaks (Michael Fallon) spoke about, because we made great strides in government, although there is still more to do on skills. We risk a lost generation of young people who have achieved a lot and still cannot get a job.

--- Later in debate ---

[Jake Berry]

I never said it was a fake Ponzi scheme, I said it was a real Ponzi scheme. That is the basis of the Opposition’s entire policy.

The markets believe in our plan and want us to stick to plan A: actually, so does every hard-working family in my constituency. They are struggling with personal loans and do not want interest rates to go up. Like so many of us, they are struggling with mortgages and cannot afford that to happen. The Prime Minister has offered real leadership throughout this, and the Chancellor of the Exchequer has been honest. That is in stark contrast to the Labour party’s constant line of “too far, too fast”.

What is the Opposition’s alternative? This five-point plan is simply too little, too late. They believe, “Why repay borrowing today when we can have business as usual and bankrupt Britain tomorrow?”

[Andrew Bridgen]

Does my hon. Friend agree that, like a compulsive gambler believes that one more big bet will solve all his problems, the shadow Chancellor and the Labour party believe that one more credit splurge will get us out of a debt crisis?

[Jake Berry]

I do, and for all addicts the hardest thing to do is admit that they have a problem. When this Government came to power in May 2010, we admitted that we had a problem with debt. Even if we fall off the wagon temporarily, we know we have that problem and so we get straight back on it. The Labour party has not even admitted it—it thinks it gave us a golden economic inheritance.

--- Later in debate ---

[Sajid Javid (Bromsgrove) (Con)]

It is always a pleasure to follow the right hon. Member for Holborn and St Pancras (Frank Dobson). Before I begin, may I, too, congratulate the hon. Member for Leeds West (Rachel Reeves) on her promotion?

I am glad that the right hon. Member for Holborn and St Pancras mentioned Alice in Wonderland, because that is exactly where Labour is. What we have heard from the shadow Chancellor today suggests that it believes that we can solve a debt crisis by taking on more debt. Let us remind ourselves of the position that this country was in when the Government changed 18 months ago. We had a national debt of £940 billion, up from £350 billion when the Labour Government entered power.

The hon. Member for Wolverhampton North East (Emma Reynolds) mentioned the debt to GDP ratio, and in terms of net debt that is at 62% today. She is right that it was lower—it gradually went up as the previous Government came to their end—but she missed out the fact that the markets do not just look at the official national debt but take into account the unofficial national debt. The good thing is that now this Government are in power we have started to have a transparent process to assess what that debt is. Before the market was all based on estimates.

I can tell the hon. Lady that the £940 billion is not even half the story. In fact, it is one third of the story because it represents one third of the total national debt of this country. The whole of Government accounts published in July by the independent Office for Budget Responsibility said that the public pension liability of the UK is £1,100 billion. PFI liabilities increased tenfold over the 13 years of the previous Government to £40 billion according to the OBR. The Office for National Statistics reported in the summer that the cost of financial interventions because of the bank bail-outs is £1,300 billion of additional debt. If we add all those numbers up, they come to £3,380 billion—a mind-boggling number equal to 225% of GDP.

Let us look at the five-point scam suggested by the shadow Chancellor. Four of those five policies would lead to a direct increase in our debt and one, the bankers’ bonus tax, would raise less than the levy that the Government have already imposed. I spent 20 years trading Government bonds. I advised Mexico, Brazil, Indonesia, Russia and Argentina when they were at default or close to default and I can tell anyone who cares to know that the way out of a debt crisis is not to borrow more money. Investors have a choice. They do not have to buy anyone’s bonds. They can look at any country or corporation in the world and there is no way to force those bonds down their throat. That was exactly the point we had reached before the last election and if the Government had not changed, we could very well have been in the same predicament as countries such as Greece, Portugal, Ireland and Iceland.

It is not just our triple A rating that shows that the Government’s policy in dealing with the debt is the right one. It is not just the gilt deals, as my hon. Friend the Member for Spelthorne (Kwasi Kwarteng) mentioned, although our 10-year gilt yield is at 2.6%.

[Andrew Bridgen]

My hon. Friend might recall that the previous Government created £200 billion-worth of quantitative easing just prior to the general election. However, that money was not pumped into the banking market to give liquidity—98% of it was used to buy Government debt because nobody else wanted to buy it at that stage.

[Sajid Javid]

I quite agree with my hon. Friend. The 10-year gilt yield today is 2.6%—one of the lowest we have ever had in our history—versus 3.8% when this Government came to power. That number is not just important to the financial markets: it makes a big difference to the amount of money this Government have to spend on servicing our national debt, to the amount that corporations have to spend when they borrow and then invest, and to the amount that ordinary households need to spend on things such as their mortgages. It makes a real difference to the cost of living.

Let us consider another indicator. I always like to look at the credit default swap spread, which is the amount that the markets charge for insurance against a potential sovereign default. Today, Britain has, for the first time, the lowest CDS spread of any large European country. According to Bloomberg, of the 157 sovereigns that trade in the CDS market, Britain has the fifth-lowest CDS spread in the world. That, again, is a reflection of the policies of this Government.

I should like to finish by picking up one positive point that the shadow Chancellor made to his party conference, which was the only thing I heard with which I agreed. He said

“we will set out for our manifesto tough fiscal rules that the next Labour government will have to stick to”.

I am glad that he has recognised the need for tough fiscal rules that are independently monitored by the Office for Budget Responsibility, as that is exactly what I suggested in a private Member’s Bill in July, the National Debt Cap Bill, which will have its Second Reading on 20 January 2012.

My proposal is that we should have an independent, tough cap on the net outstanding national debt as a proportion of GDP, monitored by the OBR. That would not be a magic bullet for dealing with potential future debt problems, but it would force the House to have a national conversation every time any Government wanted to increase debt beyond a certain point. If they had a good reason for doing that, the House could support them and Members might have an opportunity to discuss the issue with their constituents. If the House did not accept the Government’s reasons, it could prevent our country from becoming more indebted. I say to the shadow Chancellor that there is no point waiting for the next Labour manifesto because there may not be another Labour Government—at least, not any time soon. It would be far better for him to take action now, put his money where his mouth is and support my Bill, which is coming to the House in just a few months.

In conclusion, there is nothing in the motion that would help to generate investment and create jobs. In fact, if it were implemented in any form, it would destroy jobs. I urge the House to vote against it.

Eurozone

Andrew Bridgen Excerpts

Monday 10th October 2011 Commons Chamber

[Mr Osborne]

We have not done that calculation, but my hon. Friend has given me a very good idea for Wednesday’s debate. We know, because we have all experienced it, what Labour policies lead to: a completely uncontrollable budget deficit; a negative outlook for our nation’s credit rating; and interest rates that were tracking Spain’s. We have been there under the Labour party, and it is remarkable that when it cleared out the shadow Treasury team, it did not clear out the man most responsible in this Parliament for getting Britain into this economic mess.

[Andrew Bridgen (North West Leicestershire) (Con)]

In his statement, the Chancellor quoted the sage remarks of the former Minister, Lord Jones. Perhaps it is the Chancellor’s modesty that prevented him from quoting these remarks that Lord Jones made about the fact that we are sticking with plan A:

“The markets of the world will say, ‘well done George’. That will mean that interest rates are low”,

that we keep our triple A rating, and that we do not become Greece.

[Mr Osborne]

We should certainly listen to the sage words of the former Labour Trade Minister.

Regulatory and Banking Reform

Andrew Bridgen Excerpts

Thursday 16th June 2011 Commons Chamber

[Mr Hoban]

My hon. Friend makes two important points. The first is to recognise the role played by the Financial Services Compensation Scheme in protecting depositors up to that £85,000 limit. The other point is that there is collective amnesia among the Opposition about their role in the financial crisis. Yes, Northern Rock took place before the global financial crisis—and they were the champions of light-touch financial regulation and introduced the tripartite system of regulatory reform that was shown to fail during the crisis. The Opposition need to recognise their responsibility; until they do so, it will not be possible for them to move on.

[Andrew Bridgen (North West Leicestershire) (Con)]

Does my hon. Friend agree with the recent report from the other place saying that the tripartite authorities

“failed to maintain financial stability and were found wanting in dealing with the crisis, in part because the roles of the three parties were not well enough defined and it was not clear who was in charge”?

[Mr Hoban]

My hon. Friend makes an absolutely vital point. The failure of the financial regulatory system put in place by the Labour party when in government was hard-wired into the system. It was destined to fail because of the failure to identify a clear match between the people who had the power and those who had the responsibilities for managing financial stability. My hon. Friend is absolutely right. The previous system was destined to fail. We have learned the lessons from that crisis; I am not sure that the Labour party has.