Budget Resolutions and Economic Situation

Debate between Andrew Love and Sammy Wilson

Wednesday 19th March 2014 Commons Chamber

[Sammy Wilson]

The percentage growth in exports was 0.8% last year, and in the next year it is forecast to be 2.6%. By any calculation, that is more than a three times increase in the rate of growth. The Government have talked about the reduction in the cost of finance for exporters, but measures that were introduced in previous years did not have the intended effect. Of course, that is against the background of a strengthening pound, so there will be a difficulty there. On what is the Government’s optimism based? If it is on export and investment-led growth, past patterns do not show that happening.

My second point is about the Chancellor’s throwaway lines saying, “I am not in the job of easing up just because things are getting better”, and “We don’t want to spend more.” I am not asking the Government to spend more; I am asking them to spend differently and better. Of course we have to get the deficit under control, but what is the increase in that deficit at the moment? Of the percentage of our GDP that is debt, what is most of it made up of? It is made up of paying people to sit on their backsides doing nothing, instead of spending on investment in infrastructure projects, which would have a return. It would put people back to work, increase tax revenues and stimulate growth. We can examine the infrastructure projects in Northern Ireland, such as in tourism. For modest amounts of money, the Titanic signature project is now bringing in millions of pounds and half a million visitors a year, mostly from outside the state. There has also been the extension of the gas pipeline. Many Members have talked today about the cost of living, and one way of bringing fuel prices down is to give people alternatives. For modest public investment, we have been able to increase the coverage of gas pipelines in Northern Ireland, bringing people cheaper fuel and helping to bring down their cost of living.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Will the hon. Gentleman give way?

[Sammy Wilson]

I do not have much time; otherwise I would be happy to give way.

Help has been given to industry in Northern Ireland for research and development, machinery and so on. I welcome the increase in capital allowances. In fact, one thing that we suggested was that if corporation tax could not be devolved to Northern Ireland, capital allowances should be increased so that companies were more able to invest using that mechanism. Such measures could stimulate growth and add to the productive potential of the economy. That is not about spending more; it is about spending differently. If we are finding it difficult to get private investment in the economy, it can be pump-primed with public investment, which can have an important impact.

I welcome some of the specific spending proposals in the Budget, such as the extra spending on infrastructure, filling in potholes and so on, all of which has Barnett consequences. I hope that in spending money to fill in potholes, the Government will not find themselves having to look for money to fill the financial holes in this Budget in a couple of years.

I also welcome the changes to pensioners’ savings. They will not have an impact on all pensioners, because many pensioners in my constituency have never earned enough to accumulate huge savings. Nevertheless, those who have saved should be able to experience the rewards.

The Chancellor has made a lot of helping industries with their energy costs. It is one thing to make temporary changes and give big energy users temporary help, but it is another thing to continue the mad policy of increasing reliance on renewables, which have pushed up energy bills. Once the temporary measures are over, firms will still have to face that problem. This country will have to reconsider its energy policy. I welcome the fact that the Chancellor wants to improve the extraction of oil from the North sea, despite what the hon. Member for Brighton, Pavilion (Caroline Lucas) said, and frack gas, which is a natural resource that will give us cheap energy. If we stick to a policy of dear energy, we will pay the consequences.