Andy MacNae
Main Page: Andy MacNae (Labour - Rossendale and Darwen)Department Debates - View all Andy MacNae's debates with the Cabinet Office
(3 weeks, 3 days ago)
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Sir Bernard Jenkin
I wish we could all have everything that we wanted. Gordon Brown inherited a golden economic legacy from the Conservatives in 1997—[Interruption.] Yes, he did. Debt was falling and growth was outstripping our competitors. By the time of the financial crash in 2008, he had already increased borrowing and spending. The consequence of the financial crash is that he achieved what every Labour Government always achieve: they leave office with higher debt, higher unemployment and higher inflation. That is what Labour Governments always do, and that is what this Labour Government are set to do again.
Sir Bernard Jenkin
I am not going to give way any more. We need only look around the world to see that the idea that an ever-larger state makes the people richer is confounded by economic experience, otherwise the richest countries in the world would be those with the biggest state. It is businesses and free enterprise that generate the wealth that pays for the public services we need.
We can all recall Milton Friedman’s four ways to spend money. There is people’s own money that they spend on themselves: they think about it, spend it very carefully and make sure they get the maximum value for money. There is money that people spend on other people, such as when they buy a present: they may want to keep the cost down and may not be sensitive about whether the person really wants a particular gift or not. There is somebody else’s money that people spend on themselves: when people use expense accounts, they go on the most expensive aeroplane or get the biggest car their company will pay for. Finally, there is somebody else’s money that is spent on other people: that is what Governments do. It is a reality that Governments are the worst allocators of resource for ensuring future wealth creation. That is just a fact.
The record will always confirm that if we want to create more wealth, the smaller the state can be, the faster economic growth will be and the more we can afford to then spend on public services. This Government are profoundly un-strategic—just look at what the OBR says about investment:
“Tax rises in this Budget weigh on real incomes, so private consumption falls as a share of GDP”—
that means people are going to be getting poorer. It continues:
“Corporate profits are expected to continue falling as a share of GDP in the near term”.
It adds that
“business investment falls as a share of GDP as profit margins are squeezed, and the net impact of Budget policies lowers business investment.”
Is that good for the British economy? I submit not.
What about debt? If someone has too much debt, the one thing they should do is not borrow more money, if they want to get out of a debt trap—[Interruption.] Members on the Government Benches have surgeries attended by people who are in debt. The one thing hon. Members will tell them not to do is to stack up more debt, but that is what the Government have chosen to do. That is not a long-term policy.
Finally, what about GDP? I take no pride in saying that growth in GDP has been struggling for a decade or more—
Dr Hudson
I thank the hon. Member, who is my neighbour, for his intervention. We have to get on with rebuilding the Princess Alexandra and Whipps Cross, and we need to do it quickly.
I also urge the Government to listen to my constituents’ concerns about the introduction of VAT on independent school fees. This tax on education impacts not only 2,000 pupils in my constituency at independent schools but our excellent local state schools. Some families will unfortunately have to move their children midway through the school year, or in the next year, to some of these fantastic schools, some of which are already oversubscribed, impacting class sizes. Independent schools provide a social good in my constituency and right across the country, providing access to high-quality facilities, and providing access bursaries. For many parents, independent schools are a choice borne out of hard work and sacrifice. For some, they are the best way their children with special educational needs can be supported, amid the difficulties and delays found in the process of receiving and delivering an education, health and care plan. Once again, the supposed short-term gain comes at the long-term expense of our children’s future, and the Government must look again at reversing that punitive measure.
Unfortunately, harming aspiration flows not just through that education tax but in the measures that affect the everyday lives of the working people the Labour Government claim to speak for—if they have finally worked out who “working people” are. If someone strives to own their own business, they will be forced to pay increased employer national insurance contributions for having that aspiration. Business owners will have their business rates relief cut. People who rely on the bus to get to work or appointments will be penalised by the bus fare cap increase from £2 to £3. We Conservatives introduced the £2 bus fare cap, which helps people in urban and rural communities alike, and we promised to deliver it for the whole of this Parliament. The Labour Government have callously ripped up that lifeline bus ticket.
Dr Hudson
No, I am going to carry on. For pensioners aspiring to live in dignity in their retirement, this Labour Government have taken away their winter fuel payment. That is just immoral.
Let me say a couple of words about national security. It is deeply disappointing that the Government are not heeding calls to commit to spending 2.5% of GDP on defence now, when we really need to show our allies, and indeed our adversaries, where we stand. Nationally, it seems that another area of the Government’s lack of vision is food security and biosecurity. Food security is national security, and biosecurity is national security. Over the last five years, agriculture and biosecurity have faced a seismic shift as we have navigated our departure from the EU. This was an opportunity that our previous Government seized, with environmental land management schemes to ensure that farmers are rewarded for feeding us, while protecting our precious environment, and the border target operating model to keep our food industry safe from the biosecurity risks that pose a threat to both animal and human health.
The last thing that the sector needed was to learn that it will not get the stability and support of investment that is so desperately needed. To state in the Budget document that farm schemes and flood defence funding will be reviewed is no way to treat our farmers and rural communities. We have heard a lot today about agricultural property relief, the changes to which could devastate our farming sector, risking the decimation of the sector that we rely on to feed us and support our environment. The impact of the policy on family farms, the tenanted sector and our food security will be untold. Families have had their succession planning turned on its head, and that inheritance tax pressure will have profound impacts on people’s mental health. Farming communities face huge challenges from shock events such as floods and animal disease outbreaks, and chronic pressures of finance and rural isolation. These are people who we know are at higher risk of mental health issues, and tragically suicide as well. I say that as a veterinary surgeon—a profession with similar risk factors. Gallingly, this policy decision has broken the promises that Labour made to our farming communities.
The opportunity has likewise been lost in the Budget to invest in the frontline of our defence against biosecurity risks—the Animal and Plant Health Agency, the A-team of our national biosecurity. Its headquarters in Weybridge, Surrey needs an urgent and full redevelopment, as outlined by the National Audit Office report a couple of years ago. With biosecurity threats such as African swine fever afflicting livestock in Europe, avian influenza not gone away, and bluetongue virus bubbling away in this country, a full funding of the headquarters in Weybridge is now more urgent than ever. We cannot afford the devastation that biosecurity threats such as foot and mouth disease or African swine fever could wreak on our economy, our farmers, our food industry and rural mental health if we are not firing on all cylinders against these threats.
This Budget’s claim to fix the foundations falls short in meeting the everyday needs of the people of Epping Forest and of people throughout the United Kingdom. This short-termist Budget with a lack of evidence-based decision making will harm our country in the long term. An urgent rethink and reversal is needed from those on the Treasury Bench. I and my Conservative colleagues will stand up for our constituents, who will suffer from this anti-aspirational and promise-breaking Labour Budget.
Andrew Rosindell (Romford) (Con)
I am pleased to follow the hon. Member for Congleton (Mrs Russell). It was enlightening for me to listen to her because she listed a huge array of things on which the Government are now going to be spending a lot more money. They are all very good causes of absolute benefit to the people of our country. The one problem I have listening to her, and to all the Labour Members, is that we do not have any money left: we have spent it all. We had to spend half a trillion pounds on the pandemic, but I notice that no one has mentioned that. We are, in effect, running on tick. We are living beyond our means, we are spending money we do not have, and all we are doing, laudable though it may be to spend the money we are discussing today, is handing huge debts to future generations.
I have to remind Labour Members that every Labour Government we have ever had in my lifetime has left this country with higher debt, more unemployment and an economy in a worse state. I would also remind them that it was in 1979, after years of failed socialist government, that we finished up having to rebuild the economy under a Prime Minister who had the determination to do what was right for our country, and those economic reforms led to years of prosperity.
Andy MacNae
It sounds as though the hon. Member is giving up on Britain. He seems to be saying that there is no point in trying to find a better future for ourselves because there is no money left, and the previous Labour Government left no money. Would he recognise that the level of debt left in this country at the end of the recent Conservative Administration is twice what was left by the Labour Government in 2010?
Andrew Rosindell
The hon. Member forgets about the pandemic and its associated costs. The reality is that we have to create the wealth before we spend it. For many years I have heard Labour Members talk about how to spend money. I very rarely hear how we actually create the wealth we need to spend on our public services, and that is where it all goes wrong.
Andrew Rosindell
No, I will not give way.
The Chancellor yesterday painted a dire picture of our country’s future. Under Labour, it is not the economy that is booming but the size of the state, with an ever-increasing burden of taxation on working people. Under this Government, it is not the businessmen in my constituency of Romford who are being supported with the future success of their enterprise but the climate alarmist, with a public energy company that will not even produce any energy. How sensible is that? It is not the young family in areas such as Collier Row or the pensioner in Rush Green—both in my constituency—who are being supported by, for example, a decrease in stamp duty or help with energy payments, but, of course, the union bosses who are able to deliver over-inflated pay rises to the public sector, and the private sector is once again paying for that.
Despite the Government’s talk of growth, this Budget is preparing us for the return of the dark days of the 1970s, with hard-working people paying the price. Indeed, the Government are so lacking in aspiration for this country that they want the Office for Budget Responsibility not only to mark their work but, it seems to me, to do their homework completely. They are even gifting the OBR more powers, as was outlined in the King’s Speech.
In my view, Britain’s potential is far greater than a high-tax, low-growth and dysfunctional big state. Far from my “giving up on Britain”, as the hon. Member for Rossendale and Darwen (Andy MacNae) said—quite the opposite—I love this country, I believe in this country, and I hate to see what socialism has done to this country over the years. Labour Governments always end up in a worse situation than when they started, and Conservative Governments always have to come in and pick up the pieces, and restore the economy back to prosperity and vibrancy again. In five years’ time, I am sure we will have to do the same.
It is now clear that, under this Labour Government, the British people face a tyranny of taxation. Not content with the record-breaking tax burden that already exists, Labour is adding to the load on the shoulders of hard-working people. Under Labour, it will be harder than ever to buy a property. The journey to work of my constituents in Romford who are lucky enough to own their own home is going to be even more expensive than it is already under the control of the Mayor of London, Mr Khan, with the rise in bus fares. Once they get to work, my constituents will have far less in their pay packet, because the increase in national insurance paid by employers will, of course, clearly be passed on to employees. It is nothing but a stealth tax by this supposedly transparent Labour Government, and it is job destroying. Businesses in my constituency have already been telling me that they will not be employing people because of this reckless increase in national insurance. My constituents, all our constituents, might even lose their jobs. [Interruption.] They will lose their jobs, as businesses struggle with the national insurance increase. The costs of that will be phenomenal, and the growth-crushing increase in capital gains tax will also have a big impact.
As if that was not enough, when someone sadly passes away, the Labour Government want to make it even harder for them to pass on what they have earned throughout their life to their loved ones, by expanding inheritance tax to pensions and so on. That is incredibly cruel. People pay tax throughout their life, and will pay more tax when they die. Is that really the kind of thing a Labour Government should be doing? It will harm a lot of families who would inherit but will not be able to because of the cash grab from this Budget.
I do not believe that the Government are pro-worker at all. They cannot even define what a worker is. Labour used to be the party of the state from cradle to grave. Now it seems to be the party of taxing my Essex constituents from cradle to grave and beyond. This has been a very Essex-weighted debate, with contributions from my hon. Friends the Members for Epping Forest (Dr Hudson) and for Harwich and North Essex (Sir Bernard Jenkin), my right hon. Friend the Member for Maldon (Sir John Whittingdale), the hon. Member for Harlow (Chris Vince) and others. People in my county of Essex are very disillusioned by all this, because they are aspirational and hard-working. They are market traders and small business people. They will be devastated by all this. I warn Labour Members that they will find that out when they next knock on doors in their constituency.
As Margaret Thatcher warned us—[Laughter.] Well, she did rescue our country’s economy; let’s be honest about it. [Interruption.] She really did, and we are still benefiting today from the reforms that she introduced. As Margaret Thatcher said, any Government who impose high taxation are taking power away from the people and giving themselves power over the people. Of course taxation at some level is always necessary. It has to be in place to support our nation’s armed forces, to support families and protect pensioners, and for investment in necessary infrastructure and public services for the future. But what are the Labour Government doing with all the hard-earned money that the working people of this country have created? I think they will be spending billions of pounds on things that will go to waste.
Andy MacNae (Rossendale and Darwen) (Lab)
I congratulate all my colleagues who have made brilliant maiden speeches today. As always, I am taken aback by the range of experience and expertise in this House.
I had planned to be radical and speak very briefly about a few matters that are particular to the north-west, but before I do so, I have to pick up on some issues raised by Conservative Members. First, the right hon. Member for Maldon (Sir John Whittingdale) made a seemingly unequivocal statement that businesses facing increases in payroll have only two choices open to them: to reduce their workforce or increase prices. That is patently untrue. Businesses increase payroll all the time for perfectly good business reasons. We cannot be so simplistic in our analysis. Far more important for business is having the right infrastructure, and a skilled workforce who are able to get good healthcare and support—all things that the Budget will provide.
Another Conservative Member, who would not take an intervention, drew the tired analogy between household budgets and national budgets. They are not the same. It is that sort of rubbish that got us in this mess in the first place. Finally, there were several references to short-term growth forecasts. Conservative Members are either unaware of or wilfully ignoring the fact that there is a lag between good infrastructure investment and meaningful, sustained growth. The decisions that we are taking now are long-term decisions—the sort of decisions that previous Governments ducked. These decisions will deliver sustained growth in four, five, six or seven years, which will make a real, sustained difference to the country —not short-term, sugar-rush growth for political gain.
Let me focus now on the north-west. Like much of the country outside the home counties, the north-west was badly let down by the cuts and false promises of the previous Government, so I am particularly pleased that the Budget will reverse that trend and start the process of rebuilding our infrastructure and public services. I am particularly pleased to see the very significant commitment to northern rail infrastructure. With the commitment to fund a trans-Pennine route upgrade, our cities and towns across the north will be better connected, with more frequent and faster trains.
I also welcome the recognition of the importance of local connectivity, with the commitment of £650 million specifically to fund local transport links outside the key city regions. In that context, I look forward to continuing to make the case for a commuter rail link from Rossendale to Manchester. I am also delighted to see our Government’s commitment to properly funded local growth deals and town funds, with both Darwen and Rawtenstall set to benefit from £20 million over 10 years. I will be excited to work with local leaders to develop innovative implementation plans. I look forward to the development of ambitious regional growth and investment plans that will unlock the true potential of our area.
Another hugely important aspect of the Budget is the move towards integrated settlements for mayoral combined authorities. That will truly move decision making away from the centre, end the command-and-control mindset, and put power in the hands of local leaders and communities, who know our area so much better than officials in Whitehall. That approach has the potential to bring transformational change to our region and deliver both greater value for money and better outcomes for our residents. While Lancashire is not currently in a position to receive that sort of settlement, the Budget should be a signal to council leaders and other key stakeholders in the county of the huge opportunity for Lancashire if we can all work together to get a devolution structure in place. I look forward to continuing to work with the Government and local leaders to grasp that opportunity and put Lancashire back in the fast lane.
Finally, with the average income in Rossendale and Darwen much lower than the standard throughout the UK, and even in the rest of the north-west, I wholeheartedly welcome the rise in the national living wage that the Chancellor introduced. It will mean a £1,400 pay rise for many of my constituents—a rise that can make a truly significant difference to people’s day-to-day lives. Taken together, I am delighted to see how the measures in the Budget start the process of real and sustained change for the north-west, but I am very much aware that it is simply the start of the process. I look forward to future Budgets.