(13 years, 9 months ago)
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As ever, Mr Crausby, it is a pleasure to take part in a debate with you in the Chair.
I congratulate the hon. Member for St Ives (Andrew George) on raising this important strand of an exceptionally complex set of announcements, which have come thick and fast from the Government and are only now beginning to reveal themselves to MPs, never mind to the wider public, as the implications begin to hit home. A lot of implications will not hit home until the next financial year and then into the next few years of this Parliament, at which point I would expect growing discontent and increased shock and surprise at how harsh the Government chose to be on the most vulnerable in society through their spending policies.
The hon. Member for St Ives is being exceptionally honourable in this matter, and he genuinely feels strongly about trying to speak up on behalf of vulnerable people, but when he says that certain consequences of the Government measures are “perhaps unintentional”, I suspect that he is being more than generous. Part and parcel of the political strategy that goes alongside the Government’s supposed economic approach is ensuring that the welfare changes and reductions in expenditure hit the poorest in society who, on balance, tend not to vote for the Conservative party.
The hon. Gentleman will have greater insight than me into the Liberal Democrats’ approach, although I suspect that even he might not know what is going on with those at senior levels, as they assimilate ever more closely with the leadership of the Conservative party. I still regret the choice that his colleagues made to prop up and provide the scaffolding for this harshly strategic and deliberate set of decisions. Those in the Conservative party have been planning such decisions for many years, and attempts to scale back the role of public investment in our economy have been part and parcel of their approach throughout. They are now able to unwind that approach with a certain degree of alacrity under the guise of deficit reduction.
I hesitate to interrupt the hon. Gentleman’s flow, but does he agree that much-needed welfare reform should be tackled? There might be questions about how to tackle it, but does he agree with the general principle?
Nobody disagrees that we need a level of welfare reform, but the question of how we do that is at the centre of the debate. We could shut down the Department for Work and Pensions tomorrow and not spend an extra penny. That would be a degree of welfare reform, but it would be so ridiculous that it would be off this planet. We could have a level of reform that was too slow and did not really bite. I believe that the trajectory of reforms pursued by the previous Administration sought to strike a fair balance.
The extent to which Ministers are reducing what is known as “annually managed expenditure” within the welfare budget has been designed around a political strategy. By taking that amount from the welfare budget, the Chancellor tried to come within spitting distance, as he saw it, of Labour’s plans for deficit reduction within the departmental expenditure limits. That political strategy rapidly fell apart, particularly because the Opposition accepted the need for a certain level of welfare change.
Let us look at the points raised by the hon. Member for St Ives. If the welfare changes are not handled sensitively and their implementation is blind to the human costs involved, some of them will affect the real lives of real people. Such people will be increasingly frightened and unable to cope with some of the changes, and that will create great harm. That harm might not have the quantifiable economic or econometric measurements that we traditionally look at when monitoring fiscal and monitory policy, but it is real and will have an indirect effect on our economy.