Cost of Living

Baroness Morgan of Cotes Excerpts

Wednesday 27th November 2013 Commons Chamber

[The Economic Secretary to the Treasury (Nicky Morgan)]

I thank the 19 hon. Members, on both sides of the House, who have taken part in this afternoon’s debate.

It is said that the first step to recovery is admitting you have a problem, and the Opposition had a chance to admit they had a problem this afternoon. This debate has revealed the lack of an economic plan from Labour and the cost of a potential Labour Government. It is clear from what he said that the shadow Chief Secretary to the Treasury does not know the difference between a debt and a deficit. The hon. Member for Newcastle upon Tyne North (Catherine McKinnell) talked about household debt. She might like to know that household debt, as a proportion of income, was 100% in 1997, grew to 150% by 2007 and was 170% by the first quarter of 2008, but has now fallen by 30 percentage points to 141%, as of the first quarter of 2013.

Another falsehood spread this afternoon was that the Government had borrowed more in three years than the last Government borrowed in 13 years. Labour increased public sector net debt by £488 billion during their term in office, but the debt this Parliament has increased by £360 billion. The shadow Chief Secretary to the Treasury talked about record breaking. If he wants to talk about record breaking, how about talking about the record-breaking deficit that his Government left us? What about the broken promise of no more boom and bust. Remember that one? We do not hear that any more. The only honest statement we have heard from a Labour MP was from the former Chief Secretary to the Treasury, the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), who left a note saying, “There’s no money left”. He could not have been more right.

So what is missing from the motion today? There is no mention of the jobs created by this Government, of the 2.7 million people taken out of income tax, of the council tax freeze, of fuel duty cuts, of the deficit falling by a third, of inflation falling or of employment being at an all-time high.

[Robert Halfon]

Does my hon. Friend not think it strange that the Opposition, who say they care about the cost of living crisis, voted against cutting taxes for lower earners and raising the threshold? Far from paying for those tax cuts for lower earners through other cuts, as the hon. Member for Edinburgh East (Sheila Gilmore) said, have we not raised taxes on the rich by increasing the capital allowance from 18% to 28%?

[Nicky Morgan]

My hon. Friend is indeed right. I wanted to come to his speech, because he started by talking rightly about fuel duty and the wonderful campaign he has launched to ensure that households are not spending as much as planned under the last Labour Government. I heard his plea for a further cut. I take note, but I make no promises.

We then heard from my hon. Friend the Member for Braintree (Mr Newmark), who gave a characteristically positive speech. I note that unemployment in his constituency, including youth unemployment, is down by 20%, which is definitely something to be recognised. My hon. Friend the Member for Spelthorne (Kwasi Kwarteng) rightly talked about the recovering economy and about how debt had become endemic under the last Government. He is, of course, absolutely right.

My hon. Friend the Member for Tamworth (Christopher Pincher) coined a new phrase that I hope will spread across the Twittersphere and beyond about geeks bearing gifts. I wonder whether he would agree with Charles Clarke, the former Home Secretary, who said of Labour’s energy policy: “My criticism of that particular proposal is I think it is a one-off effort that does not deal with the overall comprehensive issue we have to address. I think there is even a case that some of the recent price rises we have seen might have been a response to the suggestion of a freeze”. That is absolutely correct.

We heard a wonderful speech from my hon. Friend the Member for Hexham (Guy Opperman), who talked about apprenticeships, noting the move from 430 to 690 apprentices in his constituency over the last year. He is absolutely right that for 13 years the last Labour Government failed to tackle the lack of skills necessary for our economy.

[Mr Newmark]

Is the Minister aware that every single Labour Government have left power with more people unemployed than when they arrived in power, while this Government are bringing unemployment down?

[Nicky Morgan]

My hon. Friend is absolutely right. Unsurprisingly, we did not hear that from Labour Members.

We heard an excellent speech, too, from the hon. Member for Redcar (Ian Swales), and I would like to thank him for his remarks, particularly his comments about energy investment and support for manufacturing.

[Sheila Gilmore]

Will the Minister give way?

[Nicky Morgan]

I am not going to give way to the hon. Lady, because she did not give way to anyone during her speech.

My hon. Friends the Members for Elmet and Rothwell (Alec Shelbrooke) and for Bedford (Richard Fuller) talked about work being the key to recovery, the need to create more jobs and making work pay, which is a critical part of our welfare reforms.

We heard from the hon. Member for Makerfield (Yvonne Fovargue), who talked about breaking the stranglehold of the big six. It was the last Labour Government who left us with the big six; we started with more and ended up with six.

I listened carefully to the speeches of the hon. Members for Dundee East (Stewart Hosie) and for Swansea West (Geraint Davies), of the right hon. Member for Oldham West and Royton (Mr Meacher), and of the hon. Members for Edinburgh East (Sheila Gilmore), for West Ham (Lyn Brown) and for South Shields (Mrs Lewell-Buck). What struck me most—I have referred to it before in this place—was the collective amnesia and total lack of understanding among Labour Members of how we ended up with the largest deficit since the second world war, which this Government have tackled by taking tough and difficult decisions.

[Alec Shelbrooke]

I may be able to help out the Treasury team by suggesting that if the Minister were to visit a scrap metal dealer, she might be able to solve the deficit with all the brass neck from Labour Members this afternoon.

[Nicky Morgan]

My hon. Friend makes a characteristically colourful intervention and speaks wonderfully, as always.

The hon. Member for City of Durham (Roberta Blackman-Woods) made a point about child care and called for action from this Government. This Government are taking action on that matter, with tax-free child care, increased provision for two-year-olds and increased provision for three and four-year-olds. I would have thought that the hon. Lady welcomed that. I noted her welcome of this week’s announcement on payday lenders by my right hon. Friend the Chancellor.

I noted the confession from the right hon. Member for Oldham West and Royton when he said that the problems did not start with this Government. He is absolutely right about that, but that was the only thing with which I could agree in his speech.

The hon. Member for Cardiff South and Penarth (Stephen Doughty) talked about being on the side of Welsh people. In that case, I am sure he would welcome the 4,560 people in his constituency who have been taken out of income tax entirely since this Government’s changes.

The only way to deliver sustained improvement in living standards is to take the difficult decisions that this Government have taken to tackle the economy’s problems head-on, delivering a sustainable, long-term recovery for all. The Labour party has demonstrated comprehensively today that it is not up to taking those decisions. I therefore ask the House to reject this motion.

Question put.