Budget Resolutions and Economic Situation

Bim Afolami Excerpts

Wednesday 3rd March 2021 Commons Chamber

[Bim Afolami (Hitchin and Harpenden) (Con)]

In the short time available, I want to talk about two words: “debt” and “productivity”. The Chancellor has shown in many different ways with this Budget his command of the fiscal landscape, particularly his awareness of the importance of a sensible fiscal strategy over the medium to long term. He has also shown his clear understanding that we depend on the kindness of strangers as a Government and as a country because we depend on low interest rates to sell our debt in the markets. On some level, that is boring, but it is important because the House and the country need to be fully aware of the fact that we are in a highly unusual time for the bond markets.

It is incredibly cheap at the moment to borrow money. There is no doubt about that. Indeed, I have heard many Opposition Members say that we should just borrow money ad infinitum because it is so cheap, but the problem is that it will not be cheap forever. The Chancellor is rightly thinking of the long-term fiscal sustainability of this country. His awareness of that and of the need to ensure that debt is falling as a percentage of GDP by the end of the Parliament is very important. Bearing in mind that the Budget is very generous in many ways, and many Conservative Members have explained how, the Chancellor also has that fiscal framework in mind.

My second point is about productivity. In December 1962, a bit before my time, Harold Macmillan wrote a memo to his Cabinet—it is in Lord Hennessy’s “Winds of Change”, which I urge all Members to read—about one of the major problems of the country’s economy, which he said was the need to enhance our productivity. It is a long-running problem, but the Chancellor is thinking about it in the long term.

One particular measure has not been talked about enough but it is significant: the help to grow scheme for small and medium-sized managers—indeed like my wife, who runs a successful family business. Hundreds of thousands, if not millions of people up and down the country are doing a fantastic job, but could benefit from extra help and support with management training, digital skills training and discounted digital software to help close the gap with higher performing bigger businesses. The Government and the Chancellor are backing our small businesses. That will improve our productivity because small businesses are the heart of our economy. For those reasons, and many thousands of others, I welcome the Budget.