Infrastructure (Financial Assistance) Bill

Brian Binley Excerpts

Monday 17th September 2012 Commons Chamber

[Hazel Blears]

I understand the hon. Gentleman’s concern about his local green belt. If he can encourage his party’s Front Benchers to invest more in brownfield sites in the north-west, where we can build communities, I will take on his housing allocation tomorrow to ensure that we can house our people.

[Mr Brian Binley (Northampton South) (Con)]

May I introduce Northampton into the discussion of brownfield sites? We could build between 35,000 and 40,000 houses on brownfield sites there, and I would rather do that than destroy our green belt.

--- Later in debate ---

[Mr Brian Binley (Northampton South) (Con)]

It is a pleasure to follow the hon. Member for Coventry North West (Mr Robinson), whose comments are always thought provoking. Today, they were also rather brave, which is not usually his style, but he is clearly moved by these matters.

I welcome the opportunity to debate this Bill. It aligns with the priorities of the electorate and, thankfully, sends a clear signal that the Government have, I hope, understood the importance of growth. We must accept that our nation’s infrastructure is nowhere near as good as it needs to be. A little more understanding of that point on the part of Labour Members, and of the fact that they did not do their job with regard to infrastructure in their 13 years in government, would not have gone amiss. As many hon. Members have said, infrastructure is vital.

International surveys now paint a gloomy picture, and most parliamentary postbags offer individual testimony to the day-to-day infrastructure inadequacies that hold our constituencies and businesses back, harm our competitiveness and the image we project to inward investors, and act as a drag on commercial development. Congested roads, expensive railways, imperfect utility markets, and vast tracts of the country with relatively poor broadband and other communications connections, all present substantial costs to the economy that impact disproportionately on small business and hold back the quality of life of the people we represent.

I therefore welcome the Government’s proactive approach, especially to HS2. I should also point out my gratitude for the money that is forthcoming for a new station in my constituency. We are delighted, but we are also leading the way in 15 projects to regenerate our town—recreating the structure and fabric—allied to a programme substantially to increase jobs for those not in education, employment or training.

However, local efforts take us only so far, which is why the national reach of the Bill is fundamental. In that context, the Bill is to be welcomed in principle, but it is easy to spot the problem that needs to be fixed: who will pay to upgrade our infrastructure, which is essential to how we better configure our economy? The Exchequer clearly has a limited appetite and capacity to fund the solution to those problems. There is also a legitimate question about the desirability of the Government being intimately involved. The comprehensive spending review conclusions were clear. Reductions in capital spending were relatively extreme—by 2014, capital spending will be almost a third of what it was in 2010. The arguments on the necessity for the public purse to play a diminished role are well rehearsed, but surely the Government can do better. A 3% reduction in revenue expenditure would enable us to maintain capital spending at 2010 levels throughout the period of the comprehensive spending review. Is that truly impossible?

In the absence of public money, we also need to find ways to attract alternative forms of investment. However, in a failing financial market, that is not easy to accomplish. Previous efforts to find a solution to that dilemma do not have a happy history. Most recently, the private finance initiative has been subject to the robust critique that, under it, the private sector takes the rewards of risks borne by the Exchequer. Originally, PFI was supposed to encourage the private sector to bear risk as well as provide funding, but sadly, that target somehow lost its way. What is the point of the taxpayer funding PFI projects when the Government can borrow in the money markets far more cheaply? Does PFI not just create a very high price, to be borne by future taxpayers, merely so that the Chancellor can pretend he is not borrowing money? That is what we had under the previous Government; if we have it again, it will be just as much of a nonsense.

Infrastructure investment must be seen as enabling growth, but we should moderate the claims that we make about the scheme. It is not a silver bullet. Infrastructure development cannot be delivered quickly. The Bill is a strategic enabler to facilitate the growth needed for decades and generations to come; to position ourselves in a more comfortable place to compete in an ever-more challenging global market; and to strengthen the ability of small businesses to get the access to the market that they so badly need to thrive.

The coalition has not been short of such initiatives, which include the publication of the national infrastructure plan last year. However, that only reaffirms that our approach should be a cautious one. The proposals raise many questions. What will be the impact of the Bill on the programme, cost and timetable for the schemes in the plan? How does the Bill sit alongside the infrastructure costs review programme, which promised potential benefits of between £2 billion and £3 billion? What analysis has the Minister conducted to test the propensity of the market to engage with the type of support that the Bill could provide? If the Bill is to be fast-tracked, what confidence can the Minister give us that the measures will resonate with investors? Perhaps the Minister will answer some of those questions in his summing up, and I wish him well in that task—I believe it is his first visit to the Chamber in his new position.

Even if the Bill delivers—I hope it does—it will need to be accompanied by other measures. Infrastructure measures have relatively long lead times, but growth is needed now. Infrastructure alone is not enough. The Government could adopt a number of measures to stimulate private sector demand, which could deliver results far more quickly. The measures in the Bill provide a modicum of confidence that the medium and long-term predicaments are in the Government’s mind, but we need short-term measures to get consumers spending and small businesses selling.

I and a number of hon. Members have pressed for measures to stimulate private sector demand for some time. Alongside a proactive approach to export potential, that offers the best route out of recession. We have heard encouraging words from the Government of late, but we need action, and we need it quickly.

Whatever the long-term benefits of improved infrastructure delivery—which, I repeat, are vital—if the Government fail to deliver growth, we risk the country being dragged back into the dark days of increased public spending, financed by the reckless borrowing advocated by the Opposition. Let us never forget that the former Chief Secretary to the Treasury left the bill—a little note—saying, “We’ve run out of money.” Government Members know the score. We know that the previous Government borrowed £1 in every £4 spent, and this Government are desperately trying to get it down and have cut the deficit. Let me say this to the Opposition: the vision of another Labour Government is too horrific and expensive to contemplate. That is why we need growth now, so that we do not impose a burden on our children and grandchildren, which, frankly, would be immoral.

--- Later in debate ---

[Sajid Javid]

As always, my hon. Friend is absolutely right. [Interruption.] I must plough on.

On a number of occasions the Opposition suggested that this Government were spending less on infrastructure than they would have if, by some miracle, they had won the last election. Let us look at the facts. After the last election, the right hon. Member for South Shields (David Miliband) said in his leadership hustings bid that they were going to halve the share of national income going into capital spending. Plans presented by Labour to this House at their last Budget, in March 2010, showed net investment falling from £50 billion in 2009 to a projected £23 billion by 2014-15, a figure lower than the one this Government have planned.

We heard from the Opposition about Britain’s growing debt. However, they forget, conveniently, that when this Government came to power, our budget deficit was 11% of GDP, higher than any other nation in the G7. According to the Institute for Fiscal Studies, if the plans of the right hon. Member for Edinburgh South West (Mr Darling) had been implemented, this country’s debt would be £200 billion higher than under the plans of this Government. They just do not get it—more spending, more borrowing, more debt.

Members on both sides of the House have recognised the scale of capital required to realise some major infrastructure investments.

[Mr Binley]

My hon. Friend will, I hope, remember that I posed a number of questions to him. Does he intend to write to me, or to forget those questions?

[Sajid Javid]

I will absolutely be writing to my hon. Friend. The questions he raised were characteristic of him, showing the experience he has brought to this House from the business sector. They were just the right type of thoughtful questions.