The Economy and Living Standards

Brian H. Donohoe Excerpts

Thursday 12th June 2014 Commons Chamber

[Ed Balls]

Let me make a little more progress, then I will give way.

Let me start by trying to find some common ground with the Chancellor on these big and difficult debates. I think we can agree that Britain has always succeeded, and can only succeed in the future, as an open, internationalist and outward-facing trading nation, with enterprise, risk and innovation valued and rewarded. We need to back entrepreneurs and wealth creation, generate the profits to finance investment and win the confidence of investors round the world. We can agree on that.

Turning our face as a nation against the rest of the world and the opportunities of global trade is the road to national impoverishment. But at a time when there are powerful forces in technology and trade, which mean that many people are seeing their living standards falling year on year, we cannot take for granted public support for that open global market vision. As the Member of Parliament whose constituency until recently had the largest BNP membership of any in the country, I know how some on the extremes of left and right see isolationism as the solution—turning inwards, setting their face against Europe and the world economy—which would be a disastrous road to take. It would be the wrong way to proceed.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

On the question of jobs, we all applaud the number of jobs created in the country, but do we know how many have been created on zero-hours contracts?

[Ed Balls]

We know that the zero-hours contract is one of the symptoms of change in our labour market that is causing such insecurity. My hon. Friend raises that matter because the reality is that none of us on either side of the House can afford to bury our head in the sand and ignore the legitimate and mainstream concerns of people across our country about our economy not currently working for them and their families.

The challenge for this generation is how we respond. In my view, there are two quite wrongheaded ways to respond. The first is to assume that business as usual will just do the job—that the return of GDP growth will solve the problem. I must say to the Chancellor and to Government Members—particularly to the right hon. Member for Chelsea and Fulham, given the result in his constituency—that every time they boast that their economic plan is working, I am afraid most people in our country just think they are completely out of touch. It may be working for some—a privileged few—but people say time and again, “It’s not working for me. It’s not working for my family. It’s not working for our community.” That is what they have to solve.

--- Later in debate ---

[Mr Osborne]

I will give way in a moment, but let me make some progress. I know that about 50 Members want to speak in this debate—[Hon. Members: “Not on your side.”] Well, we will hear. No doubt Labour Members can all get up on their feet and repeat what they said last year .

I have done something that I know we are not supposed to do in this place, because I actually bothered to read what the shadow Chancellor said in the House last year. Here we are in the privacy of the House of Commons where no one is listening, but what were his pearls of wisdom? In this exact debate last year he issued a stark warning that the British economy would “flatline” unless we abandoned our plan immediately. Since he made that prediction, we have stuck to our plan and our economy has grown by more than 3%.

Last year in this debate the shadow Chancellor said that business investment would “stall”, but it has since grown by almost 9%. He told us that unemployment would rise, but since he made that prediction more than 800,000 new jobs have been created. He warned ominously that youth unemployment would rise too, but it is down by 100,000 over the past 12 months. From re-reading the speeches of the shadow Chancellor, I have discovered that he performs a very useful function. He is an infallible guide to the future performance of the British economy: whatever he predicts, we can be sure that the exact opposite happens.

[Mr Donohoe]

Will the Chancellor answer a simple question about employment? How many people are on zero-hours contracts?

[Mr Osborne]

I do not have the number the hon. Gentleman asks for here, but there were zero-hours contracts under the previous Labour Government and there are Labour councils that use zero-hours contracts. As those on the Labour Front Bench have pointed out, not all zero-hours contracts are bad. One measure in the Queen’s Speech that was not mentioned by the shadow Chancellor—indeed, he did not actually address the speech in his remarks—will ban exclusivity with zero-hours contracts. Labour had 13 years; the shadow Chancellor was in charge of economic policy for 13 years and could have taken such a step, but he did not. I suggest that Labour Members hold their tongues and come with the Government through the Division Lobbies as we do something about an abuse that they did absolutely nothing to crack down on.