Future Government Spending

Debate between Cathy Jamieson and Brooks Newmark

Wednesday 4th March 2015 Commons Chamber

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

It is a pleasure to wind up the debate today and to speak in favour of our Opposition motion. This gives me a chance to describe in plain terms the gulf between this Government’s spending plans and the approach that will be taken by a future Labour Government. It also gives me the opportunity to make it crystal clear that we reject the failed austerity plans that were set out in the Government’s autumn statement.

The Minister and the Chancellor were patting themselves on the back in the media this morning, congratulating themselves on their success. That just shows how out of touch the Government are. As my hon. Friend the Member for Nottingham East (Chris Leslie) said earlier, the Chancellor told the “Today” programme this morning:

“We’ve got on top of our debts and deficits.”

My hon. Friend made it quite clear that they have not. As he and many other Labour Members made clear, this Government have failed on their own terms. In 2010, the Chancellor said that he would balance the current budget by 2014-15, but in the first nine months of this financial year, the gap was £74 billion. The Chancellor has had five years, and he has failed. We cannot afford to give him another five. That point has been made time and again this afternoon.

Let us look at some more evidence. As I have said, the Government have missed their current budget target by £74 billion. In addition, the social security bill is £25 billion more than planned, and tax credits have risen, subsidising the low-wage economy. The number of working people receiving housing benefit is up two thirds, and tax receipts are much lower than expected. The Government have failed on the deficit, on the debt and on living standards.

Some Conservative Members seemed rather excited about today’s Institute for Fiscal Studies report, but if we look at it in more detail, we can see what it actually says. It states that people are worse off today than they were in 2010. As we have heard this afternoon, the real problem is that more people are scraping by, from day to day and week to week, in poorly paid jobs or on exploitative zero-hours contracts. A number of Members have described what it is like for their constituents who have to wait for a text message on a Monday morning to tell them whether they will have any paid work that week. That is no way for them to live their lives. It does not enable them to have any sort of quality of life or to balance their household budget. There is nothing in that for the Government to be proud of.

A number of Members have eloquently argued that at the heart of the Government’s failure is their ideological obsession with shrinking the state. That seems to be their true aim, superseding all else. From what we have heard from the Government this afternoon, it is clear that they will continue to keep chipping away at that, even as the ground crumbles beneath us.

We have heard some powerful and passionate speeches from Labour Members this afternoon. We heard from my hon. Friends the Members for Rutherglen and Hamilton West (Tom Greatrex), for West Dunbartonshire (Gemma Doyle), for Blaydon (Mr Anderson), for Corby (Andy Sawford), for Preston (Mark Hendrick) and for Glasgow North East (Mr Bain), all of whom are powerful champions for their constituents. My hon. Friends were speaking up for the people who have suffered under this Government, laying out in clear terms what the impact has been on families right across the UK and talking about their experiences of dealing with the zero-hours contracts, the low pay, being on agency work, and the impact of cuts on local government, which has affected and in some cases decimated local services. They spoke about the sense they got from their constituents that living standards simply have not improved for them; any recovery has not yet reached the kitchen table of our constituents.

My hon. Friends spoke this afternoon about the need to do more to tackle tax avoidance. They spoke about the inequities of the Government’s lack of action to tackle the tax dodgers while imposing the hated bedroom tax. Labour Members made it very clear that our constituents cannot face another five years of Tory Government and that we need a change. As for the consequences of five more years of the Tories, they are still intent on doing more damage. As my hon. Friend the Member for Nottingham East reminded us in his opening speech, and as hon. Members said at various points in the debate, five more years would take us back to a spending level as a percentage of national income that was last seen in the 1930s, before there was an NHS, when kids left school at 14 and when life expectancy was 60.

According to the Institute for Fiscal Studies, which has been much quoted by Government Members this afternoon, that would necessitate undeliverable and nigh unthinkable cuts of more than £50 billion. It would, as the IFS said, represent:

“Spending cuts on a colossal scale”—

which would leave—

“the role and shape of the state… changed beyond recognition.”

So let us make no mistake: this is not about fixing the economy; it is about remodelling the role of the state This Government’s plans will do real and lasting damage in the long term, wreaking havoc in public services, decimating our skills and infrastructure, and undermining our competitiveness.—[Interruption.] I hear Government Members shouting, “Rubbish”, but they clearly have not listened to the testimonies of Opposition Members, who so eloquently, passionately and powerfully laid out the impact of this Government’s policies and actions on their constituents.

[Mr Newmark]

rose—

[Cathy Jamieson]

I am not going to give way because the hon. Gentleman had his opportunity earlier, and I wish to make a few more points about what has been said this afternoon.

The true scale and nature of that impact cannot be quantified, because the Government will not set out where their billions of social security cuts will fall, so we have to look at past performance as our guide. Those reliant on tax credits to make ends meet will be justly wary of another five years of the Tories; because of their tax and benefit changes, a typical household is £891 worse off this year. This Government’s right-wing, doctrinaire approach to the deficit has already done untold damage. Their trickle-down philosophy has been exposed for the sham that it is, and their true aim, as it ever was, is to pulverise the state and to protect the wealthy.

Labour has a better plan. As last year’s IFS green budget made abundantly clear, there is a huge gulf between this Government’s approach and that outlined by Labour. Our approach is not punitive; it is a common-sense approach. It is balanced and proportionate. We acknowledge and accept the need to close the deficit and reduce the debt as soon as possible in the next Parliament, and we are committed to achieving that, but we will do it fairly. That is because we think the wealthiest should shoulder the greatest burden. So we will reverse the £3 billion tax cut for those earning over £150,000, to increase tax revenues and help reduce the deficit fairly; we will introduce a mansion tax on homes worth more than £2 million and crack down on tax avoidance, investing the proceeds in our NHS; and we will tax bank bonuses to create jobs for young people and the long-term unemployed, increase the minimum wage and incentivise payment of the living wage. All our spending commitments will be fully funded. We will deal with the deficit and the debt, but we will not place our public services in jeopardy. Our plan will secure the rising living standards, higher wages and sustainable growth that are needed to fix the economy fairly in a way that benefits everyone, not just a few at the top.

As my hon. Friend the Member for Nottingham East said at the outset, the stakes could not be higher, and the choice could not be starker. There is a massive gulf between this Government’s spending plans and those outlined by Labour. The Tories' austerity agenda has failed. The choice at the election is between five more years of Tory failure, wage stagnation and decimation of the state, or Labour's progressive and balanced plan for the economy that is sustainable in the long term and better for current and future generations.

Financial Services (Banking Reform) Bill

Debate between Cathy Jamieson and Brooks Newmark

Wednesday 11th December 2013 Commons Chamber

[Cathy Jamieson]

I will develop my arguments in a moment, but I give notice that at the appropriate stage we will seek to divide the House on both of the amendments that we have tabled in this group.

I shall start with the payments system regulator, because I was somewhat surprised by the number of representations on the Bill from the industry, even at this late stage, including on the payments system regulator. The Minister has responded to interventions on that point, but I hope that, when he has the opportunity to respond later, he will address some of the questions raised by the industry, such as the concerns expressed by VocaLink. Although it has said that it is broadly supportive of the regulator and welcomes the change in the Government’s position, it is none the less very keen to ensure that there is no planning blight—a gap between the point at which the legislation becomes law and the time at which the system would be fully operational.

We have also had representations from other sectors of the industry, including Visa and MasterCard, on the need for a level playing field and ensuring appropriate and clear definitions of which payment systems come under the regulator, taking into account the broad range of players that facilitate payments for consumers and businesses. Further representations have been made about the need to look in detail at the whole system and the challenges of establishing the PSR, creating the right skill set and ensuring that it operates correctly. The work load of the regulator will also need to be taken into account as part of its remit.

The Minister said that he believed that the FCA had the resources to ensure that the system will be set up on time and will make progress as planned. I contrast that to the approach on payday lending, and I shall move on now to considering that issue.

At the outset, I must say that we welcome the Government’s U-turn on the issue of capping the costs of the controversial payday loans. [Interruption.] I hear the hon. Member for Braintree (Mr Newmark) saying that that was not a U-turn. I gently remind him that the Government have repeatedly refused demands to deal with legal loan sharks. They now appear to have been dragged, kicking and screaming to their current position as a result of pressure from Labour and countless other campaigners, including many of my hon. Friends in the Chamber today who will no doubt wish to speak.

[Mr Brooks Newmark (Braintree) (Con)]

rose—

[Cathy Jamieson]

Let us remember that, during the passage of the first Financial Services Bill, Labour tabled amendments to give powers to the FCA to cap the cost of credit. Perhaps the hon. Gentleman will explain why the Government opposed them.

[Mr Newmark]

I am sure we all agree that the abuse of payday lending is a scourge, and has been a scourge for many years, on our constituents’ lives. The hon. Lady seems to have a form of selective amnesia. Perhaps she can explain to the House why, during 13 years in power, Labour did absolutely nothing to deal with this pernicious form of payday lending.

[Cathy Jamieson]

I had hoped that the hon. Gentleman would explain why the Government opposed Labour’s amendments. I will come on to talk about the explosion of the payday sector, particularly in the past couple of years on this Government’s watch. [Interruption.] It is no good the hon. Gentleman shaking his head and saying, “Oh come on.” We have the opportunity now to tighten up legislation. That is what I wish to do.

--- Later in debate ---

[Cathy Jamieson]

My hon. Friend, who has campaigned for many years on this particular issue, makes a very good point again. It seems to me to make perfect sense for anyone who is lending money to want as much information as possible to ensure that the correct decision can be taken. Our amendment would mean that the FCA would have a duty to introduce a system for sharing credit data so that payday lenders could not continue to evade their responsible lending obligations.

[Mr Newmark]

Following the intervention by the hon. Member for Walthamstow (Stella Creasy), I have to say that, unfortunately, many normal credit card companies also do not carry out due diligence, and let individuals’ debts pile up.

The hon. Member for Cardiff South and Penarth (Stephen Doughty) made a very good point, which was relevant to my beloved Newcastle football club. Unfortunately, Wonga is one of its major sponsors. Does the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) agree that there should be far greater restrictions on advertising, particularly advertising by payday lenders in parts of the country where many individuals are vulnerable to them?

Finance Bill

Debate between Cathy Jamieson and Brooks Newmark

Tuesday 2nd July 2013 Commons Chamber

[Cathy Jamieson]

Thank you for that guidance, Mr Deputy Speaker. I had feared that the Exchequer Secretary would jump up and ask a supplementary question about the Opposition’s position on cutting VAT.

[Mr Newmark]

Will the hon. Lady give way?

[Cathy Jamieson]

I suspect that the hon. Gentleman wants to stray into the territory where Mr Deputy Speaker has suggested we do not go. Suffice it to say that my hon. Friend the Member for Hyndburn (Graham Jones) makes yet another suggestion that the Minister would do well to consider as part of the wider review. I look forward to hearing his response.