NHS (Government Spending)

Debate between Charlie Elphicke and Grahame Morris

Wednesday 28th January 2015 Commons Chamber

[Grahame M. Morris (Easington) (Lab)]

I am pleased to follow the hon. Member for Dover (Charlie Elphicke). I wish to make it clear that I have chosen to be here in the Chamber today to participate in this important debate rather than attend the Health Committee, which is also considering important matters, because I feel that we need to set out our view of the direction of the health service.

I was very interested in some of the hon. Gentleman’s views about fair funding. Having experienced NHS funding under the Conservatives and Liberal Democrats, I must say that my view is rather different. After the general election in 2010, the funding for a brand-new hospital that would have served my constituency—it was to be funded not through the private finance initiative scheme but by NHS capital—was cancelled by the present Government. It is an absolute disgrace that we still do not have modern facilities to serve my constituents and those of neighbouring constituencies. It prompts us to ask whether fair funding or some kind of gerrymandering is being applied.

The hon. Gentleman was talking about opening urgent treatment centres. That is a revelation to me because the two centres that opened in my constituency under the previous Labour Government are now threatened with closure. We have neither a modern hospital nor modern facilities.

I am proud to say that, although I am not a doctor, I did work in the health service. Like my hon. Friend the Member for Heywood and Middleton (Liz McInnes), I worked in a pathology laboratory, doing some important diagnostic work. I am proud of the people who deliver that service; I think they deserve enormous credit.

The creation of the NHS is Labour’s proudest achievement. More than anything else—more than football or cricket—it is what binds us together as a nation. The principle of a free national health service, which is free at the point of use, has huge popular support among the general public.

When the Prime Minister said that his priorities could be summarised in three letters—NHS—we might have been forgiven for thinking that the Conservatives had been transformed and had come to cherish the NHS as much as the British people do. But, with fewer than 100 days to the general election, it is apparent that his words were nothing more than a smokescreen. It is clear that the Government knew that they could never go into a general election stating their true intentions. Now, we have been accused of weaponising the NHS.

[Charlie Elphicke]

Yes, you have.

[Grahame M. Morris]

I would rather weaponise it than privatise it, which is what I accuse the Government of doing. That would not have been possible without the active support of the Liberal Democrat party—talking of which, the hon. Member for Redcar (Ian Swales) has just taken his place in the Chamber. I feel bitter about what has happened. The hon. Gentleman and I both served on the Health and Social Care Bill, which has now been enacted. The lead advocates were the right hon. Members for Chelmsford (Mr Burns) and for Sutton and Cheam (Paul Burstow). That Act was a really dangerous move, because part 3 opened up our national health service to the full force of competition. Conservatives may say that the difference is only marginal, but the truth is that that Act allows hospital trusts to have up to 49% of their income come from private patients.

I know that we are desperately short of time, but I want to set out some political dividing lines. Labour and the Conservatives are making very different offerings for the NHS. Labour’s offering is that it will provide more nurses and GPs, and I think it will find favour. In the next general election—

Finance Bill

Debate between Charlie Elphicke and Grahame Morris

Tuesday 3rd July 2012 Commons Chamber

[Grahame M. Morris]

Does the hon. Gentleman agree that part of the problem with the banking crisis is the excessive bonus culture? Perhaps shareholders and Governments should have dealt with that, but we will discuss that on Thursday. Is this proposal not an attempt to address that issue and to ensure that those with the broadest shoulders, who have done so well over the past 10 years with their huge bonus payments, make a contribution now that times are tough?

[Charlie Elphicke]

The hon. Gentleman makes an interesting point, but there are two problems with his argument. First, the tax would fall not on the greedy employees and bankers whom he wants to whip, but on the bank. Secondly, during his Government’s period of office—he will correct me if I am wrong—Fred Goodwin received some £15 million in bonuses, which he paid tax on at the old tax rate. The hon. Gentleman is therefore seeking to close the door after the horse has bolted.

[Grahame M. Morris]

The hon. Gentleman is being very generous and accommodating, as always. Does he know what the bonus figure has been for Bob Diamond over the past two years, while the hon. Gentleman’s Government have been in office?

[Charlie Elphicke]

For me, the issue is the size of the bonuses not in the private banks, but in the taxpayer-owned banks. That is the real concern that we ought to be focusing on. That is why the Government’s bank levy is the right way forward.

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[Charlie Elphicke]

The hon. Gentleman is simply suggesting that we give with one hand and take away with the other. He might think that he can throw lots of money at dealing with the problem of youth unemployment, but he would meanwhile be constraining businesses in getting the capital that they need to create new jobs and maintain their existing jobs. That is the central flaw in the Opposition’s argument. They want to take more money out of the banking system when capital and lending are already constrained.

The issue that we need to deal with is bonuses. The Government have taken action on bonuses in the taxpayer-owned banks. They have said that there will be no cash bonuses of more than £2,000 at the taxpayer-owned banks. It is right to have longer-term share incentivisation schemes, which align people’s interests with the success of the banks over the longer term.

[Grahame M. Morris]

The hon. Gentleman is developing an interesting argument. Does he agree that bonuses have been too high not just in the state-owned banks but in the privately owned banks, and that shareholders should do their duty and exercise some control over bonus pots? Bonuses have been paid in banks, such as Barclays, where performance has clearly not justified them.

[Charlie Elphicke]

Shareholders have been exercising control. Under this Government we have seen the shareholder spring and real action by institutional investors to restrain pay in the boardroom, which grew so much under the previous Government. Under the current Government, there has been action to ensure that shareholders have far greater power over remuneration reports and can push down the excessive rewards that have been given for not enough success.

It is right that an honest day’s work means an honest day’s pay and really good work deserves really good pay, but it is fundamentally wrong to say that the Government have not taken action. They have encouraged shareholders to do their bit as business owners to ensure that we do not have the excessive pay of yesteryear. A responsible Opposition would say, “We congratulate the Government on ensuring that excessive pay is stopped, and we take responsibility for the fact that when we were in government, we allowed a something-for-nothing culture in which everyone knew the price of everything and the value of nothing.” We need an understanding of the value of things once again. The Government have got it right by saying that there will not be excessive bonuses in the taxpayer-owned banks. Although the Project Merlin agreement was not perfect, it was a move in the right direction, as is the permanent bank levy that the Government have introduced, which raises £2.5 billion a year.

--- Later in debate ---

[Charlie Elphicke]

I believe that the OBR’s figure was for gross receipts, which were not £3.5 billion but £3.45 billion. We need to examine the net yield raised, which was £2.3 billion. That is a lower figure than the £2.5 billion raised under the current Government’s system. I appreciate that the difference between net and gross can be confusing, because not all of us are accountants—I certainly am not. Nevertheless, more cash is coming through the door under the current Government’s arrangements.

The hon. Gentleman’s argument misses a central point, which is that the Opposition want their bank bonus levy to be an additional impost on the banks. My concern is that that would pull more capital out of the banking system. Right now, we need to lend to business and kick-start the economy.

[Grahame M. Morris]

The hon. Gentleman says that accountants know the cost of everything and the value of nothing, but how does he weigh the cost to the banks against the cost to this lost generation—the 100,000 people in Dover, Easington and the constituencies we represent—consigned to a life on the dole?

[Charlie Elphicke]

If we get lending going again, the economy growing again and decent private sector jobs creating more wealth as a nation, we will do better over the longer term. Having short-term measures to create jobs out of thin air—the 100,000 jobs that the Opposition talk about, for example, which would broadly be public sector-type and make-work-type jobs—is not the way to create a sustainable economy. We need to expand the private sector, expand business and expand jobs, so that they are sustainable over the longer term, not just for a year or two.