Amendment of the Law

Chris Leslie Excerpts

Monday 23rd March 2015 Commons Chamber

[Chris Leslie (Nottingham East) (Lab/Co-op)]

May I first take the opportunity to note the many valedictory speeches by right hon. and hon. Members who have chosen to step down at the forthcoming general election? They brought back many good memories of my time working with them.

My right hon. Friend the Member for Edinburgh South West (Mr Darling) reminded us of the necessary steps he took after the global banking crisis, which, of course, the Conservative party wants to airbrush from our recent economic history. I am glad we managed to keep the cash machines working, but the recklessness of the banks left a dreadful legacy and deficit that has stayed with us to this day.

My right hon. Friend the Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) spoke passionately. He has been a good friend to many Members on both sides of the House and he will be an enormous loss to Parliament. He is such an impressive individual and one of the great parliamentarians whose capability is incomparable.

My right hon. Friend the Member for Salford and Eccles (Hazel Blears) spoke passionately about her advocacy of getting young people involved in politics. Her achievements will be seen for many decades to come. My hon. Friend the Member for Sheffield, Heeley (Meg Munn) and my right hon. Friend the Member for Holborn and St Pancras (Frank Dobson) also talked about their belief in public service and the need to invest in public services, and they told us that we should never forget the need to regulate the banking sector and make sure that the dreadful activities we have seen are never repeated. Those were fine valedictory remarks. I do not have time, in the final moments of several days of debate on the Budget, to congratulate and thank my many other colleagues who spoke passionately today.

This is the coalition’s last Budget. The final verdict is in. There are no more opportunities to pull rabbits out of the Government’s Budget boxes, whether they be red or yellow. For all the Chancellor’s complacency about walking tall and how we have never had it so good, the residual legacy of last Wednesday was confirmation that, if the Government parties get their way with their proposed public investment in vital public services, the rollercoaster will be pushed over a precipice.

The Chancellor tried every trick in the book to distract from the Government’s plan for extreme cuts, and he hoped that the public would not notice his record of failure on living standards and borrowing. Every target he has set has been missed and every promise broken.

In 2010, the Chancellor told us that the structural deficit would be eradicated in time for this Budget—it would all be gone—yet we are still borrowing £90 billion this year, which is only a 5% fall from last year’s deficit. Tax receipts should have been strong and tax credit costs significantly lower by now, but in the low-wage economy that this Chancellor has fostered—with an epidemic of job insecurity and zero-hours contracts up 20% in this past year alone—revenues have stagnated and the Government are spending £25 billion more on social security than the Secretary of State for Work and Pensions and the Chancellor had expected. We were meant to have an export-led recovery, heading towards £1 trillion-worth of exports by 2020, but we have already fallen a little bit behind that target—about £300 billion behind it. Moreover, our triple A rating, which was once this Chancellor’s litmus test of economic credibility, was, of course, downgraded.

It was not supposed to be like that, as my hon. Friend the Member for Caerphilly (Wayne David) has pointed out, and this is not where the Chief Secretary’s party wanted to be, either. The Budget spectacle over the past few days has been not of a responsible Government focused on the economy, but of an out-of-touch Chancellor in denial and focused on political survival and a Chief Secretary counting down the hours and living out his own fantasy, which even his own leader could not bear to sit through.

The reality is that we have had one and a half Budgets in two days from two parties that had nothing to offer the majority of people in this country. Those two parties are basing decisions on party political interests and their perceived electoral advantage, rather than on what is in Britain’s best interests. The Chancellor’s Budget was a Budget that could not be believed, and the Chief Secretary’s statement was just unbelievable—a Budget not for public services, not for working people, not for families and not for the NHS.

[Andrew Gwynne (Denton and Reddish) (Lab)]

Will my hon. Friend give way?

[Chris Leslie]

I will certainly give way to my hon. Friend.

[Andrew Gwynne]

Now that the dust has settled from Thursday’s Liberal Democrat statement, has my hon. Friend had the chance to scrutinise the document—published online, rather than available in the Vote Office—and if so, may I draw his attention to table 2.A on the scenario input assumptions? Did he notice, as I did, that the source for the assumptions was not authoritative bodies such as the ONS, the OBR or the IFS, but none other than the Chief Secretary to the Treasury?

[Chris Leslie]

I commend to Conservative Members, who should have a good read of it, this very authoritative document with very carefully crafted figures:

“Source: Chief Secretary to the Treasury”.

It was a classic. My hon. Friend knows that the real Budget was in the Red Book. Shall I pass it to him? Perhaps not.

The Chancellor told us in the Budget that everything was sunshine and roses, but in coalition Britain, 900,000 people use food banks, 600,000 people are affected by the bedroom tax, the typical working person is £1,600 a year worse off and the NHS is in crisis. The Chancellor tried to find the best statistic, however obscure, to muddy the waters and deny what most working people know, which is that their wages have eroded year after year as we have experienced the longest period of prices exceeding income since the 1920s. He did that by relying on a forecast for this year, rather than real data, and by adding university and charitable income, as well as what are known as imputed rents from homes even if they are not actually rented. That was basically designed to say, “If you stand on one leg and squint a little, there you are—you’re back to 2010 levels of affluence and incomes.” Even on that statistical measure, from election date to election date—rather than the start of the calendar year, as the Chancellor tried to use—people are still worse off than they were. Of course, all that does nothing to change the burden of higher taxes and lower tax credits that have seen families worse off by more than £1,000 a year. As ever, the Chancellor may give a little with one hand, but he takes away much more with the other.

By the way, now that the Chancellor has taken the time to enter the Chamber, it would be interesting to know whether he has spotted the Prime Minister’s announcement this afternoon. I understand that the Prime Minister has indicated that he will not stand for election again after this general election. He has said tonight that he is likely to be gone in a couple of years’ time, so what will the country be voting for at the next election? I can see the poster now—“Vote Cameron, get Osborne”—and all the right-wing agenda that would go with it. A Prime Minister who did not win his first election, and had not won a second election, would be saying that he would not win a third.

Of course there were a few give-away measures in the Budget, and we welcome anything that helps those on lower and middle incomes. Why, however, does the Chancellor still stand by the biggest give-away of them all? His tax cut for the wealthiest 1%—those earning £150,000—means that someone earning £1 million each year gets an annual tax cut of £42,000. That is simply unfair and unacceptable, and that is why we will vote against those income tax plans this evening. We will vote against the Government’s Budget plans for public services and public investment, because although we must balance the books as soon as possible in the next Parliament, going so far beyond that—with cuts over the next three years that are twice as deep as those of the past three years—means extreme cuts to services on a scale not experienced for generations. [Interruption.]

[Mr Speaker]

Order. There is a most discourteous exchange taking place between those on the two Front Benches while the hon. Gentleman the shadow Chief Secretary is addressing the House. Modesty forbids me from naming the errant Members, but I feel sure that they will correct their behaviour at once.

[Chris Leslie]

Perhaps we can ask Hansard for a transcript later. I would certainly be interested to read that.

When we look at the Chancellor’s plans—and those of the Secretary of State for Work and Pensions—we see that he is thinking about cutting for the next three years at twice the level we have seen over the past three years. The Chancellor realised how toxic his plans were shortly after the autumn statement, when he published the trajectory that showed he would take Britain back to 1930s levels of public investment as a share of national income. In the days running up to the Budget, we were therefore told that he had had a change of heart on public spending—coincidentally, it was just weeks before an election campaign. Sure enough, the figures for 2019-20 were shuffled around in the Budget. However, in the end, he just could not fight his gut instinct, so all he did was to front-load the cuts on to the first three years of the next Parliament and hope that nobody would notice.

Unfortunately for the Chancellor, the Office for Budget Responsibility did notice. It said that his plans will mean

“a much sharper squeeze on real spending in 2016-17 and 2017-18 than anything seen over the past five years”

and

“a sharp acceleration in the pace of implied real cuts to day-to-day spending on public services”.

That will create what the OBR calls

“a rollercoaster profile for implied public services spending through the next Parliament”.

We remain with a path of public spending that is based on ideology and political game playing, rather than a Budget for our public services based on what the economy requires and what our country needs.

I ask my hon. Friends to imagine the impact these extreme plans will have, especially on the public services that the Government say are unprotected—the police, bus and rail services, the Army and our defences—and on all those who depend on tax credits to make ends meet. I encourage my hon. Friends to take a moment to look at exactly what those extreme cuts will mean. They are not just statistics in the Red Book; they will have real consequences for real people’s lives.

To take social care as an example, in the past five years, the number of vulnerable people who receive social care support has fallen by 500,000 and the number of home-delivered meals—meals on wheels—has fallen by 59%. Of course, there has also been a rise in the peremptory 15-minute visits. That is just what has happened so far, before the Government tip social care over the precipice of the rollercoaster. Just imagine what the next three years could bring. Care cuts like this are health service cuts. As my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) said, our health services will be placed in real jeopardy in that scenario. It says everything one needs to know about this Chancellor that the battle of Agincourt got twice as many references in the Budget speech as the NHS. When I look at the Government’s Budget, it is not so much “Henry V” that comes to mind as “The Comedy of Errors”.

This path of spending—extreme and unnecessary, going way beyond tackling the deficit—is why we will vote against the Budget resolutions tonight. This is a Budget that delivered little, but revealed much. It revealed the Conservatives’ ideological obsession with shrinking public services in preparation for a privatised society. There is no support for those struggling on low incomes and in insecure work, no credible action to tackle tax avoidance and close the tax gap, nothing to reverse their tax cut for millionaires and no help for the NHS. We have a Chancellor who is full of spin but is fooling no one, and a Chief Secretary who is enjoying his final days in office but not in power.

What we need is a Labour Government who will put the interests of the British people first; who will balance the books in a fair way; who will help small businesses with a cut in business rates, rather than simply helping the largest corporations; who will raise living standards by raising the minimum wage and expanding free child care; and who will govern for the many and not for the few, because Britain succeeds when working people succeed. That would be a better plan and a better Budget. That is why I urge my hon. Friends to reject the Budget of this failing Government.

--- Later in debate ---

[Danny Alexander]

It is fair to say that the current Prime Minister also discouraged this policy. In the television leaders debates in 2010 he said it could not be done and could not be afforded. We have shown in this Parliament that we can afford it. The difficult decisions we on the Government Benches have been willing to make in other areas have meant that we have been able to deliver the largest income tax cuts for working people in a generation. That is something of which I am very proud indeed.

My right hon. and learned Friend also rightly highlighted how much progress we have made in tackling tax avoidance during the course of this Parliament. He was humble enough to admit that progress had not always been as strong during his time as Chancellor. There were many measures in the Budget to tackle tax avoidance and evasion.

We then had a contribution from the right hon. Member for Edinburgh South West. It is fair to say that there were many things in the Budget that he was not very keen on. He certainly made that clear. He did not like the rollercoaster, as he described it, of the public finances. I have set out my own alternative scenario on that. He did not mention the big dipper that the public finances had been on during his time in office.

The right hon. Gentleman rightly welcomed the package of measures to support the oil and gas sector, which was a very strong feature of the Budget. The measures will ensure that the sector, which is suffering from a dramatic fall in the oil price, has some confidence in the future. He welcomed those measures, but he rightly pointed out that the oil revenues in the OBR forecast at this Budget were a little more than a 10th of those predicted by the nationalists in the recent Scottish referendum. He made the point that had Scotland voted for independence and experienced the fall in oil prices, the difficult decisions made in this Parliament—I think I quote him correctly—would have seemed like a school picnic in comparison.

The right hon. Gentleman was too modest to remind the House of the service he rendered to his country with the leadership he showed in the Better Together campaign. I hope that Members on all sides of the House express their appreciation for that. It was certainly something I experienced first hand. It was immensely important in ensuring that the people of Scotland voted the right way in the referendum. The experience of working with him on that campaign, although we may have disagreed on many other matters over the years and will no doubt continue to do so, is one I will always remember. He showed himself to be a man of the greatest statesmanship in his conduct of that campaign.

Before I respond to some of the other points, I want to respond to the jibes from the shadow Chief Secretary—[Interruption.] It certainly is not—there are another 10 minutes to go. The shadow Chancellor, the shadow chunterer, is in his place chuntering as usual. He doesn’t have many policies, but he sure does like to chunter.

The Budget, as set out in the Red Book, was agreed by Conservatives and Liberal Democrats working together in the coalition Government. There is no policy measure in the Budget which Liberal Democrat Ministers did not sign off. Are there differences in the way the two parties in the coalition would approach the task of deficit reduction in the next Parliament? Yes, of course there are. I have made clear in this House and outside that there is another way we can meet the fiscal mandate that all parties signed up to when we voted for the charter for budget responsibility in January. Opposition Front Benchers appear to have forgotten about that, but we can do it in a more responsible and stable way. For that reason, last week I published and set out an alternative fiscal scenario for the next five years—a plan to borrow less than Labour and cut less than the Conservatives, a plan to give the UK a brighter future without sacrificing financial prudence. As the independent OBR mentioned in its economic and financial outlook, this profile of public expenditure

“is driven by a medium-term fiscal assumption”,

but

“both parties have said that they would pursue different policies if they were to govern alone.”

The Budget that my right hon. Friend the Chancellor presented last week is a coalition Budget that reflects the hard work the coalition Government have carried out over the past five years to turn the country around from the mess we inherited from Labour and to set us on a path back to prosperity. I do not hesitate, therefore, to speak in favour of it.

[Chris Leslie]

This is very confusing. So the right hon. Gentleman supports the Budget, but he opposes the Government. He wants to be a Minister, but he does not want to be a Minister. Will he at least agree that the cuts for the next three years are extreme and would be damaging, and will he confirm that he does not support the depth of the cuts to our public services over the next three years?

[Danny Alexander]

It really is not that confusing. Even the shadow Chief Secretary ought to understand that two different parties in a coalition Government will have different views about the future direction of policy in this country. I would say—[Interruption.] If the hecklers would silence themselves, I would say that Labour signed up to £30 billion of deficit reduction in the first three years of the next Parliament when they voted for the charter for budget responsibility. I am sure you remember the occasion, Mr Speaker. It was an important debate in the House, and one to which the country should be paying great attention. It is fair to say that all parties in the House have different views about how to achieve that £30 billion of cuts, and I set out my view to the House on Thursday.

--- Later in debate ---

[Danny Alexander]

No, I am not giving way. I am going to make some progress. The hon. Lady was not here for the debate, so I am certainly not giving way to her.

[Chris Leslie]

rose—

[Danny Alexander]

No, I am not giving way. I am going to finish.

The income tax personal allowance will increase to £10,800 in 2016-17 and—

[Chris Leslie]

Will the right hon. Gentleman give way?

[Danny Alexander]

No, I will not.

This is the most significant tax cut for working people in a generation. As a result of the increases to the personal allowance, a typical basic rate taxpayer will be £905 a year better off in 2017-18, and 27.2 million individuals will have benefited from increases to the personal allowance since 2010. As a result of these changes, over 3.7 million people—[Interruption.] Opposition Members do not like to hear about tax cuts for working people, Mr Speaker.

--- Later in debate ---

[Chris Leslie]

rose—

[Danny Alexander]

No, I will not give way. Opposition Members do not like to hear about tax cuts for working people because they did not deliver those cuts themselves. If they cared about cutting taxes for working people, they would be welcoming and celebrating the fact that 3.7 million working people on the lowest incomes no longer have to pay any income tax at all. That is something that Government Members would celebrate; Opposition Members should be celebrating it, too.

When a Government lose control of the public finances, it is the poorest who are hardest hit. That is why imposing fiscal discipline was such a priority for us in 2010. We created the stability necessary to deliver growth, jobs and investment. Last year, the shadow Chancellor channelled Ronald Reagan and asked, “Are you better off than you were in 2010?” On Thursday, the independent Institute for Fiscal Studies confirmed that families are set to be £900 better off in 2015 than they were in 2010.

Compared with five years ago, we have lower inequality; child poverty is down; pensioner poverty is at record lows; the gender pay gap is smaller than ever; and the number of students at university from disadvantaged backgrounds is at an all-time high. Some 1.9 million people are now in work, which is 1,000 new jobs a day, four fifths of them full time and four fifths in skilled occupations. This is a record to be proud of, and I am proud of these achievements. I am proud of the role my party has played in achieving them.

Responsible government does not mean standing on the sidelines and complaining about how long other people are taking to clean up the mess they created. Responsible government is about stepping up to the challenges and not flinching from taking the tough but necessary decisions. That is what we have done since 2010. We have created a stronger economy, we have created a fairer society, and we have delivered for the people of the United Kingdom. I commend the Budget to the House.

Question put.