Debate on the Address
Debate between David Davis and Noah Law(2 days, 14 hours ago)
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David Davis (Goole and Pocklington) (Con)
During the privileges debate, I told the House that I had hoped, a couple of years ago, that the Prime Minister would make a success of his new job. Unfortunately, this House is now debating against the backdrop of a Labour psychodrama, but that psychodrama would not have happened except for the fact that the Government have failed, and failed very clearly. In his now infamous speech, the Prime Minister said that he was going to undertake a reset. I don’t know about the Labour party, but the country certainly needs a reset. What he said, in describing his reset, was that he needed to “explain” things better. That is not a reset; that is a re-spin of what they are doing. We need a proper reset. The hon. Member for Hornsey and Friern Barnet (Catherine West) was exactly right when she said that Labour must be
“judged on actions and not just our words”.
As a number of people have said, including the new leader of the SNP group, the hon. Member for Angus and Perthshire Glens (Dave Doogan), Labour came into office promising that its No. 1 mission was economic growth. It was right to do so, because without growth we do not have the money to do anything else, yet the consequences of its own policies in the last couple of years have been that growth has been suppressed. The IMF has literally just reduced the UK’s growth forecast by half a percentage point. That is the largest reduction in the G7.
It is not just the Opposition who are concerned about growth. I recommend that the House reads the Labour Growth Group report called, “An Honest Day”, which is aimed directly at this problem. While I do not agree with everything in it, there are a lot of good ideas that the Government should have already taken on.
When Labour took over, inflation was bang on 2%—that is something it cannot claim was disguised in any way—and now it is 3.3%. Again, Labour and the Prime Minister will try to blame somebody else, and no doubt at the moment the blame is on the strait of Hormuz. That explains energy costs in the future; it does not explain the increases in food costs in the past, or indeed a number of other costs.
David Davis
No, not for the moment.
Neither does it explain the increase in borrowing costs, which are higher than any other G7 country’s and virtually double Japan’s. That is nobody’s fault but the Chancellor’s, and the horrific consequences for our public finances have been laid out already by the Chairman of the Public Accounts Committee, my hon. Friend the Member for North Cotswolds (Sir Geoffrey Clifton-Brown).
The real brake is Labour’s own policies: high taxes, massively burdensome regulation, high business rates and high energy costs. What on earth do we expect from our businesses when we saddle the country with the most expensive energy in the developed world, or indeed with the national insurance increases that the hon. Member for Angus and Perthshire Glens mentioned?
David Davis
It is interesting, because the hon. Member’s Government and his Secretary of State have claimed, “All these green policies are reducing the cost of our energy. Not using oil and gas is reducing the cost of energy.” What is the consequence? The highest energy costs in the world. I will be interested to hear if he can explain that when he makes his speech.
The other issue is that growth, or the loss of growth, has a material impact on the public finances. To give the House a measure of that, a 1% change in the growth rate is £10 billion to £11 billion in the first year and then more money in the consequential years, so when we lose that growth, we lose that amount of money. But even if we imagine that we could get that growth back, it still would not be enough. It would not be enough to pay the bills that we need to pay.
So what can we do? I am afraid that, because of the size of the debt, we have no choice but to cut welfare costs. I am a great believer in our welfare system, but it should be a safety net, not a lifestyle choice. People who can work should work, and the public have little sympathy for those who choose benefits over a job. It is true today, and it has been true since I was a child on a council estate, that the British working class, who Labour used to think of as its own voters, hate it when they see one of their neighbours choosing to sit at home spending the taxes that they have earned. Low growth handicaps our ability to solve our citizens’ problems.