Budget Resolutions and Economic Situation

Debate between Derek Twigg and Debbie Abrahams

Wednesday 19th March 2014 Commons Chamber

[Derek Twigg (Halton) (Lab)]

The Chancellor’s Budget demonstrated clearly just how out of touch this Government are with ordinary people. This Government stand only for the privileged few, not for the millions of people on middle or low incomes who are not feeling any recovery benefit, certainly not in their incomes and standard of living. The cost of living crisis continues, leaving people £1,600 a year worse off under this Tory-led coalition. Of course, from what we have heard today, the Chancellor does not care about that. He does not care that the standard of living has fallen for most people in this country.

The real story—not the story the Chancellor wants to tell—is that of constituencies like mine, where this Government have failed and where many people are struggling to pay their bills and have to choose whether to heat their homes or to eat, while bankers get big bonuses and the richest people earning more than £150,000 get a tax cut. I am pleased that Labour will reverse that cut. We should not forget the 24 Tory tax rises, with the VAT rise alone costing families with children an average of £1,350 over the past three years.

This Government are out of touch with the lives of ordinary working people. No. 10 is being run by old Etonians and a public school cabal. They are not in touch with the lives of people in this country. The Government have never stood up to the energy companies. My party is absolutely right to pledge to freeze energy bills until 2017 and reform the energy market to stop the customer being ripped off. Today’s response to the problem of energy bills was pitiful. I shall return to that issue and the industry shortly.

The real story is that of hundreds of my constituents having to rely on food banks as their source of food on a weekly basis. The number of users has grown massively since this Government came into being. The story is also about many in my constituency having to use payday lenders: Halton has the third highest concentration of payday lenders in the UK. Loan sharks have also been a plague in my constituency, preying on poor and vulnerable people on a regular basis.

The story is also one of still high unemployment in Halton, which has one of the highest levels of long-term youth unemployment in England. My surgery is visited regularly by individual claimants and by the families and parents of individual young people who are desperate for help to find their youngsters some work because they cannot get a job. That is why I support our compulsory jobs guarantee, paid for by a tax on bank bonuses.

Under this Government, despite what the hon. Member for Fareham (Mr Hoban) has said, many of the jobs that have become available are part time and low paid, and many are on zero-hours contracts. One of the things that people want is continuity of employment, but one of the big problems under this Government is that people cannot rely on having a job for a very long time, so they cannot plan their income or expenditure properly or save up to buy a house or do things that most families do. It is just not possible with the type of employment available today.

I have been particularly vocal in this House about support for small and medium-sized enterprises, which I believe are the lifeblood of our future economic growth. Many are still finding it a struggle to get money from the banks, but the Government have not done a lot about it. I support my party’s proposal to cut business rates for small firms.

The Chancellor mentioned support for the energy-intensive manufacturing industry. To date, this has been a major failure. I have been lobbied rigorously by companies in my constituency about the Government’s failure, and I have also lobbied the Government regularly. I will look at the detail of what the Government have announced today, but the fact is that until today they have failed this industry. The chemical industry is a particularly important one in my constituency, providing many people with well-paid jobs. The Government need to do more.

The Chancellor referred to housing. Of course we all want people to be able to afford to buy a house if they want to or to have access to social housing, but the recovery is relying heavily on housing—there is a housing boom—and on lending. That is a real concern, which was mentioned today by the Governor of the Bank of England in, I think, the Financial Times. The issue is that the boom cannot be unsustainable, so we have to be very careful. I am really concerned about the unsustainability of the recovery. We can and should of course help more people to get on the housing ladder, but a housing boom will make that even more difficult, particularly for young first-time buyers.

What are the Government doing about social housing? Many constituents come to see me because they need access to social housing, but there is a real shortage. The Government do not have any real proposals to get people social housing, which is what people in my constituency want. That important matter was omitted from the Budget .

The Chancellor’s policy of cuts is destroying local government. In Halton, total revenue grant funding has been cut by £28 million, or 28%, since 2010, and its capital grant funding has been cut by £14 million. Local government is suffering badly, and that is affecting services for local people.

The Chancellor commented on the Mersey gateway, a project which started under Labour and which has received all-party support. Some colleagues and I have had a meeting with him on a cross-party basis, but he did not say what he would do to ensure that people who live in Halton—they currently do not have to pay to use their local road across the existing bridge, the A533—will not have to pay a toll in future. The plan is for them to pay a toll on the existing bridge and the new one. The Chancellor has said that he will look at that and see what he can do, but I have not heard back from him, even though he referred to the Mersey gateway today. Given that he announced that the A14 in affluent Cambridgeshire will not be tolled, it is wrong for people who currently use their local road for free in Halton—the 27th most deprived borough in the country—to have to pay for it in future. I do not know of any other such example in this country.

The Chancellor said little about the NHS, but there has of course been a real-terms cut. What about the number of hospital trusts that are running a deficit? Even my own has a £2.9 million deficit. He said nothing about that, although the NHS is in crisis and £3 billion has been wasted on a reorganisation.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

In view of the income given to earners on higher tax rates, does my hon. Friend not think it is absolutely shocking that nurses have been devastated by the fact that many will not receive the 1% pay rise?

[Derek Twigg]

My hon. Friend makes a very important point. Whose side are this Government on? They are on the side of the rich, not the people who actually run our health service—the nurses, care workers and so on—