There have been 13 exchanges between Elizabeth Truss and Peter Dowd
|1||Tue 26th March 2019||
Section 5 of the European Communities (Amendment) Act 1993
|12 interactions (2,381 words)|
|2||Tue 18th December 2018||
ONS Decisions: Student Loans
|3 interactions (683 words)|
|3||Thu 1st November 2018||
Ministry of Housing, Communities and Local Government
|2 interactions (765 words)|
|4||Tue 11th September 2018||
Oral Answers to Questions
|5 interactions (370 words)|
|5||Tue 24th July 2018||
Public Sector Pay
|4 interactions (918 words)|
|6||Tue 3rd July 2018||
Treasury Spending: Grants to Devolved Institutions
|6 interactions (1,867 words)|
|7||Tue 3rd July 2018||
Oral Answers to Questions
|5 interactions (246 words)|
|8||Mon 30th April 2018||
Economic and Fiscal Outlook
|2 interactions (498 words)|
|9||Thu 22nd March 2018||
|10 interactions (1,757 words)|
|10||Tue 27th February 2018||
Oral Answers to Questions
|2 interactions (127 words)|
|11||Mon 18th December 2017||
Finance (No. 2) Bill
|3 interactions (229 words)|
|12||Tue 28th November 2017||
Department for Business, Energy and Industrial Strategy
|2 interactions (1,569 words)|
|13||Wed 13th September 2017||
Department of Health and Social Care
|2 interactions (1,388 words)|
The right hon. Lady referred to the gnashing of teeth. The only gnashing of teeth going on in this country is by those people who cannot get access to a dentist because of her party’s health policy. She talked about the Tories being the party of business. She may well wish to have a word with the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), who used an Anglo-Saxon phrase in relation to business—the second word was “off”, basically.
If education is so wonderful and marvellous and schools are in such a good state, how come headteachers marched on Downing Street and presented the largest petition about the condition of schools and education? The answer from the right hon. Lady is always more deregulation.
That is what the right hon. Lady said in relation to planning law. It is deregulation—that is what it comes down to. However she wants to dress it up, it is deregulation. Deregulation has got this country into so much trouble in a whole range of areas, including banking and housing. Let us not hear any more about how deregulation is going to solve all the problems of the world. It will not.
After that, I would like to thank the Chief Secretary to the Treasury, and give credit where credit is due. In a speech given on 19 March, the Chief Secretary finally acknowledged that we will now
“throw off the constraints of the post-financial crash world”.
There it is: it is official. It was a financial crash world, not Labour’s crash. But better late than never—apology accepted.
We find ourselves in the absurd and surreal position of debating a motion to approve the Government’s programme of convergence with the EU at a time when the issue of Britain’s membership of the EU is about to bring down yet another Conservative Prime Minister, so the only convergence on the cards is the one between the Prime Minister and her P45. The theological obsession of the European Research Group, which is opposed to any convergence with reality in fact, has hamstrung the Brexit negotiations and left the majority over there—on the Government Benches—as spectators in an unfolding disaster of their own making.
Reflecting on the first time I spoke in the debate on the Government’s convergence programme with the EU, I recall it was just before the snap election in spring 2017. I am sure we all remember that. At the time, prominent newspapers ran headlines such as “Blue Murder” in the sure and certain belief that the Conservatives would wipe out the Labour party, or “Steel of the New Iron Lady”, comparing the Prime Minister to Margaret Thatcher.
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The hon. Gentleman says that they are still in government, but that is a complete and utter fantasy, and even his honourable colleagues all smiled and smirked at that particular one.
Those supine, oleaginous headlines in the newspapers are gone, along with the words that dare not speak their name, “Strong and stable”. Whatever happened to that? Just two years later, those same newspapers now call for the Prime Minister to resign, stating, “Time’s up, Theresa”. This sea change among the Tories’ biggest supporters in the press sums up the failures of this Government.
While we are on the maritime theme, the Environment Secretary could not even use the limited imagination he has to think up another metaphor, and resorted to the hackneyed one:
“It’s not time to change the captain of the ship”.
What an imagination!
The Prime Minister’s red lines and her intransigence and insistence on a deal that has little or no support in the country or in this House have led us to this crisis. This weekend, we had the ludicrous spectacle—the ludicrous spectacle—of Cabinet Ministers jostling to brief the press about her imminent departure and her would-be likely successor, only to be followed by quick recants and unconvincing oaths of loyalty. It is almost Shakespearian.
The Government’s motion is based on the economic forecast provided by the Office for Budget Responsibility and the Chancellor’s spring statement—what there was of it, I have to say. I am sure all Members would agree that the work of Robert Chote and his staff at the OBR is indispensable in informing debate and offering an independent forecast of UK economy. [Interruption.] If the hon. Member for Solihull (Julian Knight) wants to intervene, he should feel free to do so, but perhaps he could stop muttering across the Chamber inane comments that nobody can hear and nobody understands, and I suspect he himself does not even understand what he is actually saying.
However, it is worrying that the OBR’s recent forecast continues to be based on the UK securing a Brexit deal, which the Chief Secretary did not even mention, and a smooth transition, which she did not mention, particularly at a time when the Prime Minister continues to keep the option of a no deal on the table. It is still there; it has not been taken off. This assumption means that if the UK does leave without a deal or leaves with a poor deal, the OBR’s forecasts will be in serious need of revision.
Similarly, at the spring statement the Chancellor spoke again of this mythical Brexit “deal dividend” that the economy will receive once parliamentarians sign up to the Prime Minister’s deal. According to the Chancellor’s imagination—which is, I have to say, significantly more febrile than the Environment Secretary’s—this “deal dividend” will lead to an increase in the public coffers. However, the Chancellor’s claims have already been debunked by the Treasury Committee, which described the dividend as “not credible”, and “not fully consistent” with his own fiscal rules—yes, the rules that keep changing.
Rather than the fantastical picture that the Chief Secretary to the Treasury seeks to paint for our EU partners, I will take the opportunity to outline the real state of the UK economy and the Government’s woeful record. That is where we hear the gnashing of teeth—woeful record. Under the Conservatives, we have faced nine years of politically instituted austerity, which has weakened our economy and pushed our public services to breaking point. The Government’s austerity programme has suppressed incomes by more than £3,600 per household, costing the economy £100 billion; yet austerity is far from over. The departmental spending review that the Chief Secretary mentioned—likely to report in the autumn, as she said—will see real-terms cuts for most Government Departments. I will sit down if the right hon. Lady would like to give us some more information on that one.
I do not think that is correct. I am afraid we will have to look at those figures. We will see them and we will hold the Chief Secretary to account when she is at this Dispatch Box and I am at the Dispatch Box where she is now.
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Try telling that to the 3 million people in insecure work. It is okay hon. Members jumping up and being outraged at the facts. The facts are stubborn, I completely grant them that. We are not living in the halcyon world that the hon. Member thinks we are living in. There are 3 million people living in insecure work. That is not acceptable in a modern society. The right hon. Lady the Chief Secretary has done nothing to help headteachers who having to close schools early or the 87 people a day dying while they are waiting for social care, or to assist the nurses, doctors, police officers, social workers, road sweepers, fire fighters, security services staff, civil servants or the back-office staff who keep all those services running day in, day out and night in, night out. Those are the so-called vested interests the Chief Secretary refers to in her regular speeches.
The Chief Secretary recently visited Felixstowe, Walsall and Tadcaster—commiserations to the people of Felixstowe, Walsall and Tadcaster. She said that people want
“the local roads fixed and not to have to sit in a traffic jam.”
Well, the Government are in a big jam at the moment. She went on:
“They want a less crowded commute into work. They want the basics sorted.”
This is after nine years of Tory Government! Where has she been? Did she really have to ask that question? A report today highlights that there are 2 million potholes out there with a £10 billion backlog of repairs under the Tories. No wonder people are sitting in traffic jams—they can’t get through the road for potholes. That is the reality under the Tories. Anyone with a scintilla of awareness already knows the answer to that. The good people of north Lincolnshire were certainly aware of it when I was in Crowle on Saturday, campaigning to rid them of their useless Tory council with the excellent Labour candidates. They want the Transport Secretary to do his job, and they want the Chief Secretary to do hers.
What about productivity—another abysmal failure of Tory economic policy? Productivity remains weaker than in most other advanced economies. The fact is that the Government have failed to prepare the UK economy for the future. Britain’s infrastructure ranks behind that of Germany, France, the USA and Japan in terms of quality, and its rate of public investment is among the lowest in the OECD.
Yes—to invest in public transport. We now have the Chief Secretary to the Treasury resorting to decisions made by a Labour Government two decades ago. That is how grim it has got for the Conservatives’ arguments—they are talking about something that happened 20 years ago.
Despite that, the Government have cut planned public sector investment. Their failure to negotiate a credible Brexit deal has already led to huge uncertainty, stifling investment and putting jobs at risk. Manufacturing is in recession, numerous employers have announced job losses, and businesses that rely on the EU supply chain have been left in confusion and despair—like most Government Members, who are in confusion and despair at the actions of the Prime Minister.
The internecine warfare within the Conservative party has paralysed the Government yet again, while the economy and many people’s livelihoods hang in the balance. It is affecting people’s livelihoods, manufacturing and business—more vested interests to be ridiculed and ignored by the Chief Secretary to the Treasury. All that while the Government are reporting to our EU partners that everything in the garden is rosy—no pun intended, Madam Deputy Speaker. Surely it is time for the Chief Secretary to acknowledge that the only Brexit that will gain majority support is Labour’s alternative plan: a permanent customs union, a strong relationship with the single market and full guarantees of workers’ rights and environmental protections.
The Government’s assessment of the UK economy is not based in reality. It does not account for the Conservatives’ catastrophic record of austerity, which continues to destroy our public services and suffocate the economy. It pays no regard to the Tory failure on wages, which remain lower than they were a decade ago. In addition to radio silence on productivity, there is little mention of the lack of public investment in our infrastructure. In short, the Government’s assessment says far more about the ideological position of Tory Ministers and their insolvent ideas than it does about the actual economy. It says more about the hubris of a Government who have stayed in office well past their sell-by date and do not recognise the experiences of ordinary people.
In summary, economic growth stands at 1.2%; productivity is 35% below the Germans’; household debt as a proportion of income is set to rise from 139% to 143% by 2024; the national debt still stands at 82% of GDP—the Conservatives have doubled the national debt —and the deficit is £22.8 billion. That is the Conservative Government’s record after nine years of economic incompetence. That epitomises why the country needs a Labour Government that will put jobs and our economy first, and invest to rebuild Britain for the many, not the few. I urge Members to reject the motion.
This is not creative accountancy; this is fantasy accounting from the Government. The shadow Chief Secretary talks about Labour’s policy—[Hon. Members: “You’re the shadow Chief Secretary.”] Well, that is not very far away. The Chief Secretary can try to make up Labour’s policies on the hoof. She might make her own up on the hoof, but she should not make up ours on the hoof.
The ONS announcement ends the fiscal illusion that kept student debt off the Government’s books. This is not technical, and it blows a potential £12 billion hole in the Chancellor’s spending plans. At the last Budget, the Institute for Fiscal Studies warned the Chancellor that he was gambling with the public finances, and it seems that he has lost the bet: a reckless Chancellor bluffing his way through Budgets in a desperate attempt to keep his party together while the country is led to ruin and uncertainty.
This change raises a number of serious questions that the Minister must now answer, and has not answered. First, what impact will the additional £12 billion have on the Treasury’s ability to meet the fiscal targets that the Government set out most recently? Or will it mean that the Government have to abandon their fiscal rules yet again, for the umpteenth time? Secondly, will the Chief Secretary guarantee—she has not yet—that students and universities will not be adversely affected by this change? Thirdly, can the Government guarantee that no cap on student numbers will be introduced?
Finally, does this not pose a major challenge to the entire system of student finance which the Government have not only maintained but exacerbated with a trebling of fees—a system that creates a mountain of debt, placed first on the backs of students and now on the Government’s books when students are unable to pay? Would it not be better to adopt Labour’s policy of free university education, as set out in our manifesto—a very popular manifesto—and grey book, which invests in the future of our country by investing in the future of our young people, rather than giving billions of pounds of tax cuts to large corporations?
(1 year, 10 months ago)Commons Chamber
No, I will not.
There is nothing in the Budget for teachers, police officers and local government workers. There is not a penny for most frontline services, while local council funding is being cut by £1.3 billion next year alone. The Government have broken all their economic targets. They keep setting their own work, but they are marked an F grade every single time. Economic growth has been sluggish and is set to stay below 1.6% for the next five years. Productivity remains 15% lower than in other developed economies and the Government are doing nothing about it. Regional economic disparity is vast. Public sector investment is more than £18 billion lower than in 2010—[Interruption.] The hon. Member for Aldershot talked about Marxism and brutal regimes. This is a man who has been to Saudi Arabia many times. That is the sort of brutal regime that he should be worrying about. It is an absolute disgrace.
Public sector investment is more than £18 billion lower than it was in 2010. That is not talking down the economy; that is talking up the truth. If austerity is over, why then is the Chancellor pressing ahead with a further £7 billion of social security cuts? The Health Foundation says that the money for the NHS is not enough. There is, of course, no mention of the £12 billion of outstanding loans and deficits that the NHS has had to use to get by.
On social care, the £650 million announced is less than half what the King’s Fund estimates is needed. Our children’s services are in meltdown. The additional money announced for universal credit is only half what was cut in 2015, and the list goes on and on. There is, of course, no shortage of gimmicks in the Budget. The introduction of a digital services tax is, I am told, already sending the tech companies into a frenzy. My right hon. Friend the Member for Barking (Dame Margaret Hodge) says that it is media management.
In the labour market, one in nine workers across the country is in insecure work. Many are relying on credit cards to survive. As my hon. Friend the Member for Bradford South (Judith Cummins) reminded us earlier this week, since 2008 only one in 40 net jobs created has been full time. There was no mention of that particular fly in the ointment by the Chancellor. Eight years of austerity have ripped through our society and our communities, driving in-work poverty and inequality, and further entrenching the economic crisis caused by greed and avarice. Therefore, in that context, we will not stand in the way of more income for low and middle earners; they deserve some respite from the Government. That is unlike the Liberal Democrats, who evidently will be voting against their own flagship tax policy set out in their manifesto.
The Opposition’s amendment to resolution 1 sets out our progressive taxation policy, which we laid out in our manifesto in 2017, of increasing taxes for the top 5% to help pay for improvements in public services, which we all need and which many people across the country need. This amendment highlights our tax reforms, which would shift the emphasis on to the wealthy few, while guaranteeing no further increases of tax on anyone earning less than £80,000. Labour will challenge the Government every step of the way to introduce a more progressive taxation system despite their rigging of Parliament. This is yet another broken-promise Budget that does nothing to end the slowest recovery since the great depression.
Austerity has damaged our economy, weakened our recovery and divided our society. It has made poor people poorer, made them angry, made them fearful, and made them distrustful of the politicians on the Government Benches who they feel do not stand up for them against powerful lobbies. Austerity has made the richest richer; that cannot be right and that cannot be just. It is not in the national interest. Government Members have made a point of claiming that they are not ideological, that they are pragmatists. Let them prove their pragmatism and their open-mindedness. If they are so confident of their policies, so sure of their convictions, then quite simply let them support our amendment. What do they have to fear?
Is the Chief Secretary aware in the discussions the Health Secretary may have had on NHS funding whether he mentioned his unilateral plan to ditch the 2013 pensions deal agreed with representative bodies, which was supposed to last for 25 years, and which may affect 1 million NHS staff?
Clearly, the Chief Secretary to the Treasury does not even know what she has put out in her name. The pension changes snuck out on Thursday evening could negatively affect the pensions of a further 4 million public sector workers—[Interruption.] No, that is not the case. So I ask on behalf of those dedicated public sector workers—nurses, doctors, social workers, teachers, support staff and refuse collectors—will the Chancellor withdraw these snidey proposals and honour his predecessor’s deal? Is that too much to ask? Or will millions of staff in the public sector be let down and betrayed yet again by this Government?
(Urgent Question): To ask the Chief Secretary to the Treasury if she will make a statement on the public sector pay announcement.
These uninhabited proposals will do nothing to repair the damage done to our brilliant public sector workers by this Government’s slash-and-burn policy in relation to public sector pay. Over the past seven years, our teachers have lost £2,500, our firefighters £3,000, our prison officers £4,000 and our paramedics £4,000 in real-terms pay cuts. Even the armed forces have been affected by this stingy Government.
Yet the Government think it is enough to announce to the press—to the press, Mr Speaker, yet again—an uncosted proposal that will, at best, leave workers just about breaking even on their austerity-slashed pay, while civil servants and others continue to see their pay cut. This is a mendacious PR exercise. Based on today’s announcement, after eight years of real-terms pay cuts for employees in the public sector, our police officers, junior doctors, some specialist doctors, GPs and dentists are all being offered a further real-terms pay cut.
Will the Minister now confirm what the additional cost of each announcement is to Departments? Will she also confirm that this cost is being siphoned from existing departmental spend, with no new money made available? This will have a disastrous effect on Departments already close to ruin from austerity; they will be forced to cut staffing levels and services to cope. Can she guarantee that there will be no reductions in staffing levels across the public sector because of this unfunded increase in pay? Can she guarantee that public services will not be adversely affected by her failure to provide proper funding? Will she explain why civil servants continue to see real-terms pay cuts? They are always at the back of the queue when it comes to pay. How much additional social security expenditure has resulted from seven years of cuts to public sector workers’ pay? Does she agree that it has been this Conservative Government’s policy for the past seven years to force thousands of public servants on to social security by cutting their income?
The Conservative party should be ashamed. The Government’s announcements today leave public sector workers treading water. These proposals will force threadbare Departments to make further cuts to vital services and to reduce staffing levels, and what for? All so that the Prime Minister can get a cheap PR hit to try to cling on to power. We do not buy it. Labour demands that public sector workers get the pay that they deserve.
I am not quite sure whether I need a wee dram after that speech by the hon. Member for Glasgow North (Patrick Grady). We have moved from the turgid to the ranting in one fell swoop, and it got the point where I was looking forward to the Chief Secretary’s speech, which takes something.
I will not regurgitate what has been said, because I could not make head nor tail of it, quite frankly, and I do not suspect the Members who made those speeches could, either. These debates come on the eighth anniversary of the Conservatives’ first austerity Budget, and we are still seeing the effects of that pernicious and ill-informed policy in these estimates.
Back in 2010, the then Chancellor outlined a package of cuts worth £81 billion, to be rolled out gradually, with many still to take effect during this Parliament. There has been an absolute decimation of the public realm, and the vast contraction in spending has had devastating social consequences. A cash-starved NHS is at crisis point; social care has been forgotten and ignored; there has been the longest fall in living standards since records began; and the Office for Budget Responsibility is saying that wages will stagnate for another two decades. Meanwhile, swingeing cuts to the regions have left the UK more unequal.
Today, the Local Government Association published a report showing that local authorities will have had £16 billion cut from their core funding by the end of the decade, leading to a £7.8 billion funding gap by 2025. When Conservative Members call for special consideration, I remind them that they all supported those decisions, with no dissent, year in, year out. With no codicils and no caveats, they supported every one of those spending cuts. They are now complaining and saying that they need their communities back up and running. Quite simply, they voted for these cuts in their own areas, and they should have the guts and the backbone to admit it.
Those cuts helped to create a sense of hopelessness and destitution in many places across the UK, one which no doubt contributed to the Brexit vote a few years after Mr Osborne’s slash-and-burn Budget. It is very strange that, after pursuing this unpopular and ineffective programme, cutting Department after Department, the Prime Minister managed to find enough cash to buy the support of the Democratic Unionist party. It is regrettable that DUP Members are not here today, but the fact is that the DUP should not have had to ask in the first place.
Yes, ironically, the Prime Minister sprouted the magic money tree in the rose garden of No. 10 on the very spot where the giggling David and Nick shook hands on the austerity deal. Indeed, £410 million of that deal is included in these estimates, with some £590 million left to be allocated. Perhaps the Chief Secretary could tell the House when the remaining millions promised to the DUP will be put before Parliament.
We have no issue with the funding of Northern Ireland. After all, following eight years of austerity, 370,000 people there are now living in poverty. What we object to is the Government telling the public during an election campaign that there is no fiscal headroom for investment, before immediately finding a £1 billion windfall to keep themselves in power. Unfortunately, the other devolved nations have not been privy to similar arrangements, as they could not afford to offer the Prime Minister continued tenure in office in return.
Looking north of the English border, the Scotland Office sees a significant reduction in its departmental budget. I also note that some spending has been allocated for city deals in Edinburgh, Inverness and Aberdeen. Alongside that funding, perhaps the Chief Secretary can tell us how much money the UK Government will invest in the new or recently signed city deals in Scotland, such as the Stirling and Clackmannanshire deal. Will she give us more details on the Glasgow and Clyde Valley city deal by updating us, for example, on whether there will be any additional Government funding for that deal, particularly for infrastructure projects?
Turning to Wales, the cash grant proposed for the devolved Welsh Government is 2% lower than the amount they received last year and comes at a time of unprecedented austerity for Wales. The Welsh Labour Government’s budget will be 7% lower in real terms by the end of the decade than it was in 2010-11 as a result of the UK Government’s cuts. That means there is £1.2 billion less to spend on public services. As with Scotland, this is the first financial year the Welsh Government have been given greater control over taxation. The Wales Act 2017 and the Welsh fiscal framework devolved stamp duty and landfill tax to the Welsh Government. Responding to that, the Government have reduced the block grant by £269 million to reflect changes to the amount of tax revenue the Welsh Government now collect directly.
Although the devolution of Welsh taxes is welcome, Labour is the real party of devolution and wants to ensure that the Welsh Government have a greater level of fiscal autonomy and financial self-determination. However, this also puts Wales in a vulnerable position. Welsh taxes will need to grow as fast as those in the rest of England to keep up with cuts to the block-grant. In the case of stamp duty, which has been replaced by a land transaction tax, Wales has received no agreement from the Government to protect any fall in revenue. That is particularly concerning given the deep-rooted differences in UK property market conditions, especially after Brexit, which risk leaving the Welsh Government exposed to risks that are outside their control. In addition, Wales’s slower population growth may lead to slower revenue growth than in the other nations of the UK.
The Opposition are also concerned by the method that has been agreed upon to determine how the Welsh block grant is cut. The comparable model means that Wales will lose out even if revenues per head grow at the same rate as everywhere else in the UK. When offered the same method, the Scottish Government rejected it outright, and the Welsh Government agreed to it only after the Treasury agreed to a Welsh needs-based factor being included in the Barnett formula.
So although the Government’s recognition of the Welsh population’s higher needs is a welcome step, the uprating of Barnett consequentials to reflect the high need must also be closely monitored. The transitional uprating of 5% and the agreed funding floor of 15% should not be considered a fait accompli by the Treasury. Instead, both rates should be regularly reviewed by this House and the Welsh Assembly, and, where necessary, uprated.
The day-to-day spending budget for the Welsh Government is yet another casualty in the Government’s continued austerity programme. The Welsh Government this year will see a 3.3% reduction in both their capital and resource budget compared with last year’s final budget. The reality is that the Treasury is pulling the rug from under the Welsh Government by demanding that they do more with less. It is the same old story that we have seen played out time and again, for example, in relation to local government in the UK. Ministers have cynically devolved taxation as a means to also devolve their austerity agenda. That is another case of the Tories not having the courage of their convictions; it is all a charade and an illusion. Financial settlements are dressed up, but in the end Scotland, Northern Ireland and Wales will inevitably find that they have less. Those nations deserve better from the Government; they deserve a better deal, one that is fair. With these estimates, they are not getting that deal and, to use the words of the Chief Secretary, “That’s a disgrace”.
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Will the Chief Secretary join me in congratulating the hon. Member for Stirling (Stephen Kerr) on actually getting an answer out of this Government?
Eight failed years of austerity have meant poor levels of funding for local government. In fact, today the Local Government Association reports that, by 2020, councils will have had £16 billion of funding cuts. With low pay, woeful productivity, tenuous job security, stubborn inflation, rising national debt, a huge deficit, a sinking pound, creaking public services, decaying infrastructure and chaotic railways, what other wheezes does the Chief Secretary have up her sleeve to wreck the economy further?
Yes, that told me. It gets worse, if that were possible. This year, business investment growth is slowing, annual export growth is slowing, service sector growth is slowing and economic growth is slowing. With Brexit looming and punch-ups in the Cabinet, should the nation’s economic future really rest in the hands of a go-slow Government?
Meanwhile, back on planet Earth, a prerequisite of the UK’s participation in the EU has been regular submissions of the Government’s assessment of the UK’s medium-term economic and budgetary position. I think the Chief Secretary to the Treasury will appreciate that one of the advantages of leaving the EU—for once, everyone on the Conservative Benches will agree—is the humiliation, wincing and cringing that the Government will forgo when they no longer need to submit their economic record to the scrutiny of European colleagues. The Government are rudderless, collapsing in on the weight of their own contradictions and economic ineptitude.
Let us turn to the record. While countries in the eurozone post a 10-year high in terms of economic growth, the UK under the Tories is left behind. Let us look at the seven deadly sins of the Tories. No. 1 is self-delusion, which we had in spadeloads from the right hon. Lady. Last year, growth in our economy was the lowest in the G7, and growth in the first quarter was the weakest since 2012. The Office for Budget Responsibility has now revised forecast growth down in both 2021 and 2022 since the Government’s autumn Budget, and growth is lower in every year of the forecast compared with March 2017. The upbeat tone of the Chancellor at the spring statement betrays the economic reality that many have experienced over the last eight years of Conservative mismanagement, and while the Chancellor may want to blame recent poor growth on a bit of bad weather, those of us living in the real world see an economy desperate for investment.
The second sin is sloth. The Government have provided the slowest recovery since the 1920s, and productivity growth is at its worst for two centuries. On productivity, the Government’s record is one of failure. Productivity forecasts have been revised down this year and for every year of the forecast. While the Treasury celebrates a slight uptick in the productivity figures referred to by the right hon. Lady with a “thumbs up” emoji and manic optimism, the underlying figures show a fall in production and a fall in the hours worked.
I do not know how the Chief Secretary managed to keep a straight face throughout that speech, and I am confused, too: listening to her, I thought I was in some sort of utopian democracy, but I am afraid it is completely not like that. It is a little over a week since the Chancellor stood up in the Chamber and delivered the first spring statement, proclaiming that there was light at the end of the tunnel, yet at the same time the Government have presided over the slowest recovery since the 1920s. The Chief Secretary did not mention that, so it is no surprise that for many people across this country her words rang hollow and untrue. The Tigger-like demeanour of the Chancellor and the back-slapping and self-congratulatory tone of his Cabinet colleagues, rather than reassuring an increasingly fearful public, reek of a complacency that betrays the poor state of the public finances and the challenges our economy faces.
The Chief Secretary referred to facts so let us have a few, because the facts do speak for themselves. Last year growth in the UK economy was the lowest in the G7 and the slowest since 2012. Inflation is the highest in the G7. Despite the marginal upward revisions last week, the Office for Budget Responsibility has revised forecast growth down in both 2021 and 2022, and growth is lower in every year of the forecast compared with March 2017. Those are a few facts I thought I would chuck in.
Meanwhile the economy, according to the Institute for Fiscal Studies, will now be 3% smaller in 2020-21 than was forecast just two years ago. Another fact: real wages have fallen every month in the last year and are lower today than they were in 2010. The OBR has said that it expects wages to remain subdued—an understatement if ever there was one—over the next five years, and the Resolution Foundation has gone further, arguing that the last decade has been the weakest for average earnings in two centuries after adjusting for inflation. So that is a strong economy, is it? It does not look very strong from where I and millions of other people sit.
Meanwhile, personal debt, which has risen to worryingly high levels, and stronger world growth are helping to keep the show on the road, masking just how useless the Government’s economic policy is. The reality is that the Government’s bluster and bravado are fooling no one, particularly at a time when their failed economic policies continue to harm the UK economy and not just the most vulnerable in society, but millions of people who are in work.
Whatever positive spin the Chancellor and the Chief Secretary want to put on it, this Conservative Government have missed every deficit target they have ever set. [Interruption.] It would be a lot better than under this Government; they have not really invested, and the investments they have made are pretty poor. Public sector borrowing is still higher than forecast a year ago, and public sector debt is over £700 billion higher than when the Conservatives came to power. This is hardly a record of economic competence, but is instead reflective of just how out of touch Ministers are. And may I remind the Chief Secretary that they supported all Labour’s financial spending plans in 2007-08?
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We lost our triple A rating under the hon. Gentleman’s Government, so I do not think he has any room to point the finger at anyone.
While stressed-out doctors and teachers go to work every day, the Government duck responsibility and parliamentary scrutiny at every opportunity. The Chief Secretary to the Treasury might call these hard-working people “blobs”, but every day they run our health service and educate our children. Rather than spending her time attacking workers and the professional classes, the blob snob Chief Secretary should instead focus her attention on lifting the public sector pay right across the board and stepping up and taking action on our schools.
I will tell the right hon. Lady what those professionals have: they have a vested interest in the health of our people, and in the health and education of our children. They have a vested interest in those people, unlike those on her side of the House.
Break in Debate
Of course, and I am glad that the Chief Secretary mentioned the port of Liverpool, which is actually in my constituency. She should have popped in for a cup of tea.
I know; I was busy here. The hon. Member for Ochil and South Perthshire (Luke Graham) makes a point about exports, but we have seen the biggest devaluation in the pound for as long as anyone can remember, and I suspect that that has had something to do with it. It is hardly down to the policies of the Government; it is an unexpected consequence.
Let us move on to something released today. Her Majesty’s Inspectorate of Constabulary and Fire and Rescue Services yet again reports huge pressures on police forces, with emergency services responding not in seconds, minutes or even hours, but days. The “golden hour” is being stretched to up to a week—there is an achievement by this Government from a strong economy! It comes in the wake of the UK Statistics Authority having to correct the Prime Minister’s imaginative—not a word that we often use in association with the Prime Minister—use of police funding figures. I cannot see much cause to celebrate the current state of the economy after eight years of Tory austerity.
Britain continues to have astonishingly low levels of productivity compared with other G7 countries, which is a direct result of this Government’s failure to invest productively and proactively in the economy. Bizarrely, however, the Chief Secretary wants to celebrate—she did it again today—the poorly paid, precarious labour market that has fostered unproductive business models, which rely on exploitation instead of innovation and investment. For example, much of her Policy Exchange speech was spent singing the praises of Uber, as she did again today, but Uber’s labour practices and poor track record on safety have made it the subject of an investigation by Transport for London. She sits in awe of some large corporations that use every opportunity to dodge their taxes. Yesterday, we heard about Facebook misusing people’s personal data for profit. Is that the sort of country we want to live in? Of course it is not. Is that the sort of company that the Chief Secretary thinks is marvellous, wonderful and a model?
The Labour party embraces the opportunities of a fourth industrial revolution that empowers working people to take control of their own lives, yet the Conservative party wants to return to the practices of the first industrial revolution, when the world was dominated by the interests of the few. It is strange that the Chief Secretary talks about freedoms while advocating a society in which the broad mass of citizens are denied basic rights. For example, how has the slashing of public services, while tax breaks are being handed to big corporations, made us freer? It has only trapped people in poverty and poor health.
The Chief Secretary gave a speech last year calling for better value for money from the public finances and not spending money we do not have, and she has talked about not wasting money today, so how can she justify spending hundreds of millions of pounds on further tax giveaways worth £2,000 per child to the wealthiest families—those, for example, using private schools—via the tax-free childcare scheme? Is that not a waste of money and spending money we do not have?
First, we did not regulate the banks in the United States, where it all started. I ask the hon. Gentleman—I have said this a number of times—to go and look at “Freeing Britain to Compete,” the document produced by the right hon. Member for Wokingham (John Redwood) for the shadow Cabinet in, surprisingly, August 2007.
“They were not the Government” is shouted across the Dispatch Box, but that brings me to the point I am making. The bottom line is that chapter 6 of “Freeing Britain to Compete” called for significantly less regulation of the banks. As I have said before, the right hon. Member for Wokingham effectively said in that document that the Labour Government at the time believed that, if we did not regulate the banks, they would steal all our money. Many people out there believe that that is, in effect, what happened. The taxpayer had to bail out the banks. Why did the taxpayer have to bail them out? Because of the lack of regulation. The shadow Cabinet at the time ratified a policy of less regulation. If we had followed the right hon. Gentleman’s exhortations, as ratified by the shadow Cabinet, we would be in an even worse state. I ask the hon. Member for Brentwood and Ongar (Alex Burghart) to go and have a look at that one.
(2 years, 9 months ago)Commons Chamber
As the Chancellor gave his Budget speech last week, there was a collective groan across the country not just at the bad jokes, but at the content of the most uneventful Budget speech of recent times. There was no game-changing investment announcement and no lasting solutions for the growing difficulties facing our country. The Chancellor’s speech personified this Government: out of touch, inconsistent and directionless.
The Cabinet is morbidly and irrevocably split on Brexit and, rather than focusing on their individual briefs, Ministers now spend their days attempting to steal each others’. The International Trade Secretary wants to run Britain’s foreign policy. The Environment Secretary is learning all about hypothecation, apparently fancying himself as Chancellor, and The Times reported that he is busy researching the difference between a J curve and a J-cloth. Meanwhile, the Foreign Secretary continues to scheme for the top job. He is the first to praise the Prime Minister, while constantly plotting to undermine her—Iago on steroids. Ironically, the only person who does not want to be in No. 10 is its current occupant. She remains, as in the Monty Python parrot sketch, nailed to the perch and “off the twig”. The Prime Minister’s metabolic processes are, politically speaking, history.
The most important announcements made last week were not the Chancellor’s recycled policies, but those from the Office for Budget Responsibility. The OBR lowered UK growth forecasts, business investment, productivity rates and wage growth for the next five years, blowing a hole in the Government’s economic credibility. As for balancing the books, under the Government’s current projection, the UK budget will not be in surplus until 2030 at the earliest—a full 15 years after the former Chancellor said that the deficit would be eradicated. Workers who have already endured a decade of stagnant wages and lost earnings will not see their pay return to pre-crisis levels until 2025. And there is more. UK households face the biggest squeeze in disposable income since records began. The message from the OBR is clear: Britain under the Tories is now facing a record 17-year downturn in pay.
The Budget did nothing to eradicate the impact of austerity on women, who have disproportionately borne the brunt of it. The abolition of stamp duty for first-time buyers is of course welcome, but the OBR rightly points out that the move will increase house prices. Many Government Back-Benchers called for action to help the next generation, but the best the Chancellor could muster was a millennial railcard that young people cannot even use to commute to work and that will not even cover the cost of the 3.6% rail fare increase next year.
On universal credit, the Government finally listened to Labour and scrapped the seven-day waiting time, but they have done nothing about the roll-out.
The Government once again ensured that the NHS and its staff will remain underfunded and underpaid, and the extra money announced in the Budget does not even meet NHS England’s call for extra funding. Far from being dead and buried, the public sector pay cap remains alive and well. Public sector pay is now set to fall to its lowest level by comparison with the private sector, and the Chancellor is trying to divide public sector workers.
As I have said so many times at this Dispatch Box, the UK’s economic growth wholly depends on our ability to raise productivity rates, and there was nothing of any substance whatsoever in the Budget to help that. The Government continue to fail in delivering the infrastructure and investment that the regions so desperately need. Like so many of this Government’s policies, their industrial strategy White Paper released yesterday is thin on details and thinner on ideas—another damp squib. It is about time that this Government went. They should pack their bags, get the Prime Minister out of No. 10 and hand things over to the Labour party to do the job properly and get growth back for this country.
I will come to that point in a minute.
In the election, Labour promised to end the public sector pay cap and to free the pay review bodies to do their work properly without the artificial encumbrance of a 1% cap. Meanwhile, the Tories have spent the period since the election putting the heads of public sector workers in a spin—will they or won’t they. Yesterday, No. 10 was briefing that the pay cap was over. The Chief Secretary to the Treasury was on the radio announcing derisory offers to police and prison staff, rather than coming to this House to explain what was going on. We had to have this debate today to get the Government here to explain their actions. Members on the Government Front Bench would do well to remember these words of wisdom:
“It is better that you should not vow than that you should vow and not pay.”
We will hold them to that. When the reality of this supposed U-turn emerged, there was nothing tangible. In the case of the police, it was just an unconsolidated 1% bonus on top of what they were due to get. Prison officers were offered just 1.7%. In effect, less than 4% of public sector workers were covered by the proposals announced yesterday. In the meantime, the other 96% can whistle. The nasty party simply cannot help itself. What is its tactic? It is the same old one, regurgitated time and again, of divide and rule. As ever, it tries to pit one group of workers against the other—the public sector against the private sector, doctor against manager, admin against manual workers, British workers against foreign workers, and the north against the south. Yes, it is the same old hackneyed tactic, but this time it has not worked. If the Government had focused on dealing with this matter and on sorting out the tax dodgers, we might not have been in this situation in the first place.
This is over. Even as the Government conceded the need for a thaw in the pay cap, Tory Front-Bench Members were briefing the media to raise the issue of wonderful contracts and pensions in the public sector. The Prime Minister attacked our public servants for having progression pay as they gain experience. The Government just could not accept that fairness required a change in direction. They still had to have that streak of resentment when they were announcing the policy change. As Anne Bronte said:
“There is always a ‘but’ in this imperfect world”.
With the Tories, it is always an industrial-sized ‘but’, visible from space.
The police and prison officers will have to pay for their pay rise themselves. There is no new money and no new resource. It is an announcement without substance. If and when the public sector pay cap is lifted across the rest of the public sector—namely the other 96% I referred to earlier and, in particular, the NHS—will the Minister be asking them to pay for their own pay rise by sacking more NHS staff? Will she provide new resources? Does she expect waiting times to get longer, and operations to be delayed or deferred? Who will be first on the sacking list—the porter, the radiographer, the medical secretary, the nurse, the doctor or an allied professional? Perhaps none of these redundancies will be needed because jobs in nursing, medicine and other allied health professions cannot be filled in large parts of the country.
This is a betrayal of public sector workers and it has to end. The Tories do have something in common with nurses and doctors, but for wholly different reasons. Nurses and doctors in the medical profession stitch people up for the benefit of the patient. The Tories stitch people up for their own benefit.