Management of the Economy and Ministerial Severance Payments

Gareth Bacon Excerpts

Tuesday 15th November 2022 Commons Chamber

[Lisa Nandy]

The hon. Member is absolutely right. Like many others, I was astonished to see the former Chancellor, the right hon. Member for Spelthorne (Kwasi Kwarteng), recently give an interview in which he said that the only thing that the Government had got wrong was not to explain themselves properly. That is absolutely disgraceful. We are giving Government Members the chance to set this right today and to show whose side they are on. Are they on the side of the people they put in office, who walked away with ministerial severance payments and profited from the crisis that they caused, or are they on the side of working people, who are currently paying the price?

[Gareth Bacon (Orpington) (Con)]

I would be grateful if the hon. Lady could advise the House on how many Labour Ministers refused their severance payments in 2010.

[Lisa Nandy]

I will throw the question straight back to the hon. Member: how many times did we see, in 44 days, the former Prime Minister and Chancellor essentially use the security of people in this country as an experiment? They treated us as lab rats for their ideology. They crashed the economy and left working people to pay the price.

[Gareth Bacon]

rose—

[Lisa Nandy]

If the hon. Member wants to be the first on the Government Benches to apologise, I will certainly give him the opportunity.

[Gareth Bacon]

I note that the hon. Lady did not answer my question; will she do so now?

[Lisa Nandy]

Honestly, a bit of humility from Government Members would be in order. The situation is unprecedented. They have been in office for 12 years. You put two people in office, or rather, they put two people in office, Mr Speaker—I would never for a moment suggest that you would do such a thing—who were fundamentally unsuitable for the role. They supported them, backed them to the hilt and stood up from the Government Benches and supported every move that they made. They cheered as the mini-Budget was announced and they still do not have the humility to apologise for the damage that they have inflicted on families up and down the country. The Chancellor may have U-turned, the new Prime Minister may have admitted that mistakes were made, and the Secretary of State for Levelling Up, Housing and Communities may have apologised for the error of his party’s ways, but apologies do not cut it. Government Members allowed this to happen. Without them, the right hon. Member for South West Norfolk (Elizabeth Truss) would not have become Prime Minister and the right hon. Member for Spelthorne would not have been Chancellor. Government Members let it happen; they cheered as the disastrous mini-Budget was commended to the House. They may be sorry now, although I am still waiting to hear it, but the damage has been done. Some 113,000 people were forced to re-mortgage between the mini-Budget and the present Chancellor’s belated U-turn.

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[Patricia Gibson]

Absolutely, and I am sure the hon. Member for Devizes (Danny Kruger) will be taking note and learning the lessons he needs to learn from that insight.

There is not expected to be a reduction in mortgage rates any time soon.

[Gareth Bacon]

It happened yesterday.

[Patricia Gibson]

Some estimates put additional mortgage costs at £5,100 a year, on average, by the end of 2024. I hear the chuntering from the hon. Gentleman about mortgage rates going down. He would do well to reflect on the fact that 73% of mortgage holders are worried about rate rises.

Alongside this, the UK Government are set to raise taxes. They will balance the cost of their own incompetence on the backs of those who are already struggling, and whose struggles have been made so much worse by a Government who could not find their backside with both hands. The number of Scots seeking mortgage help has nearly quadrupled, again as a result of this Government’s staggering incompetence. It is particularly galling for people in Scotland, the majority of whom roundly rejected this Government.

As if all this were not enough, inflation is soaring, rising to over 10% in September, a rate not seen since the early 1980s, outpacing normal earnings growth and expected to peak at 11%. Inflation is partly driven by sky-high energy costs, and the Government are already backtracking on the one thing they have done to bring down energy costs, with the expected bill rises early next year hammering households all over again—we could see bills of more than £4,000 in April. The shadow of recession is looming over the UK and threatens Scotland’s recovery from the pandemic, with the Scottish Government’s budget £1.7 billion lower due to the impact of inflation and the need to help households on which the UK Government have turned their back. This means that in Scotland budgets have had to be reprioritised across a range of areas to provide this much-needed support. Sadly, for the Labour party, when Wales’s budget is under pressure it is the fault of the UK Government because of how devolution works, but when the Scottish Government’s budget is under pressure Labour joins the Tories in condemning the SNP. That is why Labour is thrashing around in its death throes in Scotland, because standing shoulder to shoulder with the Tories is not working for it. The people in Scotland are not fooled.

It is bad enough that households across the UK are struggling to balance budgets in the face of soaring inflation, rocketing energy bills and huge increases in mortgage costs, and it is bad enough that my constituents in North Ayrshire and Arran are facing unprecedented financial pressures, but while they do they are watching the revolving door of Government jobs, which have been changing with breathtaking speed. The loss of a Cabinet post is compensated for with three months’ salary, and that applies even to those who were in post for only a few weeks. Sky News has reported that this ministerial churn has amounted to £709,000 in severance payments for former Ministers and Whips. A total of 71 Ministers are eligible for this pay as a result of the instability of this Government. In view of the financial stress our constituents are facing because of decisions made by this Government, they have a right to know who has taken these payments, which are due entirely as a result of the instability and incompetence of this Government. Perhaps the Minister will be able to tell us today, but I certainly will not hold my breath.

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[Gareth Bacon (Orpington) (Con)]

I rise to reject the arguments put forward by the Opposition. It is a matter of regret that Opposition day debates have abandoned any pretence of being a forensic probing of Government policy and have instead become nothing more than petty attempts for clickbait on social media.

[David Linden]

Will the hon. Gentleman give way?

[Gareth Bacon]

No. I have great affection for the hon. Gentleman, but I am mindful of Mr Deputy Speaker’s warning about the time because I know that other Members wish to speak. If the hon. Gentleman makes a speech later, he can address my comments.

In George Orwell’s “1984”, people are required during the “Two Minutes Hate” to watch a film depicting enemies of the state and loudly proclaim their hatred for them. The Labour party appears to believe that “1984” was a guidebook and not a warning, because it seems regularly to covet the chance to fabricate similarly misleading narratives, such as that of MPs voting to allow sewage in rivers, which was patently untrue. The volume of hateful correspondence and even threats against Members of this House has risen in recent years. Anecdotally, I gather from colleagues that there seems to be a strong correlation between spikes in abusive messages and Opposition day debates. I will leave the Opposition to reflect on that and on their methods.

I note that in the motion there is no mention at all of the covid pandemic, which caused the greatest contraction of the UK’s economy for 300 years, or of the £400 billion the Government spent on protecting people through the pandemic. Nor is there any mention of the £37 billion of targeted support for those on lower incomes. Nor is there any mention of the war in Ukraine, which has directly led to massive increases in energy prices. The recovery from the pandemic and the war in Ukraine have led to inflationary pressures around the world, which have in turn led to interest rate rises around the world. Again, mysteriously, there is no mention at all of that in the Opposition’s motion.

On what is in the motion, I respectfully point out that ignoring the disastrous consequences of rising energy bills would have been economic mismanagement. Instead, the previous Prime Minister and Chancellor put together a supremely generous support package that safeguarded both businesses and households. The energy price guarantee caps the price per unit of electricity and gas, and was introduced to counteract the looming October price rise, saving each household £700 on average over the winter. Had that not occurred, many families would suffer exorbitant and potentially unaffordable costs.

Similarly, the energy bill relief scheme applies to non-domestic premises so that businesses do not go bust and incur massive job losses across the country, which would have caused destitution for thousands. The previous Prime Minister and Chancellor took action to prevent such situations from occurring in the wake of what are ultimately global surges in energy prices.

It is not ancient history, so let me point out that financially ruining the country and leaving a note that says, “There’s no money left”, as the Labour party did in 2010, is quite literally mismanaging the economy. Thanks to measures taken by this Government, as of yesterday, mortgage rates have begun to fall, and some lenders are offering five-year fixed-term rates at less than 5%.

Lastly, the calls to dock severance pay for departing Ministers are a relatively new phenomenon and an over-personalised cheap shot, which is typical of the Opposition. I am not aware that any Labour Minister was particularly concerned about the matter before certain quarters of the media began discussing it. Indeed, not accepting severance packages was certainly not high on the agenda of departing Labour Ministers throughout the Blair and Brown Administrations, and certainly not when they were booted out of office in 2010. That is underlined by the refusal of the hon. Member for Wigan (Lisa Nandy) to answer both the questions I asked during my earlier intervention. Yet again, it shows that the Opposition only follow and do not lead. The motion is simply game playing. It is entirely without merit and should not be supported.

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[David Linden (Glasgow East) (SNP)]

It is a great honour to follow the hon. Member for South Cambridgeshire (Anthony Browne). I very much enjoyed his history lesson about when Gordon Brown came into power in 1997, when I was in primary 2. What relevance that has to today’s debate and the mortgage rates that are being experienced by my constituents, I am not quite sure. Unfortunately, the hon. Member for Orpington (Gareth Bacon) was unable to take my intervention. I think he is right to express some concern about the tone of Opposition day debates. One of the questions I was going to ask him was how he thinks the Scottish Conservatives conduct their Opposition day debates in the Scottish Parliament and whether he could tell the Chamber how different they are. He seems to be shrugging his shoulders, so I am not sure he is aware how the hon. Member for Moray (Douglas Ross) conducts himself in the Scottish Parliament; perhaps he is going to explain.

[Gareth Bacon]

I am grateful to the hon. Gentleman for giving way. I must confess that I do not spend a lot of time watching the Scottish Parliament, because I am often here, so I cannot answer his question. I would be happy to have a drink with him, and we could discuss it then.

[David Linden]

That is very helpful, and over the course of that drink I will explain to the hon. Gentleman that the behaviour of his colleagues in the Scottish Conservative party during Opposition day debates is quite something. It reminds me of that biblical verse about removing the log from your eye before removing the speck from your neighbour’s.

There are two parts to the motion before the House. The first aspect of it is how interest rates are rising. A theme has been developed throughout the course of the debate that that is to do with what has happened in Ukraine and the covid pandemic. I would not dispute for a minute that what has happened in Ukraine has had an impact on the economy and that the global pandemic has had an impact on the economy. However, as I said to the hon. Member for Sedgefield (Paul Howell), there is a third aspect that has also had an impact on the economy, and that is the nature of the Brexit that we took. I think most people and most respected economists would argue that Brexit has had an impact on the economy, and the cherry-picking—to use the Minister’s term—that the hon. Member for Sedgefield was indulging himself in, to try to ignore the fact that Brexit has had an impact on the economy, does a disservice to the debate.