Global Economy

George Freeman Excerpts

Thursday 11th August 2011 Commons Chamber

[George Freeman (Mid Norfolk) (Con)]

Has my right hon. Friend seen the latest data which show not only that the private sector has created four times more jobs than the public sector has lost but that Britain is now second in the G20 league of net job creation? Does that not show that the deficit strategy is working, and that the shadow Chancellor is wholly out of touch and has not learned the golden rule that you cannot borrow your way out of a debt crisis?

[Mr Osborne]

The shadow Chancellor has a bit of a history on his golden rules, and they do not usually turn out to work, but my hon. Friend is right that we are seeing net job creation. We are not remotely complacent about that. We are working extremely hard at improving the competitiveness of British industry, making sure that it is able to export and invest. That is the model of growth that this country now has to pursue.

GM Food Technologies

George Freeman Excerpts

Tuesday 19th July 2011 Westminster Hall

[George Freeman (Mid Norfolk) (Con)]

Thank you for calling me to speak, Mr Betts. It is a great pleasure to serve under your chairmanship this afternoon and to have this opportunity to talk about a subject that is of increasing importance, both to the globe and to this country, and that merits the very highest attention in this Parliament. It is the subject of our food science, agricultural research and in particular the potential of genetically modified food and other genetic and breeding technologies to support this very important sector. If I have time this afternoon, I will say why I believe it is such an important subject and why we should debate it now and in this Parliament.

However, I should start by declaring something of an interest. I come from a farming and agricultural background. I never actually worked in agriculture; that fate narrowly escaped me. Before coming to Parliament, I had a 15-year career in biomedical research in health care. Through that work, I have some experience of the genetic sciences and their potential to deliver good, albeit in the health care sector rather than in the food sector. I also have some experience of the very difficult ethical, moral and scientific issues that new technologies often throw up, and of the importance of Parliament being able to debate those issues properly, clearly, openly and well, and to build trust in an appropriate regulatory framework in order to build public support.

I declare an interest as someone who has worked in this sector and I draw Members’ attention to one or two shareholdings in one or two very small and unprofitable companies. I also declare something of a constituency interest. My constituency of Mid Norfolk is rural. That is not to say that everyone there works in agriculture, but it has a strong rural background and a strong agricultural heritage. We sit between Cambridge and Norwich. At the moment, my constituency is something of a rural backwater, located between those two phenomenal centres of science and technology. What is very striking to me as the local MP in an area where average annual incomes are £17,000, which is well below the national average, is the lack of public discussion about the potential of technologies that are developed in our area, particularly in Norwich at the Norwich Research Park. When I talk to people on the doorsteps about some of these technologies and their potential to do good around the world and in the UK, I am always struck by how surprised people are that we are not debating them and talking about them more openly.

I have also served as a non-executive director of Elsoms Seeds, a small, family-owned seed business, which does not actually have any involvement in GM but has a long and proud history of pioneering seed development in the agricultural sector. For a while, I served as an adviser to the Norwich Research Park. I mention that because, as many of my expert colleagues in the room know, it is something of a centre in UK food science, with the Institute of Food Research and the John Innes Centre next to the university of East Anglia and the Norfolk and Norwich University hospital, where work is continuing on a model gut. There is also some very pioneering work on nutrition and food science going on at the research park. Norwich is something of a centre of excellence globally in this sector and I am passionate about its potential to do good here in the UK, including in Norfolk, and across the world.

Why do I think that this technology has so much potential? The answer lies in a very important document, which I commend to all Members present if they have not already looked at it. It is the foresight report on food, written by the Government’s chief scientific adviser, Sir John Beddington, last year, and it was published—with the most beautiful timing—as we all arrived here in this new Parliament. It issues a clarion call to us all, including to this Parliament, about a global challenge. World population is set to rise to 9 billion during our lifetime, and in that time as a global society we have to produce twice as much food from half as much land with half the inputs, if we are to develop anything like a sustainable agricultural sector globally. I repeat—we have to produce twice as much food from half as much land with half as much pesticide, water and energy. That is a major challenge; it is one that Sir John and his committee have rightly received huge credit for addressing; and it is one that this Parliament needs to take very seriously.

Sir John in that report and many others since its publication have highlighted the importance of our using every tool at our disposal. I am not for a minute suggesting that GM is the magic bullet, or the only technology or even the most important technology to consider. However, as Sir John and his committee highlighted, it is one vital technology in the toolkit. And it seems to me that that global challenge of international development, of helping to lift people around the world out of poverty and of helping other countries around the world to go through a process of agricultural and industrial revolution—which took us nearly 200 years to go through—more quickly and more sustainably is a noble and important calling which we in Europe and the rest of the advanced western world, particularly here in Britain, should be drawn to.

We should be drawn to it not least because as we now find ourselves to be a small, wise, old, poor, public sector-dominated and debt-ridden economy that is looking for ways to drive growth around the world—not just growth for its own sake but growth that we can be proud of, that is fulfilling and that gives this country a sense of its self and its role in a world that is now dominated by bigger and faster-growing countries—it seems to me that drawing on our agricultural heritage and our science base in the life sciences, whether in medicine, food science or clean tech, and exporting that expertise and knowledge around the world to help the next generation of nations is something that we could all be proud of. It would be a part of a growth recovery that would have social benefits as well as economic benefits.

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

Does my hon. Friend share my view that this important debate is somewhat hampered by extremists who describe some of the practices to which he refers as a sort of “Frankenstein food”, generating fear and concern that freeze people into inaction when in fact we should be inspiring them into action?

[George Freeman]

I could not agree with my hon. Friend more. I mentioned my own experience in the biomedical sector, where I have come across that sort of extreme anti-science movement. I hope that in my moderate tones I have communicated the fact that I am not for one moment an extremist on either side. But I could not agree with my hon. Friend more.

Extremism is not helpful in the debate on this subject. In my medical experience, I have seen the extremism of the anti-animal experimentation groups. Nobody is in favour of animal experiments. However, there is an irony that I will share with everyone here today. I am setting up a company to develop predictive toxicology software, to reduce the need for animal experiments. In order to do that, one needs to consult with the people who know most about the animal experiments, to reduce the necessity of those experiments. In so doing, we triggered the attention of the animal extremists, who targeted the company. Of course, of the six people on the board, there was one female, who was the company secretary. Who do people think the extremists targeted? The lone female in her cottage at night. The cowardice—moral, intellectual and physical—of the extremists shocked me then and in this debate today I want to try to initiate an open debate and to invite a proper and open discussion of the issues. As I say, I could not agree more with my hon. Friend.

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Gentleman for bringing this matter to Westminster Hall, because the debate about it is very important and the matter needs to be aired, debated and talked about. I agree with the hon. Gentleman that GM food technology gives an opportunity for cheaper food and better usage of the land, to try to meet the demand for food that exists throughout the world. Is he aware of the key and critical role that some universities are playing with private partners in the development of GM technology? One of those universities in particular is Queen’s university in Belfast. I have visited the university and I am aware of the good work that it does. Does he accept that that key partnership is important to the development of GM food technologies?

[George Freeman]

The hon. Gentleman makes an excellent point. Yes, a number of our universities play a key role in GM development and I absolutely agree with him that Queen’s university in Belfast is in the vanguard of that, along with the universities of Liverpool, Reading, London, Norwich and Aberystwyth, and one or two other universities in the UK. Moreover, GM is potentially an important part of helping our universities to generate novelty and to put themselves at the front edge of this important area of science. The foresight report frames for us the challenge and the opportunity for the UK. In my own area of Norfolk, when one openly discusses the benefits of the technology for local agriculture, people are interested, and there is an appetite out there to hear more about it.

It might be useful to share one or two facts to help frame the debate. It is worth remembering that commercial GM crops have been grown and eaten since 1994. In 2010, the hectarage of GM crops worldwide was 148 million hectares across 29 countries, 48% of which was in developing countries. Some 15 million farmers, 90% of whom are small and resource-poor, are already actively involved in growing GM crops. The argument is often put that the technology is untried and untested, but I suggest that that is a substantial body of evidence, with proper scientific and rigorous monitoring, and I do not think that anyone is aware of any serious problems that have arisen as a result of the adoption of the technology.

It is also worth acknowledging the extent to which it is the developing world that is driving the adoption. On top crops by area, the percentage of global crop that is now GM is 77% of soybean, 26% of maize, 49% of cotton and 21% of canola. The interesting thing that comes from that is that GM crops have a potential not just in food but in fuel and fibre. One of the problems with the debate in the UK is that the extremists take us straight to the hardest point of all, which is the compulsory—that is often the implication—force-feeding of people here with GM food. To my knowledge, no one is proposing that; I certainly am not. I do propose, however, that we should debate whether this country has a role to play in the application of the technology in fuel and fibre, and certainly in food production around the world. That should be non-controversial.

Going further, one could say, “Should there not be choice in the UK, particularly in the health care and the nutraceuticals and functional foods areas?” I think it would be perfectly appropriate—and the idea would enjoy public support—to say, “The consumer should have choice, but what is wrong with going into a supermarket and having on one side the organic carrots grown locally, here in Norfolk, over there the carrots grown more intensively at a lower cost, and over here the rather more expensive cholesterol-reducing carrots that have been grown and bred specifically for a group with particular dietary, nutritional and health care needs?”

[Glyn Davies (Montgomeryshire) (Con)]

I am grateful to my hon. Friend for allowing me to intervene, particularly as I missed the first five minutes of his speech because I went to the wrong Chamber. I come from a part of Britain that considers itself to be GM-free. Does my hon. Friend agree that unless we grasp the issue of GM in this country we are in real danger of becoming seriously globally uncompetitive and will eventually lose a huge number of jobs and a huge amount of business, along with the ability to influence the debate across the world?

[George Freeman]

I could not agree more. My hon. Friend makes an excellent point, and I was just about to turn to the extent of the global nature of the matter.

As chair of the all-party group on science and technology in agriculture, I recently had the great privilege of welcoming two people from around the world who are involved in biotechnology: a gentleman from Brazil who specialises in soya, and a gentleman from Uganda who specialises in bananas. No sooner had I given them the warmest of parliamentary welcomes—I confess, possibly with a sense of welcoming people from the Commonwealth to the mother of all Parliaments—than I ate my words, because they had not come to find out what we thought about the sector but to share how much progress and investment they were making, what extraordinary innovations they were driving, the local benefits in terms of food production and productivity, and the health benefits in their countries. In response to my hon. Friend’s point, that is happening around the world in any case, and the question for Britain and Europe is whether we want to participate and bring our expertise, insight and science to bear, or sit on our hands and become irrelevant, missing out on all the opportunities that we have touched on.

It is worth looking at some of the global data. I was very struck when I looked at which countries are the biggest adopters. One would expect to see the United States of America at the top of the list, but the next 10 are Brazil, Argentina, India, Canada, China, Paraguay, Pakistan, South Africa, Uruguay and Bolivia. The fact is that the technology is being adopted rapidly by some of the fastest-developing second world countries, not because they are threatened by global mega-corporations or because they are under compulsion but because the technology offers extraordinary benefits to their rapidly growing populations, their domestic economies and their ability to develop as nations.

Part of my argument is that the technology is being adopted globally whether we like it or not, and it is bizarre that in this country we are getting into a situation in which it is almost impossible to debate the technology, and in which the European Union appears to be encouraging a national framework that countries can opt into or out of purely on the basis of emotional and political rationales—I will come on to that in a minute. As the eurozone teeters on the brink of bankruptcy, it seems peculiarly bizarre not to be involved in this major area of global growth.

I want to look at some of the things that some of the organisations involved have said. I draw Members’ attention to the Food and Drink Federation, which has issued an excellent briefing on the subject. The federation believes that

“modern biotechnology, including GM, offers enormous potential to improve the quality and quantity of the food supply but the impact of this technology must be objectively assessed through scientific investigation. Robust controls are necessary to protect the consumer and the environment; and consumer education and information are fundamental to public acceptance.”

I could not agree more. It goes on to stress the importance of choice:

“However, we believe that the time has come when serious consideration should be given to reopening a free and unbiased debate about the environmental, safety and consumer benefits of GM. FDF therefore welcomes”

the debate today. It also supports the foresight report’s conclusions that we need to produce more from less and with less impact. I am pleased that the report makes a call for the recognition of the role of GM.

[Jonathan Lord (Woking) (Con)]

I am very taken with all my hon. Friend’s arguments, but I think it comes back to the key argument of the need for more food. He talked about some of the extremists who have caused problems, and I am drawn to the analogy of the nuclear industry. There were some extremist arguments about nuclear, but the most intelligent of the campaigners came to realise that we needed an energy-secure and carbon-neutral fuel. Surely there is a similar argument, based on scientific evidence, that can engage those who have campaigned against GM, because of the need to feed the world, particularly its poor.

[George Freeman]

My hon. Friend makes an excellent point, not least because, as with the nuclear debate, people are now beginning to shift positions. George Monbiot has done so on nuclear, coming around to admitting that it has a very important part to play in the true green mix. Some early opponents of GM are now convinced by the evidence, and say, “After the number of years and the number of crops that have been grown around the world we really need to change our tune.” For that reason, it is particularly interesting to look at a briefing from the anti-GM campaign, which this weekend is staging a protest in Norfolk against the blight-resistant potato, about which I will say something in a moment. Interestingly, the briefing states:

“The campaign against GM crops ten years ago was so successful that GM almost completely vanished from our fields and supermarkets, and many people have forgotten the issues associated with the technology. But in many other parts of the world peasant farmers have been desperately fighting its spread”—

not very successfully, we might observe. It continues:

“With the renewed threat of GM on the horizon campaigners need to get together again to show the rest of the country…that we’re still here, and we’ve got an even better case than ever.”

In that language, one can hear the lack of rational debate. There is no discussion of the evidence or the latest science or findings. It is an emotional call to arms. I respect people who are concerned about the technology, but rather than ripping up plants, attacking and destroying experiments and hysterically screaming down those who want to discuss the issue, we must engage in an open and rational debate.

The blight-resistant potato is an important example of the potential involved. Many hon. Members will be aware of the groundbreaking work going on at the Norwich Research Park, led by Jonathan Jones and his team. Those who know their potato will know that the average potato crop receives more than 10 sprays of blight treatment chemicals, which are expensive and not terribly nice. That involves tractors, fuel, time and labour. It is high-energy, high-input agriculture. A blight-resistant potato would require none of that, and would have a huge impact on creating the low-input, low-energy agriculture that we all want. Sadly, campaigners will be coming to Norfolk this Saturday to try to stop that experiment. We need more science, we need a more rigorous and open debate and we need proper scientific and evidence-based policy making. I believe that we need political leadership from a generation in Parliament to stand up for this country’s potential around the world, educate the public and engage in an open debate.

With that, I will sit down and allow the ministerial spokesman to share his wisdom with us. I thank you for this opportunity, Mr Betts.

Summer Adjournment

George Freeman Excerpts

Tuesday 19th July 2011 Commons Chamber

[George Freeman (Mid Norfolk) (Con)]

I am grateful for this opportunity to speak, and for your patience, Madam Deputy Speaker. I apologise if I am unable to be here for the winding-up speech, but I have to be in Westminster Hall at 4.30.

This is an important opportunity to raise issues that are close to our hearts. I want to talk about the potential contribution of the NHS to medical innovation in the life sciences sector and in this country, and to driving economic growth. Before coming to Parliament I had the privilege of working for 15 years in the biomedical industry. It is a subject close to my heart, and I am pleased to have this opportunity to raise it. I draw Members’ attention to my declaration in the Register of Members’ Financial Interests.

My key message is that because of major changes in biomedicine and the structure of the pharmaceutical industry, including in the disciplines of drug discovery and drug development, the NHS is now one of the most valuable assets in global biomedicine. It is vital that Parliament and the Government support the NHS in unlocking that opportunity, ensure that our NHS reforms recognise and support it, and recognise the global potential of our health care sector and our NHS to drive growth and revenues around the world, which can be reinvested back into our research base.

The life sciences are an important sector in the UK. Some 27,000 people are employed in UK pharmaceutical research and development, and there are 250,000 employees in life sciences-related industries. Employees working in the highest value sectors each generate more than £190,000 in gross value added. We are of course home to GlaxoSmithKline and AstraZeneca, but we also have a range of specialty pharma, biotech, device and diagnostics businesses.

However, there is a problem: the pharmaceutical sector has been a victim of its own success. While research and development spend has doubled in the past 15 years, the rate of success in new chemical entities discovered has fallen by about a third. That crisis is driving a wave of consolidations and restructurings in the industry, some of which we have seen recently, and the rapid closure of some of the older-style, Fordist discovery structures. The increasing trend in biomedical discovery is towards patients and getting back to the places where one can observe disease and watch it taking hold in tissues. The trend is to look at anonymised, consented mass patient data to understand how it is that different patients respond differently to diseases. That is undermining the global pharmaceutical business model. These days, a one-size drug does not fit all. The industry needs to understand why it is that people react in different ways.

As the industry looks around the world for places where it can access large repositories of anonymised, consented patient data that are in the hands of world-leading clinicians and scientists with an ethical regulatory framework, this country and the NHS stand out. This is a massive opportunity for our sector and the NHS to unlock new revenues around the world. The benefits for us are obvious. We can accelerate new medical discovery, cut costs, generate new funds for the NHS and give our sector a position of global leadership. The irony and the challenge is that the NHS itself is an obstacle to the rapid uptake and adoption of some technologies and innovations because of its centralised and bureaucratic budgeting, its lack of empowered and devolved responsibility, difficulties with its reimbursement and procurement structures, which are often dominated by the bigger companies rather than smaller more innovative companies, and problems with career structures for our most innovative scientists.

I know that Ministers and officials at both the Department of Health and the Department for Business, Innovation and Skills are considering this matter. I merely wanted to take this opportunity to highlight how important it is, not just for our medical innovation and health care but for our global growth imperative, for the UK to unlock that potential and ensure that the NHS reforms, far from undermining that important sector, support it.

Oral Answers to Questions

George Freeman Excerpts

Tuesday 21st June 2011 Commons Chamber

[Mr Osborne]

It is normal for Finance Ministers to pay some attention to what the IMF says, but there we go. The last time we had a Labour Government, we had to turn to the IMF for help; I am trying to avoid that.

[George Freeman (Mid Norfolk) (Con)]

Is my right hon. Friend aware of the recent comments of the director general of the CBI? He said:

“Acting swiftly and decisively on the deficit has…laid a firm foundation for…growth.”

Who does my right hon. Friend think is more plausible: the director general of the CBI or the lone voice opposite?

[Mr Osborne]

I think the CBI’s view reflects those of almost the entire business community in Britain and almost all international commentators on the United Kingdom economy. When the CBI was asked explicitly what it thought of the Labour party’s plans, its chief economic adviser said:

“The economy would be weaker because of the impact of a loss of confidence in the markets.”

Eurozone Financial Assistance

George Freeman Excerpts

Tuesday 24th May 2011 Commons Chamber

[Chris Heaton-Harris]

I will say more about the politics later in my speech. In any event, I believe that if either my amendment or the original motion is passed, the House of Commons will be the first member state Parliament to question formally the legality of the stability mechanism.

The remaining part of my amendment involves a fairly academic argument. Does any Member in the House truly believe that, with the Greek economy running out of cash, market fears that the eurozone contagion will spread and reveal itself at the heart of the Spanish and Italian economies, and the continuing problems in Ireland and Portugal, this matter was not going to be up-front and central at the next meeting of the Council of Ministers or the European Council? I should like to think that those problems are not only the first item on the agenda for such meetings, but being discussed every day throughout the Governments of Europe.

Bail-outs have become what they were always going to be: politically toxic, not only for those who provide the cash—the local election results in Bremen at the weekend underlined that—but, much more, for the Governments of the countries receiving the money, who have to introduce economic measures that are politically unpalatable to the people, as so many Spanish socialists found last weekend. Whatever senior advisers of Governments across Europe may think, the markets have already decided—and I consider it to be a matter of fact—that the Greek bail-out has not worked and will be renegotiated.

What I believe my hon. Friend for the Member Rochester and Strood is after is a vote that will prevent us from providing any more money for these bail-outs through the EFSM. Alas, although the UK could vote against any proposal presented—and I should like to think that it would—the simple fact is that because of the disastrous advice given to the former Chancellor of the Exchequer and the consequent actions that he took at meetings on 9 and 10 May last year as the previous Government were leaving office, the UK entered the mechanism. Moreover, the Council decides on these matters now, and will do so in the future, by means of qualified majority voting.

[George Freeman (Mid Norfolk) (Con)]

Does my hon. Friend not agree that when the Conservatives were last in office they established a firm veto in precisely this context? That veto was given away in 2001 by the Labour party, and the present Government are now being forced to implement a decision that was sneaked through by Labour in the dying days of its Government.

[Chris Heaton-Harris]

Absolutely—and let me make it perfectly clear that, thanks to what Labour did a year ago as it was leaving office, the EU cannot veto the grant of an EU loan or credit line extended via the European financial stability mechanism.

Amendment of the Law

George Freeman Excerpts

Monday 28th March 2011 Commons Chamber

[Caroline Flint]

People throughout the country benefited from the decent homes programme and other housing initiatives that helped them to get on to the property ladder and to ensure that they had choices. In the first six months of 2010, before the election, the number of new homes built went up by more than 20%, but in the last six months of 2010, after the election, the number of new homes started fell by nearly 20%. If the Secretary of State wants that debate, I am always happy to have it with him—or with any of his colleagues.

The country wants to know what the Secretary of State and his Government will do to help to build the homes for which communities up and down the country are crying out. Whatever he pretends, the reality is that the Budget brings very little good news. It promises help for first-time buyers. The Opposition welcome the Government’s U-turn—their decision to bring back Labour’s homebuy scheme, which they insist on calling “Firstbuy”—but less than a year ago, the Minister for Housing and Local Government described that policy as an “expensive flop”. That was not what thousands of first-time buyers thought about it or what the housing industry made of it. The Home Builders Federation said that it

“was judged a major success by the industry”.

Only a matter of months later, with his customary humility, the Minister has been forced to admit that he called it wrong. We have wasted 10 months in which we could have ensured that people had a better opportunity to own their own homes. He has done too little, too late, and the measure does not go far enough, because while more than 3 million hopeful first-time buyers try to get a foot on the property ladder, the measure helps only 10,000 of them.

No one is convinced that the new homes bonus is the panacea to the housing crisis that the Government believe it to be, least of all the 21 Tory council leaders from the south-east who wrote to them earlier this year warning that they were not convinced that the plan provides enough of an incentive to communities for them to welcome development. The Budget was crying out for measures to support housing, but they did not happen. All it comes up with is the idea of allowing commercial properties to be turned into homes without requiring planning permission. When the Government get around to establishing exactly which sort of commercial properties will be allowed to turn into residential properties and under what conditions, we will look at their proposals carefully, but if the Secretary of State really believes that the answer to the country’s housing crisis is turning some empty offices into luxury penthouses, or asking people to live in disused out-of-town business parks or derelict industrial estates, he had better think again.

The biggest disappointment is the failure to address the deeper problems of housing supply and the lack of available mortgages. In their submission on the Budget, the Home Builders Federation is absolutely clear that mortgage availability

“is the biggest immediate constraint on demand and house building.”

Figures from the Council of Mortgage Lenders published as recently as 18 March show that mortgage lending has stalled. It says that lending is

“weaker than a year ago”

and that the housing market is “stuck in a rut”, but on that, the Budget is silent.

Before we move on from housing, let us remind ourselves of another matter on which the Government have not lived up to their promises. Just a few weeks ago, the Minister for Housing and Local Government told the Zero Carbon Hub annual conference:

“The commitment to Zero Carbon remains in place—there’s no ambiguity about that”,

but when reading the small print of the Budget, we discover that that is just another broken promise, because from 2016, new homes will no longer have to source all their energy from carbon-neutral sources, which goes back on a commitment that the Conservatives made in opposition and repeated in government. Those standards were about not only protecting our environment, but driving innovation and creating new jobs in the green economy. The Government’s failure on that undermines not only their green credentials, but the ability of our economy to compete for new jobs, new investment and new industries.

Let me deal with the underlying economic nonsense at the heart of Government policy. They hope that the UK economy will be saved by an export-led recovery, which I call Osborne’s see-saw, because the Chancellor views the public and private sectors as opposite ends of a see-saw. He thinks that the harder, deeper and faster he cuts the public sector, the sooner the private sector grows to fill the space and suck up the unemployment. One does not have to be an economist to know that there is no reason why cutting home helps, police officers and council cleaners will lead to the UK selling more electrical equipment, cars or IT services abroad. However, I do know that if we cut public investment in roads, regeneration and house building, and shred the school building programme, the private sector takes a huge hit. The construction industry nose-dives and hundreds of thousands of skilled workers and those who manufacture and supply to them lose their jobs.

[George Freeman (Mid Norfolk) (Con)]

Has the right hon. Lady noticed the International Monetary Fund’s recent figures showing that Britain is running interest rates 3% lower than those in countries with similar deficits to us? Is that not a fundamental result of our programme for the deficit?

[Caroline Flint]

I notice that the economies of the USA, France and Germany grew in the last quarter of 2010, but that of Britain shrank by 0.6%, and that the German and US economies are forecast to grow more strongly.

This is the first ever Budget for growth to downgrade its own growth forecast, yet the Government’s answer is not to continue Labour’s plan to manage the deficit reduction, but to go faster and further and hammer public spending harder. Then they blame everyone but themselves when growth forecasts fall and when Government borrowing rises. Hundreds of thousands of people tried to tell the Government on Saturday that it is hurting but not working, and they are just not listening. For this Government, giving a tax cut to the banks was more important than supporting the construction industry, keeping people in work or building new homes.

The Budget shows above all else how out of touch the Government are. With more people out of work, inflation rising and people facing the biggest squeeze on their living standards in a generation, we hear the Secretary of State make much of this year’s council tax freeze, which every Labour council has implemented, despite receiving much steeper cuts than Tory and Liberal Democrat councils in far wealthier parts of the country. However, with the Deputy Prime Minister busily coming up with a thousand and one new taxes and the Business Secretary desperately trying to resurrect the idea of his mansions tax, it remains to be seen whether the Secretary of State will be able to say the same next year.

A council tax freeze helps only so much. It is a £72 saving versus a VAT increase that will cost a family £450 extra this year, and it is coming at a time when families are losing tax credits and facing a freeze in their child benefit, when pensioners are seeing winter fuel payments cut, and when the Government’s cuts are undermining our recovery and costing people their livelihoods. They give with one hand but take with many more from the communities that we represent.

--- Later in debate ---

[Sheila Gilmore (Edinburgh East) (Lab)]

A very interesting thing happened in my city in 2009. For the first time since the 1960s, the number of affordable rented homes built exceeded the number of private homes—55% of all new build was affordable rented homes, subsidised by public spending. That subsidy helped the private builders who otherwise would have had to shut up shop for a while—as many have had to do—and meant that some at least could stay in work, and that gave work to the skilled work force who would otherwise be sitting at home watching daytime television because there was no work. When those people are at work they are contributing to our economy and paying taxes—[Interruption.] I do not know why that is so funny for people who want to reduce the deficit, because if people are paying taxes in, that is far better than their simply taking benefits out.

That was a good thing. It showed the weakness of the private sector, however, that it was affordable rented homes that had to be built in the numbers to keep some people in work. I look out from my constituency office at a regeneration scheme that has stalled because the private sector is not leaping in to build new homes and to bring offices or any other kind of business into the area. I look out on land. There is no shortage of land, but there is a shortage of investment to make all this development happen. We ought to invest in housing and build a real shared equity scheme, rather than providing a meagre amount of money that will be available for only one year, as we learn if we read the detail. The scheme is not sustainable: for one year there will be £250 million.

Shared equity has certainly helped to keep the house market going in my city—it is very important—but it needs subsidy. What is wrong is the constant juxtaposition of the private and public sector as though they are at war. In fact, the two are constantly interrelated.

[George Freeman]

Will the hon. Lady give way?

[Sheila Gilmore]

No, I will not.

The private and public sectors are constantly interrelated, because public sector stimulus has kept the economy going since the recession began.

History has been rewritten, and I find it deeply perplexing and upsetting that the Liberals have been prepared to be complicit in that. I am not surprised that the hon. Member for Colchester (Bob Russell) took us along the byways of Colchester becoming a city, because it was a diversionary tactic. He did not want to talk about his party’s real economic policy. It reminded me of when I was working from home—suddenly, cleaning the kitchen became quite attractive because I could not settle down to do the work that required a bit more effort. That is what is happening with a party that went into the election telling people that it would be downright dangerous to cut public spending too quickly. That is not just some sort of Labour notion, as the Conservatives seem to think. It was the policy of two of the parties that went into the election and that, together, won a majority of public support. It is not true that the public supported the financial disaster that the Conservatives are now wishing on us.

I said in a previous finance debate that the proof would be in the outcomes and that if the Conservative party was right and economic growth was driven by their policies, I would concede that, but so far we are seeing nothing of the sort. Our position would not be too far, too fast—

Oral Answers to Questions

George Freeman Excerpts

Tuesday 22nd March 2011 Commons Chamber

[Mr Osborne]

Manufacturers, including the one to which the hon. Lady has referred, benefit to the tune of £250 million from the reductions in corporation tax that we announced in the June Budget. That is what we have done to support British industry. As I have said, under the Labour Government British industry shrank: while the share of the economy taken by financial services grew by a third, the manufacturing share halved.

[George Freeman (Mid Norfolk) (Con)]

Does my right hon. Friend agree that, as we see signs that business confidence in the economy is being restored, tomorrow’s Budget presents a key opportunity to support the high-technology entrepreneurs who put their own wealth at risk in starting the businesses of tomorrow?

[Mr Osborne]

Yes, we will support enterprise and innovation in tomorrow’s Budget, but my hon. Friend will have to be patient and wait until then to hear about the precise measures that are involved.

Fuel Prices and the Cost of Living

George Freeman Excerpts

Wednesday 16th March 2011 Commons Chamber

[Gregg McClymont]

No, I will not give way, I am afraid. I have only three minutes. I am sure the hon. Lady will understand.

Government Members say “Yes”, but nothing I have heard so far in this debate leads me to believe that they have an affirmative answer to those questions. Reversing the VAT rise on fuel would be a statement—a declaration—of faith in working families in this country.

[George Freeman (Mid Norfolk) (Con)]

Will the hon. Gentleman give way?

[Gregg McClymont]

I will not, I am sorry. I have only two and a half minutes now, and the hon. Gentleman will understand, I am sure, that there is no time to give way.

Reversing the VAT rise in fuel would be a small concession in the context of a cocktail of economic policies that amount to a sustained assault on the living standards of ordinary families in this country. The Chancellor, the Chief Secretary to the Treasury and other Front Benchers will claim that the squeeze in living standards is beyond their control, but the Deputy Prime Minister admitted at the weekend that this Government’s policies are their choices. They have chosen to make ordinary families pay the price for their chosen economic policy. Regressive indirect taxes are going up; taxes on bankers and financial services are falling. A return of the bonus tax on bankers would be strongly welcomed by Labour Members. Support for families and for children has been cut aggressively this year. The cut to the child care element in working tax credit will hit hard families up and down this country from April.

Ministers talk of rebalancing the economy, but over the next five years the Office for Budget Responsibility has predicted falling savings rates and a lower share of GDP going into the wages of ordinary families. We already know that lower wages, squeezed living standards and lower savings rates lead to higher personal debt, higher financial stress and more personal bankruptcy. Is this the rebalancing of the economy that we really want, where debt is shifted from Government to families? I, for one, do not think so.

Today we are calling for a reversal of the VAT rise on fuel. This would be a declaration of faith in ordinary families up and down the country, and I hope that the Government will look on it kindly.

--- Later in debate ---

[Kerry McCarthy]

I am sorry, but I have no time to allow any more interventions.

We heard today that unemployment has now risen to more than 2.5 million. Another 27,000 people have been added to the dole queue in the past three months. Those who are in work find their income squeezed by the rising cost of living, with inflation surging over 5%, but average wages growing by just 2.3% and many in the public sector facing a cut in real terms. People are struggling to make ends meet.

This month, the Office for National Statistics added iPhone apps and online dating fees to its RPI shopping basket—I am not sure what was in its RIP shopping basket. The ONS believes that essentials such as food and fuel now make up an increasing proportion of the average family spend. Of course, we have heard today that the price of fuel is rising fast. A litre of fuel is now £1.32, which is up 7p from the beginning of the year. That is an extra £80 for the average driver.

We accept that the Government cannot control the price of oil. We understand that the turmoil in the middle east and north Africa is having an impact on global prices. However, the Government are not powerless. They have a choice. They could choose to help working families get through the tough times, or to carry on regardless down their reckless path of cuts, which are too fast and too deep, slashing support for families and putting the recovery at risk.

The Government have made the wrong choice. The Chancellor chose to raise VAT to 20%, which hits low and middle-income families hardest and has pushed up the prices of fuel, energy and food and, as we have heard, has hurt businesses, too.

[George Freeman]

Will the hon. Lady give way on that point?

[Kerry McCarthy]

I am afraid that I do not have time.

Before the election, when a litre of petrol was 12p cheaper than it is now, the Conservative party said that it would consult on the fair fuel stabiliser. It said that it would ensure that families, businesses and the whole British economy were less exposed to volatile oil markets. The Prime Minister said that he would help with the cost of living by trying to give a flatter, more constant rate for filling up the car. The Chancellor said that that would be delivered in the Government’s first Budget. It was not. Conservatives led voters to believe that they could and would act. However, we now face the exact problem that the policy was designed to prevent. Rising oil prices have pushed up fuel prices at the pump beyond £6 a gallon, yet there is no sign of the fair fuel stabiliser. Not only that, but the Government have added nearly 3p to the price of a litre of petrol with their VAT rise this year.

The Government need to come clean about whether they will move ahead with the stabiliser and answer the criticisms of a host of commentators, who said that the idea would never work because rising oil prices do not necessarily lead to higher tax revenues. They include the Office for Budget Responsibility, the new head of which said that its analysis suggested that a fair fuel stabiliser was likely to make the public finances less rather than more stable, and the Institute for Fiscal Studies, which said that the claim that the Treasury receives a windfall gain that it can share with motorists when oil prices rise is incorrect. Even the Secretary of State for Business, Innovation and Skills said before the election that the fair fuel stabiliser would be “unbelievably complicated and unpredictable”.

The Government are no closer to introducing the fuel duty stabiliser now than they were a year ago. Rather than teasing the public and dangling the prospect before them, the Government need to nail their colours to the mast and tell us what they intend to do. Labour believes that the Government should reverse their VAT rise on fuels and reconsider the fuel duty escalator rise, which is due in April. In government, Labour often postponed fuel duty increases when oil prices were rising and families felt the pinch. It was clearly the right thing to do then and we urge the Government to reconsider now.

Obviously, there is a balance to be struck between raising revenue and ensuring that ordinary people who are trying to get on with their lives—earn a living, get the kids to school, get to work on time—are not unfairly penalised. For some, driving is a choice and they can cut down on their journeys when petrol prices increase, but what about those who rely on their cars every day and do not have the option of using public transport because the bus and rail services simply are not there, or those who run small businesses, or the self-employed who need to run vehicles as part of their work?

Ordinary working people did not create the global economic crisis; it began in the financial sector. However, under this Government, it is ordinary working people who are paying the price. The Government are taking away more money from families with children than they are asking for from the banks that caused the problem in the first place. The bank levy is expected to raise £2.5 billion, but the last Budget and the spending review took nearly £5 billion from families with children through cuts to child benefit, child tax credits and other measures. The Government have refused to repeat the bank bonus tax that Labour introduced last year, which raised £3.5 billion and could be expected to raise another £2 billion this year.

We believe that the bank levy, which is expected to raise £800 million more this year than was originally predicted, could be used to pay for a reversal of the VAT rise on fuel. That would be the right thing to do: helping people when times are hard, getting the economy moving again and asking the financial sector to pay its fair share. Asking ordinary people to pay and hitting them where it hurts most is the wrong choice. Government Members can try to pass the buck and blame the EU for their failure to act, but the fact is that they have a choice. They could choose to help ordinary working people in the Budget next week. I urge Members to support the motion.

Oral Answers to Questions

George Freeman Excerpts

Tuesday 8th February 2011 Commons Chamber

[Justine Greening]

We are looking at ways in which we can ensure that people still get the debt advice that they need, and of course a lot of the grants are provided by local authorities. There is no point in Opposition Members talking about debt, because it was their party that created the problem in the first place.

[George Freeman (Mid Norfolk) (Con)]

9. What assessment he has made of prospects for growth in the high-technology manufacturing sector.

[The Economic Secretary to the Treasury (Justine Greening)]

The Office for Budget Responsibility sets out the official economic and fiscal forecasts. However, high-tech manufacturing is a key part of our growth plan and we need to ensure that Britain is not just open for business but making things again.

[George Freeman]

Is my hon. Friend aware of the latest data on manufacturing business confidence? January’s purchasing managers indicators show a sharp jump, suggesting annualised growth this year of 2.6%. Intuit, the software survey business, reports that 66% of small and medium-sized enterprise owners say that the VAT rise has no impact on their business, and Investec reports that two thirds of owner-managers plan to hire more staff in 2011. Does that not show that the Government’s policy is working and that the right hon. Member for Morley and Outwood (Ed Balls) is out of touch?

[Justine Greening]

What it shows is that we have the right plan to get our economy back on track. My hon. Friend mentions the purchasing managers index for January, which was at a record high since the series began in 1992. We recognise that our road to recovery will still be choppy, which is one reason why we will bring forward the first phase of the growth review in the Budget that is coming up. That will examine how we can ensure that we create the conditions for our companies to be successful.

Fuel Costs

George Freeman Excerpts

Monday 7th February 2011 Commons Chamber

[George Freeman (Mid Norfolk) (Con)]

I am grateful for this opportunity to speak in the debate, and I congratulate the hon. Member for Dundee East (Stewart Hosie) and his colleagues on raising this matter. I, for one, could listen to their wonderful brogue all afternoon.

[Stewart Hosie]

May I just say to the hon. Gentleman that I do not have a brogue or an accent? It is he who has the accent.

[George Freeman]

We can debate that another day.

The hon. Gentleman and his colleagues spoke eloquently about the needs of the rural economy, and I know that he will want to send his best wishes to one of the most exciting businesses in Norfolk, the English Whisky Co., which is doing great trade. As in so many debates, most of the suggestions that he and his colleagues made would lead to an increase in expenditure by the Exchequer, and, representing an English constituency, I find myself thinking, “English tax for Scottish voters.” His points on the rural economy were good ones, however, and I want to touch on the impact of fuel prices on that economy and offer some thoughts on how the Government might like to tackle the issue.

Fuel costs hit rural areas particularly hard, not only in Scotland but in England and Wales. In my constituency, where I am lucky enough to have four towns, 110 villages and a 130 mile boundary, the rurality is extreme. Fuel currently costs 130p a litre, which means that the average family are paying £70-odd to fill up their car. That is not a matter to be taken lightly. Families are hit particularly hard, especially those on low incomes who, it has been pointed out, tend to drive older, less efficient cars. Another group that is hit hard by high fuel costs is one by which the coalition has set so much store—namely, the people who are working hard to get out of welfare and into work. Small businesses are also affected, especially those in remote rural areas. They are crucial to the revitalisation of the rural economy.

The public sector is also affected by fuel costs. Many rural councils are hit very hard by their dependence on fuel, and this is another area in which rural councils in England have received particularly unfair treatment. Farmers are also hard hit, especially those growing commodity crops such as sugar beet and potatoes that require long-distance haulage. Hauliers are affected too, especially smaller, self-employed hauliers, who tell me that they are hit by the unfairness of the lack of a level playing field on which to compete with their European competitors.

[Rory Stewart (Penrith and The Border) (Con)]

May I make a plea to my hon. Friend to include a mention of dairy and livestock farmers, as they are also hit very hard by fuel prices in Cumbria?

[George Freeman]

My hon. Friend makes an excellent point.

On the wider economy, fuel inflation in rural areas not only affects rural communities but hinders our national economic growth. This goes to the heart of two of the coalition’s laudable objectives: the rebalancing of the economy and promotion of economic growth outside the City of London and our main metropolitan centres; and the attempts to help those sectors of the economy that do more than operate in the service, retail and housing industries—namely, the sectors that make things, transport things and sell things. Those sectors are hit particularly hard and we need to do all that we can to help them.

The reality that those on the Opposition Benches—particularly the Labour Benches—do not want to face is the fact that we have inherited a chronic legacy in our public finances that is costing £120 million a day in interest, which represents £20,000 of debt for every man, woman and child in the country. If we had not tackled the debt crisis, the interest payments would have been heading towards £70 billion a year. I repeat these figures because they need repeating to those on the Labour Benches. It ill behoves a serious party of government to come to the House, as those on the Labour Front Bench did today, and show no recognition of its part in causing this fiscal crisis. Labour Members have made no serious analysis of the rural economy and rural communities—[Interruption.] I wish that they would listen to what I am saying, rather than talking over it. They had no positive suggestions for how we might tackle the problem.

Fuel inflation risks strangling the economic recovery in our most marginal rural communities, but we cannot afford to do what we would like to do to address that. I therefore urge the Government, in accepting the constraints under which they are operating, to look carefully at the options.

[Claire Perry (Devizes) (Con)]

Does my hon. Friend agree that we need a sustainable solution, one that will work in bad times as well as good, rather than a knee-jerk reaction to what is clearly a problem for many rural constituencies, including my own?

[George Freeman]

My hon. Friend makes an excellent point. It is vital that we should not go for some short-term gimmick, and that we make a sustainable, serious commitment to helping rural communities and the rural economy.

My constituents and many in other rural constituencies have been encouraged by the Prime Minister’s continued espousal of the benefits of a fair fuel stabiliser. I defer to Ministers and experts in the Treasury on determining the right mechanism for that. We have a duty to make some gesture towards ameliorating this problem, and my plea to the Ministers and Treasury experts is that, whatever mechanism we go for, we focus on two groups in most urgent need: the rural small businesses on which we rely for economic growth and for the jobs in the rural economy on which we all ultimately depend; and the very lowest-paid employees who are struggling to get on and make something of their lives by earning a living. In my constituency, the average income is £17,500, and such people are hit hardest by this serious problem. I urge Ministers to do all that they can in the forthcoming Budget.