The Economy and Living Standards

Debate between George Freeman and Ed Balls

Thursday 12th June 2014 Commons Chamber

[Ed Balls]

I am happy to do so. I know that my right hon. Friend the Member for Birkenhead (Mr Field), whom I respect a great deal, has a proposal, but that is not my proposal and it is not Labour’s proposal at all. We know that there are pressures in the national health service and that £3 billion has been wasted on an NHS reorganisation, but we also know that there is a cost of living crisis. People are paying hundreds of pounds more a year because of the Government’s VAT rise, and what we want to do is cut taxes for working people.

[George Freeman (Mid Norfolk) (Con)]

The shadow Chancellor mentioned the right hon. Member for Birkenhead (Mr Field), who was quoted as saying,

“I can’t tell you what a good meeting I had”

with the shadow Chancellor about the jobs tax. Will he take the opportunity now in the House to confirm that the Labour party does not have a plan to introduce a jobs tax?

Budget Resolutions and Economic Situation

Debate between George Freeman and Ed Balls

Thursday 21st March 2013 Commons Chamber

[Ed Balls]

The OBR document is very interesting. It sets out the unusual underspend Department by Department. I do not think that we have yet heard the full truth about what has been going on in the Treasury: the pressure applied in one year to cut spending or to move it to the next year just to fiddle the borrowing figures. I think that we will discover the truth in the coming weeks. For a Government who attack businesses and make late payments to small business, they are the late payment Government.

Has the Chancellor learned nothing over the past 12 months? He used to say that he was sticking to his plan in order to secure the recovery, but then we had the double-dip recession. He used to say that he was sticking to his plan to get the deficit down, but his spending cuts and tax rises have choked off the recovery. As the OBR revealed yesterday, the deficit was basically unchanged last year and will remain unchanged this year and next. Then all he could say was that he had to stick to his plan in order to keep his treasured triple A credit rating, but he has even lost that. The only reason he will not now change course is to avoid his own political humiliation, and that is no reason to stick to a failing plan.

[George Freeman (Mid Norfolk) (Con)]

The right hon. Gentleman alleges that the Government have increased the deficit. I have checked the figures from the Institute for Fiscal Studies and the OBR. Will he confirm that when the Government came to power the deficit was 11.2% of GDP and that it is now 7.4%? Is that a rise?

[Ed Balls]

The Government inherited a deficit reduction plan from the previous Government, but the Chancellor is wildly off track from our plan, which he used to call irresponsible. He is borrowing pretty much a quarter of a trillion pounds more. He said that he would get the deficit down, but the deficit reduction plan has stalled.

I have urged the Chancellor to change course, as in recent months have the International Monetary Fund, The Economist, the Mayor of London, the Business Secretary and the Home Secretary. They have all cast doubt on his plan. But yesterday we got more of the same. How did he describe the Budget? He described it as a “steady-as-she-goes Budget.” Steady as she goes? What kind of ship does he think he is on: the Titanic; the Mary Celeste?

There were some welcome measures. We have consistently called for a tax break for small firms taking on extra workers. The Government are now set to introduce a similar scheme, three years after the shadow Business Secretary and I urged them to. That is a welcome step forward. The Chancellor has finally joined Twitter, five years after I did. Maybe he will find out that his plan is going to fail five years after I worked it out, although by then he will be on the Opposition side of the House.

Yesterday there was no proper plan to kick-start our economy, no bank bonus tax to fund a youth jobs guarantee, no real action to get lending going to small firms, no proper investment in affordable homes and no return of the 10p starting rate to help millions of people, paid for by a mansions tax. Despite the welcome small change of 1p off a pint of beer—buy 320 pints and get one free, which might even be too much for the Foreign Secretary—and even after the increase in the personal allowance, an important point for the Liberal Democrats, families will still be worse off next year compared with this year because of the Chancellor’s tax and benefit changes.