Ian C. Lucas
Main Page: Ian C. Lucas (Labour - Wrexham)
Diana Johnson (Kingston upon Hull North) (Lab)
As it is International Women’s Day, I want to start my remarks by paying tribute to Mary Denness, one of the “headscarf revolutionaries” of Hessle Road in Hull, who sadly died a few days ago. She fought to improve safety in the trawling industry after many husbands, sons and brothers died while at work. She won that battle.
I want to quote another formidable woman, the late Barbara Castle, who said:
“In politics, guts is all.”
I pay tribute to the women of the WASPI lobby, who are here today, for their guts in standing up and saying that an injustice has been done to them, and in continuing to campaign. I am very disappointed that there is nothing in the Budget to deal with that injustice.
I want to make two points at the outset. First, I was very surprised indeed that the Chancellor made no mention of Brexit in his statement, given that it is the major issue facing the country. Secondly, the Government have clearly broken their party’s 2015 manifesto pledge by introducing the rise in national insurance contributions for the self-employed. They stated four times in their manifesto—I checked—that they would not raise those contributions. Many of the 9,200 self-employed people in my constituency—the hairdressers, plumbers and electricians—are already just about managing. They are part of the group of people the Prime Minister said she wanted to be on the side of. I think this is a real kick to that group.
I want to focus on three issues today. The first is social care. I welcome what the Chancellor said about the need for a review. Of course we need a review and a long-term strategy for dealing with social care. In my view, the time has come to set up a national care service akin to the national health service created in 1948. However, the announcement made by the Chancellor—to spend £1.2 billion in 2017-18, £800 million in 2018-19 and £400 million in 2019-20—will overall close only half the gap that we already know exists in social care, and there are no specifics on how the money will be distributed.
Disadvantaged areas such as Hull face a crisis in social care. We are the third most disadvantaged area in the country, we have more people in need of social care than other areas, and we have fewer people who are able to self-fund. The Government have so far introduced an increase in the council tax precept of up to 3% to deal with the demands on social care. In Kingston upon Hull, because of our low council tax base, that will raise only £8.01 per head. Contrast that with Kingston upon Thames, where it could raise £15.27 per head. Clearly that policy will not meet the needs of areas that have such a low council tax base. I want the Minister to set out some clear guarantees about the most disadvantaged areas getting funding from the pot of money that has been made available.
We know that in politics it is all about making choices. One policy area that I thought the Government could have looked at for filling the gap in social care has been put forward by the Women’s Budget Group. It has said how successive cuts in corporation tax by 2021 will amount to about £13 billion per annum, and it has compared and contrasted that with the cost of free social care for those with critical care needs, which would cost £14 billion. The Government could have taken different decisions about how they raise money and spend it than the ones set out in the Budget.
On investment in the north, the Red Book contains just one reference to the northern powerhouse and the north-south regional divide. It states:
“As set out in the Industrial Strategy green paper, the government’s ambition is to support growth in all areas of the UK. The government will shortly be announcing the Midlands Engine Strategy, and is continuing to build the Northern Powerhouse.”
The latest Treasury figures show that transport investment in London is £1,943 per head of population, but in Yorkshire and the Humber it is £190. There is a real gap in the investment going into the north. The Chancellor said that £90 million is being made available to “the north”. The north is such a large area. It just goes to show that the Government really do not have a handle on the needs—
Diana Johnson
And the money is for over four years, as my hon. Friend rightly points out.
No money was identified to help Hull, particularly with the electrification that we have been fighting for over many years, even though we put together our own plan to bring in private sector money. There was no mention of trying to assist with that. There was also no mention of devolution for Yorkshire and the Humber. That would obviously be a way of accessing funds, but no decision has been made about that.
On education and skills, we all want our children and young people to have access to the best high-quality education possible. The renewables industry is very important to Hull, so we want young people to come through with the skills for that industry. I am really disappointed that the money allocated for education is for the ideological pursuit of free schools and selective education, rather than ensuring that the schools we have are properly funded. There is likely to be a cut of £380 per pupil by 2020 in Hull; 8% of the budget is going. The announcement about busing children who are on free schools meals to selective schools does not help us because there are no selective schools in Hull. If the Government are serious about social mobility, that money would have been much better spent on nursery school funding. It was announced that there were 2.4 million apprenticeship starts in the last Parliament, but today is International Women’s Day, and we know that young women in apprenticeships are paid less and that there are fewer of them in science, technology, engineering and maths.
This Budget is a bit of a damp squib. Hull will have to carry on making its own luck, as it has done for many years. We have been fortunate with the City of Culture and the investment from Siemens. In the spirit of where I started—the headscarf revolutionaries—we will continue to battle for a fair deal for our city from this Government, because we are certainly not getting it at the moment.
David Rutley (Macclesfield) (Con)
It is always a pleasure to participate in a Budget debate, and that is no less the case today. It is an honour to be sitting close to a good friend of mine, my hon. Friend the Member for Fareham (Suella Fernandes), whom I have known for decades.
I am pleased to follow the hon. Member for Kingston upon Hull North (Diana Johnson), who characteristically made an impassioned speech for her constituents and for the north. However, it is only fair to say that, although there were not as many references to the northern powerhouse in this Budget, the autumn statement contained a policy and a statement about what the northern powerhouse would be doing in the years ahead. An investment programme of £90 million has been set out, which should be seen against the context of the hundreds of millions of pounds that are being invested in rail and roads across the north.
David Rutley
The hon. Gentleman is shaking his head vigorously. I would welcome an intervention, if he wants to speak. If we compare the narrative for the north created by the Conservative party in recent years with the Labour party’s woeful track record on infrastructure and its narrative for the north when it was in power, the truth is that we are heads and shoulders above what Labour put in place.
Ian C. Lucas
I hope to catch Madam Deputy Speaker’s eye shortly, and this topic will be a big part of my speech. I would just point out that not one penny piece has been invested in transport in north Wales by this Government; and after today, it still has not been invested.
David Rutley
There are interesting schemes ahead, which I am sure the hon. Gentleman is also working on, to try to improve the interconnectivity of rail in north Wales and in Cheshire. He is aware that we are moving those plans further forward. I look forward to hearing his speech.
The Budget statement highlights the resilience of the UK economy, and seeks to ensure that we build on the clarity, certainty and confidence that business needs as we seek to forge a new role for Britain on a truly global scale and stage. Our first task after the vote to leave the EU is to reassure the markets. Britain has to be seen, and is being seen, as welcoming. It remains firmly open for business, and the Chancellor has done an outstanding job today in that respect. We have already talked about infrastructure projects, which the Chancellor highlighted. Importantly, on skills—I look forward to saying more on this in a few minutes—we will deliver millions of quality apprenticeships during this Parliament, making sure there are 15 clear, meaningful career paths linked to defined industrial sectors. There is also action on science, as we saw in the autumn statement. Some £2 billion a year of extra funding is promised for science, which will make a huge difference to what we are seeking to achieve.
Overarching all of this has to be the need to control our public finances. It has been, and continues to be, a long and hard slog to reduce the deficit left to us by Labour in 2010. I therefore applaud the Chancellor’s commitment to continuing on a sensible path to a global Britain that pays its way in the world.
In leaving the EU, we can become a global champion of enterprise and free trade, but we must recognise that Brexit, combined with other world events, has created heightened uncertainty in the short term, and that requires national economic assumptions and policies to be revisited. In its latest quarterly small business index, the Federation of Small Businesses has found that, while confidence is improving—getting back to pre-referendum levels, according to the FSB’s chairman, Mike Cherry—actual investment intentions remain somewhat subdued in the face of an uncertain landscape.
The Government are therefore right to take measures to steady the ship and to revive confidence after the momentous vote to leave the EU. As we know, buoyant consumer confidence has boosted the economy by more than was predicted in the aftermath of the referendum, but we need long-term investment too. The Government stepped up to the plate with infrastructure projects that will boost the capacity of the economy—notably, in transport policy, and I have already talked about the extra £90 million of investment that is being made available to address pinch points in the north.
We now need to make sure that we boost business spending and much-needed business investment too. Some of that will come through leveraged funds—from projects the Government support or enable. The £1 billion investment in Manchester airport over the next 10 years is a classic example of how, by clarifying things and building confidence, the Government will encourage business to invest in these vital infrastructure projects.
Underlying the measures the Chancellor has taken today is the Prime Minister’s clear plan for leaving the EU, which will work hand in glove with the modern industrial strategy. That strategy is modern because it will create an economic environment that enables winners to emerge without being picked. It is a healthy mix of horizontal and sectoral measures that enables the Government and businesses to drive forward with determination and commitment.
Those actions are solid foundations for the clarity and certainty that businesses need, establishing strong links with the place-based, sub-regional strategies of local enterprise partnerships and combined authorities, with their newly devolved powers. This comprehensive, joined-up approach stands in stark contrast to the chaotic, sloganeering and uncosted spending plans we heard from the shadow Chancellor at the weekend and again from the Leader of the Opposition today—woeful!
The way our modern industrial strategy is shaped is just as important as the end result. The strategy needs to be not only ambitious but effective, and businesses must be fully engaged, so it is good to see that the Chancellor and the Secretary of State for Business, Energy and Industrial Strategy are taking the lead in developing stronger, more trusting relationships with many businesses. Establishing a modern industrial strategy in that way creates the clarity we need to counter uncertainty and to build confidence and trusting relationships so that we can seize the economic opportunities that lie ahead.
That rightly puts a clear focus on productivity. I was pleased to hear what the Chancellor said today about the national productivity investment fund, and particularly about investment in skills and the commitment to improving the reputation of technical skills, which has been left undone for decades. The new T-levels will be vital and will make a real difference to social mobility and life chances, regardless of where people live in the country.
In the spirit of improving productivity and life chances across the country, I also welcome the Chancellor’s action—this was not mentioned too much in his speech—to boost broadband, as set out on page 43 of the Red Book, where there are proposals for connection vouchers, which will be welcome in parts of the country that have felt overlooked in recent years.
I am pleased to see the Chancellor’s continued commitment to the northern powerhouse, despite the comments of the Opposition, and particularly to the Cheshire science corridor, which is pivotal to the growth that we want in constituencies in Macclesfield and across Cheshire. It is worth noting that the ONS has set out that R and D spending by businesses is much greater in the north-west than it is in London. We have a really solid base of investment in the private sector, as well as in the public sector, in the north-west. The single largest area of R and D expenditure for businesses is in pharmaceuticals, which are critical not just for the science corridor in Cheshire, but to ensure that the whole country achieves its full potential.
We must continue to foster and support the gross value added that is created by pharmaceutical manufacturing, which contributes massively to our country—more so than in any other country except Germany. Cheshire East has a higher GVA per head than east Surrey, and we want to see a similar improvement in productivity throughout the entire north-west. We will make sure that that happens through the innovative work that is being done in technical training. We must do more to improve skills. Setting out 15 clear career pathways for apprentices is vital and the new T-levels that are being talked about are very welcome, as is the £500 million investment in tech skills for 16 to 19-year-olds. That will help to transform their experience and help us to be ready for the challenges ahead. For those reasons, I give my full support to this very important Budget.
Ian C. Lucas (Wrexham) (Lab)
It is a pleasure to follow the hon. Member for Havant (Mr Mak), who spoke about the fourth industrial revolution. We still have lessons to learn from the first.
This is the eighth Budget delivered by a Conservative Chancellor since 2010. Those of us who are old enough to remember will know that the first was rather cheekily called an emergency Budget. It said boldly that, by 2015, the deficit would be gone. Today, we heard that, by 2022, the deficit will be £19 billion. The Government have a record of failure. That target was set by the Government and they failed to meet it. They knew what the task ahead was, set a target and failed.
David Rutley
Does the hon. Gentleman recall that, shortly after the Budget speech given by the former Chancellor, the OBR set out clearly how it had underestimated the scale of the deficit and the impact of Labour’s management?
Ian C. Lucas
Strangely, I do not remember that; but the Government certainly got their excuses in early.
What we had from the Chancellor Alistair Darling in 2010 was a really excellent costed plan to reduce the deficit in a measured and sensible way. What we got from the Conservatives was an increase in VAT, deflation of the economy, stopping investment in infrastructure projects—a mess that has led to increased failure and decreased capacity delivering in the economy.
Ian C. Lucas
Let me make some progress.
I recently saw an example of the problems in our economy, and I want to talk about the difference between investment in the economy in the south-east of England and failure to invest in the economy in the rest of the country.
I recently had the great pleasure of going to Belfast. I flew from Manchester airport and I caught the excellent mini-bus from Wrexham station to the airport. It is really good, but holds only about 12 people. It got me there well. When I came back, I flew to London City airport, and from there I seamlessly drifted on to the docklands light railway, which came through investment in the local economy. I then moved seamlessly on to the Jubilee line, and I was here in 45 minutes. Wrexham is a 45-minute drive from Manchester airport, but can we get a rail connection to Manchester airport from north Wales, where some of the best businesses in the country are based? In the present system, that is absolutely impossible, and the reason for it relates to the 1980s, to where we need to look back.
In 1985, I was a newly qualified solicitor. I ran my own business and employed 12 people, so I do not need lectures from the Tories. When I started off, we had wonderful institutions such as the Halifax building society, the Leeds Permanent building society and Northern Rock—do Members remember them? They were all destroyed by demutualisation. Not only were they the main lenders to house buyers—to young people who wanted to start up new businesses; they were great regional institutions. The Halifax building society was an incredibly important regional institution. In the 1980s, those institutions were destroyed, and all the power was sucked into the south-east of England and the City. Now we have about three banks in the country from which everybody borrows. That is at the root of the problem we face.
The right hon. Member for Tatton (Mr Osborne) talked a good game: he talked about devolution and about the northern powerhouse—I was pleased to hear that. I am delighted to see that the Minister for the Northern Powerhouse has just arrived. He obviously got word that my speech was coming. It is really good to see him; he must come to Wrexham. If he does, I will look after him very well, as he knows. What we want in Wrexham, in north-east Wales and in Cheshire—the hon. Member for Macclesfield (David Rutley) is no longer in his place, but would benefit from this—is a local functioning infrastructure system that supports our local businesses.
As we have heard in the Chamber today, Germany is at the top of the list as the most efficient economy in the G7. Germany has lots of regional centres: Hamburg, Munich, Frankfurt, Düsseldorf, Stuttgart—I could go on. All those regional economies have regional banks, Sparkassen, which are required to invest in their local economies. I live in Wrexham, and if there were a Sparkasse there, I could pay my salary into it and I would know that the money was being invested in my local economy.
We need a fundamental reassessment of how to support local areas. Let me explain why. The private sector does not invest in this country’s regions. There is a market failure, as my hon. Friend the Member for Wolverhampton South West (Rob Marris) says. He made an excellent speech, and I am grateful that he is coming forward with sensible, radical economic thinking. We need new institutions through which local people can choose to invest in their local economy, because the present system is not working.
The only way of getting money from this Government—I am afraid it was the same with the Labour Government—is to go to the Treasury with a begging bowl and say, “We want some public investment in services in our area.” I have been an MP for 16 years and I have done this every year. It is very unsuccessful. It was announced today that over the next four years £200 million would be invested in public sector projects in Wales. Not one penny piece has been invested by the UK Government in transport projects in north Wales, although we have major businesses such as Airbus, and just over the border is General Motors, which needs Government support over the next few years in order to preserve jobs and be efficient. It is virtually impossible to get money from the Government, and it is virtually impossible to get private sector investment. That is because we do not have the institutional framework that enables us, if not to receive money from the Government, to borrow the money. I saw that in the 1980s in the north-east of England, where I was brought up.
Ian C. Lucas
I cannot give way; I have very little time.
In the 1970s, an excellent public transport system, the Tyne and Wear Metro, was built on Tyneside. That is what we need in north-east Wales. It was created by the Tyne and Weir passenger transport executive. Mrs Thatcher abolished that body because it was successful, and because it was a threat to her centralisation programme, which was a massive step. Not only was the private sector centralised; the public sector was centralised as well. What we need to see in this country is a radical change. We need to get away from the small-scale tinkering that took place today, and start investing in our local economy.
Let me end by mentioning a company in Wrexham called Dee Valley Water, It was doing an excellent job in Wrexham and Chester, but I am afraid that in the last three months, against the wishes of its own workforce and against the wishes of local people, it has been taken over by Severn Trent, which will now provide monopoly water services in our area. I cannot remember exactly what Severn Trent pays its chief executive, but it is either £2.4 million or £2.6 million, and we, the people who pay for water in the area, have to contribute to that sum. This was done over our heads: we had no say.
We need a change in the corporate governance system relating to businesses so that such obscenities end. We need the devolution of powers to local communities, which have been waiting for far too long. We have had centralisation under both Governments. The horrors of the 1980s need to be swept away, so that we can make real progress for our people.