Budget Resolutions

Jesse Norman Excerpts

Tuesday 2nd November 2021 Commons Chamber

[Stephen Flynn (Aberdeen South) (SNP)]

Politics is a remarkable thing, is it not? The theme for today is stronger public services. We had the Chancellor speaking for an hour last week and the Secretary of State speaking for what almost felt like an hour today but was in fact just in excess of half an hour, but no recognition whatsoever was given to the fact that when we talk about stronger public services, we need to reflect on what has happened over the past decade. It has been a decade of Tory austerity. As we heard earlier from the shadow Secretary of State, who made a number of excellent points, spending now will be 60% of what it was in real terms in 2010.

We know that life expectancy for the poorest in society has plummeted on the watch of this Government. They have brought the public sector to its knees. They choose to do that and they now have the gall to come to this Chamber and tell the people of Scotland and the UK that it is fine and that they are now putting more money in. Tell that to the people who have suffered so much—[Interruption.] The Chief Secretary to the Treasury shakes his head, but he can live in a parallel universe if he wants to. Alternatively, he could come to my constituency and meet my constituents who have suffered the hands of his Government since 2010. He could meet the disabled people who have been pummelled into the ground by this Conservative party. This Government might claim that they are a different Government, but they are of course the same party, and that collective responsibility belongs with each and every one of them, irrespective of whether we are talking about a stroke of the pen by George Osborne or by the latest Chancellor. They must all take responsibility for the horrific circumstances that they have caused for so many people over the course of the last 10 years.

Austerity did not just impact individuals; it also impacted the economy. We know that growth was not what it could or should have been, and the Institute for Fiscal Studies has been quite clear that by 2026, real wages—obviously accounting for inflation—will be at the same levels as they were in 2008. That is what the “party of the economy” has done over almost 20 years to the wages of working people right across these isles. If we take wages as a barometer for where the economy is at, we can see a shambolic record. But the economy does not stop there; we need to look at other things in the economy.

A word that has been conspicuous by its absence today and throughout our debates on both sides of the Chamber is “Brexit”. I do not think that the Chancellor quite promised us the sunlit uplands that appeared on the side of buses, but if we look at what the Office for Budget Responsibility says about the real world, we see that Brexit will cost the UK economy 4%. That means that our economy will be 4% smaller than it should be, as a result of an act by this Government for which they show no contrition whatsoever.

It does not take long to go out and speak to a business that is having to deal with the real-life consequences of Brexit. These businesses cannot get access to the supplies that they want, they are unable to export their goods in the same way as before, and they clearly cannot get the staff that they need. I could not believe the earlier remark by the hon. Member for Mansfield (Ben Bradley), who is no longer in his place, when, without a hint of irony, he suggested that his council needed not more money but more people. He is of course a member of the party that put up the barrier to those people coming to work in these isles.

It is not just the private sector that is suffering as a result of Brexit; it is the public sector as well. That includes care homes and our NHS. Right across the public sector, we cannot employ the people we need. The Government will talk wildly about the money that they are about to invest in the NHS, and investment in the NHS is undoubtedly a good thing, but every health board in Scotland is saying that they need staff. This will be replicated down south, and in Wales and Northern Ireland. If they do not have access to staff, the Government can throw as much money as they want at this but it will not resolve the problems. All of this is a consequence of the Government’s actions.

Let us look at the situation for those in the public sector more widely. Like everyone else, they are having to deal with the harsh reality of the cost of living crisis. The Chancellor almost brushed over this last week; I could not quite believe it. People right across the UK are having to face up to the fact that inflation will be in excess of 4%. If I recall correctly, the Chancellor said that he was working with the Bank of England to ensure that inflation was kept as low as possible, but it is still going to exceed 4%. The consequences of inflation of nearly 5% will be felt by people in Scotland, Wales, Northern Ireland and England. The price of their food will go up, as will the price of all their goods. The price of their fuel has already gone up, and will continue to do so. Energy bills are going up as well.

On top of that, according to the OBR, the Government are putting up taxes at the highest rate in 30 years. Again, we are meant to be thankful for that. The Government proclaim that it is a good thing that the people who have worked so hard to get us through this pandemic are going to have to face up to having so much less money in their pockets. What are the Government doing about that?

[Jesse Norman (Hereford and South Herefordshire) (Con)]

The hon. Gentleman is speaking eloquently about taxation. Could he just clarify whether, as a result of the firmly held views of the Scottish National party, the Scottish Government will be reducing taxes in the areas where they have tax control?

[Stephen Flynn]

I welcome that intervention from the former Minister. I have enjoyed our previous debates on all things financial. Let us reframe that discussion by looking at what we would do slightly differently in the case of spending. As he will be aware, he has been a member of a Government who are pleading that they do not have as much money as they should, at the same time as planning to spend in excess of £200 billion on nuclear weapons. He knows fine well that politics is about choices, and his choices differ drastically from the choices that we would like to make.

That is an important point, because it allows me to come full circle to my final topic, which is the situation in Scotland at this time—[Interruption.] I hear the Chief Secretary to the Treasury saying that the block grant has gone up, but he will be familiar with page 182 of the Red Book, which outlines that Scotland’s budget is to be increased by 2.4%. I am sure he would acknowledge that that is well below the rate of inflation, and well below the spending increases across a whole host of reserved UK Government Departments. I think he should reflect on that before he chunters away from his position over there.

In Scotland, we have again been told we should be grateful about the block grant, despite the 2.4% increase. We are also told that £170 million towards the levelling-up fund is a remarkably good thing, for which we should be really grateful. In my part of Scotland alone, the Scottish Government are putting in place a £500 million just transition fund to ensure that we can make the journey to net zero without leaving communities behind. We asked the Chancellor to match fund it, but despite the fact that the Government have raked in more than £350 billion from our North sea oil and gas sector, they said no and ignored our plea for a mere £500 million. Of course, they did something much more damaging than that: they walked away from carbon capture and storage in the north-east of Scotland. [Interruption.] I hear Members saying, “Shame,” and it is exactly that—shame on the Government. They walked away from that billion-pound investment in the north-east of Scotland in 2015 and they have done the same again now. They have turned their back on the communities I represent and the needs of Scotland. We can do so, so much better, and we will do better when we have that opportunity to take our own future into our own hands. Let me tell Conservative Members that that day is coming faster than they dare think.

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[Peter Dowd (Bootle) (Lab)]

Mr Deputy Speaker, in the light of the point of order from a Government Member earlier, which I thought was rather churlish, will you pass on my thanks to the Speaker, your fellow Deputy Speakers, the House of Commons Commission and the House staff for all their help and support, and the safety in which they keep us in the House?

Bootle is one of the most deprived towns in England and has five super-output areas in the lowest 1%, so how can it be right that our levelling-up fund bid has been rejected? In the light of that type of Government approach, it is becoming apparent that the Chancellor’s financial statement was pretty shallow and a sort of economic whistling in the dark. Inflation is on the rise; interest rates are on the rise; taxes are on the rise; the deficit is on the rise; the national debt is on the rise; inequality is on the rise; billionaire incomes are on the rise; profits from dodgy covid deals are on the rise; covid infections are on the rise—the Chancellor is taking the rise.

The Chancellor’s statement came three months after the Prime Minister’s levelling-up speech, in which he committed to working

“double hard to overturn…inequalities”—

inequalities that the Prime Minister and other Tory Governments have exacerbated. I am afraid the Prime Minister working “double hard” does not fill me with much confidence: 100% of nothing multiplied by two is still nothing.

What about the Government’s fiscal rules? They have missed so many targets that they have stopped counting. On 18 October, the Institute for Fiscal Studies said:

“There are currently no active fiscal rules in the UK. The fiscal rules adopted in the 2019 manifesto were abandoned just four months later with the onset of the Covid pandemic.”

The Chancellor did announce some fiscal rules, but they are unlikely to be met, like those of other Tory Chancellors, although hope does spring eternal.

How about the national debt? In May 2010, the Tories inherited a national debt of just over £1 trillion, or 63.2% of GDP; in August 2019, it had gone up by three quarters to £1.7 trillion, or 78.4% of GDP; in February 2021, just pre-covid, it had gone up again to £1.784 trillion, or 81.9% of GDP; and by September 2021, it was at £2.218 trillion, or 95.5% of GDP. So the Tories have added £16,000 for every man, woman and child in this country. That is why—to respond to the question from the hon. Member for Warrington South (Andy Carter)—you cannot trust the Tories with the economy. The party of fiscal rectitude has more than doubled the national debt in just a decade—more wrecked than rectitude.

[Jesse Norman]

Will the hon. Gentleman remind the House what the national debt as a percentage of GDP was in 1997 and then what it was when the financial crisis—to which Labour had allowed the country to become enormously overexposed through increased debt in the banking sector—had struck? I will tell him: it went from 46% to 84% while Labour was in government.

--- Later in debate ---

[Jesse Norman (Hereford and South Herefordshire) (Con)]

I very much welcome this Budget and spending review. Were the Chief Secretary to the Treasury, my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke), in his seat, I would be able to extend to him my warm congratulations, as I do to his new Treasury colleague, the Exchequer Secretary to the Treasury, my hon. Friend the Member for Faversham and Mid Kent (Helen Whately), on taking their places in such a fine Department and at such a difficult moment. To have delivered a spending review as a new Chief Secretary is a phenomenal achievement. I congratulate him, as I congratulate the Chancellor, on that.

Among the many good measures in the spending review and the Budget, I particularly single out—as many colleagues across the Government Benches have—the rise in the national living wage, the reduction in the universal credit taper rate, and the great emphasis placed on education and skills as the key to levelling up. I remind all colleagues, who will know this—none more so than my right hon. Friend the Member for Harlow (Robert Halfon), the Chair of the Education Committee—that education and skills are at the core of all the regeneration that we have seen over the years, not just in this country, but around the world. Education and skills, even more so than infrastructure, are positively correlated with economic growth and development, so I very much welcome their inclusion.

There is one area where I do have a concern that the Budget and spending review do not go far enough. It may appear to be a parochial constituency interest of mine, but it is actually an issue of national importance: the plans for which we requested support regarding the River Wye. The River Wye is a priceless national asset. Many Members of the House will have visited it in Wales and in Herefordshire, and seen its flow all the way down to the Severn. They will have seen this extraordinary national asset and its impact locally—not just its environmental richness, but the strength that it brings to tourism and economic development, and its central place in the nation’s cultural history.

It is easily forgotten that the idea of the picturesque—indeed, the idea of domestic tourism in this country—comes from visits to the Wye valley taken at the end of the 18th century, most notably by Admiral Nelson. That was what put the idea of tourism and the picturesque on the map, and that is the historic reason why the Wye is so central to the way in which we understand ourselves as regards the natural environment and our countryside.

As the Wye winds its way through Hay to the west of my constituency, through Hereford—which is right at the centre of it, of course, economically and culturally—and down to Ross-on-Wye, this priceless asset is being undermined by dreadful phosphate pollution. We must be perfectly clear that it is being undermined by sewage discharges, which have been discussed in the House, but also by significant levels of embedded phosphate—that is, animal waste on fields that has run off. We do not know the full scale of the issue. The best estimates appear to be that about 65% of the problem is embedded phosphate, 25% is discharge, and there is a further component because of the recent impact of chicken litter.

We need to know the answers to those issues and have a plan that addresses them, and that plan—uniquely, I think, for major rivers in this country—needs to operate across the border, because a large chunk of the River Wye is in Wales. One point that has struck me most clearly when campaigning on this issue over the last year and a half has been in the way in which the agencies —Natural Resources Wales, Natural England and the Environment Agency—have not been adequately talking to each other. We therefore put to the Chief Secretary, and ultimately to the Department for Environment, Food and Rural Affairs and the Department for Levelling Up, Housing and Communities, the idea of a cross-border, cross-agency, single strategy that is focused on a long-term approach to addressing the issue of phosphate pollution in the Wye.

The idea is a priceless opportunity for this country and the Government. At relatively little cost—through a degree of investment in measuring and enforcement; through a degree of constructive thinking about the long-term regulatory environment in which water discharges are to be managed along the Wye valley basin; and, of course, through the recruitment of citizen energies, which are already active and vigorous up and down the Wye—a great opportunity exists to bring these different resources together in a single, co-ordinated plan that is led by the Government, with the support of the Welsh Government, which I am afraid has been conspicuously lacking on the issue so far. That gives us a national opportunity to bring an end to this scourge of pollution and to restore this priceless, gorgeous, wonderful natural asset to its pristine glory.