The Economy and Work

Julian Knight Excerpts

Thursday 26th May 2016 Commons Chamber

[John McDonnell]

I will press on, Mr Deputy Speaker, as I know we are under time pressure.

All this is the direct result of a failure to invest. Too many businesses have substituted cheap labour for expensive investment. To be frank, they cannot be blamed for that, as the Government have set the lead, cutting their own investment spending. Low investment and weak productivity have real-world consequences. They mean talent wasted and opportunities lost. Some people are stretched to breaking point, working long hours just to make ends meet. Others are left to languish, desperately searching for extra hours. Even the Government’s own forecasters do not expect wages to recover before 2020.

[Julian Knight (Solihull) (Con)]

Will the hon. Gentleman give way?

[John McDonnell]

I will in a second. Millions of people are now self-employed, but their average earnings have fallen by 22% since the right hon. Member for Tatton (Mr Osborne) became Chancellor. The Queen’s Speech tells us that the Government plan to create an economy

“where work is rewarded.”

Nothing could be further from the truth. Those who work hardest are being punished with cuts to tax credits, but tax dodgers and the super-rich are rewarded with tax cuts.

--- Later in debate ---

[Mr Osborne]

We worked together to bring welfare bills down and to make work pay. I am working with the new Secretary of State for Work and Pensions, my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) to carry on that record in government. We will go on building that strong economy and the sound public finances that underpin a fair society.

[Julian Knight]

I thank the Chancellor for giving way. He is being most generous. I note that the Chancellor has been reading from the “Labour’s Future” report. I wonder whether he has seen the executive summary, which states:

“Labour lost because voters didn’t believe it would cut the deficit. The Tories didn’t win despite their commitment to cut spending and the deficit: they won because of it. The Tories were trusted to manage the country’s finances, Labour was not.”

[Mr Osborne]

My hon. Friend is absolutely right. If the verdict of this report is that Labour is on life support, the policies of the shadow Chancellor are “do not resuscitate”. That is what he is condemning the Labour party to.