Budget Resolutions

Keith Vaz Excerpts

Thursday 9th March 2017 Commons Chamber

[John McDonnell]

As always, my hon. Friend has pre-empted my remarks. Not only did the Government fail to address social care yesterday, but they failed to address in any way the crisis in our NHS. It was completely ignored.

Ahead of the autumn statement, Labour and others were warning that the NHS was in crisis. It was in crisis before the winter, but the Chancellor could not find a single penny for the NHS in the autumn statement. The Royal College of Nursing now says that the NHS is in its worst crisis ever. Ahead of the Budget, the British Medical Association called for another £10 billion for the NHS. As my hon. Friend has just said, A&E waiting times have today got worse again—more people are waiting longer. It is astonishing that there was a complete failure on the part of the Chancellor in the Budget to recognise the scale of the crisis that our hospitals and doctors face. It is a crisis that the Government created by cuts.

Instead, we have a £100 million fund to enable GPs to triage in accident and emergency. The capital spend will build rooms for GPs in hospitals with no GPs to staff them, because no revenue funding is associated with the proposal.

[Keith Vaz (Leicester East) (Lab)]

The issue is not just the immediate crisis in the NHS, but the preventable future crises that will come from long-term conditions such as diabetes. There seems to be no planning for the future. Does the shadow Chancellor agree that we have missed an opportunity to invest in prevention to save the taxpayer an enormous amount of money in future?

[John McDonnell]

I congratulate my right hon. Friend on his campaign, which he has stuck with for a number of years. I remember him saying that some years ago under a previous Secretary of State. Assurances were given about investment in preventive medicine and so on, but then what happened? We had an unnecessary £3 billion reorganisation imposed from the top and the money was lost. I regret that my right hon. Friend has had to continue his campaign. We need investment in preventive health, but we also need emergency funding now for the NHS.

This shows the difference in values. Labour says we need investment in the NHS, but the Government believe we need tax giveaways of £70 billion over the next five years to those who need it least. People are suffering in the NHS and they need social care. People are dying because of the Government’s decisions. They have failed to address them, but have also prioritised tax cuts for big corporations and the wealthiest few rather than investment in our NHS.

On education and skills, the Chancellor claimed in his speech that the Budget was for the young and for skills. He waxed lyrical about the need to provide decent chances in life for all. We share those sentiments—extra funding for training is welcome—but the £500 million of additional skills funding is nowhere near enough to undo the damage of seven years under this Government. Adult skills funding has fallen by 54% since 2010, which is a cut of £1.36 billion. That £500 million does not even come close to reversing the damage already done.

The Chancellor is providing £1 billion for the vanity project of free schools. That is more money for the ludicrous throwback of grammar schools. Thousands of Whitehall hours have been wasted on schemes for a tiny handful of privileged children, leaving the rest to fail. It is the same old Tories, isn’t it? There are real-terms funding cuts for the state schools that 95% of our children use. They are the first cuts since the last Conservative Government. Fifties throwbacks and fantasies are not how we should run a modern education system.

Finally, the Chancellor never spoke the word “Brexit” in his speech yesterday. Shocking. The Chancellor was silent on the greatest challenge facing this country. The word “Brexit” never passed his lips once during his speech. As Britain prepares to begin the process of leaving the European Union, the Chancellor had nothing to say on the matter. It should be clear why. I do not think he agrees with the position of his Government. The Prime Minister claims that no deal is better than a bad deal, which is absurd—no deal would be the worst possible deal. The Chancellor knows that very well. He knows it is a risk, because the warnings come not just from Labour but from manufacturers, business leaders, employers organisations, trade unions and a wide range of civil society organisations. They come from economists and international organisations as well. The Chancellor is being told from every part of our economy that to crash out of the European Union without a trade deal will be disastrous. We will be cut off from investment and our biggest trading partner. We will be cut off from the skills of EU nationals, who have made so much of a contribution to our economy and society. It is a disgrace that those EU nationals live with insecurity still because the Government will not give them the assurances they need, but that is where the Conservative party is setting its course.

--- Later in debate ---

[John McDonnell]

I know how hard my hon. Friend has fought on these issues, and I congratulate her. She has a grassroots understanding of the consequences of that lack of funding, and of the implications for her region and city. The consequences of the lack of investment are staggering, but it also undermines confidence in the private sector to match fund and invest. That is what we are seeing, even at the first stage, and yet, as my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) said, we heard in the Chancellor’s statement not a word of assurance to anybody, whether council leaders, business investors or workers. I found that disgraceful.

It is interesting that, prior to the Budget, the Chancellor and allies floated the idea that he was garnering a £60 billion fighting fund to deal with Brexit. It is not a fighting fund; it is a failure fund. He is having to put aside cash to deal with the consequences of what he knows will be a Tory Brexit failure. That is what the failure fund is for.

[Keith Vaz]

On Brexit, I wonder whether my right hon. Friend shares my concern that no provision has been given to the Home Office for processing the applications of 3.2 million EU citizens. The Home Office has suffered enormous cuts over the past few years and will simply be unable to deal with the applications that will be made. Currently, there is a seven-month wait to get a certificate to remain. Does he believe that provision should have been made for that?

[John McDonnell]

It is not just that provision should be made, but that the cuts have established that situation. Whatever system is introduced, that organisation will not be fit for purpose because of a lack of investment over the recent period, which my right hon. Friend has consistently pointed out.

We understand the vote in the referendum. People voted to leave, but we repeat time and again that they did not vote to trash their jobs, their livelihoods or the economy. A responsible Government would ensure that jobs and the economy were protected. A responsible Budget ahead of article 50 would have shown how the Government would protect both. The Chancellor had a responsibility and failed to deliver on it.

The Chancellor has dared to talk elsewhere about the difficult decisions he had to make. It is not he who is making the difficult decisions; it is the NHS manager in a hospital deciding whether someone will have a bed or a trolley; a police commissioner deciding which streets will be patrolled; or a council leader deciding which children’s centre will be closed. They are the ones with difficult decisions, not the Chancellor. He is passing the buck to others for his cuts.

I think that the Chancellor lives in a world in which he is completely insulated from the consequences of his decisions. He can sit in No. 11 and delete lines from his spreadsheet without a thought for the consequences. For him, it is all in a day’s work, and it is the rest of our society who must deal with the results. We have had seven long years of austerity from this Conservative Government, and the spending cuts have dragged our economy and society to the brink.

The suffering has been immense, and it is not the Chancellor or his colleagues who have been on the receiving end. It is their victims: those parents who cannot get a school place at the moment, those young people who cannot get a decent home because of a housing shortage, those families who cannot get care for their parents. We have seen public services shredded and basic standards in public life torn up, and for what? So that this Government can add three quarters of a trillion pounds to the national debt. After seven years of austerity, and two years after it was supposed to have ended, what can we look forward to? Continual cuts in public services for the rest of the decade.

This was a Budget of complacency. We need a Government who will introduce a fair taxation system, who will use public resources for long-term, patient investment in our economy, who will tackle tax evasion and avoidance at the same time, and who will grow our economy but, as we build a prosperous economy, will ensure that that prosperity is shared by all rather than being given away in tax cuts for the rich and the corporations. Yesterday’s Budget was not just complacent; it was arrogant, and it was cruel.

--- Later in debate ---

[Sajid Javid]

I know the right hon. Gentleman cares about this issue and was deeply involved in it when he was a Minister. I am sure he knows that when the Government set out their plans for the additional £10 billion per annum by 2020, the NHS five-year plan was calling for £8 billion. This goes over and above that. The announcement made in yesterday’s Budget of the additional £325 million plus the £100 million is on top of the £10 billion per annum.

[Keith Vaz]

Does the Secretary of State share my concern that there is not enough emphasis on prevention for long-term conditions such as diabetes? His ministerial colleague sitting on his left, the hon. Member for Battersea (Jane Ellison), was probably the best diabetes Minister we have ever had, and a lot of what she did was on prevention. Why has more money not been made available for investing in the future and cutting the taxpayers’ contribution in years to come by setting up prevention centres for conditions such as diabetes?

[Sajid Javid]

The right hon. Gentleman makes a good point about the importance of public health, and he is absolutely right to pay tribute to the former Health Minister, who is now the Financial Secretary to the Treasury, for the work she did. I hope he will agree with me that the work that my hon. Friend and others did shows that they have taken this issue seriously. Some of the measures that the Chancellor talked about in his Budget statement—the so-called sugar tax, for example—will help in the long term with prevention, especially in the case of diabetes.

Health and social care are not the only public services that we are investing in. The Budget funds a further 110 new free schools. It funds free school transport to include all children on free school meals who attend a selective school. It also provides an additional £216 million of investment in existing schools.

When I was a teenager, my comprehensive school refused to let me study the A-levels of my choice; the people there said that it would be a waste of time and that I should leave school and just go and get a job instead. What I did was get on the bus and go to the other side of Bristol to sign up at Filton Technical College. I am proud to call myself a graduate of FTC. The education I received there was second to none. Without Filton, I certainly would not be standing here today—so you can blame them if you wish I wasn’t.

Many opportunities were opened up by my time at Filton, but for years afterwards I would still see eyebrows raised and sneers barely supressed when I said that I had been to a technical college. For too long in this country there has simply not been parity of esteem between valuable technical education and more academic study. As Business Secretary, I began the process of changing that, including by creating the Institute of Apprenticeships. I am very pleased that the introduction of T-levels announced yesterday will continue that process.

We are following the work carried out by Lord Sainsbury, Baroness Wolf and other experts in this field to radically improve technical education, and in doing so we are investing an additional £500 million a year in our 16 to 19-year-olds. We will also be offering maintenance loans for those undertaking higher level technical qualifications at the new institutes of technology and national colleges.

--- Later in debate ---

[Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)]

During the heated interchanges that took place a short time ago, I was wondering whether this was merely a private fight or if anybody could join in—I will take this opportunity to join in. Let me declare first of all that my approach to understanding economics is different from that of the Front-Bench spokesmen, so if the House will forgive me, I will take a couple of minutes to set out why I see things slightly differently so that Members can better understand my critique of particular aspects of this Budget.

I am highly critical of an approach to economics that seeks to mimic the physical sciences and imagines that it can predict the future through statistical means. Great economists of the past of different traditions, ranging from Adam Smith to Karl Marx, would have rightly scoffed at that notion. When I picked up the Office for Budget Responsibility’s “Economic and fiscal outlook” yesterday, it fell open at page 45, which Members will recall contains chart 3.8, on effective exchange rate assumptions. If we look at that chart—some hon. Members are doing so—we can see that the OBR is able to accurately plot the past, which contains wild variations in the exchange rate, and that the biggest variations are often due to not economic decisions, but political ones, such as the EU referendum. The OBR’s prediction for the future, however, is a perfect straight line parallel to the horizontal. The only thing we know is that that is the least likely thing to happen to the exchange rate but, owing to that approach, built-in assumptions make us highly vulnerable to misreading the actions that need to be taken. Straight lines rarely predict human activity.

It was therefore with genuine concern that I heard the Chancellor deem it important in the opening section of yesterday’s statement to read out spreadsheets and forecasts as though they were going out of fashion while entirely failing to mention in any depth the key issues challenging the future economics of this country. As has been said, he failed adequately to address the challenges of Brexit, for example, but I will come to that in a moment.

Allow me to reflect a little on different ways of looking at the economy and to make three key observations. First, an economy is not a machine but a network of relationships among human beings. What do these networks do? They are built upon myriad individual and collective decisions that are affected by an almost infinite array of influences. Not only do we not know the future with any degree of precision, but we cannot know the future with any degree of precision, yet that is what such detailed forecasts pretend, and they are provided without even any margins of error.

We know that decisions are critical, so I thought about how I could highlight the importance of that and some of the things that the Government could do. The best example came to me yesterday when, along with many Members, I attended the WASPI women demonstration. Those people face having to make key decisions about their future, but this Government utterly disrupted the way in which they were able to make rational decisions, because they were given no proper notice about the huge changes being made to their pensions. Rather than helping to give some coherence to the economy to enable people to make as rational a decision as possible, the Government’s actions have caused disruption. The effective operation of the marketplace is being disrupted, not helped.

Secondly, we cannot ignore the influence of politics on economic activity and vice versa. By entirely ignoring the effect of Brexit in his speech, the Chancellor ignored the influence of such a political decision, but some of the effects of Brexit should have been tackled. The failure to guarantee the rights of EU citizens in this country will lead to disruption in the labour market. I am sure that I am not alone in knowing constituents who either have already left or are preparing to leave the country, including people who run small businesses, a German couple, someone in the creative sector, and one or two university researchers.

[Keith Vaz]

The hon. Gentleman and the SNP should be commended for raising this issue on so many occasions. It is the practicalities that worry me. EU citizens are extremely worried and distressed about their current position, so they need their applications to be processed, but there is no provision in the Budget to allow for those applications to be processed efficiently. Millions of people will have to go through the system.

[Roger Mullin]

I entirely agree with the right hon. Gentleman. Indeed, that is a great worry to me, as it is to him and to many others. It is about not only the system’s efficiency, but its effectiveness and ability to make the right kinds of decisions in complex individual cases. I have constituents who have been here for many years but are finding it difficult to get various applications through.

--- Later in debate ---

[Norman Lamb]

Our spring conference is approaching and we will be coming up with proposals.

[Keith Vaz]

Invite him to your conference.

--- Later in debate ---

[Keith Vaz (Leicester East) (Lab)]

Thank you, Madam Deputy Speaker, for the endorsement that I can count; I am most grateful. It is a pleasure to follow the right hon. Member for North Norfolk (Norman Lamb), who is widely respected in the House as someone who knows a huge amount about social care and the health service. His project is, I think, welcomed by all parties. We do need an independent assessment of health spending.

The Times today contains a marvellous cartoon of the Chancellor dressed up as Marilyn Monroe, showing his NICs. I do not know whether Ms Monroe could sue for that cartoon, although she has been dead for some years. I want to take the debate away from national insurance contributions, which have dominated the discussion, to other areas. It is important to remember that the Budget is about funding the whole of Government, not just one aspect, although it is, of course, important to raise the money before spending it.

I begin with the Government’s international aid commitment, which was reiterated by the Prime Minister and confirmed by the Chancellor. I was pleased to note that 0.7% of gross national income for aid remains a strong commitment of this Government, even though less time in the Budget statement was spent on international development than the Chancellor spent praising his Parliamentary Private Secretary, the very worthy hon. Member for Salisbury (John Glen). The Chancellor went past the development commitment very quickly, and, rightly, lavished praised on the hon. Gentleman for all the work he has done. However, I shall talk about the importance of maintaining and increasing the aid budget, especially at a time when there is a great deal of media pressure and scrutiny over what we do with our aid. It is right that there should be that scrutiny, although some sections of the media have an obsession with challenging every single bit of expenditure as if it in some way undermines the important principle that our Government provide aid to countries in need.

In particular, I highlight the aid given by the Treasury to Yemen through the Department for International Development. We heard only today that there is now a famine warning in Yemen. Of the aid that we give in the overall DFID budget, £100 million has been committed to the people of Yemen. However, although contributions have been made at a local level, a lot of the money can sadly not be delivered because of the current situation. My message to Treasury Ministers is to keep up with the commitment to fund DFID and to ensure it delivers to countries in need, such as Yemen. The aid should not just sit in a bank, but actually be spent. Until there is a ceasefire in Yemen, we will not be able to spend that money and therefore will not be able to alleviate that poverty.

[Stephen Doughty]

I concur with my right hon. Friend’s comments about the importance of DFID’s work and the support that it is providing in Yemen. That work has been praised by the Select Committee on International Development, as he well knows. Does he share my concerns that while we are providing that aid, Amnesty International has today said that there is new evidence that the Saudi-led coalition is using cluster munitions?

[Keith Vaz]

My hon. Friend is an amazing campaigner on these matters and has worked hard on the Yemen issue. He is right to raise this point, which is part of the overall debate and discussion. We cannot get the aid through unless the bombing stops. We need the ceasefire so that the £100 million that has been committed is spent. I bumped into the Secretary of State for International Development in Central Lobby yesterday, and she said that she is focused on and committed to increasing the amount of aid to Yemen. I am grateful for that, but that aid cannot get through, as my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) says, unless the bombing stops.

[Bob Stewart]

The right hon. Gentleman and I have a great interest in Yemen, both of us having lived there. My concern is that if we do not keep the aid in the bank, it might end up on some quayside in some dodgy port, where we do not want it to be and where it can be rifled by the mafia. We have to find a balance when we talk about delivering aid, particularly to somewhere like Yemen, because although we may be able to put the aid into the country, there it will sit until someone steals it.

[Keith Vaz]

The hon. Gentleman has served in Yemen, so he knows how lovely that country is when it is fully functioning. He is absolutely right that the aid needs to get to the people who actually need it, if they are to avoid the famine that is coming their way very shortly.

The second point I want to make is about the midlands engine. We have heard a lot about Birmingham and the west midlands—I am sure that has nothing to do with the fact that there is an election for Mayor in the area—but the Government need to remember that there is more to the midlands than Birmingham and other parts of the west midlands. There is, of course, Leicester and the east midlands. There is also Sherwood, and I see the Government Whip, the hon. Member for Sherwood (Mark Spencer), sitting on the other side of the House. I received a letter from the Secretary of State for Communities and Local Government just now on my iPad, and Sherwood is not even mentioned—I hope the hon. Gentleman will make representations about that. If we talk about the midlands engine only in respect of Birmingham and the west midlands, we will lose out in terms of a part of the midlands that has been a driving force for business. There are huge amounts of talent, enterprise and expertise, and many small businesses, in places such as Leicester, so it is important that we spread the money evenly throughout the whole of the midlands.

Earlier, I mentioned that the Financial Secretary to the Treasury, who is sitting near the Dispatch Box, was my favourite diabetes Minister, and I pay tribute to all the work she did in the years she served in the Department of Health, along with the right hon. Member for North Norfolk. Last year’s Budget gave us the sugar tax, which was resisted by some in the Government. As a result of that tax, manufacturers are now changing their formulas to ensure, yes, that the tax yields less when it comes into effect, but also that our young people in particular will be able to eat products with less sugar in them.

The latest such product—commended by me in an early-day motion—is, of course, the breakfast cereal Honey Monster Puffs, whose sugar content has been reduced by 25%. Nestlé announced yesterday, just before the Budget, that it would reduce the sugar content of KitKats and other products by 10%. Those of us who frequently have to go to the Tea Room, and who are met by all the KitKats there—I am sure you are not seduced by those who run the Tea Room, Madam Deputy Speaker—will be pleased to know that we probably will not even taste the difference once 10% of the sugar is removed.

However, it remains the case that I would have liked to see more focus on prevention—prevention, prevention, prevention. If we spend money now, we will save money in the future. As we know, £10 billion was spent last year on dealing with diabetes and diabetes-related issues. Some 80% of complications are avoidable. The only people who appear to be benefiting from that expenditure are the drugs companies.

Only two weeks ago, on my way back from Yemen, I stopped in Doha. I was taken—the Financial Secretary will be fascinated by this, because she has always wanted to create something like it—to a wellness centre. It had not just a GP, a pharmacy, a podiatrist and an ophthalmologist, but a swimming pool and a gym. When people go to see their doctor and are diagnosed with diabetes, instead of having to have their Metformin, they are prescribed a session in the gym or, if they can swim—sadly, I cannot, but if I could, I would be prescribed one—a session in the swimming pool. That is how to deal with diabetes—through prevention expenditure. I would very much like to hear a commitment from the Minister that prevention will be at the top of the health agenda.

I was surprised that the Chancellor did not suggest an increase in Home Office funding, which faces two very difficult challenges. Last week, Her Majesty’s inspectorate of constabulary released a report on British policing, stating that it is in a “potentially perilous state” due to “dangerous” and “disturbing” practices. The report is pretty damning, but unfair in that it places the burden of blame on police forces themselves. They have sustained enormous cuts to their budgets over the past few years, with the result that we have 19,000 fewer police officers on our streets today. This, together with other cuts, means that the police cannot deliver on the kind of agenda that the Government, and certainly the Opposition, want them to deliver on. We are constantly told that crime is coming down. Well, it is, but the nature of crime has changed: it has gone from the high street into cyberspace. Hundreds of thousands of crimes are now being committed on the internet. Unless we give the police more money to fund training, we will not be able to deal with the crimes that will be inherent in our system over the next few years.

The second aspect of Home Office funding is that the Government will, in the end, have to give a guarantee about the right of EU citizens to remain in this country. Some 3.2 million people will have to be processed. Someone who has been here for five years has a right to remain and become a permanent citizen, but they still have to apply and to get their letter confirming it. The current waiting time is between four and seven months. People have to fill in a huge number of documents to confirm that they have been living in this country over the past five years and record every single absence. A unit needs to be set up in the Home Office, properly funded, to deal with the registration of EU citizens. Ministers may grimace at that prospect, but I am afraid that we are going to have to spend money to make sure that this happens.

We need to get the police funding formula in place. In Essex, Madam Deputy Speaker, which is run by your chief constable, Stephen Kavanagh, and in Leicestershire, which is run superbly by my chief constable, Simon Cole, we need a definitive statement on what the police funding formula is going to be. Without it, we simply do not know how much money is available at a local level to spend on local matters. It is therefore essential to make sure that this happens.

The great feature of the previous Chancellor’s Budgets was that he always had a surprise concerning culture. On the last occasion, he funded a commitment to Hull because it had become the city of culture. I hope that the Minister will look carefully at what can be done for Leicester. Given the incredible achievement of Leicester City football club in winning the English premier league and becoming the current holders of the premier league trophy, it would be nice to see some kind of commitment from the Government to cultural and sporting achievement. The previous Chancellor has done it before, and I hope that the Minister will consider doing something for Leicester in future.