Economy

Lord Mawhinney Excerpts

Thursday 10th September 2015 Lords Chamber

[Lord Mawhinney (Con)]

My Lords, I congratulate the noble Lord, Lord Haskel, on his introduction of this subject for debate. I welcome the wording that he chose about economies after austerity. I will follow his lead. He did not try to define austerity or when “after austerity” might happen. Unlike others who are better qualified than me, I will not involve myself in deep economic theory. I will simply highlight two issues that have plagued this country for a very long time. I have chosen them in part because they have plagued Governments on all sides of this House, so they are not in any sense party political.

The first issue is the present level of inequality in our society. I commend the Government because they have recognised that; at least, that is the interpretation I put on the fact that the Prime Minister has repeatedly said that he will govern as one nation. He has also made it clear that, in his view, we are now the party of working people. The House will know that one-nation Toryism has a resonance within the Tory party as well as outside it, but I take my right honourable friend at his word: he will govern as a one-nation Tory and on behalf of working people.

If that is the case, there flows from it an inevitable focus on inequality. The Government have done well. They have addressed inequality at the low end through taxation measures and through commitments to living wages. Tackling it at the upper end is much more difficult because it immediately runs into fundamental questions about the role of government alongside the role of the private sector and the market. I am a good enough Tory to believe that you tread in those areas at fairly considerable risk. Yet, if we are to be serious about being one nation, the inexorable rise of inequality under all Governments—I stress again that this is not a party-political point—needs to be addressed. That is likely to be the test in the future of one nation for working people.

The second point that I have heard discussed in the 36 years that I have been privileged to be in this building—26 at that end, 10 at this—is that manufacturing in this country has not prospered. It has gone down. That fact sometimes gets masked by the success of service industries, but manufacturing is fundamental. It is affected by issues outside the Government’s control: the economies of other countries; the exchange rates of currencies; the tendency of other countries to help their economies by dumping in the world market.

My introduction to the Conservative Party was in part that I was taught that what we made and sold was an integral and fundamental part of our national wealth. I am old-fashioned enough still to believe that. If we are a one-nation Government, strengthening and addressing that long-standing manufacturing problem—which was true under all Governments; I am not making a party-political point—needs to be addressed. The future will tell us whether and how effectively those two issues prospered after austerity.