Management of the Economy and Ministerial Severance Payments

Debate between Matt Rodda and Anthony Browne

Tuesday 15th November 2022 Commons Chamber

[Anthony Browne (South Cambridgeshire) (Con)]

I echo at the outset the words of my right hon. and learned Friend the Minister for Levelling Up, Housing and Communities: mistakes were made. The Prime Minister said the same thing. The most important thing is that we fix them rapidly. That is the difference between the Government and the Opposition: we do not repeat mistakes and go on, but fix them amazingly quickly. We had a quick change of leader and of Chancellor, but most of the measures that the Opposition have been discussing were never implemented. They were reversed before implementation. We await the autumn statement on Thursday to see all the measures that the Government will take to ensure that we live within our means and get the economy on the right path again.

Various Members on both sides of the House have mentioned the different crises that we have faced since the 2019 election. I sit on the Treasury Committee, and we have been following closely the economic response first to the pandemic and then to the war in Ukraine. There is no doubt that the pandemic was an extraordinary economic shock, not just to the UK, but to economies around the world. However, our response was by and large incredibly generous and ensured that the economic reaction was less severe than it would otherwise have been. Likewise, with Ukraine, there has been a huge amount of support for households in the cost of living crisis. Various Members have mentioned the energy price fix. We are also introducing a windfall tax, and there are too many forms of support for households to mention. Most people understand that the Government’s response to those two major, once-in-a-century crises, which happened back to back, has been extraordinary. It would have been amazing if no mistakes had been made. Some were made and we have put them right.

We all know what is happening here. As my hon. Friend the Member for Orpington (Gareth Bacon) said, it is political game playing. The Opposition are looking to the next general election and trying to burnish their economic reputation. They know that the Conservatives are trusted most on the economy and Labour is not. I do not blame the Opposition—they are trying to turn that around and say, “You can trust us with the economy; you can’t trust the Conservative party.”

It is worth reminding people of the Labour party’s economic record and why a lot of my older constituents vote Conservative. They have lived through previous Labour Governments. I will go back not to the Labour Chancellor going cap in hand to the International Monetary Fund in 1967 or to the winter of discontent, which I remember, when the rubbish was piling up in the streets, but to the last Labour Government of 1997 to 2010. I was economics correspondent at the BBC when Tony Blair and Gordon Brown came in and at the time of their emergency first Budget. That election campaign was largely fought on unemployment, but the economic scenario in 1997 was golden. For years afterwards, people said that Gordon Brown was the lucky Chancellor. He inherited extraordinarily benign economic conditions. I gave up being an economics journalist because there was nothing to write about. We had budget surpluses and flat inflation, but it was all inherited from the previous Conservative Government and the result of the reforms they introduced. However, that did not last.

It was mentioned earlier that every Labour Government have left office with unemployment higher than when they came in. The same is true of the 1997 to 2010 Labour Government.

[Matt Rodda]

I am grateful to the hon. Gentleman for going back to the 1990s. It is fascinating to hear him recall that long period of higher growth compared with when the Conservatives have been in power. Does he want to reflect on that and the difference between the two parties’ management of the economy?

[Anthony Browne]

I will come to that. The economy is like a tanker and it generally moves slowly. In 1997, the Labour Government inherited the results of the all the reforms that Norman Lamont, Ken Clarke and others introduced under John Major. However, that did not last.

The Labour campaign in 1997 was fought on employment and I particularly remember Gordon Brown’s rousing speeches about workless households—households where no one had ever worked. That was Labour’s big attack on the Conservatives’ economic incompetence. What happened to workless households under the last Labour Government? They did not decrease—they doubled. There were twice as many workless households when Labour lost power in 2010 than when they came in in 1997.

Another big campaign theme for Labour in 1997 was youth unemployment. One would have thought that, after 13 years of Labour Government, youth unemployment would come down. What happened to youth unemployment? It went up by almost half; 939,000—almost a million—people aged between 16 and 24 were out of work in 2010. That is the legacy of Labour’s economic policies.

We have discussed filling black holes and living within our means. I am a fiscal conservative and I believe that all countries and Governments need to live within their means. Labour inherited a golden economic scenario, but what happened in the end? As I said earlier, the last Labour Chief Secretary to the Treasury left a note for his successor on his desk. We all know what it said: “Dear Chief Secretary, I am afraid we have run out of money.” As Margaret Thatcher famously said, the trouble with socialism is that

“you eventually run out of other people’s money.”

It is not surprising that the Opposition are trying to burnish their economic credentials and point to any mistakes that the Conservatives have made. We are putting those mistakes right and the Labour party would not do that.

Much of the debate has been about home ownership rates. I am a huge supporter of increasing home ownership. I set up the HomeOwners Alliance to campaign for people to own their homes. Some 86% of people want to own their homes. The Labour party has traditionally and historically not been a huge supporter of homeowners, preferring to focus on social housing. That is important, but so is owning your own home. Most people who live in social housing want to own their home. I welcome the Labour’s conversion and attempt to position itself as the party of home ownership—good luck to them. However, what happened to home ownership under the last Labour Government?

Generally, from the 1910s and 1920s onwards, home ownership increased under different Governments—even some early Labour Governments. It went up and up under Margaret Thatcher. What happened when Labour was elected in 1997? It took about two years for home ownership rates to start collapsing, and that continued throughout Labour’s last term. The Labour party was not the party of the homeowner; it was the party of falling home ownership rates. When we were elected in 2010, it took a couple of years to turn things around—a bit like a tanker—but home ownership rates started to increase again through all our measures to help homeowners. I totally support the Government’s ambition to build homes and help home ownership increase.

[Matt Rodda]

The hon. Gentleman is being very generous with his time, but I would like to point out that, as I understand the figures, home ownership is actually declining at the moment. Certainly in my constituency, it has been for some time, and my predecessor, who was a Conservative, wrote an article in The Economist about it. The hon. Gentleman might want to reflect on the difference between what the Conservative Government are claiming and what has actually happened.

[Anthony Browne]

I do not know what is happening in the hon. Gentleman’s constituency, but nationally—I can provide him with a graph later—home ownership rates began going down a bit after 2010, but then they started going up again. They have had a bit of a wobble, but there have been a lot of economic things happening.

Given our economic track record versus the Labour party’s rhetoric, many constituents say to me when I knock on their doors and they are worried about the pandemic, the cost of living crisis and Ukraine, “Just imagine what would have happened if the Labour party under Jeremy Corbyn had won in 2019.” Am I allowed to say that?