Policy for Growth

Debate between Mel Stride and Virendra Sharma

Thursday 11th November 2010 Commons Chamber

[Mr Virendra Sharma (Ealing, Southall) (Lab)]

I am grateful for the opportunity to speak in this important debate. Economic growth in the UK in the months and years ahead is extremely uncertain for two reasons. First, the Government’s reckless gamble to eliminate the structural deficit in four years by reducing public spending by £81 billion is resulting in 500,000 public sector job losses and a further 500,000 private sector job losses are likely. This will impact on growth, causing a double-dip recession at worst and stagnation in the UK economy at best.

[Mel Stride]

Will the hon. Gentleman give way?

[Mr Sharma]

Let me make some progress and the hon. Gentleman can try again.

Secondly, having been caused by international factors, the current economic uncertainty and any prospects of growth are still going to be greatly determined by what happens in the international economic arena. Let me begin, then, with the international dimension.

Only yesterday, the Governor of the Bank of England warned:

“The outlook for growth is highly uncertain”,

explaining:

“The contribution of net trade to growth has so far been weaker than the Bank of England Monetary Committee had expected, and it is unclear how persistent that weakness will prove to be.”

In other words, Britain’s exports and trade with the world are not boosting our hopes for economic growth, despite a 25% reduction in sterling over the last three years.