Budget Resolutions and Economic Situation

Debate between Michael Fallon and Tom Clarke

Thursday 24th June 2010 Commons Chamber

[Michael Fallon (Sevenoaks) (Con)]

It is always a pleasure to follow the right hon. Member for Coatbridge, Chryston and Bellshill (Mr Clarke), but he will not be surprised that I cannot agree with his analysis. I wish to make two specific comments to him. First, he spoke passionately on behalf of the poorest people in his constituency, but I cannot see how one helps the poorest and those out of work in Coatbridge by messing up the public finances and producing spending plans that are unaffordable and cannot be carried through. Making promises of that kind does the poor no favours.

Secondly, I disagree with the right hon. Gentleman’s accusation that we take pleasure in the measures that were announced on Tuesday. There are many things in the Budget that I do not take pleasure from, and many spending cuts are coming that Members in all parts of the House will probably wish had not been made. There are certainly tax increases in the pipeline that we would not have wished for. However, many of the decisions that the Chancellor has taken were simply unavoidable because of the mess that we have inherited. We take no pleasure in the judgments that have had to be made.

It is heartening to Members on the Government side of the House, after so many years of hubris, boasting and declaration, to have a Budget that is so clear, honest and straightforward. Even if the right hon. Gentleman disagrees with the measures in it, it sets them out clearly and simply. It is refreshing to have a Budget that takes the longer view—a Budget for a whole Parliament. It is good to know now the structure of the measures in it, unpopular and unpalatable as some of them are to Members on our side of the House as well as his, and that if those decisions are carried through, the current structural deficit will be closed by the end of this Parliament.

It is refreshing also to have a Government who face up to a situation that has deteriorated rapidly, as we have seen in the eurozone. There is no exact parallel between our deficit and that of Greece, or between our debt and that of Spain, but there was a parallel between the Labour Government and the Governments of Greece and Spain in that all of them ignored successive warnings. They were all warned by the International Monetary Fund, the OECD and the European Commission to start putting their public finances in order, and they ignored those warnings. That is why we have had to be confronted with a second Budget in a year—an emergency Budget that puts right the weaknesses that have been identified.

[Mr Tom Clarke]

When the hon. Gentleman makes comparisons with other countries, will he bear in mind that we in Britain are not in the euro? Will he also, as he did when he was on the Treasury Committee, recognise that there is a big difference between short and long-term debt, and that that matters?