Amendment of the Law

Neil Carmichael Excerpts

Thursday 20th March 2014 Commons Chamber

[Vince Cable]

I believe that about a third of the total number who are classified as “youth unemployed” are, in fact, engaged in full-time study. One of the big changes for which the coalition Government should take credit is the continued expansion in higher education: despite all the doomsday predictions from Opposition Members about the radical higher education reforms, the number of people going into higher education, particularly those from disadvantaged backgrounds, has risen.

[Neil Carmichael (Stroud) (Con)]

Does the Secretary of State agree that the issue of our productivity is linked directly to skills? Is it not rather ironic that the shadow Chancellor, who was Secretary of State for Children, Schools and Families, signally failed to help the nation to secure the right degree of skills—unlike us, with our long-term economic plan?

[Vince Cable]

Yes, indeed. I think that the apprenticeship model which we are now developing and expanding rapidly, in terms of both quality and quantity, is the remedy for the long-standing neglect to which my hon. Friend has rightly drawn attention.

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[Neil Carmichael (Stroud) (Con)]

It is a great honour to follow the hon. Member for Luton South (Gavin Shuker), not least because he and I will be working together on the all-party group on polar regions, which is absolutely fabulous.

The Budget is a staging post in the mission to rescue the British economy. It is an important staging post and it signals some important messages. First, I will introduce some thoughtful points on productivity, which we have discussed from time to time in the Chamber. Increasing productivity is the way to deal with the cost of living crisis, because we need a work force who are skilled to such a level that we can enhance our capacity in manufacturing, engineering and related activities. The importance of ensuring that we have a skilled work force is embedded in our long-term economic strategy and is part of the Budget because, as I have said, it is a staging post.

In my constituency, I have promoted manufacturing and engineering through the festival of manufacturing and engineering, which is designed to ensure that young people are introduced to the advantages of working in manufacturing and the opportunities that are provided by a career in engineering. They will end up dealing with the cost of living crisis by contributing to increased productivity and an economy that blasts forward by competing powerfully not just in the EU, but in the global economic race that we are undoubtedly in.

I am pleased to welcome the changes to pensions, annuities and so forth. Encouraging people to save is a really important part of our strategy, because the savings ratio in this country has never been worse. The Chancellor has recognised that and taken steps to encourage people to save. That is what the changes to pensions and annuities are fundamentally all about. We should welcome them as a huge step in the right direction, not only in ensuring that elderly people have choice but in improving people’s overall capacity and willingness to save. They are great news.

Something else that is important and relevant to my constituency is the framework that we have already created to encourage investment in infrastructure. We really need to do that, and I could mention a lot of projects in my constituency that will need investment in the immediate future. One is a potential new bridge across the Severn to ease congestion on both the Forest of Dean side—my hon. Friend the Member for Forest of Dean (Mr Harper) has made that point several times—and my side, where such a development would enhance economic growth opportunities in an area where they need to be created.

The changes to ensure that firms that are high energy users will benefit is great news for my constituency. We have a lot of companies that have a huge appetite for energy. BPI, a recycling firm, is a case in point. It has sites across the country, which will all benefit from the changes.

We have to ensure that our overall package is continued with, and that is why it is important to talk about the long-term economic plan as frequently as we do. Part of that plan is to reduce the deficit. Of course we are disappointed that the deficit is not as small now as we had hoped, but we are travelling in the right direction and can say that it will be further reduced in significant chunks. That is what the Chancellor has promised and will now deliver. That is the bedrock of our economic plan, because we cannot have sustainable growth if we are constantly threatened with high interest rates and constantly undermined by having one of the largest deficits in the western world. That part of the long-term economic plan must not be forgotten and must be promoted whenever possible. The real economy, which I have been talking about, is the key to delivering jobs, tackling the cost of living and putting Britain back into the competitive place that it should hold globally on the economy and growth.

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[Mr Tobias Ellwood (Bournemouth East) (Con)]

It is the afternoon after the day before. The metaphoric bunting has gone, the media have left Westminster Green and the Chamber and, indeed, the Galleries have emptied—but that just might be because I am on my feet. This is the point at which enough time has elapsed to appreciate the full impact of the Red Book. If the newspaper headlines, radio interviews and a very weak Opposition response are anything to go by, this Budget is standing up to scrutiny and is already being recognised as a significant statement of intent, building on this Government’s long-term economic plan of reducing the deficit, creating more jobs and making people more financially secure.

The Chancellor began his speech by reminding us of the scale of the economic mess we inherited, caused by banks lending funds they did not have to people who could not afford it in ways they did not understand. It has taken a new Government completely to reform the regulatory system and to introduce the necessary changes to make Britain competitive again. Unlike the predictions from the Opposition, this was achieved without any double or triple-dip recessions in sight, as my hon. Friend the Member for Gloucester (Richard Graham) said.

The first primary indicator for the economy is employment, and a record number of people are now in work. The figures from my constituency point to the fact that the number of unemployed claimants for last month fell to 1,785, down 487 from a year ago. The shadow Chancellor tried to suggest that youth unemployment had somehow increased. He wants to be Chancellor. He wants to be the person in charge of the numbers, but he fails to mention that the figures include full-time students. I am pleased to say that the number of students at Bournemouth university, the Arts University Bournemouth and Bournemouth and Poole college have increased. They are included and he should know that.

[Neil Carmichael]

The same is true in my constituency. We have falling unemployment and we are looking for more people with engineering skills. Does my hon. Friend agree that the real success of this Government is the way in which they have stimulated the real economy?

[Mr Ellwood]

Absolutely. I concur with my hon. Friend, and that is one reason why more money has gone into apprenticeships as well.

My second point concerns GDP growth. A year ago, the OBR predicted growth for 2013 at just 0.6%. In fact, it came in at three times that level, and the forecast for next year has changed from 1.8% to 2.4%.

Thirdly, inflation now sits at 1.9%, well within the range set by the Bank of England. Fourthly, thanks to our low interest rates, the cost of borrowing by individuals, banks and the Government is low. But, of course, low interest rates are not so welcome to savers, hence this important announcement to end compulsory annuities, making it cheaper and simpler for pensioners to draw down their savings.