Infrastructure (Financial Assistance) Bill

Debate between Nick Raynsford and Stephen Phillips

Monday 15th October 2012 Commons Chamber

[Mr Raynsford]

The Minister opened his Third Reading speech by claiming that we had had an excellent debate. If only! He must have had his tongue in his cheek when he said that. We have had a shockingly truncated debate in which only one group of amendments has been properly debated. The second group received only a perfunctory opportunity for debate, and that was cut short by the timetable at 9 pm. That left no time for any debate on three of the Bill’s four clauses. Frankly, that is not an adequate performance and I hope that conclusions will be drawn in the other place.

When I intervened on the Minister to ask what success criteria had been set to assess the Bill’s effectiveness, after a rather telling pause in which he had difficulty identifying success criteria, he referred me to the provision for annual reports, thereby neatly highlighting the fact that we had not had a debate about the frequency of the reports. I tabled an amendment to have those reports at six-monthly intervals, in order to make the point that the urgency for action to stimulate investment in infrastructure required a more accelerated timetable than the leisurely one proposed by the Government. Of course, we had no chance to debate that amendment, because it related to clause 3, which we never reached.

As my hon. Friend the Member for Nottingham East (Chris Leslie) rightly emphasised, the Minister’s response to our request for a definition of the success measures was essentially one of “Wait and see”. Frankly, this country cannot afford to wait and see. We are facing a serious economic crisis, which is more acute in the construction sector than in almost any other sector of our economy, and the serious problems affecting the construction industry are impacting more widely on the whole economy.

Urgent action to stimulate construction investment is absolutely vital. In theory, the Government are aware of that, because the Bill’s explanatory notes start with reference to the need for fast-track legislation. The notes ask:

“Why is fast-tracking necessary?”

They go on to say:

“The financial assistance is designed to assist infrastructure projects that may find it difficult to obtain private finance…The Government understand that there are currently commercially and economically viable infrastructure projects that are stalled because they cannot secure private finance. The timing of the UK’s proposed financial assistance is currently unclear, but the evidence indicates that there are projects that might be waiting only for finance before they can proceed to the construction phase.”

That may well be correct. We share the Government’s stated objective of bringing forward and accelerating the necessary investment. However, if that is the case, why can the Government not name a single project that stands ready and waiting to receive the benefit of the financial guarantees offered by the Bill?

In July, Lord Sassoon, speaking for the Government, referred to £40 billion-worth of projects that were ready to go by the autumn. I put it to the Minister that we are now in the autumn. If we are to see a significant proportion of that £40 billion of investment reasonably soon, we need to know very soon what those projects are. I put it to the Minister and to all Government Members from both coalition parties that it is not good enough to talk about good intentions but fail to come forward with concrete, practical proposals, particularly when they have said that the projects are shovel-ready and that it is only the lack of financial support from the private sector that is holding them back. They have said that the Bill is here to unlock that potential.

I repeat my question to the Minister: what are the success criteria? We believe that one measure of success would be a considerable increase in the investment in infrastructure. Back in 2009, in the depths of recession, investment in infrastructure was running at about £11.5 billion. That was the highest level for 20 years and was an indication of the previous Government’s commitment to infrastructure investment as one of the measures to deal with recession. Investment in infrastructure is now down to £8.6 billion and further falls are forecast. That is the record of the present Government. They have presided over a catastrophic fall in construction activity. Infrastructure, which was one of the few parts of the construction sector to survive the worst of the recession in the early years, is also falling. The industry is desperate for assistance.

[Stephen Phillips]

The right hon. Gentleman refers to the record of the present Government, but it was under the previous Government that house building fell to its lowest level since 1923 and 1924. Why does he not welcome the action that this Government are taking in the way that it should be welcomed?

[Mr Raynsford]

The hon. and learned Gentleman clearly did not listen to the contribution of my right hon. Friend the Member for Wentworth and Dearne (John Healey), who pointed out that house building levels have gone down further under this Government. The levels are now at their lowest since the 1920s and are lower than when the Government came to office.

The sad thing is that when the Government came to office, the housing sector was recovering. [Interruption.] It was recovering. If Government Members look at the statistics, they will see that in—[Interruption.] They clearly do not want to listen to the statistics. In the second quarter of 2010, there were more than 30,000 new starts in the housing sector. That was a recovery from the depths of recession. Since then, that level has never been matched. In the latest quarter, the number of starts was down to 23,000—a level that is consistent with an output of less than 100,000 in any one year. That is a shameful record, for which this Government are responsible. I say to Government Members that, for all their bravado and posture, their record is a shameful one and will hang around their necks as the British electorate come to see just what a mess their failed policies have left.

In conclusion, this is a Bill that we cannot object to in principle, because investment in infrastructure and housing is vital. Sadly, it is a Bill that, on the evidence that we have heard tonight, will not deliver what the Government say they would like to see and what Opposition Members would dearly love to see: increased investment in infrastructure and housing. The country needs it and the industry needs it. Sadly, I fear that the Bill promises it, but will not deliver it. Only time will tell, but the Government’s failure to respond adequately on the question of the success criteria speaks volumes about how this is a triumph of spin over substance.