Policy for Growth

Debate between Owen Smith and Brian Binley

Thursday 11th November 2010 Commons Chamber

[Mr Brian Binley (Northampton South) (Con)]

I congratulate the hon. Member for Glasgow North East (Mr Bain) on his speech, and I refer him to the same speech that was made in this place in 1990. He can look at the record thereafter, because the Thatcher Government did exactly what he said this Government will not do, so there are some examples of that.

I thank my right hon. Friend the Member for Wokingham (Mr Redwood) for initiating the debate. It was good to work with him on obtaining it. The number of people who are speaking in it are clearly a vital part of the process—[Interruption.] I am sorry that I got the year wrong, but if the hon. Gentleman goes back a further 10 years, it will be about right.

I welcome the Minister to the debate. I am delighted to say that Conservative Members have confidence in the work that he will do, simply because he knows business. The previous Government’s failing was that they did not. That simple difference must be taken into account.

The truth of the matter is that the Budget strategy is dependent on growth, and that small and medium-sized enterprises are vital to the success of that strategy. It is that simple. The Government are saying the right things, and have had some success, but money is not getting through to SMEs, and we must ensure that it does. I urge the Minister to give us some answers on how that might happen.

There is no doubt that the Government’s approach has been successful to date. Our international credit rating is much more secure than it ever was, and that is vital. The third quarter growth in gross domestic product was 0.8%, and in the previous quarter it was 1.2%. Bearing in mind that the average over the past 25 years has been 2.5%, that is pretty startling, and a good start for the Government.

[Owen Smith (Pontypridd) (Lab)]

Does the hon. Gentleman agree that the principal component of that growth figure of 0.8% was in the construction industry, and was entirely driven by the stimulus that the Labour Government put in place? We have already heard that it is drying up.

[Mr Binley]

That is absolutely incorrect. Construction has played its part, but not house building. If the hon. Gentleman looks at the size of growth in the manufacturing sector, he will see that it has been a major element of our growth.

I had intended to talk about manufacturing exports, but time forbids that now. I will say, however, that all of that is good, but the sector is not getting the money it needs, and we must pay attention to that. The banks say that lending to business is increasing, and that it rose by 0.9% this August, compared with the previous August. That sounds pretty good, but when we look beneath the surface, we find that most of that money was lent in foreign currency to foreign businesses outside this country. The truth is that lending to British businesses dropped by £400 million.