Management of the Economy and Ministerial Severance Payments

Paul Howell Excerpts

Tuesday 15th November 2022 Commons Chamber

[Paul Howell (Sedgefield) (Con)]

We have all acknowledged that the mini Budget caused a short-term reaction by the financial institutions, but other issues have been far more significant to the British and global economies. Indeed, the gilt yields, which were the focus of so much angst, are now back where they were before the mini- Budget.

Fundamentally, the economy is in the state it is in because of the lasting impact of the covid pandemic and the ongoing war in Ukraine. The Government have done everything possible to soften the blow to ordinary households. The hon. Member for Bradford West (Naz Shah) talked about costs being “Up, up, up, up,”, but interest rates have been at record lows for most of the last 12 years. What happened to change that? Oh—was there a pandemic? Was there a war in Ukraine? There were a couple of things that might just have happened. Do we think that food and power going up are not affected by what is happening in Europe. I find it bizarre that we are just ignoring that.

[David Linden]

Will the hon. Gentleman give way?

[Paul Howell]

No, I will not.

[Naz Shah]

Will the hon. Gentleman take an intervention?

[Paul Howell]

Go on, then.

[Naz Shah]

When we were in this Chamber voting on free school meals, which the Conservatives decided not to vote for, or on austerity measures that the Conservatives were putting through for our constituents, that was before covid. My constituents were in poverty way before covid happened, way before Ukraine happened, way before all the rest of it happened. We were not in a fiscally right position. The NHS did not have the funding. There was a political choice made by the Conservative party for austerity. It was a political choice, not something we had to do, and our constituents suffered. Libraries, youth centres—all of them were cut on the Conservatives’ watch.

[Paul Howell]

As someone said earlier, thank you for the short intervention.

[David Linden]

The hon. Gentleman spoke about the impact of covid and Ukraine, and I do not deny that they have had an impact on the economy, but does he not also think that the Government’s chaotic handling of Brexit contributed to that as well?

[Paul Howell]

No—that is the easy answer. There have been many challenges with Brexit, but we voted Brexit through in late 2019. Being in a pandemic three months later did not exactly help the process of getting things done.

Coming back to my point, since the pandemic the Government have spent billions to protect businesses. Are Opposition Members saying that we should not have spent that money—that we should not be in debt because of covid and that we should not have supported businesses and people?

[Patricia Gibson]

The international investment markets have talked about the UK’s suffering more economic hardship than other comparable countries, which they refer to as the “moron premium”. How does the hon. Gentleman respond to that? Are they wrong?

[Paul Howell]

There are so many people who have so many opinions about the different things that have happened and will put them into different contexts. We need to keep ourselves in context. To quote the numbers, the House of Commons Library estimated that the Government spent between £300 billion and £400 billion on various pandemic-related issues. That is between £4,600 and £6,100 for each individual. That is a tremendous amount of money. Before we had the chance to recover from the pandemic, Russia invaded Ukraine, causing the price of food and so on to explode. The enormous support that the Government have given in response to energy prices is expected to cost £60 billion over six months.

The Labour party are scaremongering that the support will stop in April and everybody is falling off a cliff. Nobody has said it is stopping in April. They have said that the likes of you and I, Mr Deputy Speaker, might not be receiving support—I would quite like to get support, but I do not need it. We need to ensure the money we spend is spent with those who need it, not those who just want it, and achieve that balance, but the immediate reaction on energy support—to provide it as quickly as possible—was wholly appropriate.

When people start to talk about interest rates, the rhetoric we hear from Labour about the £500 increase is selective noise, using a specific comparator of a two-year mortgage that was 1.6% two years ago, was 3.7% before we went into the mini Budget and is now probably close to 5%. The real effect on people is not a £500 difference.

[Anna Firth (Southend West) (Con)]

My hon. Friend is making an important point about interest rates. Does he agree that UK interest rates are down since the mini-Budget? The five-year rate is now 3.3%, compared with 3.5% before the mini-Budget, and the two-year rate is now 3.1%, compared with 3.4% before the mini Budget. Does he agree that, when we talk about long-term management of the UK economy and interest rates, it is only the Conservatives who can be trusted to deliver?

--- Later in debate ---

[Paul Howell]

I absolutely agree with my hon. Friend. What I find wholly inappropriate is this: we have constituents very worried about what is happening, the way interest rates are rising globally and so on, and what are the Opposition doing? They are scaremongering, making people think it is even worse than it is and that the worst effects are affecting everybody. That is wholly inappropriate and it is making people who are already worried become terrified.

I am sure we all go home and talk to our constituents and our businesses. I have many businesses in Sedgefield, and all the ones I talk to are nothing but grateful for the support this Government have given them to make sure they can pay their energy bills. They are nothing but grateful for the way we introduced the furlough scheme, which put a lot of the cost into the equation.

I personally have every confidence that our Prime Minister and our Chancellor will show us on Thursday that they are compassionate Conservatives, and that they will look after and help most those who need it the most, not just take a broad brush across everything—[Interruption.] The hon. Member for Wigan (Lisa Nandy) is chuntering from a sedentary position. On the other point that has been raised about severance payments, those payments are statutory, and it is wholly inappropriate to have political intervention on those, just trying to make them a thing. Many people have received them over the years on both sides of the House, and there should therefore not be political interference in that process. It is up to the individual to choose not to take them; if they think it is inappropriate, they can take that decision.

[Lisa Nandy]

What do you think?

[Paul Howell]

What do I think? I think it depends on the individual. The hon. Lady has chirped and talked—[Interruption.] Do you want to hear, or do you want to shut up?

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Hold on.

[Paul Howell]

My apologies, Mr Deputy Speaker.

[Mr Deputy Speaker]

We accept the apology, but, by the way, this is not a chat—this is a debate.

[Paul Howell]

My apologies. On the particular reference to the Prime Minister getting her severance and being in the job short-term, she was a Minister for many, many years, which drives the severance.

Going back to my final point, I have every confidence that the Chancellor and Prime Minister will do the right thing on Thursday. I look forward to the autumn statement.