Industry (Government Support)
Debate between Phil Wilson and Matt Hancock(14 years, 6 months ago)
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Matthew Hancock
We have not heard a single consequence of the £50 billion cuts that the Labour party would have had to introduce had they won the election. That puts the Labour party out of the debate, and leaves it to others—especially those on this side of the House—to work out how we get our country out of this terrible mess.
Over the past 13 years we have heard about the six regulations a day from the Secretary of State and the £11 billion cost each year of extra regulations. I used to say that we had the longest and most complicated tax code in the world except for India, until last year when India overtook us—I mean, when we overtook India. I will get it right eventually! Youth unemployment is the highest on record; we have had a record fall in business investment; and for all the hot air about manufacturing, the number of manufacturing firms in this country has fallen by a fifth over the past 13 years. We do not need to hear anything more from the Labour party about manufacturing as we try to turn the economy around.
I am delighted that, in the agreement on in-year spending reductions of £6 billion, £50 million was found to put right part of the catastrophe in further education funding that happened under the last Labour Government, when so many promises were made with no funds attached, when the budget was completely overcommitted, and when the Government had to go around the country to half-started projects and take away the funding. Since the election, we have heard that that is the case in Department after Department, and that FE was just unlucky that it all came out before the election. So I welcome strongly the statement by the Minister for Universities and Science that that money will go to FE colleges and that we can try to put right some of that wrong and reduce the deficit in a way that does not cause the greatest possible damage. I will be writing to him today to argue the case for Haverhill college in my constituency. It was ready to go and had been allocated funding by the previous Government, but had the funding taken away at the last minute because they had overcommitted the budget. I welcome the £50 million that the Government have found to do that.
More than all those things, and more than the Mandelson cheques we have heard about, businesses crave stability in the broader economy. Under the last Government, we had an asset price boom and bust, a credit boom and bust, uncertainty and complexity in the tax system, the longest recession in the world, the deepest recession since the war and the worst peacetime public finances in our history—and perhaps worse than all that, we had no answers to the questions of how to deal with those problems and of where growth would come from. I noted earlier that the shadow Secretary of State refused to say whether it was still Labour party policy to put a tax on jobs via an increase in national insurance, and I will be fascinated to hear whether the leadership candidates plan to argue next year that taxes should go up on every job in the country. Instead, all we have heard is the tinny sound of demands for cash and, from one hon. Member, a demand for an unfunded tax cut—those used to come from our party!
Matthew Hancock
I think that is one for the Budget statement on Tuesday.
Finally, we are starting to get the answers to some of these deep-rooted problems. We heard today about the changes to financial regulation, and I wonder how long it will take the Labour party to involve itself in the debate about the future of financial regulation. We think that banks should be properly regulated, not regulated under the old system that failed. The Government are also putting forward solutions to help credit flow to businesses; we are getting increased certainty in the tax system; and of course we have measures to tackle the deficit. As a result of those last measures, since the election, the interest rates paid on Government bonds has fallen by 0.4%—one tenth—which means that the interest on Government debt has fallen by one tenth in just over a month since the election, in anticipation of action to deal with the deficit.