Oral Answers to Questions

Debate between Robert Buckland and Kelvin Hopkins

Tuesday 6th January 2015 Commons Chamber

[The Solicitor-General]

My hon. Friend raises a tragic case. The Government have such cases very much in mind when making sure that the full course of domestic violence conduct is reflected by the criminal law. The Serious Crime Bill will be in Committee next week, and is the platform on which these important reforms will be introduced. I very much hope that Royal Assent will be achieved before the Dissolution of Parliament.

[Kelvin Hopkins (Luton North) (Lab)]

Recent press reports have suggested that cuts to legal aid have been putting victims of domestic violence at a disadvantage, and even deterring them from pursuing their cases at law. Will the Attorney-General be making representations to the Justice Secretary on this serious matter?

[The Solicitor-General]

My particular concern is the prosecution of cases involving domestic abuse. I am happy to say that numbers continue to rise, both in terms of the proportion of conviction rates and the absolute number of police referrals. In fact, we have now reached the highest number of police referrals ever recorded.

Industrial Policy and Manufacturing

Debate between Robert Buckland and Kelvin Hopkins

Thursday 22nd November 2012 Commons Chamber

[Kelvin Hopkins]

I absolutely agree with my hon. Friend. Indeed, I have a wonderful set of Wedgwood china, which we use on special occasions, that no doubt comes from his constituency.

Then we had the 1990 to 1992 exchange rate mechanism disaster—again, an attempt to pinion our currency, in essence against the Deutschmark. We recovered from that after we devalued substantially—golden Wednesday—and the economy started to strengthen again. Indeed, if that economic strengthening had continued for three or four years longer, Labour might not have won the 1997 election, because we won on the basis of the terrible mistake made by the Conservative Government by going into the ERM. Those are key factors—the key factor, I think—in our economic weakness. But Germany kept its Deutschmark at a low parity for a prolonged period, and was allowed to do so because West Germany had to be, inevitably, the showcase for western capitalism against the east, and everything was done to ensure that Germany succeeded. It was permitted; it was allowed by the rest of the western world to keep its currency low as a necessary condition for economic success. Other factors, of course, were used to ensure that the Germans were successful, including a very strong interventionist industrial policy, which we forgot and left behind when we abandoned, for example, the National Economic Development Council, abolished by the Tory Government.

[Mr Robert Buckland (South Swindon) (Con)]

I am very interested in the hon. Gentleman’s remarks about Germany. Would he join me in congratulating the Germans on the important supply side reforms that they have made in recent years, to liberalise their economy and to make it the exporting success that it clearly is? Is that not a lesson for the United Kingdom?

[Kelvin Hopkins]

If the hon. Gentleman thinks that we can recover by taking supply side measures, he is gravely mistaken. It is the macro-economic measures that the Germans took that were the basis for their success. Supply side measures can no doubt help, but having a low parity for the currency and then ensuring that investment goes into manufacturing above all was the key to German success. The euro, of course, is an invention, essentially to pinion the Deutschmark within the euro at a relatively low parity compared with the countries that Germany exports to. If those countries outside Germany but inside the eurozone were permitted to recreate their own currencies and devalue, they would not be able to buy quite so many BMWs and Mercedes as they do at the moment, and that would affect Germany. One of the reasons Germany is so keen to keep the eurozone going is simply that Germans know very well that if the eurozone was disaggregated, or collapsed, depending on how one chooses to describe it, the Deutschmark would immediately appreciate and Germany would have much more serious difficulties.

We have had that constant problem with our exchange rate. Ours has always been high, and Governments have tried to keep it high. Germany’s has always been low and German Governments have made sure it stayed low. I have had a number of experiences, about which I have written in the past, and spoken on many occasions. In 1988 I went to a meeting of the Anglo-German Foundation and raised the question of the “balance of trade problem” with Germany. I was immediately told to shut up by a very angry representative of the then German Government. I thought I was just raising something that was obvious to everyone, but he was very upset that I even raised the issue. In 1988 the Institute for Public Policy Research produced a pamphlet, “The German Surplus,” which raised that issue. That too was suppressed. I tried to get extra copies; I was told there was none. I asked who wrote it; no one would tell me. Clearly, the Europhiles inside the organisation were suppressing that document because it would damage our relationships with the European Union, which we were moving towards.

Macro-economics is the core problem. We could do lots of other things as well, but the macro-economics must be right. We must ensure that our exchange rate is right, and the only way we are going to start to recover industrially—in manufacturing terms—is first to have a substantial depreciation and then to do other things to ensure we recover. If we do not do that, we are in for a very bleak time.

I have with me the fine document produced by the Library every month, “The Economic Indicators,” which I read avidly. Let us look at the trade balances—visible trade. In 2010, Germany had a trade surplus—converted by the Library into dollars, for comparison’s sake—of $204 billion, when the UK had a deficit of $151 billion. That is the difference between countries. They should be, in many other ways, very similar. They have got it right; we have got it wrong. The UK trade deficit with the EU27—essentially with Germany—in August, the last month recorded, was £4.9 billion in one month, up from £4.4 billion in July. So it is getting worse. Most of that is, of course, with the Germans. The UK trade deficit for 2011 tipped over the £100 billion mark—a staggering figure. No other country would be able to sustain that, and we must do something about it in time.

Only a much lower exchange rate will make it possible to increase exports and drive an economic, and specifically industrial, revival in the UK. Only then will we see unemployment come down and living standards start to rise again. We must do this; it is a necessary, vital condition for success, and if we do not do it, we have a bleak future before us.