Amendment of the Law

Robin Walker Excerpts

Thursday 20th March 2014 Commons Chamber

[Mr Robin Walker (Worcester) (Con)]

Will the hon. Gentleman address the issue of 1.3 million private sector jobs created?

[Mr Robinson]

I will come to that in a moment, although the hon. Gentleman may have been here when I intervened on the Secretary of State on that precise point.

Let us examine the borrowing record, as borrowing should have been central to all this. Because we have been able to have more investment and more exports—capital investment and exports—we should have growth, which would reduce the borrowing. In fact, over the four-year period, with us now entering the five-year period, we are going to borrow nearly £200 billion—the figure is £190 billion—more than we projected. We were to reduce borrowing as a percentage of GDP, but even in the next two years—years 5 and 6—it is projected to go up as a percentage of GDP. As for balancing the budget, that has been pushed out by a further two years. This is not a plan that has succeeded; it is a plan that has failed in almost every respect.

There is one exception—the hon. Gentleman referred to it and I also challenged the Secretary of State precisely on it during his speech: the employment record, particularly in the private sector, is remarkably and surprisingly good. I do not want to get into how many jobs are part-time, zero-hours contracts and so on. The fact is that the labour market has shown itself to be much more retentive of labour and productive of labour than we expected. For anybody in this House or in the Government, or on any of the other projections indicated from any sector, the performance is quite encouraging, except in one crucial respect: it suggests that, given where output is relative to employment, we have suffered a dramatic loss—probably for the long term, for all we know—in the productive capacity of the economy and in the productivity of our labour force. Unless that can somehow be rebuilt—there is nothing at all in the Budget to address that point—we are in for a much longer and slower recovery than we could have achieved. That is a big disappointment. The Secretary of State analysed it willingly, but the Office for Budget Responsibility itself says, “There’s nothing here that’s going to make any difference to the forecast we made a year or so ago.”

In other words, we have done nothing and are proposing to do nothing, to address the central issue of the productive capacity of the economy, which would underpin, sustain and increase our recovery rather than hold it back. There is nothing in the Budget that will improve that. Of course there are a couple of measures that we welcome, including the increase in capital allowances. I never understood why they were cut in the first year. We viciously opposed it at the time. We also approve of the improvement in export financing. However, there again, the Chancellor and the Government have form on those issues. They introduced two similar export financing schemes, one of which was strangled at birth and the other helped just five firms. I hope the Government are serious this time. We do not want to see imaginative and quite substantial measures being choked off by the bureaucrats.

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[Mr Robin Walker (Worcester) (Con)]

The hon. Member for Plymouth, Moor View (Alison Seabeck) has just mentioned her father’s election address, and I am reminded of my father’s election addresses about how Conservatives had to clear up the mess that Labour left behind.

Like many Members across the House, I am passionately focused on employment. We needed the Budget to encourage business investment and help the recovery, which is gaining pace, to deliver more and higher-quality jobs. The hon. Member for Coventry North West (Mr Robinson) made an interesting point about ensuring that those jobs deliver greater productive capacity, and I agree with him that we need to do that.

The claimant count in my constituency of Worcester is down from 2,545 immediately before the election—and from a peak of 2,700 under Labour—to around 1,900 now. Youth unemployment peaked at 800 under Labour and is now below 500. That is much better, but there is no room for complacency. In fact, we have seen some small rises in unemployment in recent months, which I abhor. I have said that we need this Budget to deliver investment in jobs.

When I talk to local businesses, especially manufacturers, about what they need if they are to invest in jobs, they tell me that they need support to invest in plant and machinery, which can raise the productive output of each job. We have seen that support in this Budget. They also want support for research and development that will anchor manufacturing jobs in this country, including the jobs at Yamazaki Mazak, which has its European research headquarters in Worcester. They need help with the cost of employment, and this Budget has introduced the implementation of the employment allowance, which will provide a huge boost to businesses large and small in regard to the number of people they can employ.

It is interesting that, at the start of this Government, we got rid of Labour’s jobs tax—an increase in the cost of national insurance for every business and employer—and that, as we come towards the end of this Government, we are taking a further step forward in the form of the employment allowance. It will provide a real incentive to take young people on, and taking people under 21 out of national insurance will help more young people to get into the businesses of the future.

Crucially, we need to drive forward the skills agenda. Many of the engineering businesses in my constituency—including Yamazaki Mazak and Worcester Bosch—are great supporters of apprenticeships. Many small and medium-sized enterprises are also beginning to take on apprentices. I am glad to see in the Budget the £85 million extension of support for SMEs to take on apprentices, and to see the £20 million increased funding for degree level apprenticeships. The Business, Innovation and Skills Committee, on which I am proud to serve, has challenged the Government to deliver on both quality and quantity for apprenticeships, and so far they have an excellent record on both.

I must mention some of the spending measures in the Budget that could directly benefit Worcester. The £20 million cathedral fund will be very welcome in many of our county towns, and the horse race betting levy extension will support Worcester race course. The cathedral and the race course are two vital landmarks in the city, and I am delighted that both could benefit from the Budget. The extra £140 million of flood funding is also extremely welcome for reasons that will be all too obvious to anyone who has watched television in recent months. It is also great news that we have seen progress on the question of VAT for air ambulances. That is a huge achievement following campaigning by many Members. I would now like to see progress on the question of VAT for hospices.

The Budget did not mention delivering fairer funding for schools, although the Chancellor did mention it in his autumn statement. We also had a statement on it last week, and a huge step forward has been taken on that issue for the first time in decades. This is a cross-party campaign in which many hon. Friends and hon. Members from across the House have taken part.

[Christopher Pincher]

My hon. Friend is right to say that the Campaign for Fairer Funding for Education is a great cause, and I congratulate him on championing it. Does he agree, however, that in so far as the fairer funding has been spread around the country, it seems to have overlooked Staffordshire?

[Mr Walker]

I do agree with my hon. Friend, whose intervention has given me the extra time I need to make the point that, for many years, that campaign was led by the former Member for Stafford, David Kidney, who spoke passionately about the issue. I have said to the Education Secretary and others that it would be unfortunate if Staffordshire were passed over in this regard, but £350 million represents a big step forward for the lowest-funded authorities and, by my calculations and those of f40—the Campaign for Fairer Funding in Education—Staffordshire is among those lowest-funded authorities and deserves help.

The Financial Secretary to the Treasury, my hon. Friend the Member for Bromsgrove (Sajid Javid) is on the Front Bench today, and he is a Worcestershire colleague. I am delighted that Worcestershire will be receiving £5 million to help schools that have been underfunded for a long time. The long-term economic plan to take our country forward must focus on skills and on preparing young people for the future. Fair funding for education is a vital part of that, and I am grateful for the enormous support that colleagues have given me during this campaign. Indeed, most of my colleagues sitting on these Benches at the moment have supported the campaign and spoken passionately about it. I am grateful that it is a cross-party campaign, and one that we have been able to take forward significantly this year, and in this Budget. This is a Budget for jobs and for the future, and it allows us to take a significant step forward in achieving fairness for our country.