Business and the Economy

Rushanara Ali Excerpts

Monday 14th May 2012 Commons Chamber

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

This Government have no vision: no vision for a better future for our country; no vision to deliver economic growth; and certainly no vision to create jobs. We saw that in the Budget, and we certainly saw it in the Queen’s Speech last week. With some 3 million people unemployed, including 1 million young people, that isn’t good enough. We are wasting talent, drive and ambition simply because the Prime Minister and Chancellor cannot admit that their plans are not working. It is not good enough for the people in my constituency, who are losing their jobs left, right and centre, while at the same time the Government are giving tax breaks of over £40,000 a year to millionaires. It is not good enough for the millions of people across the country who are working so hard to make ends meet and need a Government who will stand up and work for them. Instead, they have a Government who seem happy to leave them behind and to cast aside their hopes and aspirations.

We are now officially back in recession—something many knew was coming and about which the Labour party has been warning the Government for two years. It is the double-dip recession the Government promised would not happen. Under Labour, the country had started to move out of recession, and progress was being made in creating jobs through programmes such as the future jobs fund and apprenticeships with job guarantees. Now youth unemployment alone is up 7.7% on last year, to more than 1 million. That equates to an extra 73,000 young people who want to work but cannot find the jobs they so desperately need. Also, more than 700,000 public sector jobs will be lost by 2017, with little or no sign that the private sector will be able to absorb those people.

These are tough times to be unemployed. With rising energy and food prices and the benefit changes coming this year, this Government are hurting families, young people, pensioners and public servants—to name just a few—and penalising or demonising those who cannot find work in a labour market that this Conservative-led Government are doing nothing to grow.

That is particularly apparent in places such as my constituency, which has high levels of deprivation, including one of the highest levels of child poverty in the country. The consequences of the Government’s failure on the economy are much more keenly felt in such places. Unemployment in Bethnal Green and Bow stands at almost 12%, which is well above the national average, and youth unemployment is over 9%. I frequently meet parents who are astounded that their university-educated children cannot find jobs, so I echo the point made by my hon. Friend the Member for Huddersfield (Mr Sheerman) about rising graduate unemployment. It is scandalous that even though they have such qualifications, this Government are doing nothing to support them into work.

When I speak to local business owners—the businesses that are at the heart of our local economy and employ thousands of people—they tell me how hard it is to make ends meet given the Government’s VAT rises, which have stifled their potential. In my constituency, the VAT increases are hitting sectors such as technology, the creative industries and restaurants particularly hard. The Government’s failure to do anything substantial to enable them to borrow is also hurting them hard. We need a plan to support small businesses; I echo the comments made by many Opposition Members about the need to support small businesses in order to encourage and enable the economy to grow. SMEs will be a vital part of that story.

We also need programmes to help people into work—programmes that help them develop their skills and thus enable them to compete in today’s labour market. The massive difference such programmes can make in constituencies such as mine is illustrated by the work of, for example, Job Ready hosted by Futureversity, Skillsmatch, the East London Business Alliance, the Adab Trust and City Gateway, a charity in my constituency. Such groups are working very hard, but they are suffering as a result of the impact on charities of the Budget’s tax measures. We must support organisations that develop soft skills and provide training for young people to get into work, but such organisations are being hit hard by this Government’s measures.

My constituents need this Government to step up and take action to address the very real, everyday problems they face. We need to create real jobs for young people, not enforced work programmes that do not offer any chance of employment at the end. Labour promised to introduce a tax on bank bonuses to deliver these jobs—real jobs, with real wages for our young people, who are trying so hard to find work.

This Government have no vision to create jobs and to foster economic growth. Now is the time we need a Government with the vision and aspiration to take radical and ambitious actions, yet that is precisely what is lacking. We need a Government to work for the majority of this country, not a small minority—not the 1% who will gain from tax breaks. I hope this—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. Time is up. I call Esther McVey.