Economic Growth

Sammy Wilson Excerpts

Wednesday 15th May 2013 Commons Chamber

[Mr Osborne]

The shadow Chancellor could not answer the simple question of how much the amendment he is asking us all to vote on this evening would cost. Surely he must reflect a little and realise that each year his appearance in these debates is a source of consolation and comfort to the Government. He must wonder why each year he makes the same arguments for borrowing but there is no improvement in Labour’s economic credibility. He does not seem to understand that the public think that Labour spent too much, wasted their hard-earned money and would do it all again. Does he not feel that he owes it to the British people to apologise for the mistakes he has made and the damage he has inflicted on their living standards? Should he not stand up and say, “I’m sorry, we got it wrong and we won’t do it again”?

[Sammy Wilson (East Antrim) (DUP)]

The Chancellor’s point, “You can’t borrow more to borrow less”, is a good soundbite, but he does himself a disservice, because some of the borrowing undertaken by this Government has been very effective in reducing the deficit. Only yesterday, we saw 850 new jobs in Allstate in Belfast as a result of investment in the broadband network—that is 850 new taxpayers. Does he not accept that we can borrow, and that by borrowing and putting the money into the right things we can bring the deficit down?

[Mr Osborne]

I am all for spending money on vital economic infrastructure, including broadband, and all for trying to switch the budget more from current spending to capital spending. That is precisely what we are engaged in as part of this spending round, but we have to take the hard decisions on where we are going to get our revenue from or take the hard decisions on what we will cut instead. We are making a sensible switch towards capital spending.

--- Later in debate ---

[Sammy Wilson (East Antrim) (DUP)]

It is a pleasure to follow the hon. Member for South Dorset (Richard Drax). The Democratic Unionist party endorses his views on the amendment, which we support. We believe it is important that the people of the United Kingdom should have a say about their relationship with Europe. Some of those who oppose the commitment to a referendum claim that it will somehow leave us with four years of uncertainty and that that will damage investment in the UK, but the genie is out of the bottle as far as renegotiation and a referendum are concerned. Any investor knows what will happen at some stage in the future, so there should be no difficulty in giving the people of the United Kingdom a say on this very important issue. I will concentrate on other issues that relate to economic growth, but I accept that our relationship with Europe impacts on economic growth in this country.

If we are to achieve the objectives in the Queen’s Speech of giving people job opportunities, rewarding hard work and reforming welfare, economic growth is important. If we are to create economic growth, we need proper stimulus. The Chancellor and the Government argue that we cannot borrow more in order to borrow less. That is not true. Good, solid investment in the economy would help us to grow and to pay our debts. That is not the view of those on the extreme left wing; it is the view of the IMF, which is hardly a left-wing organisation. In fact, many of its policies resonate with what is said by the Government. It is also the view of many industry organisations.

More importantly, the evidence of what has been happening in the economy bears out that view. The hon. Member for Wyre and Preston North (Mr Wallace) talked about what is happening in his constituency. Nearly every example that he gave was the result of stimulus through Government borrowing and spending to create infrastructure and produce jobs. I could give stacks of examples from Northern Ireland. There has been investment in our tourism industry. Not so long ago, we got a Barnett consequential as a result of the Government deciding to spend more money on housing. We put it into co-ownership housing, which has brought money down from the banks and has led to almost half of the houses being built in the private sector. Just a small amount of money from the public sector has created construction jobs and allowed people to pay their taxes, which adds to Government revenue and helps to pay off the deficit.

There is a strong case, even from traditional supporters of the Government, for borrowing and spending more money to stimulate the economy. The Chancellor made a big point today about the money markets. Actually, the money markets are quite relaxed about this. They are lending money to the United Kingdom on negative interest rates. There is more demand for Government bonds than supply. If there are sensible investment policies, the money can be made available. The question is whether there is the will or whether the Government have some other motive.

I am disappointed that there is not much detail on what the Government intend to do about banking. According to the figures published by the British Bankers Association, lending by the banks in Northern Ireland has fallen substantially since 2010. We have not dealt with the banking crisis. There is not time in this debate to talk about the detail, but unless the Government grasp the nettle and decide what to do with failing banks that are undercapitalised and unable or unwilling to lend, we will not stimulate growth. I believe that there is great potential and that a Government stimulus could release the billions of pounds of cash assets that are sitting on company balance sheets, which would enable us to get growth and achieve the objectives of—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order.