Budget Responsibility and National Audit Bill [Lords]

John Bercow Excerpts

Tuesday 22nd March 2011 Commons Chamber

[Chris Leslie (Nottingham East) (Lab/Co-op)]

I beg to move amendment 1, page 1, line 13, at end insert—

‘(d) the Treasury’s objectives in relation to economic policy and policy for the advancement of jobs and growth in the UK economy.

(e) the means by which the Treasury’s objectives in relation to economic policy will be attained (“the growth mandate”).’.

[Mr Speaker]

With this it will be convenient to discuss the following:

Amendment 3, in clause 4, page 2, line 20, at end insert

‘and the impact of Treasury policy on jobs and economic growth’.

Amendment 4, page 2, line 26, at end insert—

‘(c) an assessment of the extent to which the growth mandate has been, or is likely to be, achieved and the impact on employment and economic growth within all regions and nations of the United Kingdom.’.

[Chris Leslie]

It is fitting that we are discussing the Bill the day before the Budget. I understand that there are particular reasons, which the Minister will no doubt explain to the House, why the Bill needs to receive Royal Assent this evening, before we reach Budget day, so I am conscious that the ministerial clock is ticking. I pay tribute to the Public Bill Committee, whose members scrutinised the Bill in what I regard as sufficient detail.

Essentially, the first half of the Bill sets out the establishment of the Office for Budget Responsibility, and the second half makes a series of changes to the National Audit Office governance arrangements. It is fair to say that the Committee spent less time on the second half of the Bill, as the House had previously scrutinised many of those measures, but for various reasons that legislation was not included in the wash-up before the last general election. Most of our attention today will focus on the OBR.

Clause 1 relates not specifically to the OBR, but to the creation of a charter for budget responsibility. As we know, the Government have their reasons and rationale for making this set of legislative proposals. It was notable in Committee that Members were quizzical about why the charter for budget responsibility has been quite narrowly defined and why the OBR’s duties are similarly quite controlled and slimline. My view is that any realistic definition of budget responsibility must take account of the impact on jobs and growth of the wider economy and Treasury decisions on fiscal policy, particularly in the current context.

We know that Her Majesty’s Treasury is currently grappling to acquire a growth strategy, some of which might have been left on a number of photocopiers around the building before Treasury questions, although I have not been party to the memo that my right hon. Friend the shadow Chancellor picked up—I will try to get hold of him later to see what was in it. Clearly, the real economy has clashed with the Government’s plan A, which they have refused to depart from, which meant that in the fourth quarter of 2010, as GDP figures show, the economy went into reverse and shrank. The Chancellor blames the wrong kind of snow, but evidently the Government’s approach to fiscal policy has created circumstances that have not only put the brakes on economic growth, but unfortunately seem to have put it into reverse.

When we debated clauses 1 and 4 in Committee, Members felt that it was important to try to challenge the notion that we should somehow have an Office for Budget Responsibility that confines itself to fiscal, deficit and debt issues, to the exclusion of other equally important indices drawn from the wider economy.