Budget Resolutions and Economic Situation

Debate between Stephen Doughty and Michael Ellis

Friday 22nd March 2013 Commons Chamber

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

It is a pleasure to follow the excellent speeches by my hon. Friends the Members for Lewisham East (Heidi Alexander), for Walthamstow (Stella Creasy), and for Stoke-on-Trent Central (Tristram Hunt).

This is truly a triple D-rated Budget that leaves us in more debt than ever before, at risk of a triple dip, and with our credit rating downgraded. It is a Budget once again characterised by unfairness, incompetence and political game playing instead of the national interest. It is unfair, because millions of people face declining living standards while millionaires get a tax cut; it is incompetent, because the Chancellor and the Secretary of State for Business, Innovation and Skills cannot even clarify the details of the spare homes subsidy; and political game playing has seen the Chancellor play fast and loose with departmental spending to even greater political exposure in the short term, regardless of the consequences for front-line services, our international commitments or, indeed, the growth of our economy.

It is not just Opposition Members who say that—it is the Office for Budget Responsibility, which has confirmed that by 2015, people will be worse off than they were in 2010, with real wages set to fall by 2.4% over this Parliament; it is the Institute for Fiscal Studies, which only yesterday accused the Chancellor of “wasting the time” of Whitehall officials and creating “real economic costs” for the country; and, indeed, the Home Secretary, who hit the nail on the head only a couple of weeks ago, when she said:

“It’s not enough to cut budgets and hope for the best.”

I shall focus on page 70 of the Red Book, which details those £7.6 billion-worth of revenue underspends, and £2.1 billion of capital underspends in Government Departments—a staggering £9.8 billion in total. All of that was apparently done so that the Chancellor could present the illusion of a tiny drop in public sector net borrowing and make up for other accounting errors such as the 4G auction, which raised £1 billion less than he promised in the autumn statement. The consequences are serious. Opposition Members have rightly demanded to know which services, which spending, which projects and which promises have been delayed or cancelled by Departments ranging from the Department of Health to the Home Office. We need answers, and we need them now.

To take a Department in which I was proud to work, in 2010, the Prime Minister and the Chancellor categorically promised us that they would

“not balance the budget on the back of the world’s poor”.

It appears, however, that that is precisely what they have done this year, with the Department for International Development underspending by a staggering £0.5 billion, which amounts to 8% of its total revenue budget settlement for this year. That might represent a failure to pay our dues to the UN, or make our contribution to the World Bank. Indeed, the Chief Secretary seemed to suggest in TV interviews that some of the world’s poorest countries might not be ready to receive our funding. I very much hope that that proves to be untrue, because I am pretty sure that children who need vital vaccines, education or food are ready to receive our help.

[Michael Ellis (Northampton North) (Con)]

Is it not rather churlish of the hon. Gentleman to make such references, as the Government have been considerably more generous than the Labour Government were in 13 years in office in affirming a 0.7% rate of gross domestic product for international development, which is more generous than almost any other country, yet the hon. Gentleman stands up and—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I am sure that the hon. Gentleman is hoping to speak later. He must save something to tell the House.