Economic Growth and Employment

Stephen Metcalfe Excerpts

Wednesday 23rd November 2011 Commons Chamber

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

Thank you, Madam Deputy Speaker, for giving me the opportunity to speak in this important debate. There is no doubt that growth and employment should be at the top of everyone’s list of priorities, and I know that that applies to this Government, who are trying to promote that agenda. This motion, however, does nothing to build on that. It is just more of the same from the Labour party—the party that brought us to the brink of bankruptcy. [Interruption.] It is the party that just loves to spend other people's money.

[Toby Perkins (Chesterfield) (Lab)]

I think that the hon. Gentleman might have dropped his script. According to his own party, growth and job creation are not the No. 1 priority, which is deficit reduction. We absolutely support the hon. Gentleman in what he said, so will he start to put some pressure on his party to put growth and job security at the top of the agenda again?

[Stephen Metcalfe]

I put the two hand in hand. [Interruption.] Yes I do. The Government have a cogent plan, but as I say, they have to deal with the reality that we inherited.

As I was saying, the Labour party just loves to spend other people’s money. We all like to spend money: it give us that warm glow inside, but I imagine that the rate at which Labour has spent money, and wants to spend it again, would give a white-hot glow. Labour Members do not even try to hide the fact that they spent all the money. The right hon. Member for Birmingham, Hodge Hill (Mr Byrne) informed us in his now infamous note that there was no money left. Again, it falls to us to clear up their mess.

[Andrew Bridgen]

The hon. Member for Mitcham and Morden (Siobhain McDonagh) talked about problems at the Inland Revenue, but is not the truth that the botched merger with Customs and Excise has meant a vast deterioration in performance, which has affected many of my constituents? That is the fault of the Labour Government.

[Stephen Metcalfe]

I could not agree with my hon. Friend more. That is another problem that we have to sort out by clearing up the mess left by the previous Government.

Despite what Labour Members say and despite the sentiment behind this motion, we are, I believe, making good progress. As we have heard, we are creating the most competitive tax system in the G20; we are investing in businesses to help them start up and grow; we are encouraging inward investment and supporting exports; we are investing in science and technology and creating a more educated and more flexible work force. Of course there is still more to do, and I believe we are doing it.

For example, today, my right hon. Friend the Business Secretary announced new reforms to employment law—mentioned by the hon. Member for Streatham (Mr Umunna)—as part of the Government’s plan for growth, which will cut unnecessary demands on business while safeguarding workers’ rights. However, if we listen to the instant reaction from Labour, we find that they would have us believe that these measures are anti-employment and the reforms are about making it easier for companies to fire staff. I believe that the reverse is true. The Opposition spend a lot of time trying to cast employers as the bad guys—as a group of money grabbers trying to get rich off the backs of the workers.

[Guto Bebb (Aberconwy) (Con)]

Is my hon. Friend interested to hear the comments of the former Labour MEP Eluned Morgan, who is now a Baroness, when she stated that many in the private sector had sensed the animosity of the Labour party towards that sector?

[Stephen Metcalfe]

I would indeed agree with that view. I believe that all Government Members, and I suspect some Opposition Members too, would agree that the vast majority of businesses, especially small and medium-sized enterprises, know that their most valuable asset is their staff. Employers need staff and staff need employers. The problem has been that in the current economic climate firms are cautious about taking on additional risk, and that often means being cautious about taking on additional staff. I believe that making it easier for companies to manage their staff levels makes it easier for them to take on staff. Knowing that the risks of employment have been reduced might well unlock the employment door.

[Bill Esterson]

Does the hon. Gentleman agree that one of the worst things for an employer, particularly a small business, is having staff who are unsettled, looking for other jobs and fearful for their own future, which is actually bad both for the business and the economy, because those people spend less money? The measures proposed by the Government will simply contribute further to that, and make the situation worse.

[Stephen Metcalfe]

I agree that having an unsettled work force is not healthy, which is why it falls to business men to reassure their staff. However, it is possible to unsettle a business by insisting that it employ staff when there is not necessarily a role for them and it might be difficult to afford them.

[Steve Rotheram (Liverpool, Walton) (Lab)]

Will the hon. Gentleman give way?

[Stephen Metcalfe]

No I will not, I am afraid.

Responsible businesses have, and recognise that they have, a duty of care towards their employees and will often put their welfare before their own. They will not take decisions that would destabilise an existing business. As someone who has run my own business—and, unfortunately, had to let staff go—I know how difficult those decisions are to take and how painful they can be on both sides of the divide. Businesses do not want to take risks with the livelihood of those whom they already employ, so they may not hire additional staff unless absolutely they are sure that they are needed and affordable. Trying to downscale later could be costly and time-consuming, so they avoid the risk.

The proposals announced today might well help employers to make the decision to hire earlier, thus stimulating employment and growth, especially in small and medium-sized enterprises. If each one were to employ one additional member of staff, we would have an employment deficit. This will build on what has already been achieved in the last 18 months, with 500,000 new private sector jobs, more than 500,000 new businesses created, the manufacturing sector growing and our credit rating restored.

Labour Members would have us believe that they left us with some golden economic legacy, but nothing could be further from the truth. In the 13 years they were in power unemployment rose, workless households rose, and households where no one had ever worked more than doubled. Unfortunately, we also saw youth unemployment, which we all accept is a problem when it has risen to nearly 1 million. That is why I welcome the measures that the Government have brought forward, particularly in my own constituency, which has seen the number of apprenticeship places rise this year from 560 to 740.

The Opposition’s plan B is not credible. It just means spending more money that we do not have, because they have spent it all. It means borrowing more, and hang the consequences. It means saying, “Hide the bills, stop opening the post, don’t answer the door.” Well, that will not work. When you are in a hole you must stop digging, but we are trying to climb out of the hole that we are in. The Opposition’s solution means doing the equivalent of going to a payday lender to borrow and spend your way out of trouble. We all know what happens when people do that: they lose their credit rating, and that is a really serious problem which could cost this country many billions of pounds that it does not have.