Living Standards

Debate between Stephen Williams and Liam Byrne

Wednesday 30th November 2011 Commons Chamber

[Stephen Williams (Bristol West) (LD)]

Yesterday, I think we all agreed when listening to the Chancellor’s statement that much of what he had to say was grim news indeed. It was worse than many of us had anticipated. The situation was certainly worse than the last Government declared when they were in office, or even predicted when they could choose their own predictions. It was also worse than the independent Office for Budget Responsibility forecast when this Government came to office.

We now know that finances will be difficult throughout this Parliament. There will be a squeeze on many people’s real incomes. Perhaps more importantly, in terms of confidence, there will be a suppression of hopes and expectations. I understand absolutely why many people are anxious, and I even understand why many people are right to be angry about the situation in which we find ourselves. They are also right to think that some people are indeed “out of touch”, as the motion puts it.

We have seen in many major cities around the world the Occupy people, who are protesting against capitalism. I do not agree with much of what they say; I am a free-market liberal, and I want capitalism to work. Those of us who believe in the functioning of the market economy, however—I think that this now unites the three main parties in this country—must address the concerns that many of our constituents feel about the failure of the market economy to deliver fairness in our society. Last week, the High Pay Commission referred to the “gross inequality” that has arisen in our society, most of which arose, of course, during the period of the last Labour Government. The average pay of someone in work is now £25,900, whereas the pay of a chief executive of a top 100 company has risen to £4.2 million —145 times average pay.

[Mr Byrne]

The hon. Gentleman is kind in giving way, and I am following his argument closely. I am not certain which measure of inequality he is looking at, but I am sure he would accept that the Gini coefficient, which is one of the most popular measures of inequality, was practically the same at the end of Labour’s term of office as at the beginning. I am sure he would also accept that, looking around the world, the UK was one of the only countries in the OECD—I think that Turkey and Ireland were the others—where inequality was held in check. It went through the roof everywhere else.

[Stephen Williams]

We can trade statistics, but the right hon. Gentleman cannot deny what everyone is seeing and what all our constituents are saying to us. They are fed up that the people at the top of companies— Labour Members have referred to bankers, but it is not just the bankers; this also applies to others—seem to have got away with it, while people at the middle or bottom are being squeezed. I hope that the Government act on the High Pay Commission recommendations.

The Government are acting to safeguard the living standards of those at the bottom of the income scale.