Debates between Tobias Ellwood and Mike Gapes during the 2010-2015 Parliament

Oral Answers to Questions

Debate between Tobias Ellwood and Mike Gapes
Tuesday 22nd July 2014

(10 years, 3 months ago)

Commons Chamber
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Mike Gapes Portrait Mike Gapes (Ilford South) (Lab/Co-op)
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7. What the Government’s policy is on the future constitutional and political status of Iraq; and if he will make a statement.

Tobias Ellwood Portrait The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Tobias Ellwood)
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The Islamic State of Iraq and the Levant poses a threat to Iraq, the region and beyond. I welcome the appointment of a new Parliamentary Speaker last week in Iraq, and hope a new and inclusive Government will be formed quickly. The UK has announced £5 million of humanitarian support for the people of Iraq.

Tobias Ellwood Portrait Mr Ellwood
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If I may, I shall first pay tribute to the work that the right hon. Lady has done. It was a pleasure to travel with her and she is hugely experienced in this area. Unfortunately, the chaos that we are currently witnessing in Iraq is allowing many humanitarian problems to exist and allowing human rights violations to take place. We are working with the Iraqi leaders, and the urgent priority is the formation of an inclusive Government that can command the support of all the Iraqi leaders in the communities, and jointly combat the threat of ISIL. We welcome the fact that Iraq’s new Parliament met on 15 June to appoint a Speaker. The right hon. Lady will know that now the Speaker is in place, a President and a Prime Minister can be appointed. Those are positive steps in moving forward.

Mike Gapes Portrait Mike Gapes
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Unfortunately, the Foreign Secretary is not here, but in his last appearance as Defence Secretary, he told me three times that the British Government were in favour of a unified state in Iraq. Is the reality not that a state of Iraq will continue only if there is the loosest possible confederation? Given the facts on the ground, we should be doing far more to support the Kurdistan region, which is democratic and pluralistic, at this time.

Tobias Ellwood Portrait Mr Ellwood
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I was in northern Iraq last month and I was there when President Barzani made the statement of intent to move towards independence. We have heard no more details on that and we will not react to that until something more is forthcoming. However, Iraq needs to be united in tackling the challenges it faces, including the serious threats that are posed not only in Iraq but in the wider region. To achieve that, a new and inclusive Iraqi Government must be formed as quickly as possible, which includes the Kurds. The hon. Gentleman will know from his visits to the country that the Kurds have been distanced from what is going on in Baghdad, as have the Sunnis. Moderate Sunnis have indeed been pushed into ISIL. We are looking for a more inclusive Baghdad Government, which will unify Iraq.

Budget Resolutions and Economic Situation

Debate between Tobias Ellwood and Mike Gapes
Friday 23rd March 2012

(12 years, 7 months ago)

Commons Chamber
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Tobias Ellwood Portrait Mr Tobias Ellwood (Bournemouth East) (Con)
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I am grateful that I was able to catch your eye, Mr Deputy Speaker, in this Hopperesque corner of the Chamber. It is a pleasure to speak in this debate on the Budget and the economy.

During the general election, I made a speech on the economy in which I said that if three MPs were asked the same question on the economy, they would give three different answers. I should confess that I added that if one of the three was a Lib Dem, there might be four different answers. Of course, we are now in coalition, so that joke is probably politically incorrect.

It is day three of the Budget debate and we are beginning to understand the detail of the statement and the impact that the component policy changes will have. Labour is starting to cherry-pick aspects of the Budget, probably to create a distraction from its contribution to the state of the nation’s economy and the inheritance that we received. I can retort by praising the tax breaks for the digital economy, which will help Bournemouth especially because it is thriving in that area; the funds for the Dorset local enterprise partnership; and the raising of the personal tax allowance, which will remove many low-paid workers in Bournemouth from the tax system altogether.

As important as those points are, we should not lose sight of the implication in the Office for Budget Responsibility report that the shadow of the recession that Labour took us into still looms. The eurozone crisis is not over. Oil prices remain high, and could climb higher. Although it has been about four years since the collapse of Lehman Brothers and the run on Northern Rock, we are certainly not out of the woods. We must not forget the scale of the financial mess that we inherited.

Labour’s approach for a decade was to borrow money that the Government did not have. It allowed the banks to do the same by over-leveraging and lending to people who could not afford it. It is all very well for Labour to blame the rest of the world and the state of the global economy, citing Fannie Mae and Freddie Mac, but there were issues here in the UK for which the Labour Government were responsible. Bradford and Bingley was offering 150% mortgages. That was a UK responsibility. It was happening over here. We cannot blame that on the Americans or on the state of the global economy. Even with the knowledge that the recession was under way and was likely to get worse, Labour kept on spending.

Mike Gapes Portrait Mike Gapes
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Is it not the case that, in opposition, the Chancellor of the Exchequer said that there was too much regulation by the last Labour Government?

Tobias Ellwood Portrait Mr Ellwood
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I do not agree with that statement at all. It happened under the Labour Government’s watch, and they were responsible. Their Chancellor, who later became the Prime Minister, inherited a stable economy. Indeed, in the first three years of the Labour Government, they actually balanced the books. Then in 2002, they overspent by £19 billion. By 2008 they had overspent by £68 billion, and by the following year they had ratcheted up a £152 billion deficit. That was after Lehman Brothers and Northern Rock. In their final year, they were still spending like there was no tomorrow, ratcheting up a decifit of £145 billion, taking us to an overall debt of close to £1 trillion. That is not good Government responsibility for the economy.

Not until we had a general election and an emergency Budget from our Chancellor, back in June 2010, was there some slowing down in Government spending. He introduced measures to protect the economy and set out a comprehensive strategy, including measures to control public finances and stimulate growth and tax reforms to increase our global competitiveness. Those measures were lacking under Labour, and the hon. Member for Ilford South (Mike Gapes) should ponder them.

I do not have time to go into the detail, but it would be helpful to break the Budget measures down into fiscal and monetary policy. Fiscal policy means the Government expenditure and taxation measures that have a direct effect on the distribution of income, demand and the level of economic activity. Two prime examples are the corporation tax cut, which will make us far more competitive, and the reduction in the top rate of tax to 45p so that Britain no longer has the highest rate in the G20.

By contrast, Labour introduced the 50p rate just before it left office, and it failed to raise the predicted revenues and undermined our competitiveness. Looking back in history, Labour seems to have had a love affair with high income tax rates over the past four decades. It was Wilson who put the top rate up to 83%, and Margaret Thatcher then reduced it to 60% in 1979 and 40% in 1989. What did Labour do when it came into office? It did not put the rate back up again; it kept it as it was. It recognised—certainly Tony Blair recognised—that to remain competitive, we had to have sensible tax rates.

I do not have time to dwell on monetary policy—the supply of money, the cost of money, the rate at which it is controlled, the price that the Government pay to borrow it and the total supply of money into the economy—but it has an impact on matters such as controlling our triple A rating and the price of borrowing. The Government have kept interest rates low and used selective quantitative easing, and that sound monetary policy is moving Britain forward.

This is a radical and reforming Budget that will help Britain earn its way in the world in continuing difficult times. Labour gave us a disastrous economic legacy, for which it is only now, sheepishly, apologising. It led to record debts and a halving of our manufacturing base, resulting in our coming within a whisker of losing our important triple A rating. The Government are at last balancing the books, reforming our tax system, supporting British business and staying on a course towards economic recovery. The OBR has revised upwards its growth forecast for this year. It is low, but nevertheless improving, and the OBR predicts that it will reach 2% in 2013. Labour has proved that we cannot borrow our way out of trouble. This Government are proving that we have to earn our way out.