Finance Bill

Debate between Tom Blenkinsop and Jacob Rees-Mogg

Tuesday 6th July 2010 Commons Chamber

[Jacob Rees-Mogg]

There were political reasons, I think it might be said, for supporting those spending plans. I was not a Member of the House at that time, and it is a bit harsh for me to be expected to take responsibility. I think a lot of people, not only in this House, held to the mistaken idea that the economy was going to carry on growing for ever. I have always thought that boom and bust is a fact of life. We always have booms and we always have busts, and we will have them again. One can look at studies of financial cycles going back to biblical times, so the thought that there would always be growth was simply wrong, and to try to match Labour’s spending programme was a mistake. However, even Homer nods. The point is that spending was out of control and had to be cut, and taxation is at its limit.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

I know that the hon. Gentleman keeps quoting the figure of 36.4% of GDP, but is that not dependent upon what GDP actually is? According to the coalition Government’s prospectus, GDP will actually go down.

[Jacob Rees-Mogg]

The hon. Gentleman ought to bear in mind that we will achieve growth if we leave some money for business to borrow rather than it all being pinched by the state. That was the point that I was making at the beginning—if the state borrows all the money that is going, in the absence of quantitative easing, it crowds out private investment.

I know that Members do not want to listen to me all evening, so I shall—[Hon. Members: “No, more!”] Well, as I understand it, if I go on long enough tomorrow’s business is forfeit, and that is an Opposition motion, so I will conclude.

We know that the situation is serious and that tax is as high as it can be, therefore spending must be cut, however difficult it is. I commend the Liberal Democrats for their courage in supporting that and facing up to the realities of government, which they have not needed to do for a few decades. If I were wearing my hat, I would take it off to the Liberal Democrats.