Finance Bill

Debate between Stephen Pound and Chris Williamson

Tuesday 6th July 2010 Commons Chamber

[Chris Williamson (Derby North) (Lab)]

There has been a degree of hysteria from Members on the Con-Dem Benches this evening. It might be the lateness of the hour, or there might be another reason, but I have been disturbed by the amount of sneering and laughing by Government Members at the serious points that Opposition Members, who are concerned about the Bill’s implications for their constituents throughout the length and breadth of this great nation, have made. A little humility from Government Members, and particularly from the Liberal Democrats, would not go amiss.

The Chancellor of the Exchequer, the Chief Secretary to the Treasury and all Government Members would benefit from some counselling from Gamblers Anonymous, because they are gambling massively with the British economy. Although history teaches us that their gamble is doomed to fail, they are ploughing on regardless—just like a wretched compulsive gambler betting on a course of action with incredibly long odds, in the vain hope that it will turn out all right in the end.

Crossing fingers and hoping for the best is not a credible economic prospectus. The Chancellor is pursuing the same old stale, worn out and inept Tory economic policies that have failed the country before and are set to fail it again. However, the Con-Dem coalition is not betting on a horse, but playing with the lives and livelihoods of the British people. Just like its Tory predecessors in the 1930s, the 1980s and the 1990s, this Con-Dem coalition is, yet again, making the wrong choice. It is risking the fragile recovery that the Labour Administration worked so hard to secure. [Laughter.] Yes, they like laughing—that is typical of the Con-Dem Benches.

The fact is that the Government’s corporation tax proposals provide inadequate support for businesses. The Chancellor’s very own Office for Budget Responsibility predicts that his Budget will result in lower growth not just this year, but next year as well. How will that help business? Are Government Members laughing at that? If growth declines, that will not help business at all. On top of that, the OBR says that unemployment will be caused. The OBR’s predictions remind me of two notorious Tory maxims coined by a previous Chancellor of the Exchequer and a former Prime Minister. One said that

“unemployment…is a price worth paying”

and the other, John Major, said:

“If it isn’t hurting, it isn’t working.”

However, as the shadow Chief Secretary pointed out earlier, the situation is even worse than is indicated by the OBR’s predictions. The number of people who will lose their jobs will be far higher than the figures that have surfaced so far.

The Chief Secretary to the Treasury says that Opposition Members are in denial. I put it to him and to other Government Members that they are in denial. It is their policies—those failed policies—that led to interest rates that averaged 10% during the Tories’ 18 years in power and that hit 15% on one occasion. I say to Government Members that they are in denial. Their failed policies, which they want to pursue again, resulted in record numbers of repossessions and millions of people ending up in negative equity. That, in turn, had a massive impact on the construction industry and the ancillary trades that rely on a buoyant housing market.

We all remember how the failed policies now being pursued again by Government Members resulted in unemployment that exceeded 3 million. Government Members are in denial about the fact that manufacturing was decimated by the policies that they are pursuing. They smashed the coal industry, nearly wiped out the steel industry, almost destroyed the British car industry and torpedoed British shipbuilding. They are in denial because they want to destroy the very instruments that will help the recovery, by undermining the regional development agencies and by taking away the loan to Sheffield Forgemasters, which would have had such a big impact in assisting the resurgence of the nuclear industry in this country.

The Con-Dem coalition is in denial because of its unrealistic expectation of growth in respect of the exports that it expects to achieve while the worldwide economy is in a fragile state.

[Stephen Pound]

My hon. Friend’s constituency is rightly known and admired far and wide for the quality of its Rolls-Royce engines. Has he done any research into the possible effect on demand for aero engines of an increase in insurance premium tax from 17.5 to 20%? Does he share my fear that that will dampen demand for travel and, ultimately, for the wondrous engines produced in his constituency?

[Chris Williamson]

I am very proud to have Rolls-Royce in the constituency adjacent to mine, Derby South. Indeed, many of my constituents work at Rolls-Royce, a company renowned for its excellence. My hon. Friend is right: the insurance tax rise is bound to have an impact. The cancellation of the loan to Sheffield Forgemasters will also have a big impact, because Rolls-Royce is seeking to diversify into the nuclear industry—to expand its operations in that regard—and was hoping to purchase equipment from Sheffield Forgemasters, but it will now be forced to look abroad. That is a direct result of the policies of Con-Dem Members, who should hang their heads in shame.

Building a High-Skilled Economy

Debate between Stephen Pound and Chris Williamson

Thursday 17th June 2010 Commons Chamber

[Chris Williamson]

Clearly, we live in a global economy, in which orders are placed with different companies around the world—Bombardier won some contracts, but some went abroad—but the fact is that the Transport Secretary said this morning that there is now no prospect of Bombardier getting the Thameslink contract.

[Stephen Pound]

Does my hon. Friend agree that one tragedy of current British manufacturing and skills is that contracts occasionally have to go to countries such as Japan, which has invested more in Bullet train technology and other high-speed train technology, and that that underlines precisely the point he is making?

[Chris Williamson]

Absolutely—my hon. Friend makes a pertinent point. If we were to follow the lead of some of our competitor nations by investing appropriately in skills, we would put our country, our young people, and the people who work in those sectors, in a much better position to secure their long-term future.

The parties opposite have also made proposals for the regional development agencies. The RDAs have played an important role, and the East Midlands Development Agency has made an important contribution to supporting industry in the east midlands and in Derby. That has helped to create the job opportunities and the growth that are so desperately required.

We must not indulge in a race to the bottom. The Government seem to want us to move to a low-wage economy, but there is no future in that for this country. We simply cannot compete on that basis, because we will never match developing nations such as India, China and others and the wage rates paid to workers there. We must invest in those high skills that Derby excels in through companies such as Rolls-Royce and Bombardier. That is why I regret the announcement this morning about Bombardier, which will almost certainly lead to redundancies. If we do not support such companies, they could go elsewhere, because they are global, and they will simply bid for contracts from their European bases.

If there is a market failure, it is essential for the state to intervene and smooth out the difficulties, such as those afflicting the country as a result of the worldwide economic downturn. If we do not do that, it will cause significant problems for the economy—and for young and old alike. No jobs for people means lower tax revenues to support our public services, and we will end up in a downward spiral to disaster.