Business and the Economy

Debate between Lord Redwood and Nigel Evans

Monday 14th May 2012 Commons Chamber

[Mr John Redwood (Wokingham) (Con)]

I remind the House that I offer business advice to a global engineering business and a small investor management business.

We meet today with the winds of danger blowing once again from the euro area. We meet to discuss measures in the Queen’s Speech to make Britain more competitive, to equip Britain better, and to produce more jobs and deliver more goods and services around the world. No one in this House would disagree with the aim. All the main parties agree that we need more economic growth. I think they all agree it is easier to get a deficit down when we are creating more jobs, getting people who are out of work into those jobs, and generating more income and activity, than when we are not. There is no disagreement across the Floor of the House about the aim.

However, when debating how we are going to get that growth and give the best possible support to the companies and individuals who create the jobs and make things happen, we must also recognise that there is a very threatening and menacing problem on our doorsteps. As we meet here today, we know that the Greek political parties may not be able to form a Government at all, or they may not be able to form a Government that can put through the necessary measures to meet the requirements of the EU and IMF loans in Greece. They may decide on new elections in some weeks’ time, creating a dangerous hiatus; and those elections may produce a Government who fully reflect the view of the Greek people, as expressed in the last election to a considerable extent, that they do not wish to co-operate any longer with the lethal mixture of policies that the euroland senior politicians have put forward.

That matters to the United Kingdom, not only because some of our exports and services are sold within euroland, but because, as members of the European Union, we will participate in some of the meetings about what kind of growth strategy Europe as a whole can develop, and we will be a party to some of the decisions that will determine the future of the euro. If the Greek tragedy unfolds such that the Greek state cannot meet the requirements, the European Union has to decide either to give in yet again and come up with another compromise, or that there has to be an early exit of Greece from the euro. It would be better for the British economy and for the future of euroland if an early exit of Greece from the euro were organised quickly, and in confidence up to the point when the necessary announcements must be made. I would not expect the British Government to confirm that that is their aim, but I hope that Ministers are working closely together, representing the greatest financial centre in western Europe and perhaps the world, with that in mind. The sooner the Greek problem is solved, the sooner we can get on with sorting out some of the wider problems in the European economy.

If it is decided to cobble together another compromise, massive headwinds against growth and prosperity in our continent will continue to blow forcefully. Will an early Greek exit be easy to handle? No, of course not. Will it be pleasant? No, of course not. But the Greek people have got to the point where they cannot take any more years of austerity, and in some way or another Greece has to be made competitive. If is it is completely impossible, as it seems to be, in a democracy to slash wages by the amount the German side of the argument seems to say the Greeks should slash wages by, other means have to be used: having a devaluation and having a new currency.

The United Kingdom has one big advantage in the crisis: we have our own currency, it is freely floating,and we are much closer to having competitive prices than Greece, Italy or Spain can possibly be within the euro. Any measures that my right hon. Friends can take to improve our competitiveness in order to create more export jobs, the better. How right Ministers are to see that there has to be a huge reorientation of British exports towards the emerging markets—to the faster-growing territories of Asia, Latin America and parts of Africa—because Europe is making such a comprehensive mess of its economy and its prospects. It is destroying hope and jobs on such a massive scale that our only hope as a country is to support and orient our businesses to where the growth is and where the opportunities are to be found.

That means taking urgent action to mend our banks and to establish more competitive banking, with more money to lend to our companies, because they are going to need working capital and investment capital. They are going to need to gear up for the 2.5 billion Indian and Chinese who want to come to the world party, many of whom, I am pleased to say, will come to the world party and will be the market that replaces the European market, which is failing so visibly.

We also need competitive energy. Surely the Secretary of State would agree, at least in private, that if we wish to lead an industrial revival in this country or anywhere else, we need cheap and competitive energy in plentiful supply. We should not be saying, “Let’s make everything in China, so it does not score against our carbon dioxide totals.” Let us make things here. If we have cheap energy, we will have more chance. Modern manufacturing creates lots of jobs in marketing, legal work and promotion. It does not create many jobs on the shop floor because it is automated, which requires access to lots of cheap energy. That is what I want this Queen’s Speech to address: cheap energy, less intensive regulations—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. I remind hon. Members that there is a six-minute limit on speeches.

Finance Bill

Debate between Lord Redwood and Nigel Evans

Thursday 15th July 2010 Commons Chamber

[The First Deputy Chairman]

Order. We are not referring to taxes that are not proposed in the Bill. We are talking specifically about the amendments to the Bill.

[Mr Redwood]

How wise you are, Mr Evans.

I was making the point that the Minister, in responding to this debate on the insurance premium tax, might assuage some of our grief if he were to say that the Government had looked at the total package of taxes on the motorist and that they were aware that this was yet another example of the piling high of taxes on the motorist. Although this individual tax increase will not be large for many motorists—it will be more penal for young drivers and high-risk drivers—it is none the less an additional burden. Even if the Minister cannot accept the amendment, I hope that he will look at other ways of dealing with the problem of fair motoring taxes.

Every time something like this happens to motorists—this time, it is the insurance tax levy—they say, “We are being sandbagged again. Where are those better roads? Where is that safer junction? Where is the wish to spend money on improving the flows on the roads so that we can travel in a more fuel-efficient, green manner of which the Environment Secretary would approve?” There never seems to be the money to do that. We know that this bit of taxation on the motorist, like most others, primarily goes not to making better roads but to a wide range of other purposes; it gets lost in the general coffers.

--- Later in debate ---

[Bill Esterson]

The right hon. Gentleman mentioned the record of the last Labour Government on pensions, but what about the record of the previous Conservative Government when it came to the mis-selling of pensions? I trust he would accept that that was a serious problem.

[The First Deputy Chairman]

Order. That is much wider than the amendment.

[Mr Redwood]

I would love to deal with that point, but I shall take your advice, Mr Evans. The real sin was the tax and regulatory raid on pensions under the last Government, which led to the wholesale closures of final salary schemes, and as a result of which most people starting out in work today have no access to a final salary work-based scheme in the way that their parents’ generation did. That is a great tragedy. However, this provision is a small move in the right direction, so I hope that the House will warmly welcome it. Well done to the Minister.

Debate on the Address

Debate between Lord Redwood and Nigel Evans

Tuesday 25th May 2010 Commons Chamber

[Mr Redwood]

Those periods were also periods of surging income tax receipts, which demonstrates that this is good for enterprise, profits and jobs. We need more profits, more savings, more investment and more jobs. If we tax things more lightly, we get more of them. If we tax them more heavily, we get less of them. The enthusiasts for high taxes in this House have always said, “We must put up the taxes on petrol to stop people driving so much, and we must put up the taxes on smoking to stop people smoking so much.” So, presumably, putting up the taxes on enterprise will stop people being so enterprising. That must be the logic.

[Mr Nigel Evans (Ribble Valley) (Con)]

I am enjoying my right hon. Friend’s contribution. Did not Margaret Thatcher prove this point when she was Prime Minister? By reducing the level of tax on the top earners, she increased the amount of money that flew into the Exchequer.

[Mr Redwood]

I am grateful to my hon. Friend for reminding us of the great lady; she was a great Prime Minister. I not sure, however, that that is quite the model we need to persuade those on the Front Bench of a coalition Government. That is why I am drawing on more modern and foreign examples. My right hon. and hon. Friends will understand that we need good friends, because we must win this argument for the sake of our country’s prosperity.

I know a number of people whom I describe as entrepreneurs on strike. They have been very successful in business and they are now in their late 40s and 50s. Many of us would feel that they were still quite young—[Interruption.] They are also very energetic, as some of us are. They are on strike at the moment, however. They have loads of money in the bank or in a portfolio, but they do not want to commit it to a new business in Britain because they find the atmosphere here too hostile. They think that there are too many regulations and controls, which they find too burdensome. They also find the tax structure too uncertain. They feel that, if they are going to venture their money and work 12 to 14 hours a day to break in a new company and make it a success, they do not want to be paying 40 to 50% tax after five years if the company is working. They know that the Treasury will not be sending them half their losses if the business has not worked, and they feel that it is easier not to bother. They are saying, “I’ve got enough money, I can live quite comfortably, and I’m on strike.” Hon. Members might dislike strikes, as I do, but we have to work alongside them and with those entrepreneurs. This proves the point that if we want to stop something, we tax it. Please, Government, do not stop enterprise, venturing and new developments.

That brings me to my final main point, colleagues will be pleased to know. It relates to an excellent Bill proposed in the Queen’s Speech, which has been championed by my new friend, the Deputy Prime Minister: the great repeal Bill. I was delighted to learn that this was a Liberal Democrat idea. I cannot remember how many times I have urged that this House introduce a great repeal Bill, but Liberal Democrat ideas are not always wrong and I am delighted to give them ownership of this one, as long as they will do one thing for me. That is that they should work with us to make it a really good repeal Bill.

There are many things that we need to repeal. I shall not go on about them at huge length, because other colleagues wish to speak. I have sent the Deputy Prime Minister 27 proposals for the great repeal Bill, and they are also on that well-known website, johnredwood.com—I hope that I am permitted a commercial in this hallowed Chamber. If colleagues think it a good idea, they too should write to the Deputy Prime Minister with their pet ideas for the great repeal Bill. We do not want Ministers to come to the Dispatch Box with half a dozen perfectly good ideas, and then to say, “Well, we had a consultation, but nobody had anything else that they wanted knocked out.” I am sure that colleagues have their own ideas, and they should please put them in. If they do not, I do not mind them borrowing all the ones from my website. I do not expect any praise or attribution. They can even put in their letters that they do not like me, or perhaps that they agree with me. They can put in whatever they wish, if they think that it will help to get their message across. We need to bombard the Government with as many ideas as possible while they are listening and trying to construct the great repeal Bill.

We need to get costs off the back of British business. It is not easy to cut taxes as much as I would like—because the Government will not believe all my good news on how that would raise revenues—so we need also to cut the regulatory costs on business, so that more people can be persuaded that it is worth while to work. Our country is disfigured by 6 million people of working age who do not have a job. Some of them are chronically disabled and very ill; we all wish them any speedy recovery they can get and we wish to send them as much money as we can so that they can have a reasonably comfortable life. Most of the 6 million are not in that category, however, so it must be a high priority for this Government to use whatever means they can to get them back to work, which requires a strong and vibrant private sector for them to find jobs on offer. That is the central task.

If this Parliament masters the deficit before it demolishes us, if this Parliament gives hope to 6 million people out of work and if this Parliament creates an enterprising and fast-growing private sector economy, it will deserve to be well rewarded by the electorate in five years’ time or whenever the end comes.