Budget Resolutions

Boris Johnson Excerpts

Monday 13th March 2017 Commons Chamber

[The Secretary of State for Foreign and Commonwealth Affairs (Boris Johnson)]

It is entirely right that at this pivotal and exciting moment in this country’s—[Interruption.]

[Mr Speaker]

Order. Before the right hon. Gentleman develops his speech, may I gently say to those Members who—unaccountably—are leaving the Chamber before the oratorical fireworks the Foreign Secretary will volunteer that it would be greatly appreciated if they could do so quickly and quietly, so that we can proceed with the debate and the right hon. Gentleman can enjoy the certainly quiet and even possibly—if he is lucky—respectful audience that he seeks?

[Boris Johnson]

As I was saying before your kind advice to Members, Mr Speaker, it is right that at this pivotal and exciting moment in our international economic relations, not just with the EU but of course with the 93% of the world that does not live in the EU—shortly to be 94%—that I should be the first Foreign Secretary in more than 10 years to open a Budget debate. I do so with pride, because this is a Budget that will sustain the momentum of what is already one of the fastest growing economies in the west, with unemployment at its lowest for 11 years, the stock market 1,000 points higher than it was on 23 June, to pick a date entirely at random, and with more people in work—

[Geraint Davies (Swansea West) (Lab/Co-op)]

Will the Foreign Secretary give way?

[Boris Johnson]

I want to make a tiny bit of progress. I will give way many times, but let me get to the end of my second sentence—more people in work than ever before. This is a Budget that continues and enables the biggest programme of infrastructure investment this country has seen since Victorian times. It offers our young people the funding and technical qualifications to enable them to realise their full potential. As Britain prepares for re-entry, as I call it, into the global economy and for forging new relationships and partnerships around the world, the Budget—

[Tom Brake (Carshalton and Wallington) (LD)]

On forging new relationships, can the Foreign Secretary explain how he will do that when the Foreign and Commonwealth Office budget will be cut so substantially?

[Boris Johnson]

As the right hon. Gentleman well knows, we manage to run a world-class network—the most developed diplomatic network in the world—on approximately two thirds of the budget that the French spend, and we will continue to exercise the greatest prudence in managing our budget. I am fortified in that by the support that I have from the current Chancellor of the Exchequer, who was, of course, my predecessor in office. It is thanks to the Chancellor’s wisdom in his Budget that young Britons will be able to compete with confidence.

This is a Budget for global Britain. It is this Government’s argument not only that Britain is more outward facing by history and by instinct than any comparable economy, but that its global character is profoundly in the interests of the British people. A truly global Britain is a prosperous Britain, and it is Britain’s engagement with the world that means this country plays an extraordinary and indispensable role in the security, stability and prosperity of the world.

[Jake Berry (Rossendale and Darwen) (Con)]

Specifically on the issue of global Britain and our new trading relationship, does my right hon. Friend acknowledge that one of the ultimate ways in which we could project the soft power and prestige of Britain around the globe and promote trade is to recommission a new royal yacht for Her Majesty the Queen as a floating trade mission to be used by industry around the globe in the interest of our nation?

[Boris Johnson]

May I say how much I admire my hon. Friend for the indefatigable campaign he is running to create such a vessel? It is my view that it would indeed add greatly to the soft power of this country, which is already very considerable, if we were to have such a vessel, always provided—I know that this is part of his prospectus—that the new Britannia should not be a call on the taxpayer. If it can be done privately, I am sure it will attract overwhelming support.

[Several hon. Members rose—]

[Boris Johnson]

I believe that measures such as a new royal yacht—[Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Why are people making such a noise when the Foreign Secretary is saying things that might be important? [Interruption.] Order. I would like to hear the Foreign Secretary.

[Boris Johnson]

I am grateful, Madam Deputy Speaker.

The new royal yacht is one of a number of measures that I am sure this Government will be able to consider. In the meantime, we have before us a Budget that is helping to create the conditions in which this economy can continue to flourish.

The first of these conditions—

[Several hon. Members rose—]

--- Later in debate ---

[Boris Johnson]

If Labour Members will allow me, I shall say a couple more sentences.

The first of the conditions that are essential for the prosperity of global Britain is security. Unlike the Labour party, whose idea of a nuclear deterrent is to send our submarines to sea without a nuclear missile aboard so that the whole nation is literally firing blanks, this Government see the vital importance of maintaining our defences. This Budget therefore provides once again for the United Kingdom to set an example to our European partners by spending 2% of our GDP on our armed forces, thereby giving vital credibility to NATO, which of course serves as the guarantor of the security of all our major trading partners on either side of the Atlantic.

[Chris Leslie (Nottingham East) (Lab/Co-op)]

On the point about our trading relationships, at the weekend, the right hon. Gentleman said that it would be perfectly okay for the UK to leave the European Union with no deal and to fall back on World Trade Organisation rules. Lord Heseltine said, “Well, that’s rubbish, isn’t it?” Is it rubbish?

[Boris Johnson]

I repeat what I said at the weekend, and I am delighted that the hon. Gentleman was paying attention. I do not believe, by the way, that it will come to that, because we will have no difficulty over the next couple of years in doing a deal that is very much in the interests of both sides. I shall come on to that later.

To get back to the defence of the planet, let me remind Members that we are not only committed to transatlantic defences, as we will also spend £3 billion east of Suez in the Gulf region over the next 10 years. In fact we are reopening and restoring our role east of Suez, arguably for the first time since 1967. We are reopening a naval base in Bahrain, which makes perfect economic sense as well. If Labour Members cared about these things, they would understand that there is an absolute connection between our security and our economic prosperity, because the region of the Gulf—the Opposition probably do not know this—is our largest and fastest-growing export market apart from the EU and the US.

It does not end there either, because we are also committed to the security of the wider world, including Asia. Last year, as the House will know, the Royal Air Force sent Typhoon fighters to Japan, South Korea and Malaysia, proving that Britain remains one of the handful of countries able to deploy air power 7,000 miles from its shores. Soon the Royal Navy will have two giant aircraft carriers, each of them longer than the Palace of Westminster—the biggest warships this country has ever possessed, HMS Queen Elizabeth and HMS Prince of Wales.

[Owen Smith (Pontypridd) (Lab)]

rose—

[Boris Johnson]

I do not know whether the hon. Gentleman opposes those aircraft carriers as well. Perhaps he does. Perhaps he will enlighten us.

[Owen Smith]

Much as I am enjoying the Foreign Secretary’s travelogue, could we get back to the business in hand, which is the Budget? Will he confirm that the Office for Budget Responsibility has said that we are going to see less trade and less economic activity as a result of Brexit, and that we are going to borrow an extra £100 billion as a direct consequence of Brexit?

--- Later in debate ---

[Boris Johnson]

With great respect, I think we have heard enough of that sort of stuff over the last year or so. It has been proved convincingly to be wrong. As I said, the stock market is 1,000 points up. As for the deficit, which the hon. Gentleman mentions, we are bringing it down to below 3% for the first time since 2007—thanks to the prudent management of this country’s finances, and thanks to the Conservative-led Administration who had to take over the catastrophic mess that needed to be cleared up after his party was in office.

[Owen Smith]

rose—

[Boris Johnson]

I would be obliged if the hon. Gentleman resumed his seat. I do not intend to give way to him again.

[Sir Gerald Howarth (Aldershot) (Con)]

Will my right hon. Friend give way to me?

[Boris Johnson]

I will.

[Sir Gerald Howarth]

I am grateful. May I say how much I support the Government’s commitment to the 2% minimum on defence spending? However, does my right hon. Friend agree that we are going to need every penny of it, given in particular that the Chinese—my right hon. Friend mentioned east of Suez—are seeking to colonise militarily a number of uninhabited atolls in the South China sea, which is destabilising the region? Given that we are signatories to the five power defence arrangements, does he agree that we need to take action on that, and therefore increase the defence budget and not keep it steady where it is?

[Boris Johnson]

I am delighted that my hon. Friend makes that point. He reminds me that it was the leader of the Labour party, the current Leader of the Opposition, who said that he did not think this country needed a defence policy at all. I think he said that we do not even need an Army, let alone any spending on the security and stability of the South China seas. I remind my hon. Friend that 25% of the world’s trade goes through the straits of Malacca, so it is more vital than ever that we have a truly global commitment.

[Mike Gapes (Ilford South) (Lab/Co-op)]

rose—

[Boris Johnson]

I shall give way in a moment or two. I wish to return to the Budget. [Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order, Mr Gapes.

[Boris Johnson]

I will give way in due course, but I wish to make this point, because I have been asked to return to the Budget. I do so with absolute pleasure, because it is thanks to the careful stewardship of this country’s finances that we are able to deploy not only hard power on the scale that I have mentioned—we are the second biggest military contributor to NATO—but soft power on a scale unmatched by any of our European partners. The BBC, our universities and the British Council, an absolute gem of this country and its culture—an unsung gem, I might add—give the United Kingdom a cultural penumbra across the world that is of massive economic value.

[Mike Gapes]

The Foreign Secretary has mentioned the British Council. As he knows, the British Council will no longer receive any funds from the British Government. At the same time, there are continuing pressures on our diplomatic missions around the world as a result of the budget crisis with which the Foreign and Commonwealth Office has had to deal. Can the Foreign Secretary tell us how many additional diplomats will be appointed to increase the FCO’s budget so that it is able to deal with the consequences of Brexit, which is what the Foreign Affairs Committee called for in a recent report?

[Boris Johnson]

I have to say that I am deeply disappointed that I finally gave way to the hon. Gentleman, because he has shown the most staggering ignorance of the British Council, of Foreign Office spending and of the success of our diplomatic network. However, I will give him the answer to his question. In response to the challenge and the opportunities that we have, we are increasing our representation: just in our European posts, 50 more diplomats and 25 new trade experts have been recruited. We are expanding a fantastic network, and that is on top of the enormous soft and hard power that we have. As I am sure the House will know, the United Kingdom is the third biggest contributor to development finance in the world, after the United States and the European Union. That is an extraordinary record, of which I think every Member in the House—certainly every member of this Conservative Government —should be proud.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

I am glad to hear the Foreign Secretary talk about Britain’s soft power and its global reputation. Does he agree that he poses the biggest risk to both by putting his foot in his mouth on too many occasions?

[Boris Johnson]

I am terribly sorry; I missed the second half of that question. However, if the assertion was that British diplomacy is in any way falling short, let me say this. I believe that in the last few months we have seen an understanding of what the country wants, and a growing warmth towards our objectives, because they are, after all, shared with our European friends and partners.

As I have said, one of the things that are most admired by our colleagues around the table, not just in Brussels but in the United Nations, the G7 and the G20—all the bodies whose meetings I attend—is the fact that, as they realise, our Government have an extraordinary record of giving development aid. As we sit here now, the Department of my right hon. Friend the Secretary of State for International Development is helping the Pakistani Government to put 6 million girls through school in the Punjab alone. I think everyone appreciates that that is the best way of promoting economic growth, curbing infant mortality and reducing the pressures of a growing population.

We do not spend our aid budget—0.7% of gross national income—just because that is the right thing to do, although surely it is morally the right thing to do. I am not embarrassed to say that it is also the best way of promoting the development of the economies concerned, and thereby spurring the growth of our export markets. In that sense, a global Britain—[Interruption.] I did not think Labour Members would like that, because they are not interested in any policy that is so obviously of economic benefit to the country, but that is one of the reasons we are doing this. I speak as a defender of, and a believer in, globalisation, because millions of British people in our country—tens of millions, indeed—depend for their jobs and their livelihoods on the benign force of global free trade, which in turn requires safe and open shipping lanes, clear rules and effective institutions. None of that can be taken for granted.

[Geraint Davies]

Will the Foreign Secretary give way?

[Boris Johnson]

I think I have already given way to the hon. Gentleman. [Interruption.] I am sorry; I have not. Go on.

[Geraint Davies]

In the context of global free trade and, in particular, the judgment of the international financial markets, does the Foreign Secretary not accept that since 23 June our economy has slipped from fifth biggest to sixth biggest, and that those markets have deflated its value by 15%, which is why we have devalued and everyone’s wages and all our assets are 15% lower? That is not a success; it is a failure.

[Boris Johnson]

One would have thought that they would learn. One would have thought that the merchants of this kind of thing would have understood that there is no point in continually standing up and running our country down when, in fact, we are back up at No. 5. We have seen record investment in the United Kingdom, and we continue to see that the fundamentals of the British economy are strong and getting stronger.

[Crispin Blunt (Reigate) (Con)]

Will my right hon. Friend give way?

[Boris Johnson]

I will in 10 seconds.

One of the reasons for that is the active role that we play in protecting and insisting on rules-based international order. And with that, I give way to my hon. Friend.

[Crispin Blunt]

My right hon. Friend talks of the importance of the development budget and what it brings to the United Kingdom. Will he at least accept that there is an issue over how that money is invested in, for instance, the British Council, and, indeed, cross-invested in elements of his budget? Will he accept that that policy can only be applied to the developing world, that it is rather more important for him to have the tools to present global Britain across the whole world, and that the policy should not be constrained by the source of the expenditure?

[Boris Johnson]

My hon. Friend speaks with great wisdom and authority. I know that the Foreign Affairs Committee, which he chairs, has made some useful recommendations on how we can maximise our overseas spending, and co-ordinate it so that it helps to deliver not only our security but our economic objectives. I totally accept that point.

In the pursuit of the system that we want to see, our diplomats and intelligence officers and our serving men and women, backed up by the Department for International Development, are striving every day to preserve the essentials of the rule-based order, thereby helping to protect jobs and the safety of our constituents here in the United Kingdom.

[Mr George Howarth (Knowsley) (Lab)]

Will the Foreign Secretary give way?

[Boris Johnson]

Let me just conclude my thought about trade. Back in 1990, about 37% of our fellow human beings world wide lived in absolute poverty. Today, that figure has fallen to less than 10%, which is all the more remarkable when we consider that the world population has risen by 1.8 billion in the interim. That dramatic fall in poverty, unparalleled in history, coincided with the biggest expansion of free trade and open markets that the world has ever seen. Conservative Members believe in that policy implicitly.

[Mr Howarth]

rose—

[Boris Johnson]

I think that the right hon. Member for Knowsley (Mr Howarth) will agree with me when I say that the rules-based international order which we uphold in global Britain is an overwhelming benefit for the world as a whole.

[Mr Howarth]

Of course I agree with the Foreign Secretary. It is just a pity that on some occasions he does not seem to project that view when he travels abroad—but that is another problem.

A moment ago, when my hon. Friend the Member for Ilford South (Mike Gapes) asked him some questions, the Foreign Secretary dismissed them as ignorant. When the Chair of the Foreign Affairs Committee, the hon. Member for Reigate (Crispin Blunt), asked him exactly the same questions, he agreed with his hon. Friend. He cannot be right in both cases.

[Boris Johnson]

With great trepidation, I must correct the right hon. Gentleman. We travelled abroad together and both spoke the same sort of language at the time. Alas, the hon. Member for Ilford South (Mike Gapes) revealed the profoundest misunderstanding—let me put it no higher than that—of the exact state of the British Council’s finances. That was regrettable and worth correcting.

Thanks to my right hon. Friend the Chancellor, we are able to continue to support an active global Britain through the Budget, but there is of course much more to be done. Once we leave the EU, the Government will—we will all—regain a power that this country has not been able to deploy for 44 years, and that is the ability to conclude free trade agreements. The first and most important of those deals will be with our friends and partners in the EU. As the Prime Minister has repeatedly said, we are leaving the EU but we are not leaving Europe. To those who seriously doubt that we can pull it off in the next two years, let me remind them of the most essential point—that deal is profoundly in the interests of our friends and partners on the other side of the channel, who have a massive net balance of trade with us. They are optimistic. They are determined. I sometimes wish that we could have a little more of the same spirit from the Labour party.

[Owen Smith]

rose—

--- Later in debate ---

[Boris Johnson]

Perhaps the hon. Gentleman will now say that he is abandoning his gloomadon-popping and that he is going to come up with something supportive of the British negotiating position.

[Owen Smith]

I am going to seek to support the Foreign Secretary’s getting back to the question of the Budget. He talks about trade being increased in future—as a result of Brexit, I presume. Does he therefore disagree with the view of the independent, Tory-created Office for Budget Responsibility that trade will be reduced as a result of our leaving the EU?

[Boris Johnson]

I must respectfully say to the hon. Gentleman that, again, he is being too pessimistic. If we look at the UK’s trade with the rest of the EU over the past 20 years, regrettably we see that it has been declining as a proportion of our exports. I would like to see it increasing again—why not?—but I would also like to see my right hon. Friend the Secretary of State for International Trade, who I am delighted to see sitting next to me, doing those free trade deals around the world. As the House will know, there is massive excitement and enthusiasm among our global partners to do just that. There is literally a queue of countries that want to do significant and substantial free trade deals.

[Rachael Maskell (York Central) (Lab/Co-op)]

Does the Foreign Secretary agree with the Select Committee on Foreign Affairs, which just yesterday said:

“The possibility of ‘no deal’ is real enough to”

justify planning for it and that not to plan would be a mistake and constitute a serious “dereliction of duty” by the present Administration. That is your Foreign Affairs Select Committee.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. No, it isn’t. It is the Foreign Secretary’s Select Committee.

[Boris Johnson]

Madam Deputy Speaker, thank you. If I may, I will remind the hon. Lady of my optimism. I urge Labour Members to contain their pessimism. They asked me to name the countries that wish to do free trade deals. There are dozens. They have heard what the United States of America wants to do and that will be hugely in the interests of every part of this country. Right hon. and hon. Members may not know this, but at the moment the United States still has an embargo not only on British beef but on Scottish haggis. I do not know whether Members of the Scottish parties agree with that, but there is no way of liberating the haggis to travel across the Atlantic again unless we do a free trade deal with the United States.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

I appreciate the—[Interruption.]

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[Boris Johnson]

What I certainly believe is that a free trade deal with the United States and free trade deals for this country would be of profound benefit to the whole of the United Kingdom.

Since the hon. Gentleman has interrupted me, let me remind him that today is Commonwealth day, which provides an opportunity for us all to celebrate that remarkable institution which embraces one third of humanity and now includes some of the fastest-growing economies in the world—a free association of 52 countries, spread across every continent and dedicated to advancing the values that we share. I am proud to say that Britain will host the Commonwealth Heads of Government summit next year. Although we may not be able to sign free trade deals with our Commonwealth friends now, we can see them in outline and taking shape. Let me say this to our friends from the Scottish nationalist party, who seem so determined to wrench themselves out of the UK, even though they had a decisive referendum on the matter, as Members will recall, only a couple of years ago: never mind haggis; Scotch whisky exports to the Indian whisky market, a potentially huge market—the Indian thirst for whisky is colossal—account for only 4% of Indian whisky consumption. That is because at the moment, without a free trade deal, the Indian Government impose a 150% tariff on Scotch whisky.

Imagine a free trade deal that lifted the exports of Scotch to India by only a few per cent.—to, say, 6% or 10%. Dare to dream that Scotch whisky, which everyone in the House would concede is the original and authentic whisky, were slaking just 15% of that gigantic Indian thirst for whisky. We would be talking about an increase in profits for the Scotch whisky industry, for this country and, above all, for Scotland every year running into hundreds of millions of pounds. That means jobs, growth and investment for Scotland. It means the prosperity that comes with having a truly global outlook, which unfortunately Members on the Opposition Benches signally seem to lack.

[Christian Matheson (City of Chester) (Lab)]

Will the Foreign Secretary give way?

[Boris Johnson]

Let me make some progress.

In that global marketplace, this Budget will allow young Britons to compete with the best by investing in the talents and skills of the rising generation—more than a hundred new free schools provided for; a thousand more PhD places specifically for science, technology, engineering and mathematics; and another £270 million for biotech, robotics and electric vehicles. There will be another £16 million for 5G mobile technology. That is building on and fostering a global reputation for innovation. Last year, we were ranked the third most innovative country in the world. We were one place above America, seven places ahead of Germany, 15 higher than France, and fully 21 places above China. That is the measure of the extraordinary intellectual fecundity of this country.

Cambridge University alone has produced more Nobel laureates than every university in Russia and China added together and multiplied by two. When those breakthroughs take place, when that spark of innovation takes place, we foster it, we encourage it and we give business every possible incentive to turn those brilliant ideas into world-beating products.

From next month, my right hon. Friend the Chancellor will cut corporation tax to 19%, and it will be 17% by 2020—the lowest of any G20 economy. And it is by creating the right business environment—by investing in infrastructure, skills, housing and technology—that we are not only building a platform for sustainable growth but creating a launch pad for the most extraordinary exports. As I never tire of telling my friends, we export tea to China and cake—chocolate cake—to France; we export bicycles, I am proud to say, made in London to Holland; we export TV aerials to South Korea, and boomerangs to Australia, I believe; I think we have at least once in the past exported sand to Saudi Arabia, and Nigel Farage to America, I am delighted to say.

On Friday—

[Several hon. Members rose—]

[Boris Johnson]

On Friday—[Interruption.] Opposition Members mock, and they may mock the entrepreneurial spirit and the exporting drive and originality of this country—[Interruption.]—but let me tell them that on Friday—

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. The Foreign Secretary will give way when he is ready to give way; meanwhile, no shouting.

[Boris Johnson]

I will conclude with these thoughts.

Last Friday, I was in my constituency of Uxbridge and South Ruislip, and I am proud to say that I visited a business on a backstreet in Uxbridge that has more or less cornered the market in manufacturing the fancy display cabinets used to sell delicacies such as Toblerone in every airport in Saudi Arabia, and it is expanding. Thanks to the ingenuity and enterprise of that business, if we go to a Saudi Arabian airport and buy a Toblerone, we will buy it over a counter made in Uxbridge.

Given the ingenuity that this nation is showing, I believe—

[Dr Rosena Allin-Khan (Tooting) (Lab)]

rose—

[Boris Johnson]

I will not give way.

I believe that we have every reason to be confident in what we can achieve together, as one United Kingdom. This is a nation that in the last 300 years has become prosperous and successful precisely because it adopted a uniquely global outlook—active, engaged, and trading with every corner of the planet—not just for the benefit of the people of this country, but, I dare to say it, for the benefit of the entire world. This is once again the course on which we are now embarked, and this Budget will help us to fulfil our potential as a truly global Britain.