Autumn Statement

Geraint Davies Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Osborne]

My hon. Friend is absolutely right. As my constituency is affected by that road link, I very much welcome it, although I stress that the decision was not taken by me for that reason. He will know, and local people will remember, that that road scheme was cancelled in the first week of the Labour Government in 1997, and I am glad that we have now been able to take steps to help south Manchester and north Cheshire grow.

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

The Chancellor has already announced 500,000 job cuts in the public sector alongside pay freezes, both of which have deflated demand, reduced growth and helped to increase the deficit by £158 billion. He is now imposing a 3% income tax on all public servants dressed up as a pension contribution for a lower pension after working longer. Will he accept that that will mean a 3% reduction in the spending power of all public servants, which will be deflationary and which, as well as being unfair, unwise and discriminatory, will provoke an unnecessary strike tomorrow?

[Mr Osborne]

We are basing our pension reforms on the report from Lord Hutton. He particularly focused on the benefit, but he said that there was a case for the increase in contributions. He also said recently that it was frankly difficult to imagine a better deal. That was the former Labour Pensions Secretary. What I do not understand is what exactly the Labour party’s policy is on this. It is absolutely silent. Are you in favour of increased contributions? [Interruption.] If you are not in favour of the increased contributions, where in your so-called five-point plan are you spending the money to stop those contribution increases? It is completely economically illiterate—[Interruption.] The hon. Member for Dudley North (Ian Austin) talks about negotiations. Why do he and his party not condemn the strike, urge the unions to sit round the table and negotiate with us to get a deal, especially as the former Labour Pensions Secretary, John Hutton—a man I know the hon. Gentleman really admires—says that it would be difficult to get a better deal?