Government Spending Cuts

Debate between John Baron and David Laws

Wednesday 26th May 2010 Commons Chamber

[Mr Laws]

We are maintaining the young person’s guarantee. I have to tell the right hon. Lady that the clear advice that we have had is that that particular part of the young person’s guarantee was simply not effective and was wasteful—that the proportion of expenditure that was being saved as a consequence of it was minor and the administration costs were huge. I would instead point out to her the real action that we are taking to help young people in these tough times, with an additional 50,000 apprenticeship starts. That will make a real difference and will be far more effective than the scheme that we are amending in order to save money, which frankly was simply not working.

[Mr John Baron (Basildon and Billericay) (Con)]

Perhaps the Chief Secretary would like to take this opportunity to correct a fundamental flaw in the thinking of the Opposition in believing that spending cuts necessarily take money out of the economy, whereas in reality every pound that is spent and borrowed by Government ultimately comes from the private sector, and we need a strong private sector-led recovery to help us to reduce the deficit.

[Mr Laws]

My hon. Friend makes a very good point. He will also be aware that some of these funds are going to be used to avoid part of the tax on jobs that the previous Administration were intent on, and that will help to preserve employment in this country.