Policy for Growth

Lisa Nandy Excerpts

Thursday 11th November 2010 Commons Chamber

[Lisa Nandy (Wigan) (Lab)]

I begin by congratulating the Backbench Business Committee on securing this debate. Unemployment in my Wigan constituency currently stands at just short of 7%, and the human cost of that is evident in my surgeries every week. The families and individuals in Wigan who are suffering from the effects of high unemployment are also suffering deeply from the savage and unnecessary public spending and welfare cuts that have been visited upon them by this Government, and they are at a loss to understand why this is happening to them while at the same time the average pay of the FTSE 100 top chief executives rose by 55% last year.

The fact that that is happening is an insult to those people in Wigan; it is also economic madness. I am not a big fan of the over-simplified household economics practised by the Deputy Prime Minister, but it does not take a genius to work out that a family earning £10,000, £15,000 or £20,000 a year will put every pound that they earn back into the local economy—into businesses and services—whereas a banker earning millions in bonuses will not do the same. As my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson) said, it is bankers, not families, who should be paying for this economic crisis.

I wish to dwell briefly on the situation of my constituency, as a former coalfield area. My hon. Friend the Member for Barnsley East (Michael Dugher) talked about this subject compellingly and convincingly, so I shall simply say that the Coalfields Regeneration Trust and the regeneration programme was not just another well-thought-out initiative; it was a covenant between the Government and a series of communities who had suffered deep injustice at the hands of their own Government—injustice that is only now beginning to be put right. I urge the Minister, in his response to the report by the former Member for Barnsley, West and Penistone, which we expect shortly, to take that very seriously and to protect that investment, which is so badly needed.

I also wish to echo some comments made by many of my hon. Friends. In Wigan one third of people are, rightly, employed by the public sector, doing very important work, but most people work in small and medium-sized businesses. Those businesses rely deeply on public sector contracts and services; the two are interdependent, and if we damage one, we damage the other.

I wish to say a few words about the construction industry. When the Building Schools for the Future programme was axed, the children of Wigan did not just lose a badly needed new school; I heard compellingly from Union of Construction, Allied Trades and Technicians members what it meant for them in terms of the cost to jobs. It is exactly at times like this that we should be investing in those projects, not cutting them. I urge Ministers to think again, not only about that but about the regional development agencies; our RDA was the economic engine of the north-west. When the banks stopped lending, it was the RDAs that stepped in and supported small businesses. Small businesses in my constituency are going to the wall because of the Government’s decision to axe the RDAs and freeze their spending, and I urge the Minister to think again.

I read with interest the comments of Adam Posen, a member of the Bank of England’s Monetary Policy Committee, who said that rather than privatise the state-owned banks, we should use our stake in them to increase productive lending. I hope that the Government will consider that idea.

I end by stating that it is my strong contention that this Government have got it wrong—and that contention is not mine alone. As Joseph Stiglitz has said:

“Britain is embarking on a highly risky experiment…If Britain were wealthier, or if the prospects of success were greater, it might be a risk worth taking. But it is a gamble with almost no potential upside. Austerity is a gamble which Britain can ill afford.”