Charter for Budget Responsibility

Mark Pritchard Excerpts

Wednesday 26th March 2014 Commons Chamber

[Mark Pritchard (The Wrekin) (Con)]

I know the shadow Chancellor always wants to be accurate. Not everybody on the Government Benches went to private or public school, unlike many on the Opposition Benches, including him.

On the specific point, I believe the shadow Chancellor is a fair and reasonable man, so will he join me in welcoming the fact that in the last 12 months 4,000 jobs have been created in Shropshire? Surely that is good news for everybody to celebrate, whatever our party affiliation.

[Ed Balls]

First, I went to an even lesser private school than the Chancellor of the Exchequer. [Interruption.] Neither of us went to Eton, unfortunately. [Interruption.] I agree with the hon. Member for The Wrekin (Mark Pritchard) that the rise in employment is good news, but I am concerned that in his—[Interruption.]

[Ed Balls]

The thing I am concerned about—this relates directly to the welfare cap—is that in the constituency of the hon. Member for The Wrekin long-term youth unemployment has gone up by 129% since 2010. I presume the hon. Gentleman would agree that that rise, based on the jobseeker’s allowance claimant count, is a real concern. I think he should be backing our welfare reforms. The fact is—[Interruption.] If the deputy Chief Whip, the right hon. Member for Chelsea and Fulham (Greg Hands), is saying that because the hon. Member for The Wrekin has got a large majority, he does not have to worry about youth unemployment, that would be rather revealing. I hope he was not saying that.

Let me get on to the subject of the welfare cap. The Chancellor has failed to balance the books, he is contradicting his own charter by increasing national debt when it says he should be reducing it in 2015, and he has failed to control welfare spending. We have had plenty of tough talk and divisive rhetoric from the Chancellor, but his failure to tackle low wages, to deal with the cost of living crisis and to get more homes built means that he is spending £13 billion more than he planned in the spending review of 2010, and in last week’s Budget that was revised up by £1 billion in social security spending next year and the year after.

I want to explain where we are. We support the welfare cap. We support what is in the welfare cap. We agree that long-term bearing down on the costs of ageing is a good idea, but it should not be in the welfare cap in the next Parliament; we have agreed with that all along. We have also said we would match the Government’s spending in 2015-16, and the welfare cap over these five years, which we support, would rise on that basis. Although we support that, however, we will make different—

[Mark Pritchard]

On a point of order, Mr Deputy Speaker. I said that the shadow Chancellor is a fair and reasonable man, and I know he would not want, even unintentionally, to mislead the House. He has got a lot of figures before him, so I have a great deal of sympathy for him, but the fact is that in my constituency of The Wrekin there has been a fall of more than 27% in youth unemployment over the past 12 months.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

That is a point of correction, rather than of order.

Pub Companies

Mark Pritchard Excerpts

Tuesday 21st January 2014 Commons Chamber

[Ian Murray]

There is a simple formula on employment in the licensed trade: the more successful a premises is, the more people it is likely to employ. The entrepreneurial nature of people in these small businesses running licensed premises means that they tend to want to get more licensed premises and expand what they are doing, so this is very good for employment. I declare an interest again, Madam Deputy Speaker, because I have visited some of the hostelries in my hon. Friend’s constituency, some of which are rather nice, and I encourage others to do likewise.

I was talking about the double whammy of Government decisions and the tied contracts pushing up prices to the consumer, which perpetuates the demise of licensed premises. We must also consider the ever-increasing energy bills, the spiralling rates and the costs of other non-alcoholic supplies such as food, which are rising much faster than tenants are able to pass on to their customers. More has to be done to deal with all those other relationships, and I hope the Government will back Labour’s policy on both energy and business rates to enable us to bring some of those other pressures down.

[Mark Pritchard (The Wrekin) (Con)]

It is important that we talk about the financial structures of pub companies and pubs, but does the hon. Gentleman recognise the important social function of pubs such as The Bull’s Head in Rodington, The Cock Hotel in Wellington and the Plough Inn in Shifnal, all of which are in my constituency? They have a link to CAMRA and the flexibility of being able to bring in real ales so that everyone can enjoy them in the community at the right levels.

[Ian Murray]

I am delighted that I gave the hon. Gentleman an opportunity to mention a lot of the pubs in his constituency—I hope that is reciprocated. As he rightly says, pubs provide a community benefit, and many of the premises I have frequented, and one I used to run, had the local Rotary club there raising a lot of money for charity, so the community part of the pub is very well established.

I wish to reflect on the relationship between tenants and the pubco owners of the premises, which has been mentioned. One thing I found galling when I ran one of my own premises was that our business development manager took great delight in telling us which tenants he was fining that week for buying out, which they had to do to make a small living. That kind of behaviour and culture in the pubcos highlights the problem we face. We must also address the issue of inaccurate information being provided when people are making big decisions, particularly, as my hon. Friend the Member for Chesterfield alluded to, when they are putting life savings into these premises; they have to make sure that the information they get is accurate.

Oral Answers to Questions

Mark Pritchard Excerpts

Tuesday 29th January 2013 Commons Chamber

[Mr Gauke]

I can remember one particular tax simplification from the last Government, which was the abolition of the 10p rate. I think we have a better record than that.

[Mark Pritchard (The Wrekin) (Con)]

Following on from my hon. Friend the Member for Witham (Priti Patel), who made her case well, given that the Exchequer benefited from the courageous decision to reduce the top rate of tax from 50p to 45p, may I encourage the Chancellor to go even further in the Budget and reduce the top rate of tax to 40p, in order to see more funds come into the Exchequer?

[Mr Gauke]

I will take that as a Budget representation. The point is that the 50p rate was not effective in raising revenue—my hon. Friend is absolutely right to make that point—and it was damaging to our competitiveness. There are better ways in which we can get more money from the wealthiest, and that is exactly what this Government have done.

Income Tax

Mark Pritchard Excerpts

Wednesday 28th November 2012 Commons Chamber

[Rachel Reeves]

I thank the hon. Gentleman for at least highlighting that thousands of people with declared incomes of more than £1 million who were paying the 50p rate will get a tax cut next year. His figures show that in 2010-11 there were 6,000 people with declared incomes of more than £1 million, and 10,000 in 2011-12. A written answer that I received from the Exchequer Secretary to the Treasury on 19 June stated that 70% of people earning more than £250,000 were paying more than 40% in tax, and 80% of those earning more than £500,000 were paying the 50p rate. In the new year, each and every one will get a large tax cut.

If the Government honestly want people to pay their fair share of tax, they should spend more time and resources on tackling tax avoidance, not compensate the wealthiest by cutting the headline rate of tax. No wonder they have cut staff numbers at Her Majesty’s Revenue and Customs by 11%—they have just given up.

I am happy to debate the Government’s record on raising revenue through taxation. Last autumn, as a result of the slowing economy, projected income tax revenues across the board had to be written down by £51.2 billion by the Office for Budget Responsibility because of the weakness of the economy and the double-dip recession. Only last week, the Office for National Statistics released statistics showing that public borrowing in October was £2.7 billion higher than for the same month last year.

Over the first seven months of financial year 2012-13, the Government have borrowed around £5 billion more than for the same period last year. Why are we seeing that increase in borrowing? It is not as if the Government have not put up taxes for ordinary people or cut public services. The Chancellor’s flatlining economy has forced a 10% slump in corporation tax revenues, and VAT revenues are expected to be down by 2.5%. The Government can spend all the time they like defending a tax cut for millionaires, and Ministers as much time as they like in Cabinet arguing among themselves about why there has been no growth, but it is time they changed course and adopted a plan for jobs and growth.

[Mark Pritchard (The Wrekin) (Con)]

Whether the rate is 45p or 50p, does the hon. Lady accept the principle that a low-tax economy is better for Britain and for businesses to do business in Britain?

[Rachel Reeves]

The hon. Gentleman says, “Whether the rate is 45p or 50p”, but the difference between those figures is £3 billion that could be used to pay down the deficit, help families who are struggling with the rising cost of living or get rid of the granny tax that the Chancellor is introducing next year. The principle of having lower taxes is fine, but we have a deficit to reduce. I thought the Government believed we should be cutting that deficit instead of giving tax cuts. The Chancellor said that in his first Budget, but he has thought again since then and is giving a tax cut to the wealthiest while asking ordinary families to pay more. That is not what my constituents want, and I doubt it is what those of the hon. Gentleman want either.

--- Later in debate ---

[Mr Gauke]

I note with interest that the hon. Lady appears to be arguing that an increase in tax can sometimes lead to a loss of revenue. She is right—that can sometimes happen. As it happens, the revenue on stamp duty land tax is holding up all right, but she makes an important point, one that I hope is understood more widely in her party. I am pleased that the Opposition are keeping open the option of not increasing the 45p rate of income tax. Although it is right that those with the broadest shoulders bear the greatest burden—I will set out how the Government are making that happen—it is also necessary to ensure that the UK is competitive in attracting wealth creators to locate and stay in this country. A Government that are serious about the UK winning the global race for growth should be very careful about pursuing a policy that places a huge “closed for business” sign over our economy. That is exactly what the 50p rate of income tax was—a “closed for business” sign. I hope that at the next general election there will be a consensus that we do not want to re-erect that sign over our economy.

[Mark Pritchard]

The new growth guru in Europe is of course President Hollande of France, who is well known to the Opposition Front Bench. I wonder whether my hon. Friend thinks that the higher 75p rate of tax in France has helped entrepreneurs and business people to stay within France, or to flee to other shores, such as the low tax economy in Britain.

[Mr Gauke]

My hon. Friend raises an interesting point. Perhaps I should not be drawn too much into discussing the domestic policies of one of our close European allies, but it will be interesting to see the impact in France of a very high rate of income tax, and whether people will move out of that country and we see any additional revenue as a consequence.

Multiannual Financial Framework

Mark Pritchard Excerpts

Wednesday 31st October 2012 Commons Chamber

[Mark Pritchard (The Wrekin) (Con)]

Although it might be popular on the Government Benches, I think that the country is getting sick and tired of Eurosceptic words from Ministers but very little action on the ground. Is it not the case that, irrespective of whether or not the Government are successful in negotiating a freeze, in cash terms more money will be given to the European Union? If I am incorrect, will the Financial Secretary please correct me on the record?

[Greg Clark]

The shape of the budget needs to be negotiated—it has not been settled yet—but it is true to say that as a result of the giveaway of the rebate that the previous Government introduced we lose out from spending that goes to the new member states that previously would have been abated.

Let me address the three main differences between the motion and the amendment. First, the amendment would remove the condemnation of the previous Government for giving away part of our rebate. Despite the talk of fiscal responsibility, the aim is to conceal the loss to this country of £10 billion. That amount, coincidentally, is nearly equal to the whole of Britain’s share in the budget increase proposed by the Commission—an increase to which we are opposed. It is simply not credible to vote for restraint and then to remove from criticism the most wasteful surrender of the British taxpayer’s interest that any Prime Minister has made in Brussels.

The second effect of the amendment would be to delete references to new EU taxes. Yet the tax sovereignty of this country is, or should be, non-negotiable. In particular, this removal would send a signal that this House supports the introduction of a new financial transaction tax which could badly undermine Britain’s economy. By the Commission’s own analysis, the tax would lead to a fall in European GDP of up to 3.5% and nearly half a million job losses.

Thirdly and finally, there is the call simply to cut the EU budget and not, as the Government’s motion has it, to cut or, at the very least, to have a real-terms freeze. Let me address this aspect precisely, as it comes to the crux of the matter. I should like to say this not only to Labour Front Benchers but to all those Members present who are genuinely outraged by the budget proposal. Like them, I believe, very simply, that the EU should cut now, and keep on cutting. The Opposition call on the Government to persuade others and to build alliances with those who share our concerns. On the issue of budgetary restraint, that has been exactly our approach. In 2010, the Prime Minister achieved a historic breakthrough when he agreed with the leaders of Germany, France, Finland and the Netherlands that

“payment appropriations should increase at most, by no more that inflation over the next financial perspective.”

If this position were to be agreed to, then it would be the first time in the history of the EU that the seven-year budget has done anything other than accelerate. No one is pretending that this would represent all the long-term reform required—not a bit of it—but it would be a turning point. Having reached such an agreement, which has been scrutinised in this House in the two years since it was published, it is surely right for the Prime Minister to keep to his commitment rather than have to give backword at the last moment.

This Prime Minister has been clear, as neither of his two predecessors were, that the remorseless rise in spending in the EU has to stop, and it will stop. If there is no cut, or no real freeze, there is no deal: the framework will be vetoed. The Prime Minister has a formidable task in persuading other countries of this—many of them were looking forward to a seven-year pay-out—but he has made a strong start, and he deserves the support of this House as he goes in to bat for Britain.

--- Later in debate ---

[Mr Brooks Newmark (Braintree) (Con)]

I am delighted to follow the hon. Member for Dunfermline and West Fife (Thomas Docherty). I feel rather uncomfortable with what I am about to say, because I agree with pretty much everything that has been said, particularly by Government Members. Of course we all want a real cut—I am sure the Prime Minister, the Chancellor and the Financial Secretary do. The nub of the debate, however, is what my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) said. It is about how the Prime Minister negotiates, and negotiation is about achieving realistic objectives.

I think that the multiannual financial framework, or EU budget to use a simpler term, is insane. For the European Union to ask for a 10% real-terms increase above inflation is insulting to our constituents and to the people of Spain, Italy, Portugal and Ireland, who are being told to pull in their belts. My hon. Friend the Member for The Wrekin (Mark Pritchard) said—I think I am getting this right—that people are being asked to make painful cuts in their household budgets. Each and every one of us has constituents who are being told to pull in their belts, and we all agree with that.

[Mark Pritchard]

I am flattered that my hon. Friend has quoted me. One way in which the Prime Minister’s hand can be strengthened is by having a united Parliament rather than a disunited Parliament when he goes to Brussels to negotiate on my birthday, 22 November.

[Mr Newmark]

I hasten to add that it is my wife’s birthday as well.

Let us discuss and decide today what message the Prime Minister should be given. Clearly he will read Hansard, and he will know the message that the Whips give him and so on, but do we want to bind his hands when he goes into the negotiations? He has already discussed a real-terms freeze with the Germans, French and Dutch, who are buying into the fact that this is a reasonable prospect. Do we want to push him over the edge and ask for something that we know he can never realistically achieve?

--- Later in debate ---

[Mark Pritchard (The Wrekin) (Con)]

I support the amendment. Teachers, police officers and nurses in my constituency have told me, “Not a penny more.” Today we paid tribute to our armed forces—those fallen heroes and heroines—but this Government have set in place a pay freeze for our armed forces. In April next year, armed forces salaries will be capped at 1% for the next two years. Is it right, and can we justify it to our constituents, that our brave armed forces, spilling their blood in Afghanistan as we speak this evening, are not going to receive the same treatment as the European Union—a wasteful, profligate and inefficient European Union?

Is it so difficult to conceive that a multiannual budget over the next six or seven years of almost €1 trillion might be able to find some efficiency savings? Our local councils are having to find them, member states are having to find them and, most importantly, our constituents are having to find them. There are increasing numbers of food banks, and people are struggling to pay their utility bills and to put shoes on their children’s feet for the new school year. It is our job to represent our constituents.

I say to Front Benchers that we do not risk doing ourselves a disservice. We are not being self-indulgent, as my hon. Friend the Member for Banbury (Sir Tony Baldry) said. I think it is the ultimate act of self-indulgence to continue to ignore the will of the British people. The British people want us, as their representatives, to stand up to an over-bureaucratic Brussels—an obese Brussels that needs to go on a diet like everyone else, including all our constituents, this Government and member states throughout the European Union. The Prime Minister’s hand can be strengthened by a united Parliament. A disunited Parliament will weaken his negotiating hand.

The Government speak about a real-terms freeze. Let us be truthful: a freeze is not a cut. What is this real-terms freeze? It is not really a freeze as there will be increased cash—an extra £300 million a year, year on year, will be required by the European Union even if the Prime Minister is successful with the so-called real-terms freeze. That sum is the equivalent of two medium-sized district general hospitals in each of our constituencies and of a medium-sized borough council—the same councils we all represent, who are looking for 20% cuts or more. Let us stop dancing on the head of a pin, as the Conservative party so often does. Let us stop playing semantics and being disingenuous with the British people. We are talking about £300 million next year, and hundreds of millions, and billions, of pounds beyond that.

This is the decision we have to make today: are we going to continue to ask families throughout this country to stop putting new shoes on their children’s feet in order to pay for the very large Mercedes fleet in Brussels? That is the choice. This is a moment of truth, and it is no good Eurosceptics on the Government Benches speaking about things in Eurosceptic terms—it is no good our going around parading as Eurosceptics—if our actions defy what we say we believe. At the European elections in 2014, it will be no good our wrapping ourselves in the Union flag if tonight we take it off and wrap ourselves in the stars of the European Union flag.

This is a moment of truth. This is a moment of decision. We can send a united message, as a Parliament and as a nation, to Brussels. Let us make a difference. If we are not making a difference, we might as well all go home.

[Several hon. Members]

rose—

Oral Answers to Questions

Mark Pritchard Excerpts

Tuesday 11th September 2012 Commons Chamber

[Sajid Javid]

I have not had any such discussions since I was appointed, but I look forward to having them in future and will report to the hon. Lady when I do.

[Mark Pritchard (The Wrekin) (Con)]

I congratulate my hon. Friend on his appointment to the Front Bench. I am sorry to ask him a difficult question to begin with, but what consideration has been given to the impact of APD on our Commonwealth cousins? It is having an impact on many economies. We would not want our Commonwealth cousins to turn to the black economy or illegal activities, or even to require more overseas development aid. Will he look again at the impact of the policy on the Commonwealth?

[Sajid Javid]

I thank my hon. Friend for his warm welcome and for his characteristically strong question. As far as I am aware, the Government have not looked specifically at the impact on the Commonwealth, but I am willing to do so and will get back to him.

LIBOR (FSA Investigation)

Mark Pritchard Excerpts

Monday 2nd July 2012 Commons Chamber

[Mr Osborne]

I completely agree with the hon. Gentleman that confidence in the process of setting LIBOR has been damaged—of course—by these revelations. That is precisely why, if I may say to him, I want to get on with it: that is why I have asked Mr Wheatley to do his report in the next couple of months, not even by the end of the year—so that we have the opportunity in October of amending, just before it becomes law, the Financial Services Bill. The hon. Gentleman is an expert on public inquiries, and I am sure he will agree that a public inquiry would take years to get to that point. Let us get to that point this autumn.

[Mark Pritchard (The Wrekin) (Con)]

I fully support greater transparency in banking and, in particular, punishing those who have done wrong, but can the Chancellor from the Dispatch Box today reassure my constituents who, as part of their pensions, hold shares in banks that the Government, or the inquiry, will take no action that unnecessarily undermines the value of those pensions?

[Mr Osborne]

We would not want to take actions that unnecessarily undermined the value of anything, so my hon. Friend has that assurance.

Jobs and Growth

Mark Pritchard Excerpts

Thursday 17th May 2012 Commons Chamber

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

I beg to move an amendment, at the end of the Question to add:

‘but regrets that whilst the UK economy is in recession, long-term unemployment is at its highest level since 1996 and one million young people are out of work the Gracious Speech contains no measures to address this crisis; notes that Britain will pay a long-term price for a prolonged period of slow growth and high unemployment; further notes that France, Germany and the Eurozone as a whole are not in recession while in the USA, where the Government has to date taken a more balanced approach to support economic recovery, the economy is now one per cent bigger than before the global financial crisis, while the UK economy is now 4.3 per cent smaller; recognises the criticism expressed by business leaders that your Government has not come forward with an adequate plan to boost economic growth; believes that cutting spending and raising taxes too far and too fast is self-defeating as slow growth and higher unemployment means that your Government is now set to borrow £150 billion more than planned; and calls on your Government to introduce a fair and balanced deficit plan, with measures to stimulate economic growth and job creation which are essential to get the deficit down, including a tax on bank bonuses to fund a guaranteed job for every young person out of work for more than a year, a temporary cut in VAT, a national insurance holiday for small firms taking on extra workers, and bringing forward infrastructure investment to strengthen the economy for the long-term.’.

It is a great honour to open the final day of this Queen’s Speech debate, and to do so in this very special diamond jubilee year. But I have to say how disappointing it is, with our economy now pushed into recession, the eurozone crisis deepening, and businesses and families up and down the country crying out for a plan for jobs and growth, that we are today debating what is widely regarded to be a disappointing and directionless Queen’s Speech programme from a Tory-led coalition that has, frankly, lost its way.

What a change this is from two years ago. When the Chancellor of the Exchequer spoke in the debate on the Government’s first Queen’s Speech, four weeks after the general election and two weeks before his first Budget, he was bursting with hubris. He was so sure of himself that, when the then shadow Chancellor, my right hon. Friend the Member for Edinburgh South West (Mr Darling), and many other hon. Members on this side of the House asked whether the Chancellor planned to bring forward immediate and deep tax rises and said that spending cuts might choke off the recovery, the Chancellor dismissed those concerns out of hand. He was confident that his plan would

“deal with our debts, set our country on a brighter economic course and show that we are all in this together.”—[Official Report, 8 June 2010; Vol. 511, c. 206.]

What a difference two years makes.

“We are all in this together”: we do not hear that line any more—not from a Chancellor whose Budget decisions have hit middle and lower-income families harder than those on the highest incomes. His Budget decisions have hit women harder than men and families with children harder still. The Institute for Fiscal Studies confirms that his Budgets have been regressive and will see child poverty rise. Last month’s omnishambles of a Budget included decisions to raise taxes on caravans, charity donations, church repairs, pensioners, pasties and petrol, but to have a top-rate tax cut only for the richest—a £3 billion tax cut, which will give 14,000 of the richest people in our society earning over £1 million an average tax cut of £40,000 a year. Millions are paying more in tax to pay for a tax cut for millionaires. No wonder the Chancellor and the Prime Minister can no longer bring themselves to say that “We are all in this together”.

Let me remind the Chancellor of what the chair of the Conservative Association in Harlow said last week:

“The voters are disillusioned with Cameron himself. They don’t like the fact that he did not keep the 50p tax. People feel he is not working for them.”

Apparently, the Chancellor was advised precisely not to cut the top rate by his own Downing street pollster, Mr Andrew Cooper. Let me say to the Chancellor that, in my experience, disregarding the wise advice of someone called Cooper can be a very dangerous course to take.

[Mark Pritchard (The Wrekin) (Con)]

Given the right hon. Gentleman’s closeness to the new French President Mr Hollande and given that the shadow Chancellor mentioned the top rate of tax, does he think that the dash for growth will be enhanced or hindered by the introduction of a 75p top rate?

[Ed Balls]

I do not think that introducing a 75p tax rate in Britain would be the right thing to do at all. That is not our policy, but I do not think that cutting the top rate from 50p to 45p will be good for jobs, growth or fairness either.

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[Mark Pritchard (The Wrekin) (Con)]

I welcome the measures set out in the Queen’s Speech to address jobs and growth, particularly the banking reform Bill and the enterprise and regulatory reform Bill. I also welcome the rise in employment announced yesterday, and I hope we will see a rise in full-time as well as part-time employment next month.

The Government are doing a lot to address long-term unemployment among the young—a problem that beleaguered and bedevilled the previous Government—but I agree with the right hon. Member for South Shields (David Miliband) that far more needs to be done. The Government have done a lot on apprenticeships, which is to be welcomed. I congratulate the Government overall on trying to rebalance the economy. We should have more people in our economy creating wealth rather than spending it, so we need to get the balance right between private sector and public sector employment.

It is questionable whether the current tax regime for business will be sufficient to grow the economy in the way that all hon. Members would like. I welcome the Government’s announcement on corporation tax, but my view is that it might not be enough to create the growth the country needs. Perhaps they need to look again at the corporation tax rate and the timetable for introducing it. I would like to see a 20p corporation tax rate introduced from April next year, and the higher rate—not the alternative rate—to be reduced from 40p to 36p from April next year.

That would affect revenue in the short term—some might say that that will add to the deficit—but in the medium term, and quite quickly, as people are rewarded for their risk, entrepreneurship, creativity and innovation, and as the economy grows on the back of that, revenues for the Exchequer would increase. We need more courage and less timidity in the Government’s tax plans and strategy.

I would like the business rate freeze extended for small businesses and our struggling high streets. I welcome the fact that the Government have extended it again for this year, but we must look again and probably extend it to the following year.

The Chancellor rightly mentioned the eurozone—I am moving away from my notes, which is quite dangerous. I have spoken out before on the International Monetary Fund. Whatever has been said, there is absolutely no doubt that some IMF contributions have been used as a back-door bail-out for the euro. Why do I say that? What is the evidence? Three eurozone countries have received bilateral loans from the IMF because their economies are failing, and they are failing in part because of their membership of the euro. A one-size-fits-all monetary policy for the whole of Europe was always a political project. It cannot be right to apply an interest rate in Germany reflecting the unique circumstances of the German economy to the unique and particular circumstances of, for example, the Portuguese economy or—perhaps more on our minds today—the Greek economy. That is the fundamental point. The euro is a political project that has gone horribly wrong, as many people warned that it would. We have heard a lot about new, bigger firewalls, but those will not deal with the underlying structural problems of a lack of competitiveness in Europe and the failed political dream—or, some might say, nightmare—that is the euro.

Finally, the European Investment Bank, although an important institution, should not be used as a new, indirect bail-out mechanism for a failing euro or eurozone. We are one of the four largest contributors to the EIB. Yes, it is important, but it should not be used as a back-door mechanism to save a failing euro. We want the euro to succeed. At the moment, we need to address the underlying problem.

IMF

Mark Pritchard Excerpts

Monday 23rd April 2012 Commons Chamber

[Mr Osborne]

The communiqué that was issued by the Finance Ministers and the European Central Bank governors said explicitly, with reference to the $430 billion that was provided by the countries at the meeting:

“These resources will be available for the whole membership of the IMF, and not earmarked for any particular region.”

[Mark Pritchard (The Wrekin) (Con)]

But is not the IMF in danger of sleight of hand? On the one hand the IMF claims not to bail out currencies, yet on the other hand it offers bilateral loans to countries in the eurozone that are failing because of the eurozone currency. Is that not an indirect loan from the IMF?

Youth Unemployment and Bank Bonuses

Mark Pritchard Excerpts

Monday 23rd January 2012 Commons Chamber

[Rachel Reeves]

I expect the hon. Lady’s constituents, like mine, regret that the Government cancelled the future jobs fund, which was helping young people back into work. Since that cancellation, long-term youth unemployment in her constituency has gone up not just by a little bit, but by 36%. That is the reality that her constituents face day in, day out.

I hope we will not hear the usual hand-wringing—although I might have to give up that hope—or the usual shoulder-shrugging or blame-shifting. The jobs crisis is not a fact of life or a force of nature, and the Government cannot play the innocent bystander, as they have tried to do. The jobs crisis is a result of the choices they have made. They chose to cut too far and too fast; to abolish employment programmes that were working; and to destroy job opportunities in both public and private sectors.

[Mark Pritchard (The Wrekin) (Con)]

The hon. Lady approaches such matters very thoughtfully indeed, and as a future Labour leader I would expect nothing else of her, much to the shock and horror of the shadow Chancellor.

Does the hon. Lady accept that the economy needs to be rebalanced and that we need more tax producers than tax consumers? Surely we can all agree on that.

[Rachel Reeves]

I am not sure how the Government will rebalance the economy by throwing more people on the scrapheap. Perhaps the hon. Gentleman and I will just have to disagree, but that does not seem to me to be the way to rebalance the economy and to get it growing again.

Despite the Government’s mistakes, they still have choices open to them.