Budget Resolutions

Mike Gapes Excerpts

Monday 13th March 2017 Commons Chamber

[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.]

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[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.

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[Emily Thornberry (Islington South and Finsbury) (Lab)]

Let me start by saying that, like many other Members, it was my privilege this afternoon to attend the service of celebration for the Commonwealth at Westminster Abbey, in the presence of Her Majesty the Queen. In the context of tonight’s debate, it was a reminder of the powerful and historical ties that Britain enjoys all over the world; we are a country that will always face outwards and never turn in on ourselves, and, like the Secretary of State, I hope that at next year’s service we will have another member of the Commonwealth present, as a democratic Gambia completes the process of re-admission.

I thank the Secretary of State for opening this evening’s debate on the Budget and Britain’s place in the world. It is an issue of vital importance, and yet one that, it is fair to say, has not been centre stage in the five days of the debate on the Budget. If someone had told us last summer that going into article 50 week the Prime Minister and the Chancellor would be at each other’s throats, at war through the media, and engaged in a desperate blame game, while the Secretary of State for Foreign and Commonwealth Affairs would be sent into the television studios to act for the Government as the voice of calm and unity, no one would have believed them. However, if this is indeed to be the Foreign Secretary’s new role—if he is going to be the new Willie Whitelaw figure, or, dare I say it, the new John Prescott—I congratulate him and wish him the very best of luck in the future.

Of course, there will be some unkind souls who look at the row between No. 10 and No. 11 and think it is exactly what the Secretary of State needed this weekend. In their cynical minds, had it not been for that row, much more attention would have focused on Sunday’s real heavyweight contest, the one the public really wanted to see explode, the one between the two Tory blond heavyweights: Hezza versus Bozza; Tarzan versus the Zip-Glider; the Dog-Killer versus the Dave-Slayer. We were denied a true fight, but we were left with these immortal words from Lord Heseltine:

“When I listen to Boris…he has turned the art of political communication into a science”

of using

“waffle, charm, delay, anything to stop actually answering questions.”

In the rest of my speech, I intend to ask some very straightforward questions on the Budget and Britain’s place in the world, and I hope that the Secretary of State will be able to answer them without waffle or delay, and with no more charm than he feels is absolutely necessary.

It is striking that we are here to debate a Budget that has almost nothing to say about Britain’s place in the world, and with even less to offer for it. I am sure that we could all have predicted some of the rhetoric that we have heard from the right hon. Gentleman tonight about re-entry into world markets, a truly global Britain and an active global Britain. I predict that we will hear more about “brand Britannia” and terms such as “dynamic”, “agile”, “cutting edge”, “global powers”, “global reach” and “global influence”, and about the yacht and exporting boomerangs and so forth—but the question is this: what is the strategy for achieving all that ambition, and how does the Budget provide the resources to back it up? So far, we have seen no evidence of either.

It is not enough simply to want a relationship with Europe that has all of the benefits and none of the costs, and to be a leading global power at the same time, or to say, like Tinkerbell, that all we have to do to make it happen is believe that it is possible. Indeed, the right hon. Gentleman almost seems to be implying that if we do not believe, or if we ask awkward questions, somehow these things will not happen, and that fairies will start falling from the skies.

It has been said in this debate—no doubt it will be said again—that the Government are meeting their commitments to spend both 2% of GDP on defence and 0.7% on development, but while these seem like clear commitments, when we scratch the surface there are many unanswered questions, about how funding is split between the Foreign and Commonwealth Office, the Ministry of Defence and the Department for International Development, and about how, where, why and on what this money is actually spent.

It seems likely that a large part of the Foreign Office budget over the next few years will come from funding streams that are nominally shared across Departments, most of them with blandly unobjectionable names such as the conflict, stability and security fund and the prosperity fund. The idea of shared funding is perfectly valid in principle, but we need to know how these funds will be used by the Foreign Office. How much will be classed as “aid” spending, and how much as “defence”, and, for that matter, how much will be classed as both? We need to know why there is so little transparency on this issue, and what kind of oversight there is to make sure that these funds are used responsibly. One might, if one was of a suspicious frame of mind, even conclude that the Government are being wilfully opaque in this matter, but I am sure that the Secretary of State will bristle at the very suggestion, and will want to do all he can to dispel such a thought from the debate.

Of course, the reliance of the Foreign Office—perhaps the over-reliance—on funding from outside its budget settlement is really just symptomatic of a much larger and much more damaging trend under this Government. Unlike defence or overseas aid, our diplomatic service lacks the financial security of a politically or legally binding spending target, and I am sorry to say that it shows. Of the three Departments that share most of the responsibility for “Britain’s place in the world”—the Foreign Office, the Ministry of Defence and the Department for International Development—the FCO’s budget accounts for just 3% of the combined total, despite the fact that it is every bit as essential as the other two.

I am sure the right hon. Gentleman saw the Financial Times on Friday, which highlighted the real change in Departments’ resource budgets between 2016-17 and 2019-20. It is no surprise—there was a great deal of fuss about this—that there has been a cut of 37.2% to Department for Communities and Local Government budgets, but which Department has the largest cut of all? It is the Foreign and Commonwealth Office, which has a minus 38.1% change to its budget. The Under-Secretary of State for Foreign and Commonwealth Affairs, the hon. Member for Bournemouth East (Mr Ellwood) may shake his head, and if I am wrong, he should please tell me. I would be interested to see him go into battle with the Financial Times on this matter.

The Department’s budget is already very small, and it comes as no surprise that these cuts have had serious consequences for our standing in the world and for our global reach and influence. To start with, there has been a loss of expertise. We have seen the Government repeatedly being caught by surprise on events of great global significance such as the Arab spring, the crisis in Ukraine and the attempted coup in Turkey. There has been a hollowing out of expertise in these critical areas, not to mention a loss of skilled linguists. If the Secretary of State can tell us what progress has been made on recovering Russian and Arabic language capabilities, for example, I should be very grateful.

[Mike Gapes]

My right hon. Friend is making a powerful case about the hollowing out of the FCO’s budget. On the question of linguists, has she seen the report on Russia from the Foreign Affairs Committee that we published last week? It describes the lack of expertise in the FCO for looking at Russia. Does she agree with me and the Committee that the FCO needs more resources if we are to confront and understand the problems being caused by Russia’s behaviour towards its neighbours?

[Emily Thornberry]

It is because I have read that report that I mention Russian language capabilities. In my view, the reports produced by the Foreign Affairs Committee are thoughtful and informative, and I recommend them to the Secretary of State. The Committee has raised a number of flags that need to be carefully considered, because changes are happening to our precious Foreign Office and we are losing capabilities that it will be very difficult to redevelop.

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

In the Foreign Secretary’s introduction to the debate today, we heard his typical bluster, lack of detail and “winging it” approach, which augurs very well for his forthcoming visit to Russia. His speech gave a complete fantasy view of what is likely to happen to our international trade. We were told that we were going to get a trade deal with the United States, yet the Trump Administration have already torn up the Trans-Pacific Partnership. In any trade negotiations with the UK—with our 65 million population, compared with the EU’s 550 million—the US Administration’s desire to put America first and make America great again will mean that they insist on getting more than they give. Are this Government prepared to accept food from the United States that is pumped full of steroids? Are they prepared to lower our health and safety standards? That is what will happen if we no longer have EU regulations and we accept the American model of trade.

Fortunately, we have the possibility of an agreement with Canada based on the EU-Canada agreement that was negotiated over seven years. Similarly, the EU-South Korea agreement could provide a model for something that would be beneficial to us. However, as my hon. Friend the Member for Ealing, Southall (Mr Sharma) pointed out, as for the idea that we can just export thousands of crates of whisky to India, as implied by the Foreign Secretary, in some kind of great trade agreement, India generally does not want to consume vast amounts of whisky—certainly not Prime Minister Modi, who I understand is a teetotaller. The reality is that India will desire access for its young people to study in this country and a loosening of the visa regime. So much for this Government’s 100,000 yearly immigration target. The forecasts on which the OBR’s economic growth assessments are based assume 185,000 people coming to this country. How can that be reconciled? This is a Government of smoke and mirrors, and the Foreign Secretary’s pathetic performance today is a great example of that.

Similarly, the Budget states that the Government are going to put £325 million over three years into financially challenged sustainability and transformation plans in the NHS. The STP in my area of north-east London has a predicted deficit of £575 million, which must be eliminated within three years. That is just one STP. The Government say that they are providing £100 million for capital spend on new A&E departments. If the plan to close the A&E at King George hospital in my constituency goes ahead, they will need almost that amount just to replace the beds and wards on the site of the Queen’s hospital in Romford, which is part of the STP. This is Mickey Mouse economics, and it does not make sense.

I do not have time to comment on the underfunding of our schools, the wasting of money on free schools, or the damaging consequences for local government of the continuing cuts. There is a sticking-plaster solution to assist for two years with the social care crisis, but there is no long-term plan. We need a more serious Government who consider such issues.

Then, of course, there is the NICs crisis. As The Daily Telegraph headline said, the Tories are no longer the low-tax party. That is the perception of millions of people in this country. If we had a credible Opposition, we would be able to challenge on that issue effectively and avoid diversions into other matters. Twenty years ago, Labour was 20 points ahead in the opinion polls and on course for a landslide victory, and I say to all Labour supporters, “Things can only get better.”