Oral Answers to Questions

Debate between Lord Hammond of Runnymede and Andrew Bowie

Tuesday 18th July 2017 Commons Chamber

[Andrew Bowie (West Aberdeenshire and Kincardine) (Con)]

13. What assessment he has made of recent trends in economic growth.

[The Chancellor of the Exchequer (Mr Philip Hammond)]

Short-term indicators of growth are volatile. Quarterly growth was 0.2% in the first quarter of this year, but this followed strong growth of 0.7% in the quarter before. The underlying economy is robust, thanks to record employment levels. Although a recent rise in inflation, caused mainly by the depreciation of sterling last year, may temporarily dampen consumer spending—today’s inflation figure for June is a little lower at 2.6%—there are signs from surveys of business that export orders and business investment intentions are up.

--- Later in debate ---

[Mr Hammond]

Let me first congratulate my right hon. Friend; it was remiss of me not to do so in my first answer. I very much welcome her to her role on the Treasury Committee, and I look forward to being grilled or toasted by her, or whatever the correct expression is. She is of course exactly right: the only way to build resilience into the economy is to have strong public finances, and the only way to have a sustainably growing standard of living is to have rising productivity over the medium and long term, and that is what the Government’s policy is focused towards.

[Andrew Bowie]

These are obviously still worrying times for many in north-east Scotland, with the continued low oil price still causing concern, but does my right hon. Friend agree that the strength of the United Kingdom’s economy, now the second highest growing in the G7, has enabled this Government to provide over £2.6 billion of support to the industry, securing jobs in West Aberdeenshire and Kincardine?

[Mr Hammond]

Yes. The UK oil and gas sector has made a huge contribution to the UK economy, having paid over £330 billion in total in production taxes to date, and supporting over 300,000 jobs. In the next phase of the life of the North sea basin, as many fields come towards the end of their life, we are working with the industry to ensure that we extract every drop of oil and gas that it is economic to extract, that we enable decommissioning, and enable end-of-life fields to be operated in the most effective way.