Budget Resolutions — House of Commons, 2017-11-27
Topic: Macroeconomics
Sarah Ann Jones (Labour, Centre-left): The big story from last week’s Budget was clear: there is little room for manoeuvre on the economy unless we improve our productivity. We need to spend only five minutes in the company of anyone from the Institute for Fiscal Studies to see that our downgraded productivity forecasts spell real problems for the UK, particularly as we approach the full force of the Government’s chaotic Brexit Britain’s influence in the world has always had at its heart a strong economy, driving trade and growth across the globe. My own constituency of Croydon developed as a town on the principal route between the south coast and London, a gateway to this country since mediaeval times. Competing on the world stage necessitates an economy that the world can work with easily and that it will look up to. Those who enjoy this sort of thing, as I do, will follow the various global country-branding matrices, which always place Britain satisfyingly near the top as a nation brand; but these things shift, and as our economic performance becomes stunted and freedoms of movement and trade are taken away, our reputation as a place in which to work and invest will suffer I think we would all agree that productivity holds the key to maintaining and building on our place as a world-leading economy, so how do we help our businesses, and the people employed by them, to become more efficient? There are two clear concerns that we must address before we go any further: the two pillars of education and infrastructure. The correlation between a strong education system and productivity is clear, and it was extremely disappointing to see no significant mention of education in the Budget. My borough of Croydon has the largest number of young people in London. We have 16,000 people in further education or apprenticeships, but I was devastated to hear that the number of apprenticeship starts between May and July fell by 61% There is a growing crisis in our schools, which threatens to undermine our local and national economy for a generation. I surveyed over 50 Croydon headteachers recently, and 93% told me that they had been forced to cut staff due to funding. Three quarters had cut teaching assistants and, shockingly, 85% said they had been forced to cut support for children with special educational needs. This is not helping our country’s productivity. In the last Parliament, the Conservatives cut adult education by 47%. This is not helping our country’s productivity. Prospective university students in England are now looking at average debts of an astonishing £50,000—higher than almost anywhere in the developed world. This is not helping our country’s productivity. The Chancellor’s Budget and today’s industrial strategy allocate some money for parts of our education sector, but to avoid real-terms cuts we need billions more in investment just to restore real-terms funding to 2015 levels The second pillar of productivity is, of course, infrastructure. London is our most productive location and it is where our housing shortage is most acute, yet London recently slipped to the bottom of the regional house building tables. The Mayor of London was right to say that this was the most anti-London Budget in a generation. It did not offer a single extra penny in grants for affordable housing in London, and, according to the Office for Budget Responsibility, the Government’s headline measures on stamp duty are more likely to benefit current owners than first-time buyers. The Government must change their mindset from seeing housing as a commodity to seeing it as a pivotal means of increasing our nation’s productive potential More housing will kick-start productivity only if the right type of infrastructure supports it. Croydon Council recently gave the green light to a transformative project led by Westfield and Hammerson to bring thousands of new jobs and homes to Croydon, but we are hampered by our infrastructure. East Croydon station has the second highest number of rail interchanges in the country. The Brighton mainline, which serves Croydon and other important south London destinations, desperately needs £l billion to handle the increase in demand that it will face in the coming years. Overcrowding on the network is hampering our productivity To sum up, the challenges we face, from artificial intelligence to an ageing population, from climate change to Brexit, are serious, but unless we get the foundations in place to improve our productivity, we will not stand a chance.