Amendment of the Law — House of Commons, 2015-03-23
Topic: Macroeconomics
Alistair Darling (Labour, Centre-left): I agree that oil prices go up and down, but when I said that last year during the referendum campaign, I was told that I was scaremongering, that I was talking Scotland down and that that could not possibly happen. The hon. Lady should listen to her former leader. He told us that the oil price would never drop below $113 a barrel, but look what happened a few months later In relation to the oil price, I would like to say in passing that whoever is Chancellor in the future will increasingly face a structural problem in the economy. North sea oil revenues are not going to return to where they have been for the past 30 years, income tax revenues are decreasing, corporation tax is proving more and more difficult to get, and the Government’s ability to collect money through fuel duties is steadily diminishing. This is all going to put more pressure on measures such as VAT. All Governments are going to have to face these facts, and the fall in oil prices brings them into sharp focus The current low levels of productivity are a matter of great concern. The Chancellor had a lot of fun comparing Yorkshire and France, but French workers are in fact more productive. That is not because our workers are lazy, or anything like that; it is simply because French firms have invested more. That is why certainty in public spending is important. It is also important that the Government should do those things that the private sector is not going to do. For example, I have increasing doubts about the ability of the private sector to provide us single handed with the energy generation that we are going to need. I am in favour of replacing our nuclear power plants, but the proposals for the next nuclear power station are heavily dependent on the French and Chinese Governments, and I worry about that. I speak as an advocate of the mixed economy, but I believe that we now need to ask ourselves whether we have reached a stage at which it might be cheaper and more effective for the Government to be doing more in that regard, rather than leaving it to the private sector On transport infrastructure, it will, I hope, be for the next Government finally to make a decision on additional expansion, whether at Heathrow or elsewhere in the south-east. Actually, none of those arguments has changed in the 10 years since the last White Paper was published on the subject. I also hope that the next Government will take advantage of the present ability to borrow very cheaply by borrowing to invest. I personally would spend more time on HS3 than on HS2, but I recognise that I might be in a minority in holding that view, on my own side and in the House as a whole. To be honest, there would be much more benefit, particularly to the northern part of England, in spending more money on the transport links there than in building a fast link between Birmingham and London. However, that is something that the next Government are going to have to deal with. I speak as a former Secretary of State for Transport. The Department for Transport’s record on announcing such plans is pretty good, but it is not quite so good when it comes to delivering. Indeed, many announcements were made last week, but I distinctly remember announcing the same things myself 10 years ago. Perhaps that illustrates the problem that all Governments face One of the profound issues that needs to be discussed as we go into the next election is what people expect the Government to do in regard to the provision of services such as education, health and pensions and what sort of society we want to live in. However, this Budget does not begin to address those questions, which is why I shall have no hesitation in supporting my hon. and right hon. Friends in the Division Lobby tonight.