Budget Resolutions — House of Commons, 2018-10-29
Topic: Macroeconomics
Christine Anne Jardine (Liberal Democrats, Centre to centre-left): Now we have heard it from the Chancellor and the Prime Minister: austerity is over. It is a nice thought, but it will be down to our constituents and those outwith this place to decide whether they have achieved it. Every week, I meet people whose lives have been and are still being damaged by austerity. Today, like us, they have been told exactly what this Government mean when they tell us that it is over. Right now, people up and down the country will be working out the impact of this Budget on their income, their food bills and whether it means that they have reached the light at the end of the dark tunnel that began with the financial crash more than a decade ago in 2008 I suspect that they will be as disappointed as we are to be promised growth at less than 2% for five years. With Brexit weighing down the economy and the big issues that have not been tackled, today’s Budget does not fulfil even the minimum definition of ending austerity as laid out by the Institute for Fiscal Studies. That would cost £19 billion a year on top of the Government’s NHS commitment. Instead of that, we got more for potholes than for schools, nothing for women born in the 1950s and facing pension inequality, and a pathetic, inadequate sticking plaster for universal credit. So much more should, and could, be possible but for Brexit. Just think of the £500 million that the Chancellor added on today to the £3 billion that has previously been allocated for no-deal preparations—what could that have done for our public services What we needed today was vision, renewal and a way to reboot not just our beleaguered economy, but our damaged society. Instead, we got that sticking plaster. By March, if some of the Chancellor’s Brexiteer buddies have their way, this plan may have to be torn up and a fresh fag packet found to write a new one on This autumn, we are undoubtedly seeing short-term improvements in the economic picture, but there are still worrying trends that the Government have failed to tackle. Their independent advisory body, the Office for Budget Responsibility, has warned that the whole period of the Brexit negotiations is so disastrous and clouded in uncertainty that it is unable to assess the impact. What a thought that is. We are faced with so much ambiguity and the threat of chaos looms so large that the body whose one role is to assess the economy is unable to do so While the Government suddenly seem to have discovered £13 billion from somewhere, we all know that finding some money down the back of the sofa may well help with Christmas, but it will not pay the bills for the coming year. What we do not need now is a quick fix for the short term—a slapdash cover-up job. Today, the country needed a Chancellor who would lay out how we would go about repairing the severe damage that austerity has done, who would fix our broken tax system, and most importantly of all, who would find a way to restore a social contract that many struggling at the lower end of the income scale feel has been thrown on the fire, along with their ambitions for their and their family’s future. The very people the Prime Minister promised to support in her first statement on the steps of Downing Street are still waiting for the fulfilment of that commitment We need a people’s Budget that lays out a progressive way ahead for the 21st century; a Budget that protects the economy by allowing a people’s vote on the final deal with the EU and thereby allowing people to opt for an exit from Brexit; a Budget that fixes our broken tax system to boost investment and ensure the wealthiest individuals and big businesses pay their fair share; a Budget that invests this money in communities by reversing school cuts, putting more police on the streets and properly funding—yes, properly funding—universal credit. To ensure an end to austerity, we would need that cash injection of £19 billion and universal credit would need £3 billion, instead of £1 billion over five years In 1909, Lloyd George laid the foundations of what became the welfare state in his Budget and wrote the first page of the modern social contract with the introduction of employment insurance. A century later and universal credit, the descendant of that policy, is at the heart of the change we needed from this Budget. It is almost unique among Government policies: there is near universal support for the original principle of simplifying benefits and helping people get back into work, but the condemnation of how it has been implemented is almost as widespread. Universal credit is to be rolled out in my constituency for the first time next month, and we are braced for its impact. Experience elsewhere tells us to expect people waiting weeks longer than expected for payments, problems with rent arrears because of late payments, people facing increased stress and mental health issues, and so much more. It could have been avoided had the Government paused the roll-out to fix the problems and had the Chancellor announced that he was re-investing the £3 billion taken out of the system. Reinvesting that money would allow people to earn more before their benefits are reduced, which the Joseph Rowntree Foundation has said would make a difference. Instead, we have the £1 billion over five years Elsewhere our public services need investment, and this should come from reforming our tax system so that it fairly taxes wealth and not just income. If the Chancellor had grasped that nettle today, he could have begun the process of healing the country and really ending austerity, but once again he has simply put off the day when we all pay the price of that broken social contract. The way things are now are not how they have to be. The Liberal Democrats demand better.