Finance (No. 2) Bill — House of Lords, 2018-03-08
Topic: Macroeconomics
Bryan Davies (Labour, Centre-left): My Lords, Lloyd George should be living at this hour. Here we have a Finance Bill introduced by the Minister where the only contributors are the Opposition Front Bench spokesmen. This is an indication of how limited the House’s role is in relation to Finance Bills, and justifiably so. As the noble Baroness, Lady Kramer, pointed out, we will have the opportunity to have a serious debate about the economy next week, when I anticipate there will be greater participation from all parts of the House The Minister put an extraordinarily optimistic gloss on the state of the economy at the present time, as the noble Baroness, Lady Kramer, also pointed out. In circumstances where so many countries are showing real and rapid growth and the world economy is benefiting from that, this Government are still watching their levels of economic growth bounce along at the bottom of the OECD countries. What this low level of economic growth indicates is that there are limited resources for the wider society and also for the Government to meet their obligations In the other place, Ministers were so concerned about the possibility of penetrating opposition amendments to this Bill that they introduced a procedural Motion restricting opportunities for critical amendments—a procedure which we have normally only seen either in the exciting times immediately before a general election when the decks are cleared or when warfare is approaching. What is the crisis on this limited and pathetic little Bill that causes Ministers to run for cover under a procedural Motion? The only crisis is the obvious one that this Government lack confidence in handling the other place The Government’s lack of confidence, of course, derives from their exiguous majority, which is dependent on another small party. That underpins so many of the Government’s actions. It certainly underpins their whole approach to Brexit, and that is why we fear that the negotiations will not produce the effective Brexit that we all want. The Government are in hock partly to the fact that they do not have a majority in the House of Commons and partly to the fact that a determined section on the right wing of the party do not really care about the terms of Brexit—in fact, they seem to exalt in the possibility of our having the hardest of hard Brexits, and the economy is meant to cope with that. We shall see Let me be absolutely clear about this Bill: it does not in any way, shape or form measure up to the significant needs of the economy or do anything to repair the damage done to the economy by the actions of previous Conservative-led Governments. As we all know, their record on economic growth is poor and their record on productivity is almost negligible. I have seen the noble Lord join the considerable list of Treasury Ministers since 2010 who have taken up their post expressing considerable optimism about the role that they can play in this regard. Yet even the noble Lord, Lord O’Neill, who we all know has vast experience of productivity issues, was still trapped by the fact that productivity under this Government is showing no significant improvement at all. What the Minister referred to as an encouraging development is just a marginal movement which we can scarcely credit. We also recognise, of course, that the Minister slides very carefully past the targets which the preceding Chancellor used to have for clearing the deficit in 2015. That has long since been buried as a potential successful objective, and we are now in a miasma of somewhat changed definitions of the deficit we are tackling. We all know that the Government, because of their limited progress on the economy, are struggling to meet targets on reducing the deficit The Bill’s failure to address any real issues relating to the economy and society means that crucial issues remain completely unaddressed. How can the Minister talk optimistically about a society in which the average basic pay is below the level it was in 2010? That means there has been no pay rise for large numbers of working people since 2010, and yet the Government have the arrogance to suggest that things are showing considerable improvement. It is quite clear that we have had decades of lost earnings growth. We have not had an issue with regard to wages for 200 years that matches the record of this Government in that respect over the last few years That is how serious the situation is, but you would not have detected that from the Minister’s gloss on what this Bill is meant to represent. As the noble Baroness, Lady Kramer, mentioned earlier, no attempt has been made to address—what everybody recognises in our society—the crisis facing the National Health Service. Look at the limited amount that the Government set free for the health service when informed opinion was quite clear just what was necessary. The Government did not meet even half that Related to the National Health Service is the great problem of social care for the elderly. We all recognise that the changing demographic of our society is putting greater weight on the health service and on care for the elderly. Yet the Government seem quite incapable of addressing these issues. What greatly upset my colleagues in the other place was that, when a clause was tabled there for the Bill to contain an equality impact assessment, because the Government need to carry out a thorough analysis of the nature of the challenges faced by so many people in our society, the Government made sure that that was not passed. Therefore, an essential building block for the analysis of the problems in our society was not even contained in this Bill. At least if that assessment of the nature of the problem had been there, it would have been something to save the Minister’s face in introducing such a forlorn exercise. But it was turned down and rejected in the other place When it comes to productivity, I recognise certain aspects of where the Government are making some progress. We recognise the value of developing apprenticeships, although it is quite clear that we have got to be very encouraging towards that development. It is still the case that the vast majority of young people in education who are aspiring and have good results think overwhelmingly of university and in academic terms rather than of the needs of our economy for skilled manpower Alongside that, the Government have produced a devastating onslaught on the further education colleges that provide training. In addition, opportunities for part-time education have fallen almost completely by the wayside. One thinks back to the days when institutions such as the Open University were at their prime. Part-time education is now unsupported by public resources and, consequently, the opportunities have declined. A vigorous economy would keep open opportunities for people as they mature, irrespective of their achievements at any one level. People can change both in their aspirations and their abilities, and it is important to have systems that are open and flexible. With regard to education, I am afraid the Government have done exactly the opposite We may not have had the full equality impact assessment, but we all know the nature of our society. Even the Government are beginning to recognise that women come out of this Finance Bill more poorly than men. It is part of the pattern of our society. We have had a great deal of publicity about the issues of discrimination against women by the BBC, and we all recognise the challenge with institutions like that, but the whole question of equality for women needs to be addressed at a much more basic level. On this International Women’s Day, it is only right that we should have a debate—as will take place after this one—on the issues confronting women. It is important that the Government recognise that so much needs to be done to change the levels of discrimination that are plain at the present time It is not just about women: young people also feel heavily discriminated against. You cannot talk to those between the ages of 18 and 25 without recognising that the possibilities for them in our society are, in so many respects, inferior to those which their parents faced. If ever there was one clear objective that the vast majority of parents have always had, it is to try to make sure that their children have greater opportunities than they had—to improve society and the economy in such a way that their children’s opportunities are greater. We are now facing a situation where exactly the opposite is occurring. That is why this Bill should have paid some attention to tackling that crisis I welcome the fact that on Thursday next week we will have an opportunity to debate the economy and our society, and I am sure there will be a large number of participants. This miserable little Bill scarcely gives us any opportunity for that, but what it did do was crush opportunities that could have been taken under a more confident Government with clear objectives in pursuing their policies in the country. This Bill does not look like that to the average citizen or to the vast majority of our people. That is why the Government need to address themselves more satisfactorily to the economic situation than they do in this rather miserable little Bill.