Working People’s Finances: Government Policy — House of Commons, 2021-09-21
Topic: Macroeconomics
Miriam Joy Cates (Conservative, Centre-right): It is a pleasure to follow my constituency neighbour, the hon. Member for Sheffield, Brightside and Hillsborough (Gill Furniss), and it was a delight to hear the maiden speech by my hon. Friend the Member for Hartlepool (Jill Mortimer) earlier. As a fellow MP in a post-industrial area, I absolutely recognise what my hon. Friend said about the importance of levelling up being about not only materially restoring to northern areas the opportunities that have been given to the south, but honouring those areas for their contribution to the wealth of this nation over hundreds of years Throughout my whole adult life, inflation rates and interest rates have been remarkably stable. That is not normal historically, and when I speak to constituents or more senior Members and hear about what life was like in the ’70s and for many decades before, I realise that the inflation that is a threat now is very different from the stability we have enjoyed in previous years. It is a concern My constituents are worried: they are worried about energy prices, and we have heard much about that over recent days; they are worried about commodity and construction prices; and they are worried about shortages. I have just heard from a major importer in my constituency who is concerned about the cost of shipping. The cost of a shipping container from China has risen from around $2,000 a container last November to getting on for $20,000 now. That will have a huge inflationary pressure, given how much we import It is also the case, though, that wages are rising and our job market is buoyant. Our plan for jobs is working. We have heard much about the furlough scheme, which has rescued our economy from the fate of mass unemployment. We have a record number of job vacancies—more than 1 million—and businesses in my constituency of Penistone and Stockbridge are hiring people of all ages for all different types of jobs We have heard Brexit being blamed for the situation that we find ourselves in, and there is no doubt that Brexit has caused changes in our economy. I draw the attention of hon. Members to an article by Matthew Lynn in this week’s Spectator entitled "Who’s afraid of rising wages?" It starts: "During the Brexit referendum, Stuart Rose, the former boss of Marks & Spencer, and chair of the Remain campaign claimed that if Britain left the EU, wages ‘will go up’. This was, he added, in a rare moment of candour, ‘not necessarily a good thing’. But the idea that salaries might rise was exactly the reason that a great many people voted for Brexit." Why should we be afraid of rising wages? It is what the Opposition have been calling for. More competition for employees will lead to rising wages, and we are seeing that: Costa, for example, is paying over 5% more. On average, wages have risen 8% over the past three months, and, from April, this Government raised the national living wage to £8.91 We must remember that we are still in economic shock. We are coming out of an extraordinary period of time, but things will settle. In fact, the International Monetary Fund has forecast that the UK will have the highest growth in the G7 this year, so while there are concerns around inflation and the cost of living, which must be addressed, there is also a good chance that we will have a fairer jobs market at the end of this.