Amendment of the Law — House of Commons, 2015-03-23
Topic: Macroeconomics
David Blunkett (Labour, Centre-left): First, I congratulate my right hon. Friend the Member for Edinburgh South West (Mr Darling) on not just an excellent speech, but the tremendous work he did in those difficult three years alongside the then Prime Minister. When the world gathered in April 2009, applauding the then Prime Minister and then Chancellor for the work they had done on pulling people together, no one could have thought that the absurdity would exist where the last Labour Government were blamed for the sub-prime mortgage collapse in the United States and the collapse of the financial institutions across the world For 30 seconds, I just want to pay tribute to those who have been instrumental in anything that I have been able to do in my public life and in this House, starting with my wonderful family and my closest friends. They were somewhere in the Gallery when I made my maiden speech, and two are here from Canada in the Gallery tonight. Without our family and friends we could never do what we achieve, and so often they take the brunt of the rough and not the smooth in politics. I, of course, want to thank the workers, who are often forgotten in our democracy but who make it possible for us to be here in our political parties, for their dedicated work. I thank the voters and the people of Brightside, of Hillsborough and of Sheffield. I also wish to pay tribute to my colleagues in the House, including my right hon. Friends the Members for Edinburgh South West and for Blackburn (Mr Straw), who served in Cabinet with me. My right hon. Friend gave 36 years of dedicated service in and out of this House, and he deserves a great deal of credit for it My first Budget was Nigel Lawson’s of March 1988 and it was seminal in my life because my dog, Ted, was violently sick halfway through. My hon. Friend the Member for Bolsover (Mr Skinner), in a very loud voice, in only the way he could, pronounced, "Someone should clear up this dog’s breakfast." I was not sure whether he was referring to what the dog or the Chancellor had delivered. That Budget certainly had a detrimental impact which I hope this Budget will not achieve I wish to make three quick points. I have already commended my right hon. Friend the Member for Edinburgh South West for what he said about what happened through those difficult times. We do not just have to believe him; we can believe what Mark Carney, the Governor of the Bank of England, said in a speech made on 28 January in Dublin. In his second point about why our economy had managed to come through and bounce back, he said that we had a fiscal system that allowed budget deficits to rise during a downturn. It is self-evident that that is the case and it needs to be done, but it is not self-evident, in all the rhetoric we have heard over the past five years, that anyone on the Government Benches has fully understood what saved us from complete calamity—it certainly was not austerity. It has not been austerity in Greece, Spain, France or Italy that has saved those countries; what has been instrumental has been what was implemented by the Federal Reserve in the United States and by the Bank of England here: quantitative easing—printing money, as my mother called it. It eased the unfortunate—in the long term—bubble in house prices, rather than the investment in business for which it was intended, but it did make a significant difference in terms of allowing us to return to growth and to have sufficient money in the economy Paradoxically, the payment protection insurance mis-selling scheme also did that. The PPI repayments have amounted to £20 billion of money going into families and into local economies that people have spent. If a political party had announced that it was going to give, in a Budget, just before an election, £20 billion to selected families across the country, people would have had a fit. Yet that has made a significant impact on what has happened We will not and cannot allow a doubling of the pain in the next Parliament to take us backwards, with the unthinkable becoming the unachievable. That is clearly what would happen if the unfair changes and the unfair further additional austerity measures were to be implemented—and, of course, we do not know about many of them. Should the Conservatives be the lead or majority party, they will be implementing further cuts, on top of the 50%-plus of austerity measures that the coalition has already signed up to. We know about the 10% cut in the budgets in schools, because the Prime Minister has announced it. We know about the enormous cuts already in the pipeline in further education, with a 24% cut in adult skills funding. We know about the proposed budget changes already for welfare. We know what is happening in local government, with the most deprived areas taking the biggest hit. We know that if these austerity measures go any further, there will be a massive hit on those least able to take it. This is a crucial moment, when we decide whether we go backwards or forwards to a Britain we are proud of