Kenneth Clarke

So far as I am aware, the only classic Keynesian capital scheme that has been advanced in the entire country is the dualling of a road in my constituency, and for that I am exceedingly grateful. The Government could not find any other shovel-ready schemes to put money into. This country has taken hardly any measures to introduce a fiscal stimulus to the economy, because we cannot afford it owing to the state of the public finances. On the biggest measure that the Government found, the VAT cut, they are actually going to end it—quite rightly—at Christmas.

— from debate entitled “Economic Recovery and Welfare”

The three speeches/headings immediately before

  1. 1 earlier: Yvette Cooper

    As the right hon. and learned Gentleman will be aware if he has read the Budget documents, as well as the VAT cut there are the additional public sector capital projects, which are being brought forward to increase and accelerate public sector investment. In addition, there is the £5 billion support for the unemployed, which all the Opposition Members have refused to support. The right hon. Member for Maidenhead (Mrs. May) has made the same mistake before. She says that that is the automatic stabilisers, but that £5 billion is not in support of unemployment benefit. It is additional investment in services to help the unemployed. This is discretionary additional spending, which the Opposition have repeatedly opposed. If they want to change their policies and provide support for the action that we are taking to help businesses and to help the unemployed right across the country, we would welcome them doing so. It would be a pretty massive U-turn, but I am sure the right hon. and learned Member for Rushcliffe would be happy to do that.

  2. 2 earlier: Kenneth Clarke

    Apart from the automatic stabilisers, which we all accept and support, the only significant measure of fiscal support that I am aware the Government are giving is the VAT reduction, which they propose to withdraw at Christmas. Why is it right to withdraw the VAT reduction at Christmas, if any other reaction to the present fiscal deficit is a serious threat to our economy and the national future?

  3. 3 earlier: Yvette Cooper

    I give way to the right hon. and learned Gentleman, who I hope will clarify that point.

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