3 earlier: Yvette Cooper Interestingly, the right hon. and learned Member for Rushcliffe was one of the few people who did, at least temporarily, support the reduction in VAT.
The best way to help businesses and jobs right now is to ensure that we act to get the economy growing again as soon as possible. That is what we are doing; that is what we did last year when we stopped the banks going under; that is what the Bank of England is doing, backed by the Government through quantitative easing; and that is what we are doing by cutting taxes this year and increasing public capital projects and support for the unemployed. The International Monetary Fund says:
"The UK authorities policy response to the deep recession and global financial crisis has been bold and wide ranging... The aggressive actions by the authorities have been successful in containing the crisis and averting a systemic breakdown."
I disagree with the hon. Member for Glasgow, East (John Mason), who said that he saw no difference between the policies of the major parties. In fact, there are major differences between the two main parties. Opposition Members want to rewrite history and claim that they supported all the action on the banks, but, in fact, that is not true. They opposed the nationalisation of Northern Rock. They saw that as "big government". The powers that we used to stop Bradford & Bingley collapsing were actually powers that Conservative Members voted against last year. Presumably those powers were "big government", too.
On fiscal policy, as we have said already, the call for cuts in the middle of a recession would be devastating. The shadow Chancellor, the hon. Member for Tatton (Mr. Osborne), said that
"the discretionary borrowing had to stop".
Let us just think for a moment what that means: not just no VAT scheme, but no car scrappage scheme, which has helped boost car manufacturing; no help for 150,000 companies that have been able to delay their tax bills; no help for the housing market or for families worried about their mortgages; no boost for the struggling construction industry from accelerating public projects; and, no £5 billion investment for the unemployed. That is suicidal economics. Professor David Blanchflower called it an economic "death spiral". He said:
"If spending cuts are made too early and the monetary and fiscal and the monetary and fiscal stimuli are withdrawn, unemployment could easily reach four million.... If...there are substantial cuts in public spending in 2010, as proposed by some in the Conservative Party, five million unemployed or more is not inconceivable."
That is the testimony to the Conservatives' economic policies. [ Interruption. ] They do not like us quoting from Professor Blanchflower, but what about the former Conservative wise man and friend of the right hon. and learned Member for Rushcliffe, Roger Bootle, who is not known as a supporter of the Labour party? He said:
"A Conservative Government could cut too hard. They may put up taxes quite a lot and that could clobber the recovery."
The really irresponsible thing about the Conservatives' position is that cutting support for the economy will increase costs. As my right hon. Friend the Member for Holborn and St. Pancras (Frank Dobson) said so clearly, pushing up unemployment pushes up debt. For every 100,000 people we take off unemployment benefit, we save more than £500 million. The Conservatives say that we cannot afford to help for the unemployed; the truth is that we cannot afford not to, because otherwise we will pay the bills of long-term unemployment for many years to come, just as we did in the '80s and '90s.
