Treasury and Work and Pensions

Part of Orders of the Day – in the House of Commons at 4:06 pm on 27 November 2006.

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Photo of George Osborne George Osborne Shadow Chancellor of the Exchequer 4:06, 27 November 2006

I beg to move, as an amendment to the Address, at the end of the Question to add:

'but humbly regret that the Gracious Speech does not contain measures to address Britain's declining productivity growth since 1997; deplore the absence of measures to give the UK the right skills to take advantage of new global opportunities;
further regret the absence of strong and binding measures to tackle climate change and environmental degradation;
condemn the absence of measures to ensure real improvements in the public services and greater value for money for taxpayers;
and further regret the absence of measures in the Gracious Speech to tackle the pensions crisis to which Government policy has contributed.'.

Let me begin with a few words on the two Treasury Bills in the Queen's Speech. Tomorrow, we debate the Investment Exchanges and Clearing Houses Bill. It is not for this House to decide who owns the London stock exchange, but it is for us to determine who regulates it. I am therefore pleased that, thanks to co-operation between us and our former Conservative colleague, the Financial Secretary, the Bill will pass through all its stages in the House tomorrow.

We also welcome the Chancellor's admission that we need a Bill to, in the words of the Queen's Speech,

"enhance confidence in Government statistics."

That confidence is now non-existent, as a decade of spin and distortion has destroyed the integrity of Government information. We were sceptical when the Chancellor announced that he was going to make statistics independent. We did not believe that the man who taxes by stealth and hides debt off the Government's balance sheet would really give up control. We were right to be sceptical, because the Bill published last week falls far short of what was promised. The Treasury claims to be establishing an independent statistics office, yet Ministers, not that independent office, will decide which statistics it can scrutinise and release. That is like putting the Sopranos in charge of the neighbourhood watch.

The Audit Commission says that the Treasury's approach will

"only seek to generate low public trust in statistics and reinforce the perception of political interference in the production and publication of statistics."

It is not too late for the Government to deliver what they first promised back in 1995, when Mr. Straw, who is now Leader of the House, spoke to the Royal Statistical Society. In a memorable speech, he said that the national statistical service

"should be placed at arms length to Ministers, on a similar basis to that of the National Audit Office, and should report principally to a powerful Committee of the Commons."

We agree with the Leader of the House. That is what is needed, that is what the Government promised, and that is what they should deliver in the Bill.

Talking about failure to deliver, this debate is about the broader performance of the Government. Let me therefore welcome the clunking fist himself. The Prime Minister certainly has a way with an endorsement, does he not? It is amazing how, after all these years, the Chancellor still smiles as his friend gives him a hug and sticks the stiletto in.

To be fair to the Home Secretary, the Prime Minister's spokesman went round afterwards saying that he was not necessarily backing the Chancellor. He said that "clunking" could have referred to any number of members of the Government, but let us just say that the Chancellor fits the description. Indeed, "clunking fist" is such a brilliant portrayal of the Chancellor's methods and measures that if the Prime Minister does not mind, we shall also be using it, again and again. Our criticism of the clunking fist is not primarily about his character. We leave that to the likes of the Work and Pensions Secretary—or should I say the "soon to be out of work and collecting his pension" Secretary? I am glad that we could arrange the topics for this Queen's Speech debate in such a way that he could be sitting here today, almost next to his friend the Chancellor.

Our criticism of the Chancellor is that he does not understand how to respond to the big changes shaping the future of our world. In an age of greater choice, he offers more overbearing control; in an age of greater freedom, he gives us more interference; and in an age of flexibility, his rigid belief in bigger government is out of date. In short, in an age that demands a light touch, he offers that clunking fist.

It was 10 years ago that the Chancellor set himself three central tasks: give Britain a more competitive economy, improve our public services and tackle entrenched poverty. On all three he has failed. Let us start with competitiveness and see what the clunking fist has done. He has hit us with higher tax and spending than Germany, when we should be sharing the proceeds of growth. He has clobbered business with £50 billion of regulation, when we should be liberating our economy to compete. He has smashed our pension system with his tax raid, when, with an ageing population, we should be encouraging people to save. Carbon emissions have risen, but the proportion of green taxes has fallen, when we should be shifting the tax burden from income to pollution.

Back in his pre-Budget report of 1998, the Chancellor described productivity growth as the

"fundamental yardstick of economic performance".

Does he remember saying that? We do. That was the economic measure on which he wanted us to judge him. Productivity growth averaged 2.6 per cent. when he entered the Treasury, but now, as he leaves, it averages just 1.5 per cent. On his own fundamental yardstick, he has fundamentally failed.