Public Expenditure

Part of the debate – in the House of Commons at 12:00 am on 17th March 1977.

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Photo of Mr Jim Sillars Mr Jim Sillars , Ayrshire South 12:00 am, 17th March 1977

That is true. An alternative to that in this crazy capitalist system is to rebuild Hadrian's Wall. That would give employment to bricklayers on both sides of the border for all time to come. At least that would give them something to do when at the moment they are lining up in the dole queues. But enough of joking.

In their defence, the Government have already brought forward from the Front Bench this afternoon a plea and an excuse about the nature of the crisis we in the Western democracies are facing. I would acknowledge immediately that there is a very clear interrelationship between the economies of all parts of the world, and there is an interface between the capitalist and Communist economies as well as between capitalist and capitalist economies.

There has also been a pretty significant shift in the balance of wealth and power between the developed countries and the Third World countries, of which shift the oil crisis is only the first of a number of manifestations. But that should not be a sufficient excuse on the part of a Labour Government.

Everyone in the Socialist movement accepts that capitalism will run into crisis. The whole reason for the Socialist movement is that capitalism will create conditions that will require Socialist applications if the problems facing the ordinary people of this or any other country are to be solved. The reason for having Socialism is that capitalism exists and has a number of inherent contradictions that will display themselves from time to time.

Therefore, the problems of international capitalism and the problems of capitalism inside the United Kingdom should not be excuses for Government inertia. They are the reasons for rolling forward a programme of Socialism. That is no original thought on my part. That was said by the man who is presently the Secretary of State for Energy, and he said it at a Labour Party conference not so many years ago.

The Government cannot even claim that the cuts they are now introducing, and have already introduced, are having the effect claimed for them—a massive shift from one sector of the economy to the manufacturing sector. Even if we displace lecturers in colleges of education in Scotland, if we train teachers and refuse them employment in our schools, if we sack people in local government and in other public sectors—on the railways, in the Post Office and elsewhere—there is no job for them in the manufacturing sector at present.

Even yesterday the Bank of England was admitting that there would be no significant contribution from investment over the next 18 months. Even if the Government deny their projections in the White Paper, I do not think that anyone in the House, especially anyone on the Front Benches, believes that we shall reduce unemployment to the scale that is projected by 1979–80.

The major defect in the Government's economic strategy is that they are not operating against a national plan. It is beyond belief that a Labour Government facing the present crisis do not see the need to introduce as a fundamental prerequisite to recovery a national plan involving the allocation and direction of capital resources and the various other resources in the economy.

What we have from the Government in place of the type of planning that was set out in the early part of 1966 is straight from Conservative policy. Everyone on the Labour Benches knows that to be the case. That happens to be one of the reasons why the Conservative Party is not too keen to become the Government. After all, the Labour Government are doing their job of work better than the Conservatives would be able to do it.

One of the reasons why the Labour Government are carrying out Conservative policies better than the Tories could do is that they have captured the left wing of the Socialist movement and the Trades Union Congress. That is something that the Conservative Party could never do, in or out of government.

We have old-fashioned Tory policies from the Government Front Bench. We have exhortations to investors to do their patriotic duty. Those investors have never done their patriotic duty before and they are never likely to do it, especially under a Labour Government. We see the demolition of our social services and more cuts. We see higher unemployment, more cuts and rising unemployment. If we were on the Opposition Benches and a Conservative Government were in office, this is the sort of speech that all Labour Members would be making. They would be denouncing Tory policies when such policies were evidently before them.

My main concern about the effect of cuts in the public sector lies with jobs. I remind my right hon. and hon. Friends that the most fundamental pledge in the Labour election manifestos of 1974 was to create an irreversible shift in the balance of wealth and power in favour of working people and their families. Anyone who knows anything about the conflict between capital and labour knows that we cannot shift the balance of wealth and power in favour of working people when we make labour weaker in relation to capital by creating high unemployment. If there is to be a shift, it can take place only in a full-employment society, when for the first time in many areas of the United Kingdom labour would be able to compete with capital on a far better standing than historically it has ever done before.

We cannot shift the balance of wealth and power to the workers and their families with 1·4 million unemployed. The best that can be said about the Government is that they whistle louder in the dark than anyone else. The proof of the pudding is in the eating.

When my right hon. Friend the Secretary of State for Scotland was appointed he gave a major interview to the Daily Record, a Glasgow-based Scottish newspaper, although it is owned in London. The article stated that Bruce Millan, the 19th Secretary of State for Scotland, has an air of slightly languid, academic world-weariness. However, matters picked up during the interview and my right hon. Friend said: Never since the war have the economic prospects for Scotland and the United Kingdom looked so good—inflation is down, costs are being stabilised, production is going up, unemployment is set to come down. The great thing this time is that it is under control. It is not another of the old boom-and-bust cycles. When my right hon. Friend said that, Scottish unemployment was 165,000, or 7·7 per cent. It is now 179,572, which is 8·3 per cent. There are over 40,000 other people in the Scottish economy part-time employed, in terms of job creation.

Since the early part of 1975 we have had similar measures—I was about to say "put before the House" but that is not being done tonight. The Government are merely talking of measures involving a change. That is a far more accurate description of the situation that we now face with no vote. We have had these measures since the early part of 1975. The promise was made that inflation would be defeated, resources shifted and unemployment reduced. That has not been the case, and every Socialist in this building knows that it will never be the case while we pursue these policies.

I finish on a fairly general point, although in some senses it is specific. Earlier this evening my hon. Friend the Member for Bristol, North-East (Mr. Thomas)—the Chairman of the Tribune Group—addressed the House. He said that if a vote were to arise tonight the members of the Tribune Group could not bring themselves to vote against the Government and jeopardise their position. However, on their behalf he reserved the right to vote against individual cuts in public expenditure. The qualification was made that the Tribune Group would take that course as long as they were not required to vote in the "No" Lobby along with the Conservatives.

I say to my hon. Friends on the left wing of the Labour Party that that is the game the Government want them to play. If the Government can engineer a situation in which only the Tribune Group goes into the "No" Lobby and casts its 50 or 60 votes and clears Socialist conscience, they will be delighted. In that event they will still have the people to campaign in the country and to tell workers on the shop floor that people are fighting for their position in the House of Commons. That will be done while the Government do the work of the Establishment on a day-to-day basis in implementing the cuts.

If my hon. Friends on the left wing of the Labour Party were prepared to face the logic of the problem, they would realise that the only way to stop policies going through is to vote against them. If that were done, many policies to which they are opposed would not go through. My hon. Friends demonstrated that that is so in a quite devastating manner on the vote on the guillotine on the Scotland and Wales Bill. If my left-wing hon. Friends followed that logic now, they would stop much of what the Government are doing from taking place. That is because the Labour Government would not dare to take the risk that is inherent in such a situation.

My hon. Friends say that they do not like going into the "No" Lobby with Conservatives. I do not like going into the Lobby with Conservatives either but let us consider the possible position arising from the White Paper. Let us assume that in three weeks or four weeks time we are faced with a single item of public expenditure cutting—for example, a cut involving the colleges of education in Scotland—because of the implications of the White Paper. Are we not to go into the "No" Lobby, irrespective of who is there, if going in there will stop the colleges of education from closing? Surely that is why we were sent to his place. If we have to employ Conservatives, for whatever hypocritical reasons they happen to be in the "No" Lobby, let us employ them to stop the Labour Government implementing Conservative policy. If the Tribune Group and the left wing of the Labour Party adopt that policy, they will win far more often.

For all the pontification and for all the hot air of Labour Party conferences, they have not succeeded in stopping the Labour Government rolling on in terms of public expenditure cuts and high unployment. Every Left-wing Member of the Labour Party knows that that is true. That, in essence, is the problem that is facing them politically tonight. Probably it will not face them tonight because the Government will renege on the question, but sometime within the next six months they will be faced with the crunch questions. I hone that on that occasion Left-wing Members will reconsider their position.