Orders of the Day — Budget Resolutions and Economic Situation

Part of the debate – in the House of Commons at 6:24 pm on 3 July 1997.

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Photo of David Borrow David Borrow Labour, South Ribble 6:24, 3 July 1997

I begin by thanking the voters of South Ribble for showing their confidence in the Labour party by electing me to represent them on 1 May. I find myself in this Chamber because of a cruel twist of fate. In January 1996, the Labour party in South Ribble selected Dennis Golden as the candidate. In January 1997, ill health forced him to resign as the Labour candidate. Thus, not only did he fail to achieve his lifelong ambition of representing the constituency in which he lived; he also failed to live long enough to see the election of the Labour Government. I am therefore conscious that I arrived here in tragic circumstances.

Dennis lived in Leyland and held a county council seat there. He served as chair of the highways committee on Lancashire county council. He was a tireless worker for the people of Leyland. He worked at Leyland Motors, the heart of the town, and was a pillar of the engineering union. During the election campaign, many members of that union from across the constituency told me little tales of how Dennis had helped them. I am glad to pay this tribute to a fine socialist.

I was gratified to learn while in my constituency last week that the local authority has agreed to name a road there after Dennis Golden—a fitting tribute to the chair of the highways committee of Lancashire county council, a post he still held on the day he died.

The constituency was created in 1983, when it shared the boundaries of South Ribble borough council. Between 1983 and this year's election, it was represented by Robert Atkins, who became my Member of Parliament when he was elected, by 20 votes, to represent Preston, North in 1979. Ron Atkins, the defeated Labour candidate, remains a good friend of mine and continues to serve on Preston borough council as chair of the planning committee. I have spoken to him since the election. The election of a Labour Government gave him great pleasure, and he was particularly pleased that his daughter, Charlotte, has been returned as the hon. Member for Staffordshire, Moorlands (Ms Atkins).

Robert Atkins had a reputation in the constituency as an assiduous dealer with correspondence. His reputation owed a great deal to his wife, Dulcie, who ran the constituency office and whose personal manner with constituents was often praised during the election campaign. Robert served as a Minister in several Departments, including the Northern Ireland Office and the Department of the Environment. He also took a particular delight in being the Minister for Sport—like the right hon. Member for Huntingdon (Mr. Major), he loves cricket. I am sure that he will now have more time to devote to the cricket at Lord's.

I also pay tribute to my hon. Friend the Member for West Lancashire (Mr. Pickthall), four of whose wards were transferred to South Ribble in the boundary changes. He gave me a great deal of help before and after 1 May, for which I give him these public thanks.

My constituency can be divided into three distinct parts. The principal town is Leyland, an old manufacturing town which has traditionally depended on the commercial vehicle industry. The forerunner of Leyland Motors was founded in Towngate, which is in Leyland, in 1896. When I first moved to central Lancashire in the mid-1970s, Leyland was a thriving town to which thousands of people travelled by bus and train each day to make buses and trucks. It is a tragedy that, over the past 18 years, so much of that industry has gone.

I pay tribute to the work of Lancashire Enterprises and Lancashire county council in rescuing Leyland DAF in 1993. I was pleased to have the opportunity, on Wednesday last week, to welcome the Prince of Wales to Leyland Trucks so that he could see the company that had been born out of the ashes. It is expanding, taking on more staff and investing heavily in new trucks and new ideas.

The second chunk of my constituency is best described as the southern suburbs of Preston, lying to the south of the River Ribble. As a former leader of Preston borough council, to the north of the river, I well remember many of the communities in the area participating in the Preston guild celebrations of 1992.

The remaining part of the constituency contains about a dozen small rural villages stretching between Preston and Southport. They are partly commuter villages, but, in many respects, they are agricultural, specialising in horticulture and market gardening. There is also a good deal of poultry breeding. As the new Member of Parliament for South Ribble, and as a confirmed townie, I found it particularly interesting to meet and talk to farmers in the constituency.

It is customary in maiden speeches to mention figures from the past who have served in all or part of one's constituency. Leyland, in my constituency, used to be part of the Chorley constituency. I was very pleased when George Rodgers, the former Member of Parliament for Chorley, spent several days working for my election campaign, and I know that he was pleased when the result was announced.

I want to mention another former Member of Parliament for part of my constituency. Until recently, I did not realise that he had represented it. As a Yorkshireman, born in Huddersfield, I was interested to find that, 50 years ago, Ormskirk had been represented by another Yorkshireman born in Huddersfield, the late Lord Wilson.

The Budget should be judged on the basis of two sets of criteria. The first relates to the Government's policy objectives and priorities. Those will not necessarily be shared by the Opposition parties, but Labour Members must assess the Budget according to how far it goes towards meeting them. That is part of the test that we must apply.

The second set of criteria involves the extent to which the fiscal and monetary policy in the Budget creates stability and eases the excesses of the business cycle. Obviously, exchange rates and interest rates are a particularly important aspect of that. In any Budget debate, those two factors can sometimes work in opposite directions.

Let me deal first with the policy priorities and objectives. I remember visiting Leyland in 1975 and seeing a thriving town. Many people worked in manufacturing industry, and school leavers could walk into apprenticeships. My generation, brought up in the 1960s and early 1970s, could not only expect to be better off than our parents, but could look forward with some optimism to a secure future. By and large, our expectations were justified, but the young men and women in my constituency today do not enjoy the same sense of security. They do not believe that they will experience better living standards than their parents or that their jobs and futures will be more secure.

One of the tragedies of the past 18 years is the fact that work has become less secure. So many jobs are part-time, casual or fixed-term, and so many jobs are low-paid. A social tragedy and a growing problem in society is that while, at the age of 16 or 17, members of my generation could expect to settle down, establish homes and start thinking about raising the next generation at 28 or 29, that is no longer a prospect for all too many youngsters in their late teens and early twenties. We should not be surprised by the violence, drugs offences and other crime that we now see—all the social problems that blossomed during the years of the Tory Government.

The key measure in the Budget is the welfare-to-work proposal, which goes to the heart of what I see as the basic problem in society. That proposal begins to give the generation to which I refer some hope of secure employment and of security in later life. It will be particularly effective when combined with legislation to establish a minimum wage.

All too many youngsters are paid such poor wages that they have no prospect of leaving home, settling down and bringing up a family—and we wonder why they feel that they are not part of society and why there is social breakdown. Unleashing market forces produces winners and losers. We have seen the salaries of the winners, and we have seen the social consequences for the losers. Combining welfare-to-work measures with legislation for a minimum wage will constitute a crucial first step towards stabilising our society.

I was interested to hear the Chancellor's proposals for the release of capital receipts, which will improve—albeit only marginally—not only employment among building workers, but the prospects of people in poor housing or no housing at all. That, too, is a useful step in the right policy direction.

If I am asked whether the Budget meets my Government's policy priorities and objectives, I will say that it does. It meets the policy priorities and objectives of the people who voted for me on 1 May.

Will the fiscal and monetary policies produce stability and cushion the excesses of the business cycle? There have been contradictory comments by Opposition Members. The figures given by the Chancellor yesterday show that, in the current financial year, £6 billion is being taken out of the economy by the reduction in the public sector borrowing requirement. A similar amount is proposed for 1998–99.

Classic economic theory has it that a rise in interest rates and a rise in the value of the pound are linked to excessive demand in the economy with which the economy is not structurally strong enough to deal. Therefore, it seems sensible to take some of that demand out of the economy. We can argue about whether it has been taken out in the right way, but the policy seems to be heading in the right direction. It is strange that Opposition Members are not prepared to admit that some demand needs to be taken out of the economy.

It is a pity that the right hon. and learned Member for Rushcliffe (Mr. Clarke) has left the Chamber. It has puzzled me for 12 to 18 months that insurance and housing finance companies have acted as if they were printing money and have put extra spending power into the economy in an uncontrolled way. The Treasury and the Government have to pick up the pieces as a result of those private decisions to print money, but there was remarkably little debate on such issues before the election. That increase in money which is about to circulate in the economy has had a significant effect on the Budget.

I have tried to keep my speech as uncontroversial as possible. I commend the Budget to the House and look forward to its provisions being implemented and well received in my constituency.