Economy, Pensions and Welfare

Part of Debate on the Address – in the House of Commons at 9:05 pm on 15th December 2008.

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Photo of Jim Cunningham Jim Cunningham PPS (Mr Mike O'Brien, Minister of State), Department for Energy and Climate Change 9:05 pm, 15th December 2008

I was very interested in what Alistair Burt had to say—he is not in the Chamber any more—because I seem to remember that he was the Minister who introduced the Child Support Agency a long time ago as part of John Major's Government. He may cast aspersions on others tonight, but some of us have long memories, and people have been trying to put the CSA right ever since.

I represent Coventry, and we in the west midlands have been concerned about manufacturing for a long time. Over the years, certainly under the previous Government, the industrial base was eroded to the point where the west midlands now provides in the region of 25 per cent. of this country's manufacturing. We are obviously very concerned about that, and when we consider that the west midlands produces about 10 per cent. of this country's wealth, we see that it is an area to be reckoned with.

I support the measures taken by the Government. They had to take those measures; when we look at history or at documentaries about the 1930s, we can see why the Government have to do what they have got to do. Any measures that the Government take will never be perfect, but nevertheless, they have to get the central thrust of what they are doing right or, as some people have predicted, we could end up in a situation comparable with that of the 1930s.

That takes me to the issue of Northern Rock, an issue which the Opposition have always ducked. Northern Rock gave the public a snippet, as it were, of what could be around the corner, which could be compared with the 1930s. Let us remember that people were queuing up to withdraw their money from Northern Rock, and that a number of societies were in the same boat. Let us remember that the Opposition dithered when we eventually took some action to stabilise that situation, and that they criticised us for doing so. When we listen to the Opposition, we are led to believe—the previous speaker just said it—that everything is the Government's fault. There is a big, wide world out there. Apparently, we are insulated from that, and everything we do has no bearing on the world, but in actual fact the world has a big bearing on us. The situation started about two years ago, when India and China were forcing up commodity prices. The Opposition conveniently forget about that little thing that happened two or three years ago. It had a knock-on effect on oil prices, and we all know the story of how those prices then went through the roof.

We must not forget that the major problem started with mortgages in America, and others cannot duck the truth, as much as they would like to, because if they do not recognise it, they will never get a solution to the problem. We could give a litany of what has happened since then. The Government have been operating in a difficult situation, trying to persuade people that their course of action is the right one, with little support from the Opposition. As I remember, their support lasted only 10 days before the Leader of the Opposition withdrew it.

Let us take the other argument that the Opposition use quite a lot, which is that we did not prepare for a rainy day. We did, because we followed a Tory budget for two years—people tend to forget that. For every pound that was paid in tax, 50p of it was to pay off Government debt. We also invested for that rainy day, when we were able to, by spending on schools and the health service. The Conservatives cannot run away from the fact that we did invest for a rainy day. We also invested in modern technology and research and development, which our major industries rely on. Universities rely on that money, because it is part of their seedcorn funding. We also invested in skills and a number of other areas of the economy. At the end of the day, to suggest that the Government did not prepare for a rainy day is slightly misleading to say the least. It is totally misleading to say that if everything had been right in this country, somehow everything else in the world would have been okay, because the fact remains that the problems started outside this country, and I have highlighted a few examples of that.

Earlier today, the shadow Chancellor said that the Conservatives cared about families, decent housing and so on, and that Conservative local authorities would do the same sort of thing. However, in Coventry, for example, they have spent £40 million out of £70 million of reserves and they are introducing £9.4 million in spending cuts, which could affect 189 jobs, such as neighbourhood wardens. It will also affect youth services and library hours, and lead to cuts in certain areas of education, foster and social care. I know that my hon. Friends are waiting to get into the debate, but I wanted to highlight Coventry city council proposals and suggest that it look at them again.

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