Economic Growth

Part of the debate – in the House of Commons at 4:38 pm on 15th May 2013.

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Photo of Sammy Wilson Sammy Wilson Shadow DUP Spokesperson (Treasury) 4:38 pm, 15th May 2013

It is a pleasure to follow Richard Drax. The Democratic Unionist party endorses his views on the amendment, which we support. We believe it is important that the people of the United Kingdom should have a say about their relationship with Europe. Some of those who oppose the commitment to a referendum claim that it will somehow leave us with four years of uncertainty and that that will damage investment in the UK, but the genie is out of the bottle as far as renegotiation and a referendum are concerned. Any investor knows what will happen at some stage in the future, so there should be no difficulty in giving the people of the United Kingdom a say on this very important issue. I will concentrate on other issues that relate to economic growth, but I accept that our relationship with Europe impacts on economic growth in this country.

If we are to achieve the objectives in the Queen’s Speech of giving people job opportunities, rewarding hard work and reforming welfare, economic growth is important. If we are to create economic growth, we need proper stimulus. The Chancellor and the Government argue that we cannot borrow more in order to borrow less. That is not true. Good, solid investment in the economy would help us to grow and to pay our debts. That is not the view of those on the extreme left wing; it is the view of the IMF, which is hardly a left-wing organisation. In fact, many of its policies resonate with what is said by the Government. It is also the view of many industry organisations.

More importantly, the evidence of what has been happening in the economy bears out that view. Mr Wallace talked about what is happening in his constituency. Nearly every example that he gave was the result of stimulus through Government borrowing and spending to create infrastructure and produce jobs. I could give stacks of examples from Northern Ireland. There has been investment in our tourism industry. Not so long ago, we got a Barnett consequential as a result of the Government deciding to spend more money on housing. We put it into co-ownership housing, which has brought money down from the banks and has led to almost half of the houses being built in the private sector. Just a small amount of money from the public sector has created construction jobs and allowed people to pay their taxes, which adds to Government revenue and helps to pay off the deficit.

There is a strong case, even from traditional supporters of the Government, for borrowing and spending more money to stimulate the economy. The Chancellor made a big point today about the money markets. Actually, the money markets are quite relaxed about this. They are lending money to the United Kingdom on negative interest rates. There is more demand for Government bonds than supply. If there are sensible investment policies, the money can be made available. The question is whether there is the will or whether the Government have some other motive.

I am disappointed that there is not much detail on what the Government intend to do about banking. According to the figures published by the British Bankers Association, lending by the banks in Northern Ireland has fallen substantially since 2010. We have not dealt with the banking crisis. There is not time in this debate to talk about the detail, but unless the Government grasp the nettle and decide what to do with failing banks that are undercapitalised and unable or unwilling to lend, we will not stimulate growth. I believe that there is great potential and that a Government stimulus could release the billions of pounds of cash assets that are sitting on company balance sheets, which would enable us to get growth and achieve the objectives of—