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I would like to use the short time I have to focus on the issues of fiscal responsibility, public spending and public debt, which have been much debated in the Queen’s Speech, including by the Prime Minister and the Chancellor. I make it clear that I welcome the Government’s public spending commitments, which are long overdue. As they stand they are inadequate, but they are a step forward. However, what is significantly absent from the Queen’s Speech, and from any other pronouncement I have heard from either the Prime Minister or the Chancellor, is how they are going to be funded.
Will the Government’s public spending commitments be funded through economic growth? I doubt it. Last quarter, debatably, we were in recession. Even the most optimistic estimates reckon that we will be flatlining for months to come. Indeed, if we look at current investment in our manufacturing, which is so crucial to economic growth, the idea that we will fund them through economic growth is, quite frankly, fantasy.
What about taxes? The Government are placed to reduce taxes; they are not demonstrating how they are going to increase them, so no information there. The fact is that the only alternative has to be borrowing and that is already looking pretty dicey. Even the current level of borrowing is an increase of 20% on the previous year. The deficit is currently projected to be in the region of £40 billion this year. That is expected to rise to a deficit of £50 billion-plus, with the £13 billion we are committed to spend next year.
In a moment, I will come on to talk about the impact of no deal and even the Government’s withdrawal agreement. This is incredibly worrying, because there is no indication from the Government as to how we are going to fund all this. I welcome it, but it is potentially very damaging indeed.
The Government have not given any economic impact assessment of the withdrawal agreement. On the one hand, they tell us we have to decide within two days of debating, because we have had three and a half years of debate, but on the other they say, “We haven’t enough time to do an economic assessment.” Perhaps someone can square those particular arguments; I cannot. Happily, a number of organisations have done an assessment, and they have made it clear that under the withdrawal agreement, we will potentially be £50 billion a year out of pocket—£20 billion more than the Office for Budget Responsibility estimates. We are heading towards the sort of debt levels that were portrayed under Labour as a prelude to economic apocalypse. Indeed, this argument was rehearsed again by the Chancellor of the Exchequer. I would like to know why something that was portrayed 10 years ago in such a light should suddenly have morphed miraculously into a springboard for some sort of economic growth in the halcyon years that will come post-Brexit. That does not make sense. The fact is that the Government were wrong in 2010 and they are wrong now. That is why I will vote against the Queen’s Speech.