Increasing productivity is the best way to boost wages, improve living standards and enhance prosperity. We have worked hard to build a stronger, fairer economy, dealing with the deficit, helping to get people into work, and cutting taxes for families and businesses. We will continue to invest responsibly, including by investing billions more in infrastructure, creating a new national skills fund and boosting investment in research and development. We will invest to unleash the potential of the whole country, so that no place is left behind.
Productivity is damaged if SMEs feel that there is no fair system for resolving disputes with their bank, yet the eligibility rules for the new Business Banking Resolution Service exclude 85% of historical claims, including, incredibly, those that have been through the recently discredited Lloyds bank customer review. Will the Chancellor meet me to discuss how we make this fit for purpose and not simply a fig leaf to cover past banking malpractice?
My hon. Friend speaks with experience on this subject and is right about the importance of access to finance. I know that he has broadly welcomed the voluntary Business Banking Resolution Service but is not happy with the way it is exactly working at the moment. I know that he has a meeting coming up with the Economic Secretary on this important issue.
High-quality infrastructure is a key factor in improving productivity, so will my right hon. Friend consider establishing both a sovereign wealth fund and an infrastructure bond, which would enable part of the financing solution to allow that necessary infrastructure to be implemented?
The Government’s fiscal policy will allow for a step change in infrastructure investment, which is what we need to level up and unleash the potential of the whole country. That is why I am open to looking at ideas for new financing instruments, but I would need to be satisfied that they represent good value for money, that they can be sustained for the long term and that they are consistent with our wider fiscal objectives. I would be happy to discuss that with my hon. Friend.
Only 15% of people who start their working lives in entry-level jobs progress beyond such jobs by the end of their working lives. In order to deal with that situation, will the Chancellor look again at the national retraining scheme to see what we can do to help people to progress further in work, to reduce poverty as well as increase productivity?
As usual, my hon. Friend raises an important issue. Some excellent work has been done on the issue, including work to which my hon. Friend has contributed. In our manifesto, we set out our intention to have a new national skills fund, which will help to transform the lives of people who are trying to get on to the work ladder, to get new qualifications or to return to work. I know that my hon. Friend will welcome that.
First, may I welcome my hon. Friend to his place? He raises the important issue of infrastructure investment and its importance to productivity. I understand the incredible importance of the A1 in Lincolnshire, and a number of colleagues have raised it with me. We will soon publish our second road investment strategy, which will set out our plans, but I can assure my hon. Friend that in this Government’s infrastructure revolution no part of our country will be left behind.
Having spoken to business leaders in West Bromwich and throughout the west midlands, I know that tackling productivity and imbalances across the region is vital, and key to levelling up our economy. Will the Chancellor commit to working alongside me to tackle the imbalances in West Bromwich East and the wider west midlands?
Yes, I will. May I also welcome my hon. Friend to her place? I remember my visit to her constituency last month; we met some excellent local businesses. She is right to talk about the need for further investment in the midlands. As a west midlands MP, I understand that as well, and I know exactly how much more potential can be unleashed. I look forward to working with my hon. Friend throughout this Parliament to do just that.
“Weirdos and misfits with odd skills”.
As a member of that Cabinet, what weird explanation does the Chancellor have as to why, according to the Office for National Statistics, productivity is falling at its fastest annual pace for five years?
We have just had an unprecedented decade of growth: it is only the third time since 1700 that we have had an uninterrupted decade of growth, and that is thanks to the work of this Government. When it comes to weirdos and misfits, I know that there are many on the Opposition Benches, but they need not apply.
That speaks volumes, does it not? The worst recovery since the industrial revolution—is that what this Government can be proud of? It is absolutely pathetic. More bluster from the Chancellor, but the facts are absolutely clear: most people are worse off under Tory economic mismanagement, working longer hours on flatlining real pay. So, what targets has the Chancellor set for improved productivity? Will he make way for another weirdo or misfit when, inevitably, those targets are not met?
We should never forget that the Labour Government gave us the deepest recession in almost 100 hundred years, and the British people were clever enough not to allow them to do it again. Now, they throw stones at the firefighters who put out the fire that they set in our economy. That is what they do. We will not take any lessons from the Labour party.
May I first pay tribute to the economist Professor Andrew Hughes Hallett, who passed away on Hogmanay?
The Bank of England has said that pessimism and uncertainty around Brexit have had an impact on investment and productivity. That uncertainty has been compounded in Scotland by the fact that our Government found out only today in the media that the UK Government will finally be setting their budget, yet they have absolutely no certainty over whether that budget will include the £1.2 billion in Barnett consequentials promised by the Prime Minister during the election campaign. When does the Chancellor intend to meet the Scottish Finance Secretary to apologise?
I welcome the hon. Lady to her new position as, I think, Treasury spokesperson for her party.
When it comes to productivity, it is important that the Scottish Government play their role. They should examine their own policies, especially those on tax and infrastructure and skills, and see how they have let down the Scottish people time and again.
It is a huge disappointment. The Chancellor does not even have the dignity to apologise to Derek Mackay for making this announcement only in the media. Furthermore, the right hon. Gentleman may not be aware, but
In the election that we have just had, we talked time and again about the need to unleash the potential of the entire United Kingdom, and of course that includes all of Scotland. Scotland has been let down time and again by the SNP Government, which are charging Scottish people the highest taxes in the United Kingdom and providing the worst public services.
I call Rachel Reeves.
Let us take somebody else then.
With regard to productivity, what plans does the Chancellor have in the upcoming Budget to tackle the lack of investment in further education? Investment has been cut by 50% since 2010, and productivity relies very much on colleges and high-quality education outside the university sector.
The hon. Lady is right to raise the importance of FE and technical skills—I went to an FE college myself—and it is one reason why, in the spending round back in September, I allocated an increase of £400 million for the forthcoming year to FE budgets, which is the biggest increase in a decade. In our recent party manifesto, we set out plans for £2 billion of investment in the FE estate throughout England.