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My Lords, we all know that the impact of Brexit on our economy, deal or no deal, is bad. It is because of this, we must strengthen our economy economically and socially to withstand the impact. Both are needed to unite our divided country and build a better future. I welcome some of the spending proposals to make up for the austerity cuts, but, as other noble Lords have said, they are gestures. On a per capita basis, only about one-third of the cuts will eventually be restored. That will do little to unite us and deal with growing public resentment at rising inequality and inadequate standards of living. That divides us more and more, and feeds growing populism and resentment.
The Minister was upbeat about the economy. Yes, there is record employment, but there is also record in-work poverty. As many economists have put it, the economic model is not working for us all. I see little in this Queen’s Speech that recognises this, but many in business and industry now do recognise it and seek to rectify it with so-called more responsible capitalism. Indeed, many in business are united with the Labour Party in this objective. This is why many no longer see the Conservatives as the party of business and industry.
Reports from abroad say that many do not recognise Britain for what it was. This weakens trust in our reliability and has an impact on our ability to trade and to make trading agreements. I agree with the Minister: we need to be a country that people want to trade with. I understand that the Government intend to roll over 40 continuity agreements that, through our EU membership, the UK has with 70 third countries. How is that progressing? Far more is at stake than just trade across the frontier with Ireland.
Will Parliament scrutinise these future trade agreements? As said in debates in this House, this is important because trade affects a broad swathe of public policies, such as consumers’ rights, workers’ rights, the environment, standards in food and health and especially public services. We want a level playing field with high standards not the race to the bottom that the PM promised an American audience.
In spite of what the Minister says, this weakening of trust in our reliability has affected inward investment. I mean the valuable investment that supports large parts of our business and industry, not the buying up of UK assets with cheap pounds. Proper inward investment has helped improve many parts of our economy with good productivity, skills training and management, and this against the overall picture of static pay and declining productivity painted by many other noble Lords.
Yes, the Prime Minister has spoken about productivity, but in very vague terms. We all know that it is the key to economic growth and a rising standard of living. Apart from infrastructure, I see little in the Queen’s Speech to encourage it. Cutting corporation tax does not seem to work. Experience shows us that in many cases it encourages only higher salaries and dividends and share buybacks. Financial markets are just not recycling dividends into productive new investment. The Government can play an important part in boosting investment and productivity if they just uphold their objectives laid out in Industrial Strategy.
Some question the way we measure productivity. However we measure it, our productivity is well short of where it should be. Instead of trying to explain that away, the Government should encourage us to change the way we run our businesses. Indeed, it is often clever accounting rather than real economic activity that is measured, and that creates resentment. Limiting levels of debt and dividends is a major concern of the IMF, and the regulator is trying to do that in the water industry. Why not extend it? It could have avoided the need to repatriate 160,000 Thomas Cook customers.
Many businesses are conscious of this and are trying to raise standards of behaviour through schemes such as Blueprint for Better Business and Be the Business. The British Standards Institution too has been hard at work devising a new standard that lays out many of the features of a well-run, responsible and trustworthy business and invites companies large and small to satisfy that standard. Not for the first time, I ask the Government: will they will support these initiatives and perhaps make this standard a condition of public procurement? I know that a number of local authorities are looking at this, and I believe it will be an important step in restoring fairness and public trust in our businesses and maintaining a level playing field. It will also be an important feature in making our economy more competitive by opening markets that are dominated by large companies to smaller and newer businesses.
Many noble Lords have spoken about climate change. The Governor of the Bank of England thinks that business must agree to rules of reporting it within the next couple of years. Otherwise, will they be imposed? Under the new Bill, will companies have to report on compliance with UK carbon budgets? Will it include emissions from shipping and aviation?
Brexit has already taken quite a toll, economically and socially, and more is to come. It will not be made up by economic promises; it will be done by engaging with the issues that make our economy work. Making the economy work for us all is an objective that is absent from the Queen’s Speech.