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Mr. Kidney: Before the hon. Gentleman leaves the point about confirmatory hearings, can he confirm what he said about the veto? That is certainly not part of the practice of the Treasury Select Committee, or of the recommendation that it made, during the passage of the Bill that became the Bank of England Act 1998, about the procedure for confirmatory hearings.
Mr. Ruffley: I see it as a natural future extension of the request from the Select Committee this week that the confirmatory hearings be placed on a statutory basis.
My third and final point concerns the high level of sterling. We know that there is an implicit dilemma in achieving convergence on interest rates and inflation rates in preparation for joining the euro, in achieving an inflation objective of 2.5 per cent., and in getting sterling down so that it is at a level ready for entry to the
eurozone. I did not find the answers that we received from the Chancellor about whether that was a future possibility convincing. He talked about his current intention. He did not rule out the--probably covert--pursuit of an exchange rate policy while aiming to achieve an inflation objective. We shall wait with interest to see how the Government get sterling down--as they will have to if they seek entry to the European single currency.
Finally, the shadow Chancellor announced this week that he would institute a commission to look at all the issues of which I speak--the absence of accountability, and the fact that we do not know whether the MPC has performed properly or not. Given that the Labour party did not tell us two days before the election about its position on an independent monetary policy, it is entirely right and proper that, two years before the next general election, we have a considered--
Mr. Deputy Speaker (Sir Alan Haselhurst):
Order.
Mr. Christopher Leslie (Shipley):
Thank you, Mr. Deputy Speaker, for calling me this evening.
The hon. Member for Bury St. Edmunds (Mr. Ruffley) has been very brave this evening. He is one of the few hon. Members on the Opposition Benches who voluntarily raised the issue of Bank of England independence, and the wonderful independent commission that the shadow Chancellor has set up--under his own stewardship. The shadow Chancellor is to chair his own commission that will consider whether the Conservatives should do a U-turn on their policy on Bank of England independence. How ignominious, how humiliating for them!
In the wide-ranging debate tonight on economic stability and public services, the Conservatives had a great opportunity to oppose the Government and to show the world and the voters what their alternative would be and what their policies are. They have failed abysmally. Why? Because the Government are so successful with their economic policies, with the way in which the economy has been performing, and with the public expenditure plans that we have put in place, which leave so little to be criticised.
Most of the attacks on the Government have focused on welfare, on various statistical anomalies that the Opposition like to talk about, on whether ISAs have been sufficiently successful, and of course on the perennial subject of Europe. The Conservatives were so desperate for hon. Members to help them out that even those on the Front Bench had to intervene on each other--an unprecedented parliamentary occasion. The Clerks looked extremely perplexed at that interesting innovation. The public outside will have to realise that that was a symptom of a failure to attack a Government who have been performing so well.
Let us look at the state of the economy. Consumer spending is picking up well--2.5 per cent. in July. The growth in gross domestic product is coming into line with the Treasury prediction, coming in at 0.9 per cent. in July. Unemployment, simultaneously with low inflation, has come down from 1.58 million in January to 1.4 million in July.
Headline inflation is now very low--1.2 per cent. in July--which helps pensioners and savers in particular by stopping savings being eroded and ensures that people are
rewarded for thrift and cautious planning for their future. I know that my constituents are extremely grateful to the Government for their policies, which have put in place such low inflation levels.
That is the true characteristic of a one-nation party, because inflation at its present low level helps everyone. People can plan for the future with the certain knowledge that their savings and money will not be eaten away by other external factors. Our record on inflation is highly commendable. Over the summer months, we should continue to repeat how that contrasts with the Conservative record of prolonged double-digit inflation during the 1980s.
Interest rates are extremely low, and mortgage rates are at their lowest for a generation. Home owners across the country and especially in Shipley are pleased that they have been able to plan for the future and borrow at an affordable rate.
Even manufacturing output is edging upwards. Things are looking up for the economy. We have managed to steer ourselves through difficult international times by maintaining a careful course of stability, and by focusing on getting monetary policy and fiscal policy to work together in such a clever relationship.
The monetary policy framework that we have put in place and the independence of the Bank of England have been a success. I should be interested to hear from the hon. Member for West Dorset (Mr. Letwin) his party's policy on the Bank of England's independence. I know that there are many different views, but does he agree with, for example, the shadow Chancellor who, only nine months ago, said, "We would not have given up control of interest rates in the first place", or with the right hon. Member for Wokingham (Mr. Redwood), then the shadow Secretary of State for Trade and Industry, now the shadow Minister for Transport, who called it a wrong idea and a big mistake?
Many Conservative Front-Bench spokesmen castigated the Government's policies, saying how dreadful and horrible it was that we were creating greater objectivity in monetary policy. Now, when they see the success that the policy has engendered, the only criticism that they have is exemplified by the empty Benches opposite. This is a sad and embarrassing day for them. It is degrading for the Front-Bench spokesmen. We shall watch their U-turn with great pleasure and relish during the summer months.
I shall be interested to know what will happen to the Conservative party's fiscal policy during the summer months. It has made many spending commitments. Just tonight we have heard talk of the Territorial Army, and the hon. Member for Reigate (Mr. Blunt) pleaded for more money for defence. Earlier in the day, the shadow Home Secretary asked for tax relief for donations to political parties. Apparently, the odd couple of dozen million pounds does not matter too much.
Earlier in the week, we heard the Conservatives' policy on London Underground. Instead of investing in London Underground, they want to privatise it and use the proceeds to pay for however many dozen new road schemes the right hon. Member for Wokingham recently put in his new transport policy document. London Members in particular will be curious to know whether
the Conservatives intend that any proceeds from the privatisation of London Underground should be ring-fenced for reinvestment in London, or whether it is now Conservative policy to spend that money in the rest of the country. I suspect that Lord Archer, in his campaign to become London mayor, will find that a difficult circle to square.
A Conservative Front-Bench spokesman has committed himself to an extra £227 million for the police budget. Even the Scunthorpe Evening Telegraph makes it clear that the Conservatives have committed themselves to massive extra expenditure. In March, its headline was "Hague's promise of free travel" for sixth form students. Their spending commitments are being piled on top of each other.
9.20 pm
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