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Tomorrow we will publish our proposals for economic reform for our presidency, but I come to a final issue that is prominent in the Queen's Speech, and that is an economic, social and moral issue upon which I believe that there can be all party agreementour shared responsibilities to Africa and to developing countries to move forward on debt relief, aid and the attainment of the millennium development goals, where Britain under the Prime Minister's leadership has a powerful role to play in the G8 and the UN special summit.
Yesterday, as we heard, European Ministers proposed to double aid by 2010, on the road to 0.7 per cent. for all the richest countries. But I hope that in our Finance Ministers meeting on 7 June in Luxembourg we can secure an even more extensive agreement that will give hope to Africa and to the developing countries. Every day that we delay, 30,000 children lose their lives. Every day that we delay, 100 million children do not go to school. On current rates of progress, we will not meet the millennium development goals for 150 years. We would like to front-load aid through an international finance facility. We would like a pilot facility for vaccination and immunisation, supported by the Gates Foundation. We believe that that could save 5 million lives over the next 10 years. We want an international trade agreement for free and fair trade, and we are moving forwards to agree a plan that could finally complete what started at Birmingham, and that is matching 100 per cent. bilateral debt relief with as much as 100 per cent. multilateral debt relief.
Many hon. Members have been in Africa and in developing countries and have seen what I have seenthe humiliation and agony of abject, relentless poverty; the humiliation of illiteracy and disease; children destined to die even before their life's journey has begun; mothers struggling to save the lives of infant sons and daughters and in doing so losing their own; millions of children denied education simply because their mothers and fathers cannot afford the fees; the great poverty and yet the great potential of these countries if we play a part in helping.
I believe that there can be all party support so that in 2005 Britain can become a beacon to the world in our crusade to tackle poverty in the poorest areas. Ours is a call to action to all men and women full of idealism, irrespective of political party. I want this generation to be remembered for seizing the opportunities, not for missing them.
This is a Queen's Speech that recognises our international responsibilities and our domestic responsibilities. Its themes are stability, not instability; equipping Britain for the future, not laissez-faire policies; renewed public services, not privatisation; and fairness. It is a Queen's Speech on the side of the people and I commend it to the House.
"but regret that the Gracious Speech contains no commitment to introduce legislation to reform the voting system and ensure that the composition of this House reflects the wishes of the electorate; further regret that the Gracious Speech proposes the introduction of a costly and ineffective system of compulsory identity cards instead of providing for more police on the street;
Dr. Cable: I should like to extend a welcome to the new shadow Chancellor. He has enjoyed some good press over the last few days. I was particularly intrigued by the comments in The Economist this week coupling him with the hon. Member for Witney (Mr. Cameron). It says that the hon. Gentlemen are "posh and youthful" and
The shadow Chancellor will, I am sure, face many challenges from both myself and the Chancellor, but neither the Chancellor nor I have any intentions of trying to compete with him in respect of being either youthful or posh. However, we have one thing in common of which he may not be aware, because one of his ancestors, the hon. Ralph Osborne, was once the Liberal Member for my constituency, which was then called Middlesex. He was a dashing gentleman with a reputation for living dangerously, a trait that he has clearly passed on to his descendant, because we saw during the earlier part of the election campaign an example of how dangerously the hon. Gentleman lives. It occurred at the time of the episode to which the Chancellor has already referred when the affable and inoffensive Member for Arundel and South Downs, as he then was, was burnt at the stake for the heresy of saying that there were two different versions of the report on public spending, one of which had been filleted for its political sensitivity. The grand inquisitor, the leader of the Conservative party, was obviously not aware that a day later on the "Today" programme, the new shadow Chancellor had said almost exactly the same thing in almost the same words. I have the quote here for him. None the less, he escaped and has been promoted, and he is welcome.
I mention the James report because one of its key recommendationsthis was in both the expurgated and the unexpurgated versionswas a severe cut in provisions for social housing. That may be one reason why he glossed over rather quickly the challenge to the Government on their new housing policy. I do not intend to gloss over it because this is clearly one of the Government's major new policy initiatives. It has not been dealt with in a way that is terribly courteous to hon.
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Members; we have picked up what we know about it from the newspapers, but it is substantial and I shall try to address myself to it. It is superficially attractiveit deals with the problems of first-time buyers, about which we are all concerned and which led three parties to argue for lifting the stamp duty threshold; it promotes shared ownership, which Liberal Democrats are keen to encouragebut as far as I understand it, it is in many ways a very bad idea.
One of the characteristics of the Chancellor's period in office is that while he has an excellent record in respect of macro-economic management, he periodically comes up with what are frankly wacky ideas, worked out on the back of an envelope with very little detail. Some of us call to mind individual learning accounts, the private finance initiative for the London underground, film industry subsidiesbetween them they have cost the taxpayer well over £1 billionand I suspect that this is another one.
Dr. Cable: There is no proposal, but we have a completely open mind and a willingness to look at new ideas, which is what I am endeavouring to encourage. There may be something to learn from other European countries that are experimenting with this, but we do not have a proposal to that effect. We campaigned on the tax proposals in our manifesto.
On the basis of the information provided to us, there seem to be several serious problems with the housing proposals. Perhaps the Chancellor or one of his colleagues will intervene to put me right if I have got this wrong. The first is that it seems to be a very clumsy intervention in the housing market, which as we all know is volatile and characterised by a major bubble. None of us knows what will happen to house prices. I used to do forecasting for a living, and I have learned the hazards of trying to make forecasts. In one of its technical annexes, the Treasury itself predicts that prices will fall this year by 1 per cent. They may or may not, but if prices reflatethis proposal may help that processa growing amount of Government subsidy will chase first-time buyers up the housing ladder.
The housing market could, however, collapse. Bodies such as the International Monetary Fund have predicted a very substantial and painful correction of 20 to 30 per cent.who knows? If that were to happen, a large amount of taxpayers' money would be put at equity risk.
One detail that has already emerged is that the Government, in their partnership with the banks, will accept the first losses in any fall in the market. Why should the Council of Mortgage Lenders, which has always been cool on shared ownership, suddenly have developed an enthusiasm for it? The only possible reason is that the Government are accepting a substantial level of risk. As the Chancellor knows, one of my criticisms of him is that, in the five years since he failed to implement the findings of the Cruickshank report on bank profits, the banks have run rings around the Treasury. I suspect that this is yet another case in which that will happen.
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There is a second criticism of the proposals as they have emerged. Why on earth are the Government trying to reinvent the wheel? Shared ownership is a complex and specialised business. A great deal of knowledge about it resides in housing associations and the Housing Corporation, which, as I understand it, the Government propose to bypass in their entirety.
A good report sits in the Office of the Deputy Prime Minister and the Housing Corporation, called "Shared ownership models that work". I should declare an interest, in that it was written by my wife, Rachel. It is one of several reports suggesting that shared ownership is a complex process and that we must learn from the mistakes as well as the successes. But if the Government's proposal is, as has been announced in the press, to bypass completely the existing institutions with a new, centralised Treasury-driven initiative, it will not work.
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