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Edward Miliband: The point that I was making is that, listening very intently to the hon. Gentleman's speech, I have heard lots of proposals for tax cuts and lots of proposals for more spending. I wonder whether he thinks that those two things add up.

Daniel Kawczynski: I have the benefit of not being on the Front Bench, so I can say what I like, quite frankly. On that note, I will conclude my speech.

7.36 pm

Helen Goodman (Bishop Auckland) (Lab): I am pleased to take part in the Budget debate and to follow the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski), who seemed not to acknowledge that spending on the NHS is now at a record high and that we are going to have an increase of £6 billion next year. He displayed the attitude to climate change that Labour Members are becoming used to hearing: he willed the ends, but not the means. Indeed, from what he was saying about China, he seemed to be looking urgently for a translation from Shrewsbury to Shanghai. I am also pleased to follow my right hon. Friend the Member
 
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for Oldham, West and Royton (Mr. Meacher), who spoke about manufacturing, which is a concern in my constituency, and my hon. Friend the Member for Hartlepool (Mr. Wright), whose seat is in the north-east and who spoke eloquently and with compassion about the needs in the north-east.

Last November we held a conference in Bishop Auckland to examine the needs of the local economy, which is largely manufacturing based. We brought together small and large businesses, trade unionists, academics and policy makers to consider how to develop our manufacturing sector in an economy increasingly dominated by services and threatened by low-cost competition, and how we will ensure that workers have the skills needed to innovate and encourage entrepreneurship.

I believe that active government can make a difference to local economic success. In the north-east we should resist the temptation to engage in special pleading based on relative economic weakness. Instead, we must focus on using the potential of local people, too many of whom are still workless and, as my hon. Friend described, lack the skills and confidence to succeed. We need to create a framework that encourages businesses to innovate, invest and grow. That cannot be achieved through a laissez-faire approach that assumes that the market will take care of everything. It requires active intervention by Government agencies to embed skills in the work force, develop transport and communications infrastructure, and strengthen business networks.

At the conference, Professor Ian Stone of Durham university business school pointed out that 100 years ago the north-east economy had all the qualities that we need now: leading edge sectors, a strong demand for products and services, high levels of innovation, dynamic industrial clusters, a skilled work force, high productivity and growth, and net inward migration of skills. Of course there are examples of that today, such as NETPark, on the border between my constituency and the Prime Minister's. It is a partnership between the local authority, the university and the private sector to promote new technology. None the less, we need to strengthen such qualities.

George Cowcher of the North East chamber of commerce undertook an interesting survey of what manufacturing companies in my constituency wanted. Their priorities were work force skills, better transport infrastructure, less red tape, better business support and access to finance. Tommy Brennan of the GMB called for support for manufacturers and environmentally friendly technologies. I shall assess the Budget against those demands.

First, on work force skills, the Chancellor of the Exchequer is surely right to increase resources in our schools. There has been a tenfold rise in schools investment since 1997, and the 50 per cent. rise in schools investment next year will make a huge difference. For example, there will be a completely new school in the village of Byers Green, where teachers and pupils are now struggling in a 1915 building. The extra money for science teachers and new science clubs will be welcomed both in the Glaxo plant in Barnard Castle in my constituency and in Bishop Barrington school, which I visited recently. The school has had one new lab, but needs another one. The Chancellor's approach will
 
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build on collaborations such as that in the north-east process industry cluster, which provides visits and science training for local schools.

The new entitlement to, and grants for, further education for people up to 25 will have a significant impact in my constituency. Bishop Auckland college is now getting a completely new building to accommodate the 60 per cent. rise in students in the past five years.

On transport infrastructure, County Durham needs better roads going south and north. The extra £800 million outlined in the Red Book is enabling the A66 between North Yorkshire and County Durham to be dualled, which will both improve safety and cut business costs.

As someone who used to run a small voluntary organisation, which is a sort of small business, I am sympathetic to calls from business for less red tape. I am sure that business will benefit from the new code for risk-based regulation and the proposals to introduce that in Europe, too.

Manufacturers in my constituency said that they wanted business support and more streamlined one-stop shops. The growing role of the manufacturing advisory service, and a smaller number of business services offering more targeted support, represent the right way to go. There are young entrepreneurs in the north-east who will benefit from the national enterprise network of 200 summer schools. Accessing finance for small and growing businesses can be hard, so the proposal to expand the R and D tax credit, the new tax relief for investment in venture capital trusts and the £100 million of new money to double enterprise capital funds are all welcome.

The Chancellor of the Exchequer's proposals to support our renewables and energy efficiency industry will achieve three objectives—our climate change targets, our obligations to the developing world, and the sustainable development of our manufacturing base. The new environmental research institute and the seed-corn finance for the first enterprise capital fund for the environment demonstrate the Government's commitment to action, which contrasts sharply with the position of Opposition Members. In addition to the 5 per cent. biofuels quota, the increase in the duty differential for biofuels will be of particular benefit to Farmway—a farmers co-op in my constituency engaged in its manufacture.

As my hon. Friend the Member for Hartlepool said, in the north-east, labour market participation is below the national average. Sue Stirling of the Institute for Public Policy Research north believes that if we could get recipients of incapacity benefit into work, we would close the gap. There is already a successful pilot at the Bishopgate medical centre to support people back into work, so the proposals to reform the linking rules for incapacity benefit, which discourage some people from experimenting with taking jobs, are very welcome.

Before the Budget, I met members of the Wear Valley pensioners association. One of the things that they most wanted to see was the extension of free bus passes nationwide, so I am sure that they welcome the £250 million that the Chancellor is providing for free bus travel nationwide next year. Such travel will be available to all 17,600 pensioners in my constituency.

In February I visited Mr. and Mrs. Hodgson, who had benefited from a Warm Front grant. Improving energy efficiency is the best way of tackling fuel poverty
 
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and meeting our climate change objectives, so I am especially pleased that the Chancellor has increased the number of households that will benefit by 250,000 over the next two years.

The people of Bishop Auckland are not focused on their own interests alone, however. During Fairtrade fortnight, many of them signed a petition calling for the Government to keep their promise to raise aid to 0.7 per cent. of GDP, so they will be pleased by the increase in development aid set out by the Chancellor.

Opposition Members simply fail to understand the significance of the Government's successes and long-term strategy for the British economy. Since 1997 unemployment in my constituency has fallen by 41 per cent., and it has fallen by 11 per cent. in the country as a whole. Prudent fiscal and monetary frameworks have brought new stability to the British economy, and low inflation and interest rates enable businesses to plan and invest. That has allowed a steady programme of investment in public services. The Conservative party is committed to cutting public spending as a percentage of GDP, irrespective of need or circumstances. However, it will not tell voters which services it would cut. People need to know, because those public services not only improve our quality of life, but provide the skills and infrastructure for our long-term economic success.

7.47 pm

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