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House of Commons

Thursday 13 July 2006

The House met at half-past Ten o’clock


[Mr. Speaker in the Chair]

Oral Answers to Questions


The Chancellor of the Exchequer was asked—

Lisbon Agenda

1. Mr. Mark Hendrick (Preston) (Lab/Co-op): If he will make a statement on progress towards meeting the Lisbon agenda. [84762]

The Chancellor of the Exchequer (Mr. Gordon Brown): Britain is at or near the best for employment and enterprise. The report on science that we are publishing today shows the progress that we are making on research and development. Europe accounts for 50 per cent. of British imports and exports. To speed up the pace of economic reform across Europe, we are proposing that Governments and business join together in a Europe-wide business forum.

Mr. Hendrick: My right hon. Friend presides over one of the most dynamic economies in the world, with record levels of foreign direct investment, according to the United Nations, and massive levels of employment, according to the G7 nations. In an age of globalisation and cut-throat competition, what is he doing to ensure that our European Union partners go the same way as we have?

Mr. Brown: I am grateful to my hon. Friend, who has taken a broad interest in these matters. He is absolutely right about our economic performance, given that the shadow Chancellor has congratulated us on establishing economic credibility and on our success in macro-economic policy. On employment, despite the recent difficulties, the claimant count in Britain is 3 per cent. and the labour force survey figure is 5 per cent. Our unemployment rate is about half that of the mainland European economies. I believe that we can continue to expand, even in a situation of massive global competition. Our aim is full employment for this country, and I hope that all parties will subscribe to that.

Mr. John Redwood (Wokingham) (Con): Will the Chancellor try to speed up progress on the famous
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Lisbon agenda, particularly deregulation, given that under his stewardship the Scottish economy has grown at only one quarter of the pace of the Irish economy? Can he learn from the Irish economy, which gets less in subsidy from the EU than Scotland gets from England?

Mr. Brown: I can only tell the right hon. Gentleman what he said in his own report on the British economy:

We have that allure for investors because we have a low-tax economy, stability, and an open competition policy. When the right hon. Gentleman chairs the Conservative party review on these matters, perhaps he can sort out its policy on Europe, which is in complete disarray according to the e-mails of the Leader of the Opposition’s Parliamentary Private Secretary. Perhaps he can also say that our economic record has brought stability, whereas under the Government in which he served there was instability.

Mr. Siôn Simon (Birmingham, Erdington) (Lab): Does the Chancellor intend to continue working with colleagues across Europe to promote employment and stability under the Lisbon agenda, or does he have any plans to isolate us from Europe and common sense by joining up with neo-fascists, weirdos and maniacs from all over the place?

Mr. Brown: My hon. Friend is right. It was Conservative Members who talked about the cranks, fanatics and extremists that they might have to join if they were part of the opposite grouping to the European People’s party. The choice is between a pro-European and pro-business agenda and an anti-European and anti-business agenda. The tragedy is that the Conservatives are not only anti-European, but are about doing what is damaging to business. If they will not believe what I have said, perhaps the Swayne e-mails—

Hon. Members: Order!

Mr. Speaker: Order. I have given the Chancellor some elbow room, but he is stretching a point.

Dr. Vincent Cable (Twickenham) (LD): Is not the Chancellor becoming a little concerned that Britain’s good performance in employment and unemployment is being undermined by the fact that unemployment has risen for 15 of the past 16 months and is at its highest point for six years? Does he have any specific initiative to make in respect of Britain’s mortgage lenders, given that unemployment is translating into rapidly rising repossessions because of the absence of any system of safety nets for people in mortgage arrears?

Mr. Brown: It is difficult to take lectures from the Liberals when they have just published their tax and spending plans, which show a £20 billion spending hole that would lead to damage to the economy. As for employment, I would have thought that he would give us a balanced account. We have one of the lowest unemployment rates in Europe. At the same time, we
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have moved closer and faster to full employment under this Government than under any Government for 50 years.

On interest rates, while I recognise that house prices have risen, the hon. Gentleman should recognise that interest rates are among the lowest that they have ever been. In fact, for mortgage holders, interest rates have averaged half under the Labour Government of what they were under the Conservative Government. It is perhaps about time that the Liberals acknowledged that.

Mr. John McFall (West Dunbartonshire) (Lab/Co-op): The Chancellor will agree that the Lisbon agenda must be founded on the rock of economic stability. The Treasury Committee’s report, “Globalisation: the role of the IMF” suggests that there is significant risk to the UK in Europe if there are global imbalances and disorderly unwinding in the global community. Given that, will my right hon. Friend ensure that when he goes to Singapore in September, he will promote crisis prevention rather than crisis resolution so that economic stability is best served in the UK, Europe and the global community?

Mr. Brown: I am grateful to my right hon. Friend. The report is an important document, which points to the changing role of the IMF and, indeed, other international institutions. The emphasis must now be on crisis prevention rather than crisis resolution, the transparency that is necessary for countries to report what is happening in their fiscal and monetary policies and, therefore, for programmes of proper surveillance, whereby we can examine at first hand what is happening not only to countries’ fiscal and monetary but their corporate positions. That is why the proposal for extending article IV reports to cover those issues, and for an international form of surveillance as well as national reports, is important. I applaud the report. Perhaps we should also have surveillance of Opposition parties’ proposals.

Mr. George Osborne (Tatton) (Con): The Labour Member on the European convention, the hon. Member for Birmingham, Edgbaston (Ms Stuart), said recently that economic policy throughout Europe is moving backwards. She singled out one country for special criticism—Britain. She said:

I know that the Chancellor is keen to get on with the parliamentary Labour party at the moment. What does he have to say to his hon. Friend?

Mr. Brown: I just repeat what the hon. Gentleman says outside the House but not in it. He supported us and congratulated us on our successful macro-economic policy. [Interruption.] What is the country to make of a shadow Chancellor who, inside the House, criticises us for our economic policy but outside, when talking to business, to try to show that he has learned from his mistakes under a previous Conservative Government, refers to

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and says that Labour has been successful in “establishing economic credibility.” He also said:

If he is not prepared to say those things in the House but says them outside, the country will have to draw its own conclusions.

As for European issues, perhaps he should read the e-mails of the Leader of the Opposition’s parliamentary private secretary. [Hon. Members: “Oh!] Oh yes—they are precisely about the Conservative party’s European policy, which, according to the e-mails, is the subject of dismay, depression, “frustration and impotence.”

Mr. Osborne: Before the Chancellor talks about friends in Europe, he should read the comments of the President of the European Commission, who says that, every time the Chancellor turns up in Brussels, it is like a vegetarian visiting a beef eaters’ club.

If the Chancellor does not agree with the hon. Member for Birmingham, Edgbaston, perhaps he will agree with the Prime Minister’s former chief economic adviser, who wrote recently in the Financial Times that

Or perhaps the right hon. Gentleman is simply no longer interested in the mundane issues of the economy because his whole attitude is, as the right hon. Member for Birmingham, Ladywood (Clare Short) put it recently, “Please, please, let me take over. I’ll do anything you say.”

Mr. Brown: I can only quote back his own words to the shadow Chancellor and cite what has happened in his constituency, where unemployment has fallen by 54 per cent. under a Labour Government. Only a few days ago, he said:

Mr. Dennis Skinner (Bolsover) (Lab): Does my right hon. Friend agree that the Lisbon agenda is about real issues such as inflation, employment and getting money for public services? Will he scour the agenda next time to see whether it has any references to saying no to chocolate oranges and padded bras, or hugging a hoodie selling dodgy goods? I do not think that he will find them because they are all part of the Tories’ agenda.

Mr. Brown: The issue is whether one believes in stunts or substance in policy. The substance in policy is the lowest unemployment for 30 years, the lowest interest rates for 40 years and the lowest inflation rate in a generation. No Conservative Government have been able to boast of such a record. The shadow Chancellor would do better to go back to the drawing board with the right hon. Member for Wokingham (Mr. Redwood) and examine the Conservatives’ economic policy.

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G8 Summit

2. Mr. David Anderson (Blaydon) (Lab): What progress he expects to be made at the forthcoming G8 meeting in St. Petersburg towards agreement on education provision for every child; and if he will make a statement. [84763]

The Chancellor of the Exchequer (Mr. Gordon Brown): We call on all G8 and other countries to join us, and the fast-track initiative of the World Bank, in 10-year plans to expand education so that, instead of the situation today in which 100 million children are denied schooling, all children throughout the world will have the right to education.

Mr. Anderson: I thank my right hon. Friend for that answer. Yesterday, 10 children from St. Joseph’s primary school, in my constituency, met the Prime Minister and pressed him on this very issue. One read a poem, which included the following words:

How can my right hon. Friend help to ensure that those children’s words and efforts are not in vain, especially if other countries renege on their commitments?

Mr. Brown: I am grateful to my hon. Friend. He has led a campaign in his constituency, and I hope that there are many Members in all parts of the House who are able work with schoolchildren and teachers in their constituencies, so that the “education for all” initiative gains support throughout the country, and schools in Britain can link up with schools in Africa. Two thirds of the 100 million children who do not receive education are girls. Many are at school, but the pupil:teacher ratios are anything from 100:1 to 150:1. Britain has set aside £8.5 billion over the next 10 years—the Secretary of State for International Development will make a statement later today on future plans—so that we can lead the way in providing education for all. That is the most cost-effective and beneficial investment that the world could ever make, and I hope that all Members can join together to support it.

Mr. David Laws (Yeovil) (LD): This is clearly an ambitious and bold project that we Liberal Democrats would wish to support, but it will clearly also be very expensive. In light of that, and of the views of the Office of Government Commerce, will the Chancellor of the Exchequer consider redirecting the savings made by not proceeding with the identity card scheme into this area?

Mr. Brown: One of the benefits of running a successful economy, which the Liberal party might not understand, is that it is possible to spend money on both international development and domestic policy. We have proved over the past nine years that it is possible to expand public expenditure on policing and the Home Office, education and health and social services generally, and still to double the amount of
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money in real terms going into international development. I hope that the Liberal party will review its own spending plans, so that it can prove to the public that it, too, could be trusted with the spending of money.

Mr. Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab): Would my right hon. Friend care to develop his thinking on the education for all programmes and the strategies of African countries, particularly in view of the need for them to be fully funded and consistent with paragraph 18(a) of the Gleneagles communiqué?

Mr. Brown: I am not—I do not have it to hand—aware of what the (a) part of paragraph 18 says, but the whole House will thank my right hon. Friend for his work on the International Development (Reporting and Transparency) Bill, which will require the Government to report regularly to Parliament on the successes in, and the challenges of, meeting the international development aid targets. His work has been welcomed by all non-governmental organisations and pressure groups not only in this country, but around the world.

Yes, we will keep to the Gleneagles agreement on these issues, and at the same time we will continue to expand spending not only on education, but on health. The vaccination initiative introduced in the past few months, providing £5 billion extra for vaccination, will ensure that over the next 20 years millions of children will be able to survive, where previously they would have died. This initiative involves both education and health, and we are showing that this Government are properly funding it.

Mr. Graham Stuart (Beverley and Holderness) (Con): For education programmes to be worth while, we also need a decent environment for children. Can the Chancellor explain why he was unable to address the G8-plus-five legislators’ dialogue last weekend, which was very disappointed not to hear from him? Can he also tell us of any progress that has been made with the climate change fund, which he announced with many headlines at the time of World Bank’s spring meetings in Washington?

Mr. Brown: I am glad that the hon. Gentleman agrees about the need for action on climate change, and I hope that he will support not only our UK climate change levy but our public investment programme, so that the World Bank will set up, as he knows, a fund providing loans and grants to enable developing countries to move into alternative sources of energy and to make more efficient use of existing energy.

David Taylor (North-West Leicestershire) (Lab/Co-op): If media reports are to be believed—not always the case—Vladimir Putin was successful in keeping Africa off the core agenda of the G8 meeting in his country at St. Petersburg. Can the Chancellor reassure the House that education has the greatest potential to transform the lives of people on the continent of Africa? Will he try to ensure that the subject of education provides a means of broadening the debate
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so that Africa is not forgotten? It played a central part in Gleneagles, but it seems to be less central in St. Petersburg this week.

Mr. Brown: I suspect that middle east issues will form a big part of the G8 agenda in St. Petersburg, but I can assure my hon. Friend that African issues will be discussed. I can also assure him that the Germany presidency of the G8 next year fully intends to make development a central part of what it does. The IMF and World Bank meetings in September are focusing heavily on issues of development and providing finance for it. There is also a UN reform commission that is looking into how the UN can play a far more effective role in development in future. Far from those issues being off the agenda after Gleneagles, they are definitively on the agenda, and I believe that the public action by non-governmental organisations, Churches and faith groups, which have kept it on the agenda over the past year, will also keep it on the agenda in future years. I hope that MPs on both sides of the House can join Churches and faith groups in making sure that in every country there is a full knowledge of our responsibilities to the developing countries.

Mrs. Theresa Villiers (Chipping Barnet) (Con): At the forthcoming meeting, will the Chancellor urge his G8 colleagues to live up to their promises on programmes for dealing with HIV/AIDS, particularly programmes relating to children? Will he take steps to ensure that UK Government programmes that are administered multilaterally alongside G8 partners or the EU give HIV/AIDS a much higher priority than they have in the past?

Mr. Brown: I will not be attending the meeting at St. Petersburg on Saturday, but I was at the meeting of Finance Ministers there only a few days ago. What was decided there was that we would push the development agenda forward. We discussed health issues and promised that HIV/AIDS sufferers would get some form of treatment and help by 2010. We know that 25 million people have died as a result of AIDS, we know that there are 12 million AIDS orphans and we know what our responsibilities are. Instead of promoting what I believe are divisive ideas about education vouchers, I wish the Conservative party would unite around the necessary funding that should go through Governments and civil society to deal with problems of health and education.

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