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The fact is that the international regulatory regime did not keep pace with a remarkable change in the global movement of financea fact now well acknowledged across the world. That is why we need, as part of the G20 process, a new architecture for regulation. Banking will never be and should never be the same again. As for the hon. Gentlemans point on unemployment, we will do everything we possibly can to ameliorate the consequences of this international recession. Many Scottish families have people who have lost their jobs over the past few weeks, as has been confirmed today. As I say, we will do everything we possibly can to stop the newly unemployed becoming the long-term unemployed by giving people additional skills and retraining in order to retain their confidence and an attachment to the labour market. Of course things are more difficult. Not everyone can walk straight into a job, but we should not ignore
anyone, and we should try to support people to keep their skills and confidence fresh.
The Parliamentary Under-Secretary of State for Scotland (Ann McKechin): We are giving people across Scotland real help now by offering greater support to help them to move back into employment. We have invested £1.3 billion in Jobcentre Plus services to ensure that those looking for work receive individual support, and an additional £0.5 billion to guarantee more help for people who are unemployed for six months or more.
We currently have quite a good level of employment in East Lothianover 80 per cent.but I am concerned about the possibility that unemployment will rise both in East Lothian and in Scotland more widely. The position could be greatly improved if the banks adopted measures allowing them to enable small businesses to recover by lending them money. Constituent after constituent has said to me recently that they will have to make people unemployed because the banks will not lend to them. The arrogance of the banks beggars belief.
Ann McKechin: My hon. Friend has raised an important point to which the Secretary of State has already referred this morning: the need for banks to start lending in order to enable businesses to survive and to invest. We have introduced the necessary measures to make that possible. I am sure that she welcomed the recent announcement by the Royal Bank of Scotland of the provision of additional funds focused particularly on small and medium-sized enterprises, many of which are based in her constituency.
It is important to note that the United Kingdom still has the second lowest unemployment in the G7 area, but we are not complacent. That is why, from April, we will be providing additional help for those who are unemployed for more than six months, in the form of a £1,000 recruitment subsidy. [Interruption.]
Mr. David Hamilton (Midlothian) (Lab): My constituency is next to East Lothian, and it is in the same position. The problem is not just unemployment, but the fact that companies are reorganising themselves. Would my hon. Friend and my right hon. Friend the Secretary of State consider bringing the banks to Dover House, so that Members of Parliament can have a discussion with them, and put our cases to them? Why are the banks still not lending to companies that are reorganising themselves to try to get through their present difficulties?
Ann McKechin: I should be more than happy to speak to any of my colleagues about constituency issues, and about how we can help Members to ensure that local banks respond to the needs of companies in their areas. I welcome the fact that East Lothian council recently joined a local employment partnership, enabling us to work with employers in trying to deal with some of the problems.
The Secretary of State for Scotland (Mr. Jim Murphy): I have regular discussions with my right hon. Friend the Chancellor. Sir Kenneth Calman's commission on Scottish devolution is supported by business and trade union leaders, and by the Labour, Conservative and Liberal Democrat parties.
Mr. Murphy: The Scottish Government have more money than ever before. The current Scottish Government have more than double the budget that the late Donald Dewar had when he was First Minister. I think it important for politicians in all parties in Scotland to find additional ways of working together through the recession. We are in it together, and we will get out of it together.
I appeal again to the Scottish National party to stop putting its obsession with the constitution before the priorities of our country, which are to do with economic recovery. Scotland will never forgive any political party that puts its interests before those of our country.
Mr. Adam Ingram (East Kilbride, Strathaven and Lesmahagow) (Lab): Is my right hon. Friend aware that although financial powers are important, they will take some time to produce any change, if change is coming? What we need now is action. Unemployment in Lanarkshire is higher than it is in any other region, and Lanarkshire also has the fewest job vacancies. I welcome all the initiatives that my right hon. Friend is taking thereunlike the one-trick pony who is First Minister in the SNP Administration in Scotland, who is interested only in division and in rubbing Scotland out of the United Kingdom.
My right hon. Friend campaigns tirelessly for the people and businesses of Lanarkshire, which has a proud industrial heritage, not least in mining and of course the steelworks. The people of Lanarkshire have shown their determination and resolution to rise from
previous recessions. Working with him and other fellow Members, and businesses and trade unions, we are determined to do everything possible to make sure that Lanarkshire is not the epicentre of this recession in Scotland.
The Prime Minister (Mr. Gordon Brown): Before listing my engagements, I am sure the whole House will wish to join me in expressing our deepest condolences to the family and friends of those killed on operations in Afghanistan over the last week. They were Corporal Dean John, Corporal Graeme Stiff and Lance Corporal Christopher Harkett. They, and all those who have lost their lives in conflict, deserve our profound gratitude for their service not just to our country, but to the peace of the world. Their courage and sacrifice will never be forgotten.
Todays unemployment figures are extremely disappointing and, as a former shipyard worker who experienced the indignity of three years unemployment in the early 1980s, I can well understand the frustration and anger that unemployment brings. May I ask my right hon. Friend not to abandon the unemployed and to make sure that the Government continue to invest in the skills and training needed to help us through these difficult times?
The Prime Minister: I am grateful to my hon. Friend. Any person who loses their job or is in fear of losing their job is a matter of personal regret for me and the whole Government. I do not regard unemployment as a statistic; I regard it as one person, a second person and a third person who needs our help. That is why we will do everything we can to help people get back into work: that is why we have announced more apprentices; that is why we have announced more help with training; that is why we have announced that from April there will be help for those who have been unemployed for six months; and that is why we have put £1.3 billion into the jobcentresmoney that is necessary, so that we can help hundreds of thousands of people in the next few months get back into work.
Mr. David Cameron (Witney) (Con): I join the Prime Minister in paying tribute to Corporal Dean John, Corporal Graeme Stiff and Lance Corporal Christopher Harkett. The fact that more than 150 of our servicemen and women have been killed in Afghanistan is a reminder, once again, of the huge sacrifices our armed forces are making on our behalf. We praise their bravery, we honour their memory and we must look after their families.
Today, as has been said, unemployment has risen to more than 2 million people. The increase in the claimant count is the sharpest since records began. Does this not reveal that the claims repeatedly made by the Prime Minister that Britain is one of the best-placed countries in the world to withstand recession were simply nonsense?
The Prime Minister: I came into politics, and I stood for Parliament, because I wanted to help tackle unemployment and poverty, and that is why we are announcing the most comprehensive programme to help the unemployed. But I have to tell the right hon. Gentleman that unemployment is higher in France, in Germany, in Japan and in America. It is higher in most of the other countries we deal with, but we are taking urgent action to help those people in Britain who are unemployed. We are spending £1.3 billion helping our jobcentres and helping people into work. The Conservatives would not spend that money. I ask him why he would not help us deal with the problem of unemployment.
Mr. Cameron: I have to say to the Prime Minister that Members in every part of this House will contrast what he said with the fact that 144 of our further education collegesthe exact organisations we need to retrain people who are unemployedare having their building projects halted. There is this enormous gulf between what he says every week and what his Government are actually doing. Let me return to the question. People will simply not understand why the Prime Minister is so incapable of ever admitting that he got anything wrong. It is not just the unemployment figures today; the International Monetary Fund has said that the recession will be deeper and longer in Britain than in many other countries, and that Britain will be the only major economy in the world that will be in recession next year. So let me ask him again: was it not wrong to claim that Britain was one of the best-placed countries in the world to withstand recession? Admit it.
The Prime Minister: No, because the fact is that America entered recession more than a year and three months ago and the euro area entered recession in April last year, whereas we entered recession in July. We stopped ourselves going into recession for months after what had happened in America, and the action that we are taking now is designed to get us through it as quickly as possible.
Let me correct the right hon. Gentleman on FE collegeswe are going to spend £110 million this year investing in them. Let me correct him on public expenditure we are investing £44 billion this year, in health, in education and in other capital investment projects to help us through this downturn. Let me correct him again on unemployment. Unemployment is far higher in America, in France, in Germany and in the euro area. I know that is of little comfort to people in this country, which is why we are doing everything we can to help them.
Let me correct[Hon. Members: More.] Yes, there is plenty more. Let me correct the Prime Minister on the figures that he has just given to the House of Commons. He says that the recession started in July, but the economy stopped growing in April last year; we have been in recession for almost a year. [Interruption.] Yes, let me correct him on the further
education colleges. He should come to my constituency of Witney, where people are in temporary classrooms because the whole building project has had to be abandoned because of his incompetent Government.
The entire country will see that the Prime Minister is in denial about the length and the depth of the recession. He likes to talk about the schemes that he has announced, so let us have a look at them. Can he confirm that not a single unemployed person has been helped by the recruitment subsidies that we called for in November and that he announced in January? Can he confirm that not a single home owner has been helped by the home owners mortgage support scheme that he announced in December? Is it not the case that those two specific schemes simply are not operating?
The Prime Minister: First of all, the right hon. Gentleman is wrong about the start date of the recession. Secondly, he is wrong about further education, because £110 million will be spent on it this year. Thirdly, he says that we are not doing anything, so I should tell him that in the last recession there was no help available for the unemployed, but we are spending £1.3 billion to help people get into work. Let us just go through the things that we are doing: 300,000 people used to be helped under Train to Gain and that will rise to 1 million; we have raised the levels of mortgage support, so that people can stay in their homes even when they lose their jobs; and, as the Secretary of State for Work and Pensions announced, in Aprilnext monthprogrammes will come in that will help people who have been unemployed for six months. That was the date we set. The problem is that the right hon. Gentleman asks us to do more, but he is the only Opposition leader in history who is asking us to do more when saying he will spend lessit just does not add up.
Mr. Cameron: We have just had the view from the bunker, where all these schemes are operating and where everything has been implemented, but the fact is that, on the ground, these things are not happening. We get a lecture in competence from a Government who are so incompetent that they could not even stop Fred Goodwin, or, sorry, I should say Sir Fred Goodwinthe Prime Minister knighted him for his services to the banking industrywalking off with a pension that is worth £60,000 a month. The lack of action applies not just to the housing scheme and the job scheme, because the asset-backed securities scheme is not up and running, and the working capital scheme is not working properly. Is that not why the CBI said that this Government have a total lack of a coherent strategy? Is that not why Shelter says that people facing repossession have been given false hope? Does the Prime Minister regret giving those people false hope?
The Prime Minister:
That is not what we have done. We have negotiated with the building societies and banks a six-month moratorium for people who are faced with mortgage repossession. We have sent new orders to our courts that lenders cannot, as a first resort, go for repossession; they have to go through all the proper processes before they even consider that. We are helping unemployed people with their mortgages at a level that has not been done before, and next month we will bring in the protection scheme, under which we are insuring the banks and building societies against
loss so that people can phase their mortgages over a longer period of time. The problem that the right hon. Gentleman has got is that everything he proposes, he will not fund. On Monday, he said there would be more cuts in public expenditurealready he has refused to support the £1.3 billion that we are spending to help the jobcentres and to help people who are unemployed. It is simply not credible to come to this House and say that he is urging us to do something when he would pay for absolutely nothing.
there is a frustration about these schemes and the money and the credit getting through.
If the Prime Minister had listened to us, he would have introduced a national loan guarantee scheme back in November, and it would have been operating for five months. Should not he also listen to the German Chancellor, Angela Merkel, who stood with him in Downing street and said [ Interruption. ] The hon. Member for Bolsover (Mr. Skinner) should be quiet. I know that he wanted miners to join the Government: well, now he has got oneLord Myners [ Interruption. ]
if we want to make real impact, you really must implement the package first before you talk about the next step.
Is not that right? Are not this Government just running round, like headless chickens, with initiative after initiative that never gets implemented? Is not that combination of ineffectiveness and hyperactivity the worst combination of all?
The Prime Minister: The right hon. Gentleman opposed the German fiscal expansion. He has opposed every fiscal expansionin the US, in Germany and in France. He is out on a limb in opposing public expenditure rising in the downturn: he wants to cut it, and he wants to cut it now.
does not add to public expenditure.[ Official Report, 18 December 2008; Vol. 485, c. 1228.]
the taxpayer will take some of the hit.
The Leader of the Opposition does not understand that this is an unprecedented global banking crisis. Unprecedented means without precedent. Global means that it affects the whole of the world. The sooner that he wakes up to the fact that we need global action to deal with it, the better for our country.
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