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The Prime Minister: I have already said that current expenditure will rise, and continue to rise. Capital spending will rise until 2011, then it will fall. I have already made it clear that for health, education and for all these public services current spending will continue to rise. The issue is surely this: in 2009-10, we are raising spending substantially. We are doing so in 2010-11, and we are doing it to take us out of recession. There is only one serious party in the world that is trying to tell us that we should cut spending nowthe Conservative party. The right hon. Gentleman must therefore admit that under his proposals, schools would lose money now, teachers would be made unemployed, Sure Start services would go, child care services would be at risk, and no teenager would get a guarantee for jobs. That is the future if the Conservatives were ever to implement it.
Mr. Cameron: Complete nonsense. Nobody [Interruption.] It is interesting that not even the Prime Ministers own Cabinet now backs the ludicrous line that he is taking about public spending. He keeps talking about this 10 per cent. I do not know whether he realises how much damage it is doing to him. It is not doing any damage to us. Let us explain where the deceit about the 10 per cent. comes from. Let me explain to the House [Interruption.]
Mr. Cameron: If we take the Governments own spending plans, take off debt interest and take off the increase for unemployment, which, sadly, will go up, we are left with a 7 per cent. cut in every Departmentthe Governments own figures. If we exempt the NHS, we get a 10 per cent. cutthe Governments own figures. If we take out [Interruption.] Thank you, Schools Secretary. If we listen to the Schools Secretary and take out health and schools, we get a 13Â1/2 per cent. cut. That is the Prime Minister: Mr. 13Â1/2 per cent.his own figures. Let us see if he can answer the simplest of questions. Is he going to have a full departmental spending review before the electionyes or no?
The Prime Minister: The first thing that the right hon. Gentleman said was that unemployment is going to continue to go up. That is the Conservative policy. It is a prediction. That is when they say that unemployment is a price worth paying. Is he basing his assumptions on unemployment rising to 2014? No wonder he wants to cut public services. He is basing his assumptions on unemployment continuing to rise, because he will do absolutely nothing about it. We have taken action that is preserving 500,000 jobs. A quarter of a million people are leaving the unemployment register every month. We put in extra money on Monday so that there is more for young people who are unemployed and for summer school leavers. We will not forecast our spending plans on unemployment being higher in 2014 and rising every year, but if that is what the right hon. Gentleman wants to do, he cannot afford public services. Therefore the truth is that he will be cutting public services by 10 per cent.
I have to say that this is one of the most feeble performances that I have ever seen from the Prime Minister. If Peter Mandelson had not been so busy wandering round the television studios this morning,
he could have given him a bit of tuition. There is only one person who we want to add to the unemployment register, and that is this Prime Minister. I asked a simple and straightforward question. Perhaps he could now answer it. Peter Mandelson has said that there will not be a spending review before the election. Can the Prime Minister tell uswill there be one or not?
The Prime Minister: It would be wrong to have a spending review now, at this stage[Hon. Members: Why?] Because we are in the midst of a recession and it is not possible to say what unemployment, growth and all the characteristics that the right hon. Gentleman has been referring to are likely to be in 2012, 2013 and 2014. We have got to the heart of the Conservative position today. They are the party of unemployment. They are premising all their spending plans on unemployment continuing to rise. He said himself that unemployment will keep on rising. If that is the basis of their spending plans, people can look forward, under a Conservative Government, not just to 10 per cent. cuts, but to rising unemployment. Why do they want these public spending cuts? To pay for inheritance tax cuts for the very rich. We see once again that they are the party of the few, and we are the party of the many.
Mr. Cameron: I know the walls of the bunker are thick, but the Prime Minister seems completely unaware that unemployment is rising across the country because of the policies of his Government. We have seen hundreds of people lose their jobs at Diageo in Scotlandanother tragic caseyet the Prime Minister seems blissfully unaware of what is going on in the country that he is meant to be governing. Everyone will conclude that the Government will not have a spending review because they do not want to own up to the cuts that they are planning in Department after Department. The truth is that this Government are planning to cut capital spending: fact. They are planning to cut total spending: fact. The most important fact of all is that they are incapable of being straight with the British people.
The Prime Minister: This Opposition would cut public spending this year and deprive people of help with unemployment and housing. This Opposition party would cut public spending next year, and cut it savagely in schools, in education and even in the Sure Start programme. We now know the truth about the Conservatives assumptions about the future: they assume that unemployment will continue to rise, as the right hon. Gentleman said, until 2014. That is not the policy of this Government; we want to get people back into work.
Colin Challen (Morley and Rothwell) (Lab): Does the second franchise fiasco on the east coast main line in two years not tell us that the Tory rail privatisation experiment has finally hit the buffers? Now that we are taking the east coast main line back into public ownership, can we keep it that way?
The Prime Minister:
Our first and overriding obligation is to ensure continuity of service to the passengers, and that there is no disruption of services, so the Secretary of State for Transport is establishing a publicly owned company, the East Coast Main Line company. It will take over all franchised rail services at the point that National Express East Coast ceases to operate, and
existing staff and assets will transfer to the new company. We are making sure that the service continues to run, that passengers continue to be served and that jobs continue to exist.
This afternoon we have seen the bogus debate about public spending hit new lows. I am almost tempted to suggest that Lord Mandelson and the Conservative economic spokesman go on another cruise together to make up. The real failing is that the Conservative party leader wants to cut spending when the economy is still on its knees, which is economic madness, and he will not tell us how; and the Prime Minister is still living in complete denial about the long-term savings that will be needed when the economy starts to recover. Are they not both deliberately choosing to trade insults so that they can both avoid telling the truth?
The Prime Minister: The right hon. Gentleman does not tell us what his policy is at all. The fact of the matter is that if spending were cut this year, jobs would be lost and services would be put at risk; and if spending were cut next year, jobs would be lost and services would be at risk. We are determined to ensure that spending remains in order to increase job opportunities and to protect home owners, and to make sure that our public services are in place. I hope that he will join our side of the debate in protecting public services for the future.
Mr. Clegg: What the Prime Minister is avoiding once again is the fact that difficult choices on long-term spending need to be made now if we are going to get any grip on the countrys finances. That is why we should admit that we neither need nor can afford to replace Trident. He is planning to sign the first contracts for the new Trident submarines this summer, during the recess when we are all away. Is it not obvious that he should not do that?
The Prime Minister: We have already announced a deficit-reduction plan for the next five years. We have taken difficult decisions about efficiency savings and asset sales, and about raising the top rate of tax: about measures that ensure that people who are in a position to pay more do pay more in the tax systemthat is, at the top rate of tax. I hope that the right hon. Gentleman will support those measures, which are designed both to reduce the deficit and to ensure that there are sufficient resources for public services. I have already made my position on Trident clearin the debate on Monday.
Ms Angela C. Smith (Sheffield, Hillsborough) (Lab): Last week Corus announced 379 job losses in the steelworking town of Stocksbridge in my constituencyjob losses that will have a devastating impact on the economy of a town with a population of only 13,500. Will my right hon. Friend make a commitment to do whatever he can to ensure that Corus can secure a long-term future for steelworking in places such as Stocksbridge?
The Prime Minister:
Corus employs more than 20,000 people in this country, and wherever there are redundancies it is a matter of sadness and regret. We are dealing with a fall in demand in the steel industry throughout the world, and it is affecting Britain and every other country.
We are in talks with Corus, we have provided extra money in the past week for help to secure jobs and we will continue to talk with it about what more we can do. We are also in negotiations with Corus about its relationship with a conglomerate of steel producers. That contract has broken down; it puts jobs in Britain at risk; and we are trying to do what we can to ensure the agreement of a new arrangement that can protect more jobs in Britain.
Q2.  Mr. David Gauke (South-West Hertfordshire) (Con): The Prime Minister has twice told the House today that capital spending will continue to rise until 2011. The Red Book shows that capital spending is at £44 billion this year and will be at £36 billion next year. I am sure that the Prime Minister understands that that means a cut, starting next year. Will he correct the record now?
The Prime Minister: As I have already explained to the House, we are bringing forward investment, previously allocated for later years, to 2009-10 and 2010-11. The reason why we are doing so is that we can help get the economy out of the recession. The capital investment would not be supported by the Conservative party. As a result, projects such as housing, in which we are investing from this Monday, as we have announced, could not go ahead. I have already explained to the House that while the previous Budget announced that there was a rise in capital expenditure over a period of time, more money has been reallocated to the first years so that we can help ourselves out of recession.
Mr. Eric Martlew (Carlisle) (Lab): There has been a great deal of talk about the modernisation of the House, but I would like to ask the Prime Minister whether we could go back in timeto when we had Prime Ministers Question Time twice a week, on Tuesdays and Thursdays. There would be much more accountability to Back Benchers, the questions would be more topical and the Chamber would be much better attended on Thursdays.
Q3.  Simon Hughes (North Southwark and Bermondsey) (LD): As more than 1 million of our young people leave education this summer, the Governments rediscovered commitment to training and apprenticeships is very welcome. However, it appears that many of the training schemes on offer cannot be completed in the time that the Government have announced. Will the Prime Minister meet a group of us to make sure that we do not consign our young people to unemployment or to a failure to gain the qualifications that they need?
The Prime Minister: As the hon. Gentleman should know, in 1997 there were 70,000 apprenticeships in Britain; this year, there are 225,000three times as many. To say that we have reduced the number of apprenticeships, or that we are not taking the issue seriously, is wrong. As far as training programmes are concerned, on Monday we announced how we would do more for summer school leavers and for young people under 25. I hope that the hon. Gentleman will support the new investment that we have made into those measures. They cost money; I hope that his party is prepared to support them, even if the Conservative party is not.
Q4.  Mr. Neil Turner (Wigan) (Lab): This Labour Government have made a lot of progress in tackling disadvantaged communities, such as Pemberton, Scholes and Beech Hill in my constituency, through the neighbourhood renewal fund. However, local authorities and primary care trusts are hampered from building on that success because they do not get the money that the Government formula tells them they are entitled to. Will my right hon. Friend meet me, and other colleagues with similar constituencies, to see whether we can find ways to tackle the problem?
The Prime Minister: I understand that Wigan will receive more than £21 million between 2008-09 and 2010-11 as an additional resource to help tackle problems faced by local people. Of course I am happy to meet my hon. Friend to talk about both the neighbourhood renewal fund and some other aspects of central funding to local authorities, but I do say that in the past few years we have increased those resources substantially. Where there is unemployment, we will be increasing resources to help people get back to work.
Q5.  Mark Simmonds (Boston and Skegness) (Con): In the light of recent cuts of £3.9 billion in Department of Health funding, as announced in the Budget, will the Prime Minister confirm what further reductions in health expenditure his Government are planning for between 2011 and 2014?
The Prime Minister: We are raising expenditure on the health service this year and next year. The hon. Gentleman should know perfectly well that we have done so against the advice of the Conservative party, which would prefer to see [ Interruption.] If we had not taken the decision to raise national insurance to put investment in the national health service, we could not have had the 90,000 extra nurses, the 20,000 extra doctors and the new hospitals. That decision was opposed by the Conservative party.
Mr. Denis MacShane (Rotherham) (Lab): In a few days time, the newly elected European Parliament sits for the first time. Can the Prime Minister assure me that Labour MEPs will not sit with Polish MEPs who are homophobic and of an anti-Semitic orientation, with Czech MEPs who believe that global warming is a myth, or with Dutch MEPs who think that abortion should be abolished and that Sunday shopping should stop? Which party does support those loonies and weirdos?
The Prime Minister: It took the Leader of the Opposition almost a year to admit that there was a recession all over Europe. Now that he has had to admit it, perhaps he should also admit that there is a need for co-operation all over Europe to deal with these issues. What I think people will find very sad is a Conservative party now on the fringes of Europe with some of the extreme parties on the right wing of the European political family.
Q6.  Jo Swinson (East Dunbartonshire) (LD): News of tomorrows statement is welcome, but if the swine flu pandemic worsens sufficiently to trigger changes in the Governments approach during the 82-day summer recess, would the Prime Minister recall Parliament so that there could be proper scrutiny of the Governments actions?
The Prime Minister: The hon. Lady will know that the Health Secretary will make a statement tomorrow on the issue of swine flu. We will make sure that at all points we are vigilant in ensuring that the treatment of that disease in every part of the country is right and proper.
Gordon Banks (Ochil and South Perthshire) (Lab): My right hon. Friend may have seen todays announcement by Diageo on the restructuring of jobs in Scotland, to which the Leader of the Opposition referred. It was mixed news, with 500 job losses over two years but also £100 million of investment, including in my constituency. Will my right hon. Friend do everything he can to negate the loss of these jobs, and will he agree to meet the company to discuss its continued plans for investment in Scotland?
The Prime Minister: Where there is unemployment, we are ready to help. The measures that we announced on Monday will move in to help young people, but also adults who are losing their jobs. It is possible for firms making capital investment to get new capital allowances which were introduced in the Budget to stimulate new investment. We are seeking an investment-led recovery. The capital spending that we have reallocated to 2008-09 and 2009-10, while it falls in 2010-11, is vital to doing that. We will continue to back private investment in our country, and these are the figures that I want to make clear to the House.
Q7.  Lembit Öpik (Montgomeryshire) (LD): As chair of the all-party Bahai group, I have become deeply concerned about the seven Bahai leaders in Iran facing trial by the revolutionary court on 11 July on serious but unsubstantiated charges, with no evidence being offered against them. Will the Prime Minister be willing to meet me and representatives of the Bahai faith in Britain to underline his and, I hope, our collective support for the fundamental principles of fairness and tolerance in the treatment of these and all Bahai in Iran?
The Prime Minister: The hon. Gentleman raises very difficult issues. I am sure that the whole House will share my deep disappointment at the recent behaviour of the Iranian regime: disappointment at the manner in which legitimate demonstrations have been suppressed; disappointment at the restrictions that he has mentioned on the freedoms of the Iranian people, with people due to stand before a closed court on 11 July; and disappointment that the Iranian Government have expelled two of our diplomats and detained several of our embassy staff. This action is unjustified and unacceptable. Some people in Iran are seeking to use Britain as an explanation for the legitimate Iranian voices calling for greater openness and democracy. However, we will continue, with our international partners, to raise our concerns with Iran, including on the issue that the hon. Gentleman raised.
Mrs. Linda Riordan (Halifax) (Lab/Co-op): Following job cuts announced by Lloyds, will the Prime Minister assure banking staff in my constituency that he will do all he can to protect their jobs? Will he join me in sending a clear message to Lloyds Banking Group that further job losses would be totally unacceptable?
The Prime Minister: I have visited the area and talked to staff, and I understand their frustrations at what is happening. They have served the bank well, and they are the victims of what has happened to HBOS in its worldwide activities, particularly its failures in other countries. We will do what we can to help the staff of HBOS and Lloyds TSB. We are also making it possible for people to have new facilities to find jobs in the area. We will do what we can to reduce unemployment in these difficult circumstances; that is why we have set aside £5 billion to help the unemployed, which is only possible because we have made these additional allocations.
Q8.  Mr. Adam Holloway (Gravesham) (Con): Another opportunity for the Prime Minister to be straight with the British people: in which Departments does he expect to see spending fall between 2011 and 2014?
The Prime Minister: Being straight with the British people means talking about how we get out of recession and how we build for growth. It is not much good the Oppositions talking about 2011 when they are cutting spending in 2009-10 and 2010-11. Throughout this debate, they have refused to support the action we are taking on jobs. They have no plan to come out of recession, they have no plan for jobs, and they have no plan for growth in the economy: they have nothing to offer the British electorate but cheap gibes and no policy.
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