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Matthew Hancock: We have not heard a single consequence of the £50 billion cuts that the Labour party would have had to introduce had they won the election. That puts the Labour party out of the debate, and leaves it to others-especially those on this side of the House-to work out how we get our country out of this terrible mess.
Over the past 13 years we have heard about the six regulations a day from the Secretary of State and the £11 billion cost each year of extra regulations. I used to say that we had the longest and most complicated tax code in the world except for India, until last year when India overtook us-I mean, when we overtook India. I will get it right eventually! Youth unemployment is the highest on record; we have had a record fall in business investment; and for all the hot air about manufacturing, the number of manufacturing firms in this country has fallen by a fifth over the past 13 years. We do not need to hear anything more from the Labour party about manufacturing as we try to turn the economy around.
I am delighted that, in the agreement on in-year spending reductions of £6 billion, £50 million was found to put right part of the catastrophe in further education funding that happened under the last Labour Government, when so many promises were made with no funds attached, when the budget was completely overcommitted, and when the Government had to go around the country to half-started projects and take away the funding. Since the election, we have heard that that is the case in Department after Department, and that FE was just unlucky that it all came out before the election. So I welcome strongly the statement by the Minister for Universities and Science that that money will go to FE colleges and that we can try to put right some of that wrong and reduce the deficit in a way that does not cause the greatest possible damage. I will be writing to him today to argue the case for Haverhill college in my constituency. It was ready to go and had been allocated funding by the previous Government, but had the funding taken away at the last minute because they had overcommitted the budget. I welcome the £50 million that the Government have found to do that.
More than all those things, and more than the Mandelson cheques we have heard about, businesses crave stability in the broader economy. Under the last Government, we had an asset price boom and bust, a credit boom and bust, uncertainty and complexity in the tax system, the longest recession in the world, the deepest recession since the war and the worst peacetime public finances in our history-and perhaps worse than all that, we had no answers to the questions of how to deal with those problems and of where growth would come from. I noted earlier that the shadow Secretary of State refused to say whether it was still Labour party policy to put a tax on jobs via an increase in national insurance, and I will be fascinated to hear whether the leadership candidates plan to argue next year that taxes should go up on every job in the country. Instead, all we have heard is the tinny sound of demands for cash and, from one hon. Member, a demand for an unfunded tax cut-those used to come from our party!
Phil Wilson: Does the hon. Gentleman believe that VAT should go up next week?
Matthew Hancock: I think that is one for the Budget statement on Tuesday.
Finally, we are starting to get the answers to some of these deep-rooted problems. We heard today about the changes to financial regulation, and I wonder how long it will take the Labour party to involve itself in the debate about the future of financial regulation. We think that banks should be properly regulated, not regulated under the old system that failed. The Government are also putting forward solutions to help credit flow to businesses; we are getting increased certainty in the tax system; and of course we have measures to tackle the deficit. As a result of those last measures, since the election, the interest rates paid on Government bonds has fallen by 0.4%-one tenth-which means that the interest on Government debt has fallen by one tenth in just over a month since the election, in anticipation of action to deal with the deficit.
Claire Perry (Devizes) (Con): I want to emphasise that point. We heard so much about the financial stability that the previous Government were going to give us, yet the international markets have sent out an incredibly strong signal: that we finally have a Government with the guts and the policies to tackle this deficit, which hon. Members who are now on the Opposition Benches could never even own up to, let alone deal with. The markets are saying, "This is now a country that we want to invest in again," and interest rates have fallen as a consequence. I want to underline the importance of the statistic that my hon. Friend gave in demonstrating the world's view of Britain finally being open to business, now that we have had a change of Government.
Matthew Hancock: I agree with my hon. Friend.
Matthew Hancock: It would be a delight to give way to the hon. Lady, who has made so many fascinating interventions this afternoon.
Rachel Reeves: The hon. Gentleman has quoted a fascinating statistic, but does it not fly in the face of what those on his Front Bench have been saying about how, because nobody wants to buy our debt-that is what one of his colleagues said earlier-we have to make cuts immediately? If interest rates are going down, surely there are lots of people who want to buy our debt.
Matthew Hancock: Interest rates are going down in the market because people can see a Government who are taking action and getting to grips with our problems, who have already made in-year cuts and who will finally put this country back on the path to fiscal sanity. That is exactly why interest rates are going down, which is a commendation on the action that the Government have taken so far.
The point that I will rest on is this. Across this country, businesses are paying interest rates that are in some cases extremely high. They need to borrow in order to invest for the future and get the private sector recovery that even some Labour Members talk about. The single best measure to do that is to have low interest rates and a stable economy, with confidence in the future. That is exactly what this Government's programme is delivering, and I commend them on that. I strongly support the amendment to the motion, and I look forward to voting for it later.
Andrew Miller (Ellesmere Port and Neston) (Lab): May I join others in congratulating you, sitting there in your smart attire, Mr Deputy Speaker, and also the many hon. Members who have made their maiden speeches this afternoon? Clearly standards have gone up since you and I entered the House in 1992. Congratulations are due to those from all parts of the House who have made such interesting contributions.
I want first to encourage people to think about what has been happening in manufacturing. There has been massive technological change impacting on manufacturing, along with a continual process of globalisation in the manufacturing process, which has put all developed countries under huge pressures to maintain their positions. Because of the changes that have occurred, we have to work at the leading edge-something referred to by hon. Friends who spoke about Nissan and similar projects-if we are to sustain our position. However, one thing is for certain: we will not sustain the number of jobs in manufacturing. There will continue to be pressure on those jobs, as there has been over a long period, because of technology.
I would like to cite two examples from my constituency by way of illustration. Vauxhall Motors used to employ nearly 11,000 people, but now produces a much higher quality product with 2,200 people, with much higher numbers of vehicles coming out of the factory. The Shell oil refinery used to employ 10,000 people, but now the control room looks like something out of NASA and a handful of people can control the whole refinery, because of sophisticated IT technologies, which have made such a massive change to the way such operations work.
Richard Graham: Will the hon. Gentleman give way?
Andrew Miller: No, I will not for the moment.
The Secretary of State and I had a short exchange about Vauxhall Motors earlier, and there have been developments during the course of the afternoon. The Government eventually agreed that the loan guarantee approved by Lord Mandelson had been approved correctly and was in order-contrary to earlier suggestions-but despite that and because of what has happened in Germany and the UK, the company finds itself having to drive things forward itself. In a statement issued this afternoon, the company says:
"We cannot afford to have uncertain funding plans and new time-consuming complex negotiations at this time when we need to keep investing in new products and technologies. With these new products and the impact of restructuring, we expect to return to profitability shortly".
The parent company is going to support the necessary changes. It is a pity that the Government were not part of the solution, but I welcome the fact that the mischief that had been created over the inappropriateness of the grant has at last been dealt with.
Mr McFadden: Does not my hon. Friend agree, however, that the delay involved in this case should serve as a warning of the damage that can be caused by needlessly calling a halt to important industrial projects? It is little use the Government coming along today and saying that they have approved the loan guarantee, on the very day that the company in question has run out of patience.
Andrew Miller: I could not agree more-
Richard Graham: Will the hon. Gentleman give way?
Andrew Miller: May I please finish?
I could not agree more with my right hon. Friend the Member for Wolverhampton South East (Mr McFadden). There is a lesson for us all here. There has to be proper due diligence, and I respect the fact that Lord Mandelson took a long time to reach the agreement, working with my right hon. Friend. It was done correctly and, what is more, the then Opposition party was notified of that during the process.
Richard Graham: I am grateful to the hon. Gentleman for giving way. Does he agree that one of the main reasons for the decline in manufacturing in this country has been the slowness of decision making by the previous Government? To bring that point alive, I shall give one particular illustration. British Energy, which is headquartered in my constituency of Gloucester, was eventually taken over by the French company, EDF, simply because the previous Government failed to make any future provision for the nuclear power that this country so badly needs.
Andrew Miller: That is a bit rich, coming from the hon. Gentleman. He really is rewriting history. He must acknowledge how slow his party has been to wake up to the calls from people like me who were demanding a move towards nuclear power. I find it ironic that the amendment to our motion starts with the words "leave out from 'power'". I just wonder how much of a row there was in the coalition about that, given the fact that the two words before "power" are "civil nuclear". I am pleased to see that the Government's amendment would allow those words to stay in the motion, but I bet there is going to be trouble in the coalition when it comes to agreeing on some of the decisions that the hon. Gentleman is quite right to suggest are mission critical to the success of the UK economy.
This Government's delays in decision making have also had a dramatic impact on the supply chain and, as a consequence, on many of the apprenticeships in the supply chain. We have heard all the stories about the creation of 50,000 new apprenticeships, but, goodness me, those delays have slowed down the creation of apprenticeships in my constituency and in the travel-to-work area around it. That includes the constituency of my hon. Friend the Member for Wrexham (Ian Lucas) and others, all of which are affected by the decisions at Vauxhall and the other big manufacturing operations around us.
The Minister of State, Department for Business, Innovation and Skills (Mr John Hayes): I could not intervene on a less experienced or distinguished hon. Gentleman than the one who is speaking. On apprenticeships, he will understand that recessions do make things difficult, but will he not celebrate and welcome the commitment of this Government to creating more apprenticeships, particularly in small and medium-sized enterprises, in constituencies such as his?
Andrew Miller: I am counting every one of them, and if I have to come back and agree with the hon. Gentleman in a year's time, I will do so. I just hope that he is not double-counting the commitments already made by those on the Labour Front Bench before the election. As long as he is not double-counting the number of apprenticeships, I will celebrate them with him. I look forward to seeing them.
We have also heard mention of FE colleges this afternoon. One thing I am immensely proud of-photographs of it feature on my website if anyone would like to look at it-is the new FE college that was built with funding provided by the Labour Government. It was chosen to be part of the network of colleges that would be built because of the importance of manufacturing to constituencies like mine. Apprentices from Vauxhall and the petrochemical sector, as well as from the retail and leisure sectors, study in that college, which is going to be a centre of excellence in the middle of Ellesmere Port, where manufacturing genuinely matters. I welcome that investment.
I move on to the second issue that is particularly important for the future of manufacturing. I welcome the fact that the Minister for Universities and Science has taken over the science portfolio, and I look forward to working with him in my new position as Chair of the Science and Technology Select Committee. We have already had some exchanges. I also put on record my thanks to my hon. Friend the Member for Blackley and Broughton (Graham Stringer) for the civilised way in which the election between him and me was conducted.
The Minister of State, Department for Business, Innovation and Skills, the hon. Member for South Holland and The Deepings (Mr Hayes) knows how passionately I feel about the role of science. He and I have talked about information technology issues in the past. I will press the Minister for Universities and Science in particular to ensure that he protects our science base, without which our future will genuinely be bleak.
To return to what I said at the beginning of my remarks, the impact of technological change on manufacturing and the globalisation of manufacturing mean that if we are to have a place in the manufacturing of tomorrow, part of it is going to have to be science-led and driven by the highest levels of research. It is mission critical-I hope this commands support from all corners of the House-that we maintain our investment in the science base. In areas of scientific endeavour that are close to market, we cannot afford-because of the pace of change-to take our eye off the big picture either. When it comes to our commitment to CERN or the European Space Agency, we need to realise that these blue-sky areas are incredibly important for our children and their children in turn. They are crucial if we are to maintain our position in this incredibly competitive field.
Another important issue for my new responsibility is ensuring that we work together-I hope in a collegiate way-across parties to improve public understanding of some of the complex scientific challenges that face society today. On that note, despite our odd disagreements on manufacturing issues, I hope that there will be common ground between the parties. Some aspects will divide the parties and other aspects might divide people within the parties, but I hope that serious progress can be made during this new Parliament. Nothing can be more important to our children than making sure that we are at the leading edge. If we do not stay there and if we do not invest in science and technology, we will start slipping down the ladder.
In seeing you join us, Mr Deputy Speaker, I note that this is the first time I have had the pleasure of speaking with you, another Lancastrian, in the Chair. I will
conclude my remarks. I know how dearly you, Mr Deputy Speaker, hold manufacturing to your heart and how importantly you view it as the cornerstone for our future. It has to be manufacturing that is led by investment in science and technology; we need to deliver that at all levels in every aspect of our endeavours.
Harriett Baldwin (West Worcestershire) (Con): It is a pleasure to take part in this Opposition day debate on Government support for industry. It was a great pleasure to hear the maiden speech of my hon. Friend the Member for Bracknell (Dr Lee). I also heard the maiden speeches of the hon. Members for Bolton West (Julie Hilling) and for Wansbeck (Ian Lavery). I apologise for having to leave the Chamber, as I had been invited to tea by Mr Speaker, and that is why I sadly missed the maiden speeches of the hon. Members for Barnsley East (Michael Dugher), for North West Durham (Pat Glass) and for Middlesbrough South and East Cleveland (Tom Blenkinsop), but I look forward to reading them in Hansard. It has been delightful to hear so much about the north-east in today's debate. In 2005, I fought Stockton North, and, as they say, Stockton North fought back. However, I do know what a delightful part of the world the north-east is.
I speak as someone who has worked in the private sector for the past two decades-my whole career thus far has been in the private sector. In those two decades, I have survived both boom and bust and all types of economic cycle. I have been through the cycle in which one hires additional people, the cycle in which, sadly, one has to let people go, the cycle in which one invests heavily in training, research and development, and the cycle in which one markets and exports products overseas, so one travels to explore overseas markets. I learned in those two decades that businesses have to be adaptable to thrive and survive. I also learned that Governments do not create wealth. Governments do not invent new products or start new businesses and cannot tell which businesses will survive or thrive. However, I strongly agree with the Secretary of State's comments at the beginning of the debate that the Government have an important role to play.
There are signs that the Labour party is beginning to understand that Governments do not create wealth. Last week, the former Labour City Minister, Lord Myners, said:
"There was flawed thinking about job creation in the past. I found it very frustrating to sit in meetings with some of my fellow Ministers talking about creating jobs in the green economy and biotechnology. The Government cannot create jobs."-[ Official Report, House of Lords, 8 June 2010; Vol. 719, c. 625.]
Lord Myners is right. Across the world, and throughout history, economic recoveries are almost invariably led by small business creation and by the jobs created by those small businesses as they grow and become successful.
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