The Woodchurch Partnership provides support for the community with programmes such as the Ford Way horticultural project, where volunteers produce fruit and veg and the most exquisite Woodchurch honey. Local mums fight for all local children. Last year they put on a “mischief night” of music, fancy dress and Zorb balls to give the kids on the estate some fun and to keep them out of mischief, valuing each and every one of them, no matter what their background. The community shop on the Overchurch estate gives out food parcels to those in need, with the majority going to people who

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are in work but who still cannot afford to feed their children. The Chancellor’s announcement of cuts to working tax credits in his Budget will hit working people hard, especially those who are already struggling to feed their families. Churches across the constituency provide food banks, meals and company to those who have fallen on hard times, as well as celebrating the spiritual life of the community.

That constructive community activity is taking place against a backdrop of dwindling public services. Wirral council has had its budget savagely cut by central Government. While Wirral lost £65 per head of population, Richmond upon Thames enjoyed an increase of £54 per head. That cannot be fair and the impact is being felt severely in Wirral. By the end of 2017, Wirral council’s grant funding will have been reduced by about 57% in just five years.

The local authority is committed to doing the very best for the people of Wirral, but it is being put in an impossible position. In 2014 it carried out a public consultation on where the funding cuts should fall. It is a sign of the crisis facing local authority funding that the options considered included cuts to children’s disability services, youth leisure services, school crossing patrols, libraries, pest control, public toilets, allotments, bowling greens and football pitches, and increased fees for cremations and burials. Is there no part of civic life untouched by the Government’s agenda? Do our people not deserve properly funded public services? Can we not afford to build a strong, stable and good society? I ask the Government to consider those questions with full regard to the impact of their cuts on the life of communities in Wirral West.

I believe that the people of Wirral West deserve a society that provides strong and reliable public services for all of its people—a society in which people can afford to feed their children, in which young people can find employment that will enable them to reach their full potential, and in which those who are disadvantaged through ill health, frailty or misfortune can live decent lives with the support they need from Government.

7.6 pm

Kwasi Kwarteng (Spelthorne) (Con): It is an honour and privilege to speak in this important debate after a number of Members on both sides of the House have given good maiden speeches and accounts of the challenges that their constituencies face. I am sure that all today’s maiden speech-givers will become distinguished parliamentarians and will give good service to their constituents.

This was an excellent Budget and I am pleased to support it. When the coalition Government took office in 2010, the deficit was £153 billion. In the Red Book, published last week, we discover that the deficit is £69 billion. There is still a long way to go, but people will recognise that that is a remarkable achievement given the international context and the fact that growth has been much more sluggish across many western economies than we had ever anticipated. The Red Book also makes it very clear that the growth rates we are enjoying as a country and have enjoyed in 2014 and 2015 are particularly enviable. They are the highest across the western world, and we should celebrate that on both sides of the House. That does not happen by accident. It is not an accident that the deficit has been more than

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halved; nor is it an accident that we are growing faster than nearly all our competitor countries in the G7—I think that we have the highest growth rate in that body.

We appreciate that if the election had gone differently, we would not be in such a good position and there would not be such optimism about the future. It was clear during the election that there was a binary choice confronting the country between a Conservative Government, when the Conservatives had largely delivered very effectively as the leading party in the coalition, and a potential Labour Government—let us be honest, it would have been a coalition—without any economic credibility, when the Labour party was largely responsible for the mess in which we found ourselves in 2010.

I want now to address the specific issues in the Budget that I am particularly happy to endorse and welcome. As a south-east MP, I naturally look to the interests of business—I do not think that business is a dirty word—because lots of my constituents work in small businesses. In fact, 82% of people who are in work in Spelthorne work in the private sector. They work in small businesses, including businesses related to Heathrow airport, and they will welcome the further reduction in the corporation tax rate that my right hon. Friend the Chancellor announced. They will also welcome the fact that the Government are being very serious about addressing the deficit.

The Government’s ongoing commitment to building more housing will also be welcomed. We have talked about the need for more housing, and the Government are happy to take on that challenge.

I am particularly gratified that various measures have been introduced to increase the living wage. The Government are doing absolutely the right thing in reducing the amount paid in tax credits. That is a bold and challenging move, but I am happy to say that it is the right thing to do. However, if the Government are going to do that, they must ensure that companies do not get away with simply exploiting low-paid workers. It is a legitimate corollary of reducing tax credits to try to boost the living wage and the minimum wage. I understand the logic of that move and it is to be commended, even though Thatcherite purists may argue against increasing the minimum wage and particularly the living wage.

Finally, we cannot pretend that the deficit has been resolved or that we are out of the woods in terms of our approach to fiscal discipline. I support and commend my right hon. Friend the Chancellor’s commitment to running surpluses, because my earnest hope is that we will run a surplus at the end of this Parliament. However, when we finally get a budget surplus, the last thing we need is a return to the Labour spend, borrow and tax regime. We need to set in stone a regime whereby this country, like Germany and Switzerland, will have a much more mature and disciplined approach to public finances, and I hope that in the course of our debate we will be mindful of the need to balance the books every single year.

7.12 pm

Mr Douglas Carswell (Clacton) (UKIP): I, too, will vote for this Budget. Tomorrow’s vote is a binary choice and although I have reservations about some of the Chancellor’s proposals, on balance I support the measures. We must never return to Ed Balls economics.

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I support a number of measures. I unequivocally back the idea of having a fiscal charter, to echo the point made by the hon. Member for Spelthorne (Kwasi Kwarteng). It is a commitment to run a budget surplus by 2019-20 and to retain that approach in subsequent years unless growth is less than 1%. The principle behind that idea is exceptionally good; as a country, we cannot go on living beyond our means. I believe I am right in saying that we have only had budget surpluses in six of the past 40 years. That is unsustainable and also deeply unfair on the next generation. If we keep on running up these debts, someone will have to pay them, and it is deeply unfair and irresponsible of us to pass them on to the next generation. I only hope that the Chancellor manages to meet his own fiscal charter objectives. He has introduced, I think, five Budgets and in each one he has pushed back the date by which he hopes to balance the books.

I also support the proposal to remove the climate change levy exemptions for providers of renewably sourced electricity.

Kwasi Kwarteng: I am particularly gratified to hear the hon. Gentleman espousing the cause of sound finance. I just wonder how he feels being surrounded by people who deny that there is any need to reduce the deficit.

Mr Carswell: I will come on to say a little about my views on the unreformed Opposition. In fact, I will make them a proposal at the end of my short speech.

My party loves new energy technology. However, there is something we find objectionable: if the technology is so wonderful, why does it need to be subsidised? Removing some of those subsidies is a good thing, particularly when they push up the cost of energy, but the Government lack a fully coherent free market energy policy that allows real choice and competition.

I also cheer Government changes to vehicle excise duty. The new tariff will reflect changes in technology. Given that most new cars’ carbon dioxide output is below the old CO2 low threshold variable, vehicle excise duty is fast becoming a subsidy from poor people, who cannot afford new cars, to rich people, who can. VED will also be used for the creation of a road fund in 2020-21. That is a very sensible move, as it means that taxpayers will see directly where their VED goes and the tangible benefits that come from it.

I also support raising the personal allowance to £11,000 by 2015-16 and to £12,500 by 2019-20. That should be welcomed as a tax break for everyone who works. Indeed, I hope that at some point we will be able to raise the threshold even higher, to £13,000.

I also support welfare reform. When the tax credit system was put in place, I do not think that we ever expected that it would allow big corporate interests to rely on the taxpayer to subsidise their payrolls, and yet in effect that is what has happened. I fear that tax credits may have contributed to wage compression. Welfare reform is possible and necessary, but it is also very important that, as the Chancellor has said, we are prepared to raise the minimum wage to try to offset some of the impact of that reform.

Having outlined where I support the Government, I am afraid to say that there are one or two measures about which I have some concerns. I am particularly concerned about limiting public sector pay increases to 1%. I fear

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that that may not be politically sustainable over the next four years. There was a pay freeze in the public sector between 2010 and 2013. Since 2013, pay rises have been limited to 1% and, given that inflation is often above 1%, that has, in effect, amounted to a pay cut. If the economy grows in the way that the Chancellor expects it to, I am not sure that four more years of 1% is sustainable.

I also have some doubts about the Chancellor’s fiscal projections; I fear that there is a degree of fiscal complacency. In its manifesto, my old party told us that it would run a budget surplus from 2019, which is only four years later than promised five years ago. In fact, that target has now been pushed back to 2020.

This year, we will still manage to accumulate a deficit of £70 billion and we still have a bigger primary budget deficit than Greece. The budget deficit last year was 5.7% of GDP, which was higher than that of any country in the eurozone apart from, I think, Spain and Cyprus. UK national debt stands at £1,600 billion, which is £950 billion higher than when the Chancellor first took office. That is not an impressive record. Servicing that debt costs £40 billion a year. Think of what we could do with £40 billion—that is more than the entire defence budget. Think of the tax breaks we could give people and, more to the point, think of how much greater that sum will be when interest rates go up.

I will support this Budget, and I look forward to the Finance Bill that follows. If Her Majesty’s Opposition will repudiate Ed Balls economics and table sensible amendments, I will be delighted to support them, bearing in mind that the Government have a rather slender majority. However, there must never be a return to the recklessness of the Parliaments between 2001 and 2015.

As the UK Independence party’s sole Member of Parliament, I will support classical free market liberal economics. From that point of view, this Budget is not perfect, but it is infinitely preferable to the alternatives.

7.18 pm

Amanda Milling (Cannock Chase) (Con): I am very grateful to have the opportunity to speak in today’s Budget debate. This is my first experience of a Budget in this place.

We need only look at our performance on the global stage to see that Britain is back in business. If people visit the west midlands, and more specifically my constituency of Cannock Chase, they will see the benefits of the Conservatives’ long-term economic plan.

Once a mining area, Cannock Chase is now the home of thriving small, medium-sized and large businesses. It is the success of those businesses in the last five years that has resulted in jobs being created, directly leading to a dramatic fall in unemployment. That fall in unemployment was also the result of measures that were taken in the last Parliament to encourage people to get back to work. It is that aspect that I will focus on today.

The benefit cap, which was introduced in the last Parliament, is morally right in ensuring that people are always better off in work. Although I welcomed the cap, I must admit that I always felt that £26,000 was too high. Someone in work would have to earn about £35,000 to take that amount home—a salary or wage that many people in Cannock Chase can only dream of. That view was confirmed by a group of residents in Rugeley only the other day.

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In short, the cap was too high but the principle was right. That is why I welcome the changes that were announced in the Budget, which mean that in my constituency benefits will be capped at £20,000. We have a welfare system that we should be proud of, but it needs to be affordable and fair. When I say fair, I mean fair for the people who receive benefits, as well as fair to the hard-working people who pay their taxes so that benefits can be paid. The cap helps to ensure that our welfare system is sustainable in the long term and is there to support the elderly, the vulnerable and the disabled.

We must not just encourage people into work, but ensure that work pays. While unemployment fell significantly in the last Parliament in Cannock Chase, low pay has been an issue in the area. I am therefore particularly pleased to welcome two aspects of the Budget. First, there was the news that the personal allowance will rise to £11,000 from April next year, lifting nearly 900 more of my constituents out of tax altogether. That is a major step towards raising the personal allowance to £12,500 by the end of the Parliament, which will take even more people out of paying tax. That will ensure that working people in Cannock Chase get to keep more of the money they earn—money that they can spend with local businesses and in our town centres to support local independent retailers and market traders across Cannock, Rugeley and Hednesford.

Secondly, I am pleased to welcome the introduction of the new national living wage. As I said, Cannock Chase has historically faced issues of low pay. Cannock Chase deserves a pay rise. That is exactly what my right hon. Friend the Chancellor recognised and addressed with his compulsory living wage.

We need to ensure that that policy is backed by business. That is why I welcome the steps that were taken in the Budget to ensure that the move is not taken at its expense. For small businesses, the increase in the employment allowance to £3,000 means that they can continue to employ four people without paying national insurance contributions at the increased living wage. That is an important step towards ensuring that employers who pay the higher wage will not be stung by the jobs tax.

The path that has been set out to reduce corporation tax to 18% will save businesses across the UK more than £6.6 billion by 2020. That sends the powerful message to international businesses that are looking to invest in companies such as Gestamp, an automotive supplier in my constituency, that Britain is a low-tax, higher-wage, high-skilled economy, and therefore the best place to invest, grow or start a business.

I welcome my right hon. Friend the Chancellor’s Budget. It will help to deliver the Conservatives’ long-term economic plan, and it supports and rewards hard-working people and businesses across the country, in the west midlands and in Cannock Chase.

7.24 pm

Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP): It truly is an honour and a privilege to make my maiden speech as the new MP for Cumbernauld, Kilsyth and Kirkintilloch East. I grew up there, I have family roots there and I will always be grateful to my fellow citizens for putting their faith in me to represent our constituency here in Parliament.

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As hon. Members across the House will know, the first few weeks of life as an MP give rise to many and varied challenges. There is, for example, the huge challenge of navigating the complicated corridors of Westminster—a challenge that I failed spectacularly when I found myself, by accident, a fish out of water and the cause of considerable mirth, in the middle of a meeting of the Conservative 1922 committee. I think that I escaped, just about, with my political integrity intact.

The other major challenge that I have faced is the fact that there are two new SNP MPs called Stuart McDonald here in Westminster. Given that we spell our first names differently, I was expecting only the odd stray email or letter. In fact, in two short months, my hon. Friend the Member for Glasgow South (Stewart McDonald) has managed to steal my seat on one flight to Glasgow, leaving me stranded at Heathrow; cancel two other sets of return flights; hijack one of my constituents who had travelled 500 miles to lobby me; and steal credit in Hansard for my first ever intervention in this Chamber. At such times, many words spring to mind, but “honourable” and “Friend” are not among them. Looking to the positive side, it was comforting to receive a note congratulating me on my maiden speech some four weeks before I rose to make it.

More seriously, for their assistance in helping me surmount some of the challenges, may I put on the record my thanks to all the staff in the Houses of Parliament, who have been unfailingly helpful in these frenetic first few weeks?

I also wish to pay tribute to my immediate predecessor, Gregg McClymont. A Cumbernauld lad, after school at Cumbernauld high, he studied at the universities of Glasgow, Pennsylvania and, finally, Oxford, where he taught prior to his election in 2010. His mastery of the pensions brief means that he will be missed on the Labour Benches. I know at first hand that he is definitely missed in the parliamentary football team, notwithstanding his inexplicable support for Airdrie football club. I wish him and his new wife well, as well as all his staff, as they take on their next challenges.

Cumbernauld, Kilsyth and Kirkintilloch East is a constituency that is big in name, but also big in character. Situated right at the heart of Scotland, from Croy you are but 20 minutes by train from Glasgow city centre, while from Lennoxtown, you are a pleasant half hour drive over the Campsie fells to the banks of Loch Lomond. It is the best of both worlds, to use that expression in an appropriate context.

The communities of Cumbernauld, Kilsyth and Kirkintilloch East have diverse histories, from old parishes and mining towns to the new town of Cumbernauld itself. The communities have shared ambitions and a determination to forge a bright new future. In the weeks before and after my election, I have been amazed at the range of community groups, residents associations, community councils, social enterprises, churches and charities that work so hard for the local people.

The ambitions of the people of Cumbernauld, Kilsyth and Kirkintilloch East include secure well-paid jobs, strong communities, well-funded public services and a future free from poverty. The Budget does not support those ambitions; rather, as for millions across the country, it puts them further out of reach. The Chancellor spoke

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of a Budget for security, yet his Government have singularly failed to tackle the scourge of zero-hours contracts. He spoke of fixing the roof while the sun shines, but he risks the roof caving in altogether as more and more families are pushed deeper and deeper into debt, with household borrowing soaring. He spoke of boosting productivity, but he is determined to make UK workers the least protected and least invested in in western Europe. He made claims about a living wage, but, unlike the Scottish Government, his Government do not pay a living wage, and the welcome progress on the minimum wage was utterly undermined by the regressive measures he took on social security. He spoke of efficiencies, but his relentless pace of cuts risks pushing proud public services and committed public servants beyond breaking point.

Perhaps where the Chancellor’s rhetoric was most removed from reality was in his claim to be a one nation Chancellor, when all the while he was deliberately targeting those he accused of making lifestyle choices by the simple fact of claiming social security. He claimed that that was tough but fair. What is fair about systematically undermining the support for low-income families? What is fair about deliberately targeting children and young people for further cuts? My constituents have aspirations, but thanks to Tory Budgets, for far too many of them even putting food on the table at the end of the week is a difficult ambition to fulfil. This is a Budget that does not support aspiration but stifles it.

While other parties might be having some difficulty in deciding whether and what to oppose, we in the Scottish National party have no such problem, because we believe there is a better way. This party has outlined a programme to increase investment in public services while still moving towards balanced budgets. It wants to see action to tackle unfair zero-hours contracts, and we support a partnership approach between employers and employees, recognising the link between workplace rights and productivity and the fact that union participation and collective bargaining can be key drivers of fair pay and efforts to tackle inequality.

It is an honour to serve the constituents of Cumbernauld, Kilsyth and Kirkintilloch East and, however they voted, I will do whatever I can to support them in achieving their ambitions for themselves, their families and their communities.

7.30 pm

Richard Fuller (Bedford) (Con): It is a pleasure to follow an extremely gracious maiden speech by the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald). I particularly noted his kind words for the staff of the Houses of Parliament, which I thought was a particularly noteworthy thing to put in one’s maiden speech, and his kindness to his namesake who took his seat on the aeroplane. The hon. Gentleman follows a man, Gregg McClymont, who was probably one of the most intelligent Members and was one of the most fair-minded, so he certainly has big shoes to fill. He has made a very good start with his maiden speech today.

For me, the test of the Budget is whether it fits with what the good people of Bedford and Kempston talked to me about during the election campaign. As mine was a marginal seat where people had a straight choice between Labour and Conservative, and obviously chose

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Conservative, I listened intently to what they had to say. Their first and most abiding thought was that they appreciated the need to continue with the Government’s economic policies. They appreciated the stability that those policies had brought to their lives after the tremendous fears about the economy at the time of the 2010 election, when it could have gone either way for the United Kingdom. They appreciated the need for deficit reduction and understood the fundamental point that it is unfair on our children and grandchildren for this generation to continue to live beyond its means, and that somehow, in the fairest way possible, the Government have to find their way to getting the books in balance and to starting to repay the debts. That is the trajectory that was outlined in the Budget.

The second thing that people in Bedford and Kempston told me was that they understood the need for welfare reform and benefit reform to be at the centre of the changes that would be made. As my hon. Friend the Member for Cannock Chase (Amanda Milling) said, for many people, the idea that a benefit cap of £26,000 is somehow fair to them, when they pay their taxes—the median income in Bedford is £19,000—does not strike them as fair. People in Bedford will think that the Government’s proposals in the Budget to reduce the benefit cap, both in London and separately outside London, are fair. They will also see changes such as the limiting of child tax credit to two children, the introduction of a maximum income for staying in council housing and the changes to housing benefit as fair and reasonable.

Alison Thewliss: Does the hon. Gentleman consider it fair that a woman who has been raped will have to declare that to Her Majesty’s Revenue and Customs and the Department for Work and Pensions to qualify for her child to receive tax credits?

Richard Fuller: The hon. Lady repeats a point that one of her colleagues made in an earlier day of the debates on the Budget. We need to examine in this debate the broad range of the impact of the Government’s policies. When the Government make any change, they are moving big blocks around—that is one reason why I am a Conservative, actually. When that happens, there will be specific examples of an impact on people’s lives that the general policy was not supposed to have. The hon. Lady should raise those instances directly with Ministers, so that changes can be considered. However, we should not undermine the entire sweep of Government policy because of a particular example. I have found the Government reasonable in understanding the need for certain changes to benefit policies if they have a deleterious impact on individuals.

Emily Thornberry: The hon. Gentleman is making a thoughtful, although wrong, speech.

If a constituent of mine were a single parent with two children and met up with a man who had a child, would the hon. Gentleman advise her not to get together with that man because they would then have three children and be subject to cuts in their benefits?

Richard Fuller: It is not the role of an MP to advise an individual constituent on their life choices. That is their decision. With respect, the role of an MP is to analyse and scrutinise Government policies to see whether, in the round, they will provide the changes that the British public think are fair and reasonable. Against that

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test the deficit reduction policies, with welfare reform at their core, accord with what I heard on the streets of Bedford and Kempston. I hope that when the hon. Lady’s party has finished tearing itself apart at its parliamentary Labour party meeting, it will come together and see that it is worth supporting the welfare reforms.

I wish to say a few words about the Government’s proposals on pay. A lot of hon. Members have mentioned the interaction between the introduction of a national living wage and the changes to tax credits. That is an important debate to have, but I hope that Members of all parties will give the Chancellor credit for grasping that important nettle. At some point, the era of corporate welfare, with the taxpayer subsidising wages, had to be brought to a close. The cost to the Exchequer and the taxpayer was getting larger and larger. We were sending terrible signals to employers about what they should do about pay rates, and terrible signals to people in work that if they chose to improve their wages by getting extra skills or training, all their extra pay would be taken away because of changes in benefits. The change needed to be made, so I look to the Opposition to bring forward more thoughtful responses in the weeks ahead. They should have the grace to say that the change is important and that, overall, they support it.

As a Conservative, I say to my party’s Front Benchers that we have not yet seen the impact of tax credits following the recent recession. There is an argument that in the previous recession, during which the Government had a tremendous record of overseeing growth in jobs, tax credits had a beneficial impact in dampening the impact of the recession. They made people more willing to accept reduced hours, because their income was increased by tax credits, so employment could stay high. I urge the Government not to get too ideological about the transition from tax credits to the national living wage, and to be cautious about the impact on businesses on a sector by sector basis.

I welcome my right hon. Friend the Secretary of State’s comments about housing policy. There has been tremendous take-up of Help to Buy in Bedford—one of the highest proportions in the country. The extension of the right to buy to social landlords will be particularly welcome in Bedford. Between 1991 and 2001 the decline in home ownership there was 10%, compared with 4% in the rest of the country, because in 1991 the council put all the housing stock into a social landlord. Since then, the most significant increase in household wealth has been through people buying their own home. For 20 years, a large proportion of people in my constituency were denied access to one of the most fundamental ways in which they could have provided a better future for their children, because they were denied the right to buy. The change to the right to buy has been presented thoughtfully, and I encourage the Government to move it forward.

This afternoon I have heard the progressives and socialists on the Opposition Benches say that they do not support the national living wage, poor people getting a pay rise or people in council houses having a cut in their rent, and that they would deny people on low incomes the chance to buy their home. The right to buy has been one of the most successful policies that any Conservative Government have ever introduced, and I hope that the Government will move forward with it later this year.

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7.39 pm

Mark Durkan (Foyle) (SDLP): It is a pleasure to follow the hon. Member for Bedford (Richard Fuller). Although I do not agree with many of his points, I note that—as always—he is careful to reflect what he has heard from his constituents and he makes his own particular points. It is also a pleasure to follow the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald), who made his maiden speech. He is probably the only Member who could accuse another Member of identity theft, hijacking and credit theft, and still comply with the rules of avoiding controversy in a maiden speech.

I cannot agree with what I have heard from some Conservative Members about the Budget. The hon. Member for Cannock Chase (Amanda Milling) said that she was proud to support the Budget because of the moral principle that people should always be better off in work. If that is the moral standard by which we are to test the Budget, then just as the hon. Member for Bedford has listened to his constituents, I have listened to mine who know that as a result of the Budget they will not be better off in work—they are in work and will be worse off because of the significant changes to tax credits, the overall changes and the particular changes to family size and the two-child policy.

Those are people who are hard working and who meet all the tests used in the past by the Government to define hard-working families, strivers and people who have made sacrifices. The region that I represent has very high unemployment and a low-pay profile—it is not as though those people choose to be in that type of employment with the pay that they receive and their dependency on tax credits. This is a wilful choice by the Chancellor: “These are the people who are to be punished. If we are going to balance the books, I am picking out those who have no choice but to work for those wages and need tax credits to support themselves and their families.” That is why I oppose this Budget.

In principle I support the concept of a living wage, and a good, working, national living wage would be a good thing. The Chancellor has used the national living wage not just—supposedly—to grab the headline of increasing the minimum wage, but also to try to puncture the concept of the living wage. The hon. Member for Bedford believes that the tax credit nettle had to be grasped because too many companies were abusing tax credits and paying people less than they should be paid, but there are other ways to tackle that. Let us do more to force through pay transparency in companies. We have talked a lot about trying to improve tax transparency for companies large and small, but we should be doing more on pay transparency as that would help to sort out those issues.

Strengthening and encouraging trade unions to bring forward more pay transparency would also help. If this is about tackling corporate abuse, we should do it at the level of those committing the abuse, not those people who are being “exploited”—in the terms of the hon. Member for Bedford—by companies and therefore have to depend on tax credits. Removing tax credits does not remove the exploitation faced by people on low pay. It makes people walk the plank into poverty simply so that somebody can say the nettle has been grasped. That is a miserable proposition.

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I know that Conservative Members favour the benefits cap and placing an overall cap on what families can receive. We continue to oppose the benefits cap which, as we predicted, once introduced has been lowered. We are also seeing the start of regionalisation and a differentiation between London and the rest, and we know that at times people have flirted with the idea of further regionalisation.

As well as the benefits cap there is the welfare cap, and the two are sometimes confused. The welfare cap is generally ignored, but it was introduced by the Government to place a cap on the overall welfare budget across the UK. In the March Budget statement, the welfare cap for 2016-17 was set to be £122.3 billion, but the recent Budget placed it at £115.2 billion—a reduction of £7 billion between March and the summer. What a difference an election makes, yet the Government did not tell us they were doing that.

The 2017-18 benefit cap is down by £10.2 billion from £124.8 billion to £114.6 billion, and for 2019-20 it is down by £16.3 billion from £129.8 billion to £113.5 billion. We know that that will mean not only cuts to households or people with disabilities but cuts that hit spending power in economies such my constituency where, because of high unemployment, low wages and high levels of economic inactivity, people are dependent on benefits. There will be a cost not only to those family economies but to the local economy as well, and that is why I will oppose this Budget.

7.45 pm

Fiona Bruce (Congleton) (Con): I welcome the Budget. Much of the thinking behind it recognises that worklessness is a root cause of child poverty, and that a lack of employment skills and effective training for the world of work dramatically reduces a young person’s life chances. I welcome the Government’s determination to address those issues, and in my constituency we can already see tangible results. Unemployment figures for the five years to June 2015 have fallen by no less than 62%, and the number of young people claiming out-of-work benefits for a similar period has fallen by 61%.

Investment in the economy of the area has been unprecedented. An investment of millions of pounds has been made in Jodrell Bank as part of the science corridor across Cheshire, and no less than £46 million has been committed by the Government to the Congleton link road. I trust that the Minister will join me in recognising that one key reason for that local growth grant was to open access to and land for business parks and employment sites, and to increase job opportunities for local people. That should remain a key priority in the finalisation of the link road plans, so that businesses such as Reliance Medical Ltd—led by inspirational local businessman Andy Pear—have room to expand locally, along with others such as Senior Aerospace Bird Bellows. We must send a clear message to international companies with factories in the area—such as Airbags International—that Cheshire and the UK are very much open for manufacturing business.

The northern powerhouse concept is welcome. I ask Ministers to ensure that its benefits truly extend beyond the Greater Manchester region, so that young people in constituencies such as mine in Cheshire who—as a recent survey of Congleton youth council showed—very much want to stay, live and work in the towns that they

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grew up in can do so. One immensely effective way in which the impact of the northern powerhouse could be widely realised would be the reopening of Middlewich railway station to passengers—a campaign that thousands of residents of Middlewich have supported for many years. That would open up rail access directly from Crewe, right through Cheshire and into Manchester, and relieve pressure on the M6. It also has the support of many surrounding constituency MPs. I urge Ministers to look into that and to revert back to me with their considerations.

I also welcome the Government’s intention to fast-track the building of homes on brownfield sites. A great deal of grief, no less, has been caused in my constituency as a result of the rapacious attack on green space sites by developers—including prime agricultural land—only a stone’s throw from hundreds of brownfield housing plots that they persist in ignoring. I welcome the Minister’s intention to encourage development on brownfield sites, but we must ensure that not only is permission fast-tracked but that developers are realistically motivated to build on that land and not just to bank permissions. Not only a carrot but a stick may be needed. I welcome the news that Ministers have plans to improve the timely delivery of a local plan where a local authority has not yet produced one, and I ask Ministers to clarify urgently what the Government’s plans are to ensure that that takes place.

I referred at the outset of my speech to worklessness being a root cause of child poverty. Another root cause is family breakdown, and I would like to address two issues that concern me with regard to that and to the Budget. The first is Sunday trading because I am deeply concerned about proposals to delegate Sunday trading legislation to local decision makers. In August 2014 the Government made a welcome commitment to put family back at the heart of public policy, and to initiate a family test so that all new domestic policy should be considered in the light of its impact on families. I cannot see how the proposed alteration of Sunday trading regulations will have anything other than a negative impact on families. Ministers may argue that the decision the House is being asked to make is simply one of delegation rather than relaxation, but I cannot accept that.

When one local authority area decides to relax its Sunday trading regulations, surrounding areas may well feel compelled to do so, and we should recognise that reality. As the National Society for the Prevention of Cruelty to Children states, Sunday working has a detrimental effect on the quality of time parents can spend with children, and I am particularly concerned that that will affect children in the poorest families most, as they have least flexibility in deciding whether to work on Sundays. The health and strength of family relationships are not only a major influence on the health, wellbeing and life chances of children, but key contributors to the economic wellbeing of the nation. Parents, children and communities need time to rest, recharge their batteries and invest in relationships, and we further degrade Sundays as a day of rest at our peril.

I am disappointed that the Budget made no mention of an extension of the transferable tax allowance for married couples. It is currently worth only about £200 a year, whereas the value of 30 hours of free childcare is about £5,000. What message does that send to the stay-at-home mum or dad? Extending the transferable

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allowance would send a proper signal in favour of marriage and stability, recognise the important role played by stay-at-home spouses and help to address the seriously unbalanced tax burden that we place on one-earner married couples, as the “Taxation of Families 2013” report published last week by CARE—Christian Action Research and Education—showed. The report also highlights how one-earner married couples with two children on 75% of average wages face a marginal tax rate of 73%, the highest in the OECD.

7.51 pm

Gavin Newlands (Paisley and Renfrewshire North) (SNP): It gives me great pleasure to deliver my maiden speech to the House today as the first SNP Member of Parliament for my home of Paisley and Renfrewshire North. The fact that it was our first victory has not been for lack of effort over the years. My hon. Friend the Member for Kirkcaldy and Cowdenbeath (Roger Mullin) contested the seat in the 1990 by-election. He fought a brilliant and memorable campaign, despite the fact that he was hindered by an eager but occasionally ineffective 10-year-old boy called Gavin. I should have been better. By that point I was a veteran, a seasoned campaigner keen to follow my dad to any political event. Two other campaigns from around the same time that I am proud to have been part of were the one against the iniquitous poll tax and that against the closure of the Ravenscraig steel plant in the constituency of my hon. Friend the Member for Motherwell and Wishaw (Marion Fellows).

The late 1980s and early 1990s saw the Conservative Government rip the heart out of hard-working families and communities right across Scotland. That was the height of Thatcherism and her Government’s policies caused untold damage to Scotland, to our economy, to our people and to our self-confidence. Little did we know it at the time, but those decisions about Scotland—made on our behalf in Westminster and Whitehall against overwhelming Scottish public opinion—would cause a massive political shift in Scotland that would not only see the Conservatives all but wiped out for a generation, but cause a depth of feeling so strong that a form of self-government was inevitable.

Fast forward a quarter of a century, however, and here I stand—and, as we say back home, “I’ve brought hauners.” I am immensely proud to be representing my home constituency of Paisley and Renfrewshire North, where I have lived almost my entire life. I was very fortunate to be able to vote in what was my old primary school, and is now that of my two young daughters.

I would like to say a few words about my predecessor, Jim Sheridan. Jim was the Member of Parliament for the area for 14 years. He was a dedicated constituency MP and I am sure that the whole House will want to join me in wishing Jim, his family and his staff all the very best for the future.

Paisley and Renfrewshire North is one of the most diverse constituencies in Scotland, with some of the poorest communities as well as some of the most affluent. My own home town of Renfrew is a royal burgh, and is known as “the cradle of the Stuarts”. It was also home to Scotland’s first municipal airport and the RAF’s 602 Squadron, rather misnamed as the City of Glasgow Squadron or Glasgow’s Ain. Unfortunately, Renfrew is also home to the constituency’s latest food

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bank—yet another symptom of the Tories’ ideological obsession with welfare cuts, which are hitting not only the poor and the vulnerable but hard-working families across Renfrewshire.

If we leave Renfrew and travel north-west towards Inchinnan, we pass the site of the battle of Renfrew of 1164. This relatively little known battle was actually one of the most significant civil battles in Scottish history. Somerled, the Lord of the Isles, gathered an army 15,000 strong and marched on King Malcolm IV’s forces. After a bloody fight, Somerled was slain on the battlefield alongside thousands of his followers before the remainder beat a hasty retreat The message that my hon. Friend the Member for Na h-Eileanan an Iar (Mr MacNeil) should take from that story is “Dinnae mess with Renfrew”. [Laughter.]

Just beyond Inchinnan we find the great new town of Erskine, which is the second largest town in the constituency no less. Indeed, a study by the Post Office last year declared that Erskine was the second most desirable postcode in Scotland to live in. As we continue westwards, we pass the charming village of Bishopton. On our journey down the Renfrewshire riviera, we come across the lovely riverside village of Langbank, which affords magnificent views down to the Firth of Clyde. On a clear day, Madam Deputy Speaker, if you crane your neck and have good eyesight, you may be able to see the obscenity of the Trident nuclear submarines as they slip and slither up the Clyde to Faslane. We were well aware of the shoddy safety standards in the handling and transporting of nuclear warheads long before Able Seaman McNeilly’s recent whistleblowing.

On 11 January this year, 50 mph gales were battering the west coast of Scotland. As a result, high-sided vehicles were warned not to cross the Erskine bridge over the Clyde. I am not sure about anyone else, but the very last thing I want driving over a 150-foot bridge during such high winds is a convoy loaded with nuclear warheads. Unbelievably, that is exactly what the Ministry of Defence chose to do. My colleagues and I will not only lead the fight for better maintenance and security of those weapons, but ensure that the voices calling for the complete abolition of those obscene and senseless weapons of mass destruction are heard loud and heard often.

My constituency includes a number of affluent towns and villages, such as Langbank, Crosslee, Bridge of Weir, Brookfield and Houston, although it should be noted that despite their relative wealth, those areas still have pockets of deprivation. Just outside Paisley lies Linwood, another area deeply damaged for generations by Thatcherite economics. The famous Linwood car plant, which provided work for 13,000 people at its height, had its Government support pulled and overnight the town was devastated. Parts of Paisley, including Whitehaugh and Ralston, are slightly more affluent but certainly not without their issues. Shortroods, Gockston, Ferguslie Park and Gallowhill all have pockets of deprivation but a people whose spirit is unbending in the face of Tory misery.

The House should note with deep regret and concern that the Paisley job centre has doled out the most sanctions in the west of Scotland; that sanctions across Renfrewshire have soared by 148% since 2010; that the

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demand for the aid of food banks in Renfrewshire has exploded by 1,763% since 2012; and that one in five kids goes to bed hungry each night. That is the legacy of the coalition Government, it is the record of this Conservative Government and they should be ashamed.

The Budget will do nothing to lift any of those people out of poverty. In fact, it will have the reverse effect. Countless children will, before long, find themselves living in poverty through no fault of their own, but I am sure that they will be comforted by the fact that the Government’s response to child poverty is to change the definition. This Government believe that if they fiddle the figures to show what they want them to, children and their families will—as if by magic—soon find themselves out of poverty and living a life of comfort. The message that came from the Chancellor last week was clear: do not work in the public sector; do not have children; do not be out of work; and do not, heaven forbid, be a young person.

Over the last few weeks I have received countless messages from constituents who are growing increasingly frustrated and angry with the Tory Government’s arrogance. The Conservatives, a party that was near routed in Scotland with the worst result in its history and with only one MP, deign to tell Scots that we cannot have what we voted for in overwhelming numbers. The Government must stop playing games with the Scottish electorate and devolve the powers as proposed, without caveat, without veto and without delay.

7.58 pm

Rebecca Pow (Taunton Deane) (Con): I congratulate the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) on his maiden speech and painting such a clear picture of his constituency. I look forward to his contributions in the House, which I know will be feisty and campaigning—something that he seems to have been doing for most of his life. I also congratulate the other hon. Members who have made maiden speeches today.

I am delighted to speak in this debate to lend my weight to the general consensus on this side of the House that this was a positive and transformational Budget. It will move towards an economy in which the books will be balanced. We cannot pretend that the deficit is solved. It is still too high, which is why we need the Chancellor’s plan to continue to reduce it. I welcome the philosophy behind the Budget. It is all about changing behaviour and loading the scales in favour of people going to work, with the aim being to develop higher wages, lower taxes and a lower welfare economy. While there will be some time for adjustment, we cannot go on spending more than we earn, and we have to work to this new plan. The key tools for the success of this plan lie in raising the living wage and cutting welfare dependency, and I am delighted that the Leader of the Opposition seems to agree with us. It is a shame that her colleagues are not as enlightened as she is.

We cannot continue on a trajectory where nine out of 10 people claim welfare benefits. Some 1% of the world’s population live in the UK, but 7% of the world’s welfare payments are made here. That does not make sense, which is why, with care and sympathy, we need gradually to alter it.

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Emily Thornberry: I read the statistics the hon. Lady has just trotted out in The Sunday Times. She draws an equivalence between us and the developing world, where, presumably, enormous amounts of benefits are not being paid. The fact is that we are part of the developed world. Would she like to compare us with other countries in Europe?

Rebecca Pow: The hon. Lady makes an interesting point, but my statistics still stand. Even when we make these changes, five out of 10 people will still be receiving some kind of benefit or tax credit. We always need to support the people who really need support, and the Conservatives will always do that. I spent Friday afternoon with my local citizens advice bureau, finding out and understanding what is happening and how we can continue to support the people who really need it. That will always happen.

Thanks to a shrewd Chancellor and the hard work of British business and the good people of Britain, Britain is now moving and growing faster than any other major advanced economy. It grew by 3% last year, as we have heard from other Conservative Members, creating 2 million more jobs—far more than the OBR anticipated. My constituency has played a major part in creating those jobs. Many businesses have grown and expanded. Unemployment is down and jobs are up. I will give just one example of a booming business: the Ministry of Cake in Taunton, which the Chancellor himself visited during the election campaign. Indeed, he iced a carrot cake.

The Ministry of Cake has recently secured a huge contract to supply cakes in coffee shops right across Europe, all the way to Moscow. It already supplies more than 1 million slices of cake a week to customers in the food service and the catering trade. It will now be employing another 30 people in Taunton, all of whom will be contributing to the local economy. This is exactly the direction we want the economy to go in. This example proves that it is. I would also like to say that the Chancellor is much, much better at handling the economy than he was at icing the carrot cake.

There is very little youth unemployment in Taunton: it is very low at 1.9% and it is continuing to fall. On Friday, I met a very fine example of the kind of young person who has been given the necessary skills to take our economy forward and is getting to work. Ashleigh Thompson was an apprentice at the local Creech St Michael preschool. For a year, she worked four days a week at the college and one day a week at the preschool. She has done her NVQ stage 3 and has just qualified. She has now got a full-time job at the preschool, because she is offering exactly the qualification and skills it wants.

George Kerevan (East Lothian) (SNP): The hon. Lady mentions exports. The OBR report, published alongside the Budget last week, shows that our export position and current account deficit is forecast to worsen over the next four years. How does she explain that?

Rebecca Pow: I gave an example of exactly the opposite of that. Exports, all the way from Taunton, are increasing. That is exactly what we want: companies taking advantage of the opportunities opening up and skilling up their workers.

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I would like to reflect on one of the important tools in the Budget box: the welcome introduction of a compulsory new national living wage for all working people aged 25 and over. It will kick in at £7.20 an hour in April next year, rising to £9 by 2020. It will mean a pay rise for half a million people and translates into a cash rise of £5,000 for a full-time worker. It will benefit women especially—we had the equality and gender pay gap debate the other day—and quite a number of women are still in the low paid category. This measure will help them. Of course, it is businesses that will have to shoulder the changes, but the increase in employment allowance and the improvements to corporation tax should help businesses to pay the extra wages. I have consulted widely with businesses in my constituency. They welcome this measure and they agree that we need to raise the living wage.

I welcome the £7.2 million investment in transport infrastructure in the south-west. In particular, I welcome the Prime Minister’s and the Chancellor’s commitment to upgrading the key road in my constituency, the A358, and its junction with the M5. This is the busiest road in Somerset. There will be a new employment site right on the junction, and without the road upgrade we cannot have the business site. We need the business site because we need the new jobs and the new skills to move the economy in the right direction. I therefore applaud all that, and I applaud the £10 million in the Budget to improve broadband in the south-west. It is absolutely imperative that all the rural areas that are missing out can take advantage and get broadband.

In conclusion, I welcome the Budget. It will transform behaviour and move us to a higher-wage and lower-tax and lower-welfare economy. It will cut the deficit and enable us, at last, to live within our means.

8.6 pm

Catherine West (Hornsey and Wood Green) (Lab): I am very pleased to be speaking in the Budget debate. The Chancellor’s announcement on the increase in the minimum wage, mistakenly called a living wage, raised the issue of low pay. That is a debate we all welcome. Sadly, when it is combined with high housing costs and cuts to working tax credits, families in my constituency will be worse off. I will not vote in favour of this Tory Budget. Not only will many families be worse off following the Chancellor’s Budget; it has failed to address the deeper issue of social mobility.

This was not a good Budget for young people. For younger people, it is becoming more expensive to attend further education or to secure well-paid employment, and it is much more difficult for them to get on to the housing ladder. The employment training levy, to be levied against workplaces, could provide much needed workplace training opportunities. However, coupled with the proposed cuts to further education due in the autumn, training programmes could be at risk—one step forward, two steps back. Converting student maintenance grants into student personal debt will increase the debt of our young students further. In one case I know of, a student will leave a local university with £56,000 of personal debt—hardly a good start to a career for a young professional.

Preventing under-24-year-olds from gaining access to housing benefit could lead to long-term homelessness problems among a small but needy group of youngsters—

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many of the rough sleeping population are in this critical age group—creating not just personal misery, but further cost to the NHS in later years.

The cost and availability of childcare is a major block to productivity, and in high value areas such as London it is becoming prohibitively expensive. Childcare cuts to Sure Start and children’s centres undermine the Government’s excellent 30-hour childcare commitment, slowing down parents’ return to work and preventing the return to work of much needed skilled workers. Assessments show that returning women to work in London would be a real spur to the economy. Unfortunately, owing to the prohibitive cost of childcare and lack of childcare places following cuts to Sure Start and children’s centres, we have a false economy.

Renting in the private rented sector is now prohibitively expensive. A family would need a household income of £75,000 per annum to rent a modest three-bedroom property in Finsbury Park in my constituency. This is unaffordable and represents a failure of the housing market to support local families. By spending such a high proportion of income on housing costs, people are unable to save eventually to get on to the housing ladder. The average age of first-time buyers is going up every year in London. We are becoming not just a city of renters, but a nation of renters. Many of our children are in low-quality, high-cost housing with no hope of remaining in the local area to look after us in our older age.

While some elements of the Budget, such as applying the brakes on buy-to-let property, might have benefits, they are undermined by a failure to announce more new affordable housing and by the regressive right-to-buy housing association discounts, which set us back decades on housing supply. We must address the supply issue; it is critical.

Furthermore, pay freezes in public sector employment will be bad for young people. We know we have a crisis in retaining teachers, particularly in English and maths. We know we have a problem retaining nursing staff in our A&Es and our local hospitals. This pay freeze for the public sector is detrimental. Unless young people have access to unlimited family funds for their education, housing and training, they face a bleak future under this Tory Chancellor.

Richard Fuller: The hon. Lady has listed a number of steps that would lead to an increase in expenditure to cover some of the important topics she mentioned. Does she accept, however, the overall need, while we are borrowing over £70 billion a year, to reduce expenditure more each year so we can get back into balance? Does she accept that general trend in principle?

Catherine West: Let me deal with aspects of the question of expenditure in turn. First, the employment training levy is being levied on small businesses by your Government. It is not a Labour proposal, but I support it because it is about investing in the workplace. Secondly, the position on student maintenance grants amounts to cost shunting—taking the costs from the university and putting them on to the individual. I referred to a case of a student owing £56,000, so instead of it sitting on the balance books of the Chancellor, it is sitting on those of

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the individual, which is a bad thing. Thirdly, we spent £60 billion on housing benefit over the last Parliament. We should have invested more of that in new build housing. We should not forget that council housing is not a cost. It is a net contributor to the economy because the rent is so low that housing benefit is not payable on many council properties. Housing benefit is mainly payable in the private rented sector. By investing in social homes, we will be saving the housing benefit bill in the longer term. Finally, on childcare, your own pledge by your own Government is 30 hours per week—

Madam Deputy Speaker (Natascha Engel): Order. The hon. Lady must speak through the Chair, so she should be referring to the hon. Gentleman in the third person.

Catherine West: How did I forget that? Through you, Madam Deputy Speaker, I am saying that the Government have pledged to provide 30 hours a week childcare, which is an excellent pledge, but it is not a Labour proposal. In fact, Labour proposed something more modest and more affordable. I am thus a little worried that the hon. Member for Bedford (Richard Fuller) thinks that we are over-spending, when this is a pledge of his own Government. I wonder whether it will happen, though; I worry about the feasibility. If we go through all those elements, we find that they are not really about cost; they are about feasibility and getting the job done.

8.13 pm

Mrs Flick Drummond (Portsmouth South) (Con): May I say what a pleasure it is to speak in this debate on one of the most reforming Budgets we have had for a long time? It balances entitlements against responsibilities, and extends our economic plan even further into the years ahead—years of growth and stability.

In Portsmouth, we naturally all welcome the renewal of this Government’s commitment to spending 2% of GDP on defence. We face evolving threats as a nation, and I hope that when the strategic defence and security review has drawn its conclusions we will enhance our capability in important areas such as maritime patrol aircraft and the full Type 26 order, which we hope will amount to 13 ships.

I want to focus on the long-term impact of this Budget on my constituency. I am sure Members will agree that the infrastructure upgrades are vital for businesses and for boosting productivity. In Portsmouth and along the south coast, we have an opportunity for a “southern powerhouse”, but we have some infrastructure needs if we are to unlock the potential. A number of my hon. Friends, including the Exchequer Secretary, share my belief that we need to upgrade our rail connections on the line between Waterloo and the south coast. In many cases, the journey takes as long as it did in Victorian days. It takes one hour and 40 minutes to travel 70 miles, which is not acceptable in our modern days. I shall campaign on this issue and hope to speak to the Chancellor about building a faster railway down to Portsmouth. It is a challenging route with issues of capacity, but if we are to have investment in areas that already have a good level of service in the north, it is only fair that the real bottlenecks elsewhere are addressed, too. A high-speed train to Portsmouth via Eastleigh would benefit much of the south coast—from Weymouth to Chichester,

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and it would include the Isle of Wight, too. Portsmouth has been left behind, so we need support and further investment in our education and skills, and, most of all, we need some more aspiration.

I welcome the Budget’s emphasis on partnership working between central Government, local enterprise partnerships and councils. In Hampshire, we have Solent LEP and the promise of working with combined local authorities—probably for the whole of Hampshire—and I want to help drive this progress forward. We have benefited from investment in Portsmouth under this Chancellor. “Bridging the Gap” has helped small and medium-sized enterprises with £3.6 million, creating 600 jobs. It has helped a particular coffee shop in Southsea, which proved to be popular. Another £1.8 million from the Growing Places fund has helped infrastructure projects, including a centre of excellence in engineering and manufacturing advanced skills training. Maritime engineering is one of the centres of excellence in Portsmouth that I am hoping to push forward.

We also have massive investment in our dockyard to support the Navy, but there are still areas where we can and must improve over the coming years. I look forward to campaigning on these issues, making sure that Portsmouth and the south coast is well catered for in much of its infrastructure. I look forward to talking to the Chancellor over the next few years about all the issues that I want to put forward.

Several hon. Members rose—

Madam Deputy Speaker (Natascha Engel): Order. I shall change the time limit on speeches to seven minutes—Members have kept their speeches nice and short.

8.17 pm

Debbie Abrahams (Oldham East and Saddleworth) (Lab): That is good news, Madam Deputy Speaker, for someone who is always in a rush.

This is an illusion of a Budget of which even Dynamo would have been proud. Saying that it is going to make work pay defies all the evidence. Illusion No. 1 relates to the performance of the economy. The Government are borrowing £219 billion more than they anticipated in 2010, and there is a debt to GDP ratio of over 80%, when it was only 60% after Labour recapitalised the banks. Why is the economy at this level? Basically, because it was absolutely tanked under the coalition and that is now going to be carried forward under this Government.

In 2014, population-adjusted growth was 1.4% below its pre-recession peak, and in the first quarter of 2015 it was still below it, at 0.67% of the pre-recession peak. This reflects the particular issue that the Government have had with productivity, which is the second worst in the G7. Now that we have a productivity plan, will the Minister identify the specific measures that are going to support small and micro-businesses to access finance and to deal with all aspects of late payments, which are an absolute blight on small businesses? How is he going to harmonise taxation and make the tax system more consistent, particularly for self-employed sole traders?

Since 2008, nearly three quarters of the increase in all employment has been down to the increase in self-employment. According to Office for National Statistics data, self-employment has increased by nearly 40% since

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then, and is now at a 40-year high. There are many benefits from being self-employed: people get to be their own boss, and can choose when and where to work, but there are issues with taxation. We also know that the average income of someone in self-employment is half that of an average employee. It has fallen by 22% since 2008. Last year, Demos undertook research to establish the reason for the sudden increase in self-employment, and concluded that the level was artificially high because there were no jobs for people to move into, and people often moved backwards and forwards between employment and self-employment. There were no real jobs about. There is also the issue of false self-employment. Many large companies in the construction industry, for instance, sub-contract rather than employing brickies, joiners and plumbers. How will the Government deal with those issues?

Another illusion is that the Budget is fair and will make work pay. We know from an analysis conducted by the independent Institute for Fiscal Studies that the poorest 20% of the population will lose proportionally more of their income from tax and benefit changes than any other income group—between £800 and £1,300 a year—and that 3 million people are set to lose £1,000.

The increase in the national minimum wage is welcome, although it is not a living wage as the Government have tried to suggest. It is something, but it does not begin to compensate for the cuts in tax credits that will be suffered by the low-paid. Let me add to the examples that have already been given by many of my hon. Friends. The income of a lone parent with two children who works for 16 hours a week will increase by £400 a year, but that will be accompanied by a tax credit cut of £860, so that person will be £460 worse off. A couple with one partner working full-time on average income will lose £2,000 in tax credits, and will not benefit from the increase in the national minimum wage. According to data published by the International Monetary Fund last month, raising the income share of the poorest 20% of the population increases growth by 0.38% over five years. What the Government are doing will harm the chances of a sustained recovery.

Rebecca Pow: It is interesting to note that we hardly ever hear the word “business” mentioned by Opposition Members. It is businesses that must pay the £7.20 that may rise to £9, and that will cost many of them a great deal, but they agree that it is worth it to give people better living standards. Surely we can discuss some of those issues.

Debbie Abrahams: If the hon. Lady had listened to my earlier remarks, she would have heard me talk about small businesses then. I have done a significant amount of work with small businesses.

The Government are trying to persuade the public, and to justify what they are doing to working people. We know that, on the whole, it is working people who will be affected. Half the 13 million people who are living in poverty are in work, and two thirds of children in poverty are in working families. The Government are trying to construct a narrative to justify the tack that they have taken—the “divide and rule” narrative about people being feckless—but it is the working people who will be affected most.

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Another thing that the Government regularly do is a source of immense frustration. Although I have consulted the Ministers’ code of conduct and many other sources, I have been unable to identify a responsible use of statistics on their part. The Chancellor, for example, tried to suggest in his Budget speech that we were one of the most generous welfare-spending countries in the world. That is simply not true. It is absolute rubbish. If we compare the UK’s spending as a percentage of GDP with that of developed countries in the European Union —as my hon. Friend the Member for Islington South and Finsbury (Emily Thornberry) tried to do earlier—we find that it is ranked 17th out of 32.

Mrs Drummond: We are the fastest-growing economy in Europe. We are securing more jobs, we have higher employment, and our businesses are doing well. How can that be squared with what the hon. Lady is saying about the welfare state?

Debbie Abrahams: I dealt with that earlier in my speech.

In my constituency, more than 20,000 working families with nearly 30,000 children are claiming tax credits. That is two in three families, and three in four children. For them, tax credits mean keeping their heads above water. The changes in tax credits will be devastating for them and will undoubtedly result in an increase in child poverty, with a knock-on effect on those children’s educational attainment, health and life chances. The worsening inequalities are set to become intergenerational.

I must also mention the impact of the £30-a-week cut in additional support for people in the employment and support allowance work-related activity group, which is another punitive measure affecting extremely vulnerable people. The Disability Benefits Consortium believes that the 300,000 disabled people who are already living in poverty will be pushed further into that condition.

Finally, let me say something about housing policy, the inheritance measures and wealth inequalities, especially in the context of land and property. In 2002, it was estimated that 69% of land in the United Kingdom was owned by 0.6% of the population. In the six years to 2011, the number of landholdings had been reduced by 10%, but the size of those holdings had increased by 12%, so even fewer people owned even more land. The inheritance tax measure is but a drop in the ocean when it comes to addressing the concentration of wealth that is held by a tiny elite. Many people who are involved in housing policy emphasise that if we are to solve the housing crisis as well as building more homes, we must tackle the cost and availability of land and the volatility in the market. Given that the average house price in the United Kingdom is more than £180,000, it has been estimated that it will take 22 years for people with low and middle incomes to save up a deposit.

8.26 pm

Mark Pawsey (Rugby) (Con): It is a great pleasure to speak in the debate, and to follow the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), who told us in her opening remarks that under this Government, and the coalition before them, our economy had tanked. Well, if growth of 3%, 2 million new jobs,

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and a fall in borrowing from a staggering and unsustainable £153 billion a year to just half that constitutes an economy that has tanked, I would hate to imagine how she might describe what happened under the Labour Government in the run-up to 2010.

It is also a great pleasure to see the Minister. I look forward to the considered and thoughtful remarks that I know he will make when he winds up the debate.

I want to focus on the steps that the Government are taking to grow the economy. As we know, we saw record growth of 3% over the last 12 months. We had become used to seeing “flatlining” gestures from the Opposition Front Bench, but we do not see those any more, not least because the person who used to make them is no longer present in the Chamber. We shall see 2.6% growth over the coming year, and it is important for us to maintain that growth, because the Government are doing two things. As any business, household, council or other organisation would do, they are controlling their expenditure —we have heard a lot in earlier Budget debates about how the Government are doing that—but it is also massively important for them to grow their revenues, and they do that when the economy is growing. That is why it is so important for them to focus on growth.

I want to focus on the measures the Government are introducing to grow the country as a whole through the governance of its cities, and on the more flexible planning system.

George Kerevan: I rise to intervene on the hon. Gentleman, as I do on all Conservative Members, in the forlorn hope that he might address the worsening trade picture and the fact that we have to borrow to fund our imports. The Government are shifting the burden of debt from the Treasury on to the private sector, and particularly on to foreign borrowing.

Mark Pawsey: I am sure the hon. Gentleman is aware of the principle of reshoring, which is taking place in our economy right now. Manufacturing companies that years ago were offshoring and sending jobs out to other countries are now making products in the UK. In Coventry, which is immediately adjacent to my constituency, I visited a small company that is producing the rechargeable torches that sit in every Range Rover. Until recently they were being imported from China. Now they are being produced in the UK. We are slowly bringing manufacturing back to the UK, which will in time deal with the issue that concerns the hon. Gentleman and which is, of course, a concern for the Government.

George Kerevan: Will the hon. Gentleman give way again?

Mark Pawsey: No, as I want to talk about rebalancing our economy and ensuring that we get effective growth in the regions outside London, which has a momentum of its own.

The Government are looking closely at what is happening in Manchester, and that is the model they want to see. It is very good news that new combined authorities are coming together across the UK to provide the growth that the country needs, because the cities are of massive importance.

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Mr Alan Mak (Havant) (Con): My hon. Friend will no doubt be aware of the recent World Economic Forum report on global competitiveness which places Britain one place above its ranking of last year, praises the Chancellor’s deficit reduction and cites our stronger regional growth. Does my hon. Friend agree that the stronger regional growth and sustained investment in our cities, regions and counties is important for the years ahead?

Mark Pawsey: Absolutely, and I am pleased that the urban conurbations are coming together in combined authorities across the country.

I am also pleased that the Government have received combined authority proposals from two local authority groups in the east midlands. The Derbyshire consortium has 10 councils including the county council and city council, and the same process is under way in Nottinghamshire.

As part of that process, the Government are right to insist on a directly elected mayor for each combined authority so that there is a figurehead for the body being created. I have tried to put myself in the position of an overseas investor who arrives in Manchester or Birmingham wishing to invest in the region. I would want to understand who is the titular head of the body and who is ultimately responsible. A directly elected mayor goes some way to addressing that.

Mrs Drummond: Does my hon. Friend agree that the decision in the last Parliament to create single pots for infrastructure projects such as those determined by the local enterprise partnerships has shifted power, which has been crucial to places such as my area of Portsmouth and his of Rugby?

Mark Pawsey: Absolutely. The shift of power from the centre out to the regions is massively important and I will talk about the importance of local enterprise partnerships shortly, but first I want to talk about the impact of combined authorities in my part of the country.

Even though Rugby is right in the middle of the country, under the old regional development agency model we were placed in the west midlands because Warwickshire was put in the west midlands. However, my town’s economic links are much closer to places such as Lutterworth and Leicester in Leicestershire and Daventry and Northampton in Northamptonshire. In so many instances we in Rugby look east rather than west. That is one reason why I have some concerns about the developments in the west midlands. It is entirely right that the urban area of the west midlands—Birmingham, Solihull, Walsall, Dudley, Sandwell and Wolverhampton—comes together. I ran a business in Rugby, and we looked at that block of authorities as one big market. In fact we did not know where one authority ended and the other started because to us it was one big market.

John Mc Nally (Falkirk) (SNP): Will the hon. Gentleman give way?

Mark Pawsey: I will carry on, if I may, as other Members wish to speak and I only have a little time left.

It is entirely right that those authorities come together in the midlands engine, but I note that Coventry, a city

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almost in the centre of Warwickshire and surrounded almost entirely by Warwickshire, wants to join that combined authority. I do not think the people of Warwickshire have made a sufficiently strong case to both the people and local politicians of Coventry for the merits of Coventry remaining within Warwickshire. To take up the comment made by my hon. Friend the Member for Portsmouth South (Mrs Drummond) about the role of the local enterprise partnership, my local LEP is called the Coventry and Warwickshire LEP. It is a natural economic unit, and I would like more thought to be given to the possibility of Coventry and Warwickshire working together as a combined authority. I say to the people of Coventry—to Coventrians—that it is not too late and there is no automatic reason why Coventry needs to join the west midlands combined authority. One of my selfish reasons for having concerns about that is that if Coventry joins that combined authority, Warwickshire may feel a need to do so, too. I have already explained that my authority’s links are closer to the east midlands than to the west midlands. I hope it is not too late to have a further look at this matter.

All that raises the issue of the role of two-tier authorities within the move to combined authorities. Some challenges for government will emerge where we have a two-tier authority and the upper tier wishes to go in one direction and the lower tier—the district councils—wishes to go in a different one. It is entirely right that both tiers are talking to the emerging west midlands combined authority, but I am keen that in my part of the world, Rugby, we continue to talk also to the districts and counties on our eastern flank, because our relationships with that area are so strong.

I wish to make one or two quick remarks about the changes the Government are making to the planning system. It is entirely right that we make it easier for businesses to grow. Housing development is a very substantial part of economic growth and we want to make it easier for people to build new houses. I am very proud that in my constituency we are doing entirely that, with two substantial housing development sites coming forward.

Several hon. Members rose—

Madam Deputy Speaker (Natascha Engel): Order. Before I call the next speaker, may I say that since I raised the limit everybody has taken the maximum number of interventions and therefore we are getting a bit pressed for time again? We will leave the limit at seven minutes, but may I just ask everyone to keep interventions to a minimum and make them short? If we do that, we might get there.

8.37 pm

Sue Hayman (Workington) (Lab): I am delighted to speak in today’s debate, during which we have heard many excellent maiden speeches. Since being elected to serve as MP for Workington, I have been privileged to meet many young, hard-working people who only want to do well in life and make a positive contribution to the communities in which they live. For example, this coming weekend I am proud that I am going to be presenting the awards at the Gen2 graduation ceremony, celebrating the achievements of students in engineering and other technical disciplines.

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I want to draw attention to the particular and disproportionate impact the Government’s Budget proposals will have on young people—I want to ask the Minister what he thinks young people have done to deserve such a kicking. It is truly shocking that they are going to be bearing such a heavy load in these Budget proposals, which mean that they are increasingly going to be paying to support the older generations, who are better off than they are. The Budget divides young from old, as well as rich from poor, and will do nothing but drive down young people’s aspirations in my constituency. Young people are three times more likely to be unemployed in the UK than they are in Germany, and for those who are in work this new “national living wage” will be paid only to those who are over 25. That is unacceptable, as it leaves younger workers on a much lower salary for doing the same job. Young people who have children will be particularly hard hit, as their benefits will be deducted far more quickly than their earnings will be increasing.

On top of that, young people who aspire to climb the ladder out of poverty and go to university will now be thinking twice, because the student maintenance grant is going to be scrapped and replaced with yet another loan, only creating more debt for our poorest families.

Let me move on to housing. There is a crisis in housing in our country, particularly in affordable housing—both to buy and to rent. Instead of looking at real sensible solutions to support young people into their own homes, this Budget will stop housing benefit for those under the age of 21. The implications of that are enormous. I do not know whether the Government have properly thought through this policy. In my constituency of Workington, one local housing authority, Impact Housing, has estimated that it will lead to an extra 200 young people becoming homeless. My constituency does not particularly have a homeless problem, and I do not want to see the Government create one, thank you very much. The proposals talk about exempting vulnerable people, but I ask the Minister how he will assess who is vulnerable. Why should they be assessed as vulnerable?

Hannah Bardell (Livingston) (SNP): I am listening carefully to the hon. Lady, and I agree with much of what she is saying. Does she agree that limiting families to only two children and putting women in the position that they have to declare whether or not they have been raped to justify benefits for a third child is both dangerous and divisive? We need much more detail and discussion on that matter and on other areas of the welfare proposals.

Sue Hayman: I could not agree more.

The Government are interfering in how people live their lives and in how many children they should have. It is not for the Government to dictate to people how many children they can afford to have. People should be able to make that decision themselves. What if people’s circumstances change after they have had their children? How does that work?

Rebecca Pow: Will the hon. Lady let me intervene?

Sue Hayman: No, I wish to finish my point. I was talking about vulnerable people. I know that the proposals suggest that vulnerable people will be supported. I asked

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about how vulnerable people will be assessed. The people whom I am really concerned about are those who do not quite meet the vulnerability criteria. They cannot afford the rent, but they are not classified as vulnerable. What happens to them? Do they then become homeless as well? The Government have not considered the fact that not everyone can move back with their parents and that not everybody has friends and relatives who can give them a home. It is wrong that we have a Budget that will increase homelessness. That is my point.

Let me return to the fantastic work that young people do in my constituency. I am talking about the apprentices and the students who work hard to get on in life. In my experience, most young people want to get on in life and be part of society. This Budget offers little encouragement in that regard, which is why I believe that it should be condemned.

8.43 pm

Martin Vickers (Cleethorpes) (Con): Before I start my comments, may I respond to the points made by the hon. Member for Workington (Sue Hayman)? Towards the end of her speech, she referred to a more positive outlook for younger people. That outlook is something that I hear about from young people who are training for apprenticeships, or who are attending the local further education colleges. They have a much more positive view. They can see the opportunities that have been created in my part of the world, which is, to a great extent, thanks to the investment in the offshore renewables sector. These young people have a vision of the future and can see the opportunities, and we should do all we can to support them. Of course, in our constituency work, we come across those who face challenges and significant problems. There will always be those people in our communities and we should do everything possible to help them. Certainly, the policies that I have picked out from the Budget do exactly that.

Two specific aspects of the Budget benefit my constituency. First, the coastal communities fund is being topped up. I was at an event on Friday evening with Amanda Austin, a businesswoman who manages the major shopping centre in Grimsby, next door to my constituency. She had already downloaded the application forms for the coastal communities fund. She had a scheme in mind and she could see how we could take advantage of that in the Cleethorpes area.

Secondly, the extension to the enterprise zones is particularly welcome. The largest enterprise zone in the country is a cross-Humber one, which partly takes in my constituency. We have attracted considerable businesses. Able UK, which is investing hundreds of millions of pounds in my constituency with the Humber marine energy park, has just signed a deal with Dong Energy, which is already a significant investor in the area. It is anticipated that 1,000 jobs will result from this deal. It involves manufacturing, which we want to expand in our economy.

Fiona Bruce: I thank my hon. Friend for referring to the speech of the hon. Member for Workington (Sue Hayman). Does he agree that she seems to have forgotten that under her party’s Government there were over 1 million young people who were not in education, employment or training, and that this Government have radically improved that, to the benefit of young people in this country?

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Martin Vickers: My hon. Friend makes an important point. In my constituency I can see the reduction in the number of NEETs and the increase in the number of apprenticeships. Opportunities for younger people are increasing all the time.

Coming as I do from a working-class background, I am keen to see the initiatives in the Budget that boost working-class people—blue collar Conservatives, as we tend to call them. Opposition Members are in total confusion about whether to accept the welfare cuts. No one can say that they were not flagged up during the election campaign, and the people of the United Kingdom voted overwhelmingly for a Government who would implement them, make the welfare system fairer and allow—[Interruption.] I take the point from the Scottish National party Benches, but we are still a United Kingdom, thankfully. Even the Scottish people voted in favour of that. The Budget must be judged as a package. Yes, there are those who will be hit by the changes to tax credits, but that is offset to a considerable extent by, for example, the changes to personal allowances.

On devolution, I have for many years been an advocate of elected mayors, and I am pleased to see that, as things go full circle, the Government are promoting that idea. An elected mayor is a figurehead, another ambassador for our areas, someone who can go out there and sell our constituencies. I would prefer a much more radical devolution and settlement for local government, but the Government have outlined a clear policy. I was at a cross-party meeting last Friday with the Humber MPs, and we can see a consensus emerging among Members. I hope that will be copied—

George Kerevan: Will the hon. Gentleman give way?

Martin Vickers: I am running short of time so I will not, if the hon. Gentleman does not mind.

The way that local authorities are beginning to come together and recognise the advantages of what is on offer from the Government suggests that they will move towards a system of combined authorities. Personally, I would prefer to see unitary authorities rather than combined authorities and economic authorities, but at least it is a step in the right direction.

I have some reservations—for example, in relation to planning. As we all know, planning is very controversial. It is an issue on which we must take our communities with us. If, as in the case of most of my constituency, which falls in a local authority area where there is no local plan and it is years before we will have one, the people, through the democratic process, must have some sort of opportunity to put their case.

Mark Pawsey: Does my hon. Friend agree that when a local authority has been incredibly slow to bring forward a local plan, having had many years’ notice that it needs to be done, it is entirely right for the Government to say, “Look, if you don’t do it, we will”?

Martin Vickers: I entirely agree, and I am glad to see the Government being much more proactive in that regard. Equally, whether it is the Government or the local authority, they must take communities with them. For many years I have advocated giving those who object to planning developments a right of appeal in certain limited circumstances. One such circumstance should be when no local plan exists, because that means the democratic process has let those people down.

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The other thing that I have reservations about is Sunday trading. Personally, I do not want to see Sunday trading extended. It is an uneasy compromise that we have at the moment. I do not want to turn the clock back to the Sundays of my childhood, when the most exciting thing to happen was “Two-Way Family Favourites” followed by “The Navy Lark”, but the rush to allow superstores unlimited opening is detrimental. Our lives have a certain rhythm, as does the week, the month and the year. I think that we are losing something from family life, and from the support that we have given to small traders.

John Mc Nally: Will the hon. Gentleman give way?

Martin Vickers: I will, but for a 10-second intervention.

John Mc Nally: We are trying to encourage small companies, in particular, to create more apprenticeships and jobs. Does the hon. Gentleman agree that legislation needs to be tightened to get bigger companies, instead of delaying payments, to make payments quicker so that small companies can trade in a better position?

Martin Vickers: The hon. Gentleman makes a valid point, but I have only 48 seconds left and so will race through the other points I wanted to make.

Members across the House support our high streets, or at least they pay lip service to the idea of supporting our high streets. Many small shops, such as convenience stores, rely upon the extra cash they get in the till on a Sunday, which is thanks to supermarkets being limited to six-hour opening. I know that the Government will say that it is up to local authorities, but I would like to see that proposal removed.

Several hon. Members rose—

Madam Deputy Speaker (Natascha Engel): Order. I apologise to those Members who are still to speak, but we have had the maximum number of interventions and the maximum time for speeches, so the time limit will now have to drop to six minutes.

8.52 pm

Richard Burgon (Leeds East) (Lab): When I think of this Budget, I think of my constituents who will be hard hit by the measures it sets out; measures that were cheered to the rafters by the Conservative party, led in fist-pumping style by the right hon. Member for Chingford and Woodford Green, known to my more polite constituents as Iain Duncan Smith.

This Budget is bad for the economy and bad for the poorest, whether working or not, in my constituency and in our society. It takes money from the poorest in society and hands it to the wealthiest. Do not just take my word for it; criticism and concern has ranged from the TUC and major trade unions to Citizens Advice, the Joseph Rowntree Foundation and Barnardo’s, and from the Institute for Fiscal Studies to the Local Government Association and the Federation of Small Businesses. For example, Paul Johnson of the IFS has said:

“In general the more important tax credits are to someone’s income at present the less likely they are to be compensated by the higher minimum wage”—

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note that he refers to the minimum wage, not the living wage—

“But the key fact is that the increase in the minimum wage simply cannot provide full compensation for the majority of losses that will be experienced by tax credit recipients. That is just arithmetically impossible.”

This Budget negatively affects a majority of the population. The IFS says that 13 million people will lose out through the freeze in benefits and tax credits. This Budget is bad for people in my constituency of Leeds East, where the cuts to tax credits will hit an overwhelming majority of families. In Leeds East there are 9,600 families with children claiming tax credits, 6,100 of whom are working families, with 12,600 children affected. The scale of the impact in my constituency and constituencies like it across the country should make Conservative Members ashamed. Sixty-seven per cent.—two thirds—of families in Leeds East receive tax credits, while 75%—three quarters—of children are in families receiving tax credits. This is an attack on the incomes of the poorest while helping the wealthiest.

Freezing benefits for four years and cutting tax credits will reduce real incomes. The Joseph Rowntree Foundation makes it clear:

“For those out of work, especially childless adults, it will further widen the distance between their incomes and what is needed to achieve an even basic standard of living. This is of course deliberate, in that the aim of the Government is to sharpen work incentives for those not currently in work.”

Citizens Advice says that

“a government serious about making significant savings to the welfare bill needs to tackle problems at the source including insecure work and failures in the housing and childcare markets...Cuts to welfare including freezing benefits for four years, lowering income disregards and work allowances, and cutting tax credits will all have a very serious impact on many people’s ability to meet day to day costs.”

I have to mention George Osborne, the Chancellor—

Madam Deputy Speaker (Natascha Engel): Order. I say this in the spirit of helpfulness. We name Members not by their names but by their constituencies. This is the second time that the hon. Gentleman has done it, so I ask him to use the constituency or job title—“the Chancellor” will do.

Richard Burgon: The Chancellor’s so-called living wage is a con. He claims to be giving Britain a pay rise but his living wage premium is actually a new minimum wage undercutting the rate proposed by the Living Wage Foundation.

Quote after quote that I now do not have time to go into sets out the reality of the Government’s Budget. Many measures, as other Members have mentioned, are an attack on the hopes of young people. They include excluding under-25s from the so-called living wage, preventing young people from living independent lives by cutting their access to housing support, and abolishing student maintenance grants for the poorest and raising university fees. What we needed to hear in the Government’s Budget was a call for investment to publicly deliver affordable social housing, access to well-funded further and higher education, and new jobs and apprenticeships with better pay that would allow people to live decent and stable lives.

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People in my constituency and areas like it across the country are not a priority for this ultra-Thatcherite Government. They talk about a northern powerhouse, but we need only look at what is happening with trans-Pennine electrification. They are cutting funding for infrastructure in Leeds and in the north. They talk about devolution, but I and many others fear that the real aim is to devolve the blame for the national Government’s austerity economics. We must not give up fighting against what is being done to my constituency and areas like it by this Government, who are all about siding with the rich and the powerful. I look forward to carrying on fighting, alongside Labour colleagues, campaign groups and trade unions, against this Government’s cruel plans and for a better society.

8.58 pm

Mr Alan Mak (Havant) (Con): It is a great pleasure to follow the speeches by my hon. Friends the Members for Rugby (Mark Pawsey) and for Cleethorpes (Martin Vickers). It is also a great pleasure to welcome my fellow Hampshire Member of Parliament, my hon. Friend the Member for East Hampshire (Damian Hinds), as Exchequer Secretary. I congratulate my hon. Friends the Members for Chippenham (Michelle Donelan), for Somerton and Frome (David Warburton) and for Southampton, Itchen (Royston Smith) on their outstanding maiden speeches.

I am grateful for the opportunity to speak in this debate on the summer Budget. It is a Budget that rewards hard work and aspiration, not just in London but across every region of our great United Kingdom; backs working people by cutting their taxes, boosting their wages, and clamping down on the abuse of the welfare system that they help to pay for; and strengthens our public services while backing our armed forces. I am proud to speak in support of this Budget not just because of those positive attributes but because it is a Budget that builds Britain’s opportunity society.

Although bolstering Britain’s economic growth and giving working people financial security is rightly this Government’s most pressing priority, building the opportunity society must and will be their most distinct legacy. Alongside our long-term plan for a stronger economy, for me this Budget signals our renewed commitment to a long-term plan for a stronger society. That society should be one in which everyone can fulfil their potential, no matter what their starting point in life, because what counts towards their success and prosperity in the opportunity society is how hard they work, the talents they have and the ambitions they hold, not who their parents were, where they grew up or what sort of school they went to.

This Budget gives fair chances to everyone across the entire spectrum of society, young and old, and across every region of our great country, north and south. That is vital, because building an opportunity society gives us not only a stronger, fairer, more prosperous economy at home, but a more competitive economy abroad.

George Kerevan: Will the hon. Gentleman explain why, if we are exporting, the OBR has downgraded its forecast for the current account deficit for the next five years?

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Mr Mak: I shall come to that point later in my speech.

This Budget builds the opportunity society, which is important because in the global race for success, Britain cannot afford to waste the talents of anyone in this country. Last year, the Sutton Trust estimated that improving social mobility, including by getting people back to work, could add up to £140 billion to our GDP by 2050.

This Budget helps to build on the Government’s track record during the past five years, when 1,000 jobs were created every day, the deficit was cut by half as a share of GDP, 2 million apprenticeships were created and we enjoyed the highest growth of any developed country—higher than France, Germany or America. It is therefore no surprise that the latest World Economic Forum global competitiveness index report places Britain ninth in the world, which is up from our position last year and ahead of competitors such as France, Canada, Australia and Ireland. The Budget builds on and locks in the growth that we have sustained during the past five years. It helps Britain to move from a high-tax, low-wage and high-welfare economy to a higher-wage, lower-tax and lower-welfare country. It delivers a stronger society at home, and it gives us a more competitive economy abroad. Conservative Members share an abiding faith that individuals and businesses flourish when they have control over their lives, so I welcome this Budget.

John Mc Nally: I rise to make the same point again. Does the hon. Gentleman think that legislation will stop the farcical situation of big businesses delaying payments to small businesses? A small company wanting to grow ends up having to chase bigger companies to get the money they owe, which frustrates its wish to employ apprentices. Does he agree that we need to tighten up the legislation on that?

Mr Mak: The hon. Gentleman will know that the Government are taking decisive action to ensure that small firms are not punished and penalised when larger firms delay their payments. I come from a small business background, so I fully understand the challenges that that poses. What the Budget does for businesses is to lock in the growth and success that we have had during the past five years. I have talked about apprenticeships, and I will come on to the cut in corporation tax later.

I welcome the Budget because, ultimately, it keeps working people in work and allows them to keep more of the money they earn. The rise in the tax-free personal allowance to £11,000 from April next year means lower taxes for about 45,000 working people in my Havant constituency, and an estimated 750 people will be taken out of income tax altogether. That is what the opportunity society Budget looks like on the ground, and it is one that I am proud to support.

At the same time, lowering the welfare cap sends out the clear, distinct and unambiguous message that a life dependent on welfare and benefits, funded by those who work hard and do the right thing, is no longer an option. Our welfare reforms also send a strong signal that modern Britain will be a lean, nimble and productive economy that not only pays its way in the world, but asks each and every one of us to contribute where we can.

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Although no one must be held back in our society, it is equally right that the Government do not allow anyone to be left behind as we run the global race for success. In other words, we want everyone who can contribute to be on the field of play, not watching from the sidelines. In particular, our Budget gives 18 to 21-year-olds a clear path from welfare and into work. I welcome the new earn or learn youth obligation and the ending of the automatic right to claim housing benefit. At the same time, the new apprenticeship levy for larger employers will ensure that our ambitious and successful apprenticeship programme gets the funding it deserves.

In addition to those structural policy reforms, Britain’s place in the world economic order and our ongoing national prosperity are dependent on our regions, cities and counties doing just as well as our capital city. In my Havant constituency and the wider Solent region, we are heartened that the Government are committed to rebalancing the economy and bringing local growth to every part of the UK, whether by building a northern powerhouse or supporting important regional economies in the midlands, the south west or the south coast, where my constituency is based.

The summer Budget confirms that the Government are working towards further devolution deals, for example with metro areas such as Sheffield, Leeds and Liverpool, to boost local growth. I can confirm to my right hon. and hon. Friends on the Treasury Bench that in the Solent region all our councils support more devolution of powers to our county of Hampshire. I am personally committed to working with them to use any new powers to boost local economic growth and raise living standards.

I am very pleased to be working with my hon. Friend the Member for North East Hampshire (Mr Jayawardena) to create a new all-party group to champion Hampshire’s economic growth, and I look forward to working with other Members, particularly my hon. Friends the Members for Portsmouth South (Mrs Drummond) and for Fareham (Suella Fernandes), whom I can see in the Chamber. We are all committed to regional growth in our county for the greater prosperity of our citizens. That will help Havant to build on an already impressive record of growth, with exciting plans for local economic development being implemented. For example, at the Dunsbury Hill Farm development, a 50-acre stretch of farmland is being redeveloped with support from the Solent local enterprise partnership to become a new modern business park, driving local growth. We anticipate up to 3,500 new local jobs as well as investment in infrastructure such as local roads. The Solent LEP has been awarded £125 million in vital funding from the local growth fund for exactly that purpose.

Elsewhere in Havant, Langstone Technology Park and the Solent Retail Park are both booming. Business is coming to Havant. Businesses that relocate to Havant—and I urge them to do so—will benefit from a range of measures in the Budget designed to help businesses and our local economy. Corporation tax, already the lowest in the G20, will be cut to 18% over the course of the Parliament and the annual investment allowance has been put at £200,000 on a permanent basis.

The Government’s continued commitment to hard-working people and supporting local growth also means that unemployment in my constituency fell by 48% between

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May 2010 and May 2015. Those are people who have moved from welfare into work. They are playing a key role in Britain’s economy and our opportunity society.

The Government rightly put security at the heart of our manifesto and of this summer Budget. That means economic security, financial security and national security. The most important thing for me is the social security not of a life on welfare but of giving opportunities to people to work hard and make a better life for themselves.

9.7 pm

Wes Streeting (Ilford North) (Lab): It is a pleasure to speak in the debate and to follow so many hon. Members who made excellent maiden speeches.

This is a Budget that puts politics above economics, which we have seen reflected on subsequent days in the interventions from those on the Treasury Bench and the very well read interventions from the Whips’ briefings from those on the Government Back Benches.

I want first to turn to the constant myth we hear about the record of the previous Labour Government. We are told time and again that that Government were somehow profligate, which led to the crash of the economy—[Hon. Members: “Yes!”] Government Members say yes, but it may interest them to know that public spending accounted for about 40% of gross GDP under Thatcher, 38% under Major and 37% under Blair and Brown. In the 10 years of Labour government leading up to the crash, we had cut the deficit and the national debt—[Interruption.] Since Members on the Treasury Bench are so exercised, perhaps they can tell us why, if our spending plans were so bad, they backed them pound for pound until the crash; or whether they accept, as they should, that the mess we find ourselves in was actually the result of the banking crisis, in which the state had to nationalise a huge amount of private debt.

When has the Conservative party ever been the party to which we turn in the case of weak regulation? Where were the calls from the Conservative Opposition during years of Labour government to tell us that City regulation was insufficient? We did not hear those cries. There was a banking crisis; it was not the result of the previous Government. It is understandable that Government Members want to perpetuate the myth to entrench their political position, but that is about politics rather than economics. Having listened to the Chancellor’s Budget speech and to the speeches of Government Members in the days following it, I know that there is absolutely no way that the Conservative party can claim to be the party of the worker, and it seems that its blue-collar modernisation is already dead in the water.

We are told that somehow the Conservatives are the champions of high pay. Why is it, then, that when they talk about a national living wage, what they actually mean is an increased minimum wage? And why is it that, come 2020, that so-called living wage will be less than the London living wage that employees are being paid today?

Why are the Conservatives attacking working people on tax credits? If the Government were serious about lifting people out of poverty through work and pay, they would need to increase the living wage to about £12.65 an hour to account for their cuts to tax credits. When difficult choices are being made, it cannot be

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right to target people who are doing the right thing by going out to work hard every day—sometimes in several low-paid jobs—or to cut their tax credits and perpetuate the myth that somehow they are being helped by the introduction of a national living wage that is nothing of the sort.

This Budget and Chancellor are overlooking some of the major issues that need to be addressed if we are serious about a so-called long-term economic plan. The Chancellor is only interested in his own political position, and he is ducking the big question about Britain’s membership of the European Union. If he is serious about Britain’s place in the world and about our future economic prosperity, he should be leading the argument to stay in Europe. Instead, like so many of his Cabinet colleagues, he sits on the fence and perpetuates the myth that some big renegotiation is coming along.

The Chancellor is also ducking the big issues on infrastructure. He has already cut the power from the electrification of the railways, and he is also ducking renewable energy and more housing, which, by the way, would be the best way to cut the benefit bill. It would be fantastic if we saw a house building programme that cut the amount we are paying, not to those claiming housing benefits but directly to landlords. That programme would be an effective way to reform welfare, but it did not feature in the Budget.

Another issue is Heathrow, which has huge potential for the London economy and for people in my constituency, who will have the benefit of Crossrail to get to the jobs that will potentially flow from Heathrow. As usual, however, the Government are sitting on the fence because they do not want to tackle the big issues.

There are a number of other issues with this Budget that I wish to raise in the limited time I have left. It cannot possibly be right that people who are unfit to work, including people receiving treatment for potentially life-threatening illnesses, will be penalised by this Government’s welfare measures. Other hon. Members have already asked about the test for vulnerability, and I hope that that issue will be addressed in the Finance Bill Committee.

It cannot possibly be right that this Government will cap the aspirations of students from the poorest backgrounds by making sure not only that they graduate with record levels of debt, but that, through the other changes to higher education student finance, it will be the lowest-paid graduates who are hardest hit while the highest-earning graduates, who are still disproportionately from wealthier families, will take longer to repay their debt. Surely that cannot be progressive.

Finally, there can be no greater evidence of this Government’s shallow commitment to dealing with some of the deep structural problems of our low-pay economy than their pretence that they are tackling child poverty when in fact all they are doing is tinkering with the measures. The hon. Member for Rugby (Mark Pawsey) talked about the flatlining gesture. We may have tepid growth now, but one thing that is certainly flatlining is the progress that was being made to tackle child poverty. It is an absolute scandal that in the days after the Budget, Government Members have continued to justify their child poverty measures. This Budget will make child poverty worse; it does not do what the Chancellor says it does; and there is certainly no evidence whatever in it that the Conservative party is the party of the worker.

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9.13 pm

Suella Fernandes (Fareham) (Con): I thank the hon. Member for Ilford North (Wes Streeting) for his passionate speech; I do not agree with many of his points, but I admire his passion. I also thank my hon. Friend the Member for Havant (Mr Mak) for a good speech about the opportunity society, and other hon. Members for the excellent maiden speeches we have heard today, in particular that by my hon. Friend the Member for Southampton, Itchen (Royston Smith). I helped him during the campaign and I was thrilled by his victory on 8 May.

At its heart, this Budget is about opportunity, endeavour and responsibility. Those are my core values—the values that make me a Conservative. This Budget is not only about aspiration, but it underpins the truth that the Conservatives are the real party of working people. It aims to create a Britain where everyone has the chance to prosper through earning more, paying less taxation and having free innovation. Those are the kernels of aspiration. The rise in the minimum wage, the increase in the tax-free threshold and the rise in the 40p tax threshold will all contribute to a fairer society, where aspiration is a reality for millions of people. Key to that aspiration, opportunity and growth are productivity and a skilled workforce that are local to the workplace. The need for increased skills will be key to transforming the efficiency and growth in our economy.

My constituency of Fareham on the south coast has an economy of more than £2.5 billion gross value added, 1.3 million people, 50,000 businesses and thriving marine, aviation and aerospace sectors, with high technology and advanced skills and engineering.

George Kerevan: The hon. Lady mentions the aerospace industry. Can she name one airliner that this country still builds?

Suella Fernandes: I am very proud of the local aviation and aerospace industries. My constituency has Eaton Aerospace and the neighbouring Portsmouth constituency has BAE Systems—key British companies that are exporting and are at the cutting edge of the aviation and aerospace sector, thanks to lots of investment from central Government.

Solent local enterprise partnership, which I met today, benefited from the local growth deal, receiving more than £150 million of Government funding over the last Parliament to boost skills, improve infrastructure and provide better business support. That increase in higher skills has allowed Solent LEP to set a target of increasing GVA by 4%. Key to that target is an increase in the amount of housing. We need houses to accommodate the increase in the workforce and the employment base.

My constituency has a strategic development area called Welborne, which has been controversial. It will consist of 6,000 new homes, create 6,000 new jobs and contain 1 million square feet of employment land, which will enable growth and facilitate enterprise to take flight. It has been approved by the local council and the Planning Inspectorate. It is a huge opportunity for investment. It will be funded by £50 million from the new homes bonus—a great initiative that was brought in by the Conservative-led coalition—and £2 million from Solent LEP. There is currently a £30 million shortfall, but I hope that will be filled by central Government.

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The problem with housing is not supply and demand; it is that the market lacks fluidity. Throughout the course of a life, someone might start off in a student flat, want to expand into a family home, get a larger home and then downsize in their old age. We do not currently have that fluidity, but the Budget addresses that.

We need to enable the ownership of housing. Ownership is more than just a name on a contract; it enables people to have a stake in society and, in many cases, something to hand on to their children. A key to that is enabling capital and equity. Those kernels of home ownership, responsibility and a stake in society are at the heart of our robust and bold Budget, which I commend to the House.

Several hon. Members rose—

Madam Deputy Speaker (Natascha Engel): Order. I am sorry to say that I must drop the time limit on speeches to five minutes to get all the speakers in.

9.19 pm

Liz McInnes (Heywood and Middleton) (Lab): I am pleased to be able to contribute to the debate. We have heard the Tories’ repeated claim to be the party of working people, but we have a Tory Budget that is not the Budget that working people need. It leaves working people worse off and fails the test of building a more productive economy to bring the deficit down.

Cuts to tax credits will hit working people on middle and lower incomes, as well as those with larger families. My hon. Friend the Member for Hornsey and Wood Green (Catherine West) asked the Secretary of State last week for an equality impact assessment of the Budget. She was assured that the Budget had been fully equality impact assessed, but the document appears to be a closely guarded secret. It certainly does not appear as an accompanying document to the Budget on the Government’s website. I hope that in his winding-up speech the Exchequer Secretary will direct me to where I can find that elusive document.

Certain groups seem to be hit hard by the Budget, and I would like to concentrate specifically on the effect of the change from maintenance grants to loans on young people hoping to go to university. It might dissuade many students from poor and modest backgrounds from going to university, but might none the less result in large sums never being paid back to the Treasury.

The current system of maintenance grants supports students from the poorest backgrounds through university. In England, students from households with incomes of £25,000 or less receive a grant of £3,387 each year to cover accommodation, living expenses, books and course materials. In 2014-15, 400,000 full-time students in England received a full maintenance grant and 135,000 received a partial maintenance grant. Even with those grants, the system is stacked against working-class students. Students from wealthy backgrounds are 10 times more likely to receive a place at university than those from poorer backgrounds, according to the Sutton Trust, an education charity.

Following the Budget, our students will be saddled with even more debt, in addition to repaying tuition fees. Maintenance grants will be replaced with loans to be repaid under the same terms as tuition fee loans—that

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is, once a graduate is earning more than £21,000 a year. I will give credit where it is due: during the coalition years, the Liberal Democrats blocked plans to convert maintenance grants into loans. Here we have a fully fledged Tory Budget, and we see just what the Government want to inflict on our young people.

The general secretary of the University and College Union, Sally Hunt, has said:

“Maintenance grants are crucial for engaging students from disadvantaged backgrounds who are already daunted by cripplingly high tuition fee debt. Increasing the debt burden on students will act as a disincentive to participation, and it does not make sense for the taxpayer either, as the extra loan amount is unlikely to be repaid in full.”

We already have students living in poverty, and the replacement of grants with loans will just exacerbate that. The president of the student union of the University of the Arts London, Shelly Asquith, has described her university’s students as having to use food banks and payday loans to make ends meet. Others are being forced to take on work,

“often for so many hours it has a huge impact on their study.”

A typical student currently leaves university with debts averaging about £44,000, and no one knows what effect a loans-only system will have on university applications. There is a real risk that the Government are experimenting with the future of the current generation of secondary school students. In my constituency, 40% of working people do not even get paid the living wage —and that is the real living wage, which is set independently by the University of Loughborough and is currently £7.85 an hour. Five years ago, poorer students also received education maintenance allowance, which the Government have also taken away. We need to look urgently at the impact of the Budget on disadvantaged young people who aspire to go to university, and who will get the most out of it.

9.24 pm

Peter Dowd (Bootle) (Lab): The Budget statement, although difficult to hear at the time, was a hocus pocus concoction with built-in excuses should things go wrong: “Things will be better tomorrow, but then again they might not be”—it was a sort of mañana Budget. Having told us that growth was strong, the Chancellor attempted to make a subliminal and conflated link with the Greek crisis, and the possible implications if we do not allow him to get on and finish the job he started. Of course that was just the warm up excuse, because he then went on to say that—notwithstanding what a fantastic job he claims to be doing—we cannot be complacent.

To reinforce his potential alibi, and in case things went wrong, he reminded the House that the economies of the United States and China have slowed. Like an astrologer or a Mystic Meg character, he told us that the global risks are in the ascendant. He then wagged his finger at Europe, reminding it in a vague and imprecise way that it must not allow our future prosperity to be put in danger. Of course he forgot to remind us that Europe is way ahead in productivity, and that the French and Germans, among others, look on a little bemused—the French no doubt gave a bit of a Gallic shrug. The Chancellor also told us that this year the share of the national debt is falling after five years. I recall that

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he said—indeed, he boasted—that he would do much better than that on both the deficit and the debt, but he has not.

This was a back to the future Budget. If there is any doubt about that, we simply need to look at the self-satisfaction with which the Chancellor announced the sales of public assets, including some quasi-private assets in the form of housing association stock. It is the biggest sell-off since the 1980s says the Chancellor, but it is the old Conservative two-step shuffle of “Miss your targets, have a back-up plan, get the money from elsewhere—preferably somebody else’s money.” It is consistent, if not wholly imaginative. The Chancellor’s ambitions are not matched by the practical proposals that he has put in place to achieve them. Transport infrastructure proposals are currently in a mess. Many Conservative Members thought that they were going to get rail or road upgrades—or perhaps both—but they will have to wait a little longer until the mess is sorted out.

The Chancellor said that he wanted to make the NHS a priority in the Budget, but in short order he proceeded to tell the very people who make it run effectively and efficiently that they will be on a pay go-slow—in fact, they will have to be even more effective and efficient over the next four years because they will get just a 1% pay rise each year. That has become a habit. Local government—an area that I know reasonably well—has had to bear an unfair and disproportionate burden of cuts to budgets. Within the cuts to local government, some councils—including my own Sefton council—have had to bear even more significant and disproportionate reductions in central support.

If the funding of the NHS is taken in isolation from the funding of social care, that will create problems because they are different sides of the same coin. This is where local government comes into its own as it is the most efficient of public services. I hope that the new Secretary of State for Communities and Local Government will spend time ensuring that the devolution process for local government moves ahead positively and effectively, and at a pace consistent with good and effective governance, whatever those governance arrangements turn out to be. A slight glimmer of hope is the flexibility that devolution may bring to local government, and the ability to enable local growth that is unhindered by political and economic centralisation that, in my view, has hindered growth.

Let me make one salient point about the Chancellor’s claim that 1% of the world’s population generates 4% of the world’s income yet pays out 7% of the world’s welfare spending. In reality, a significant proportion of that is pensions that people have paid into and to which they are entitled. The Government’s jiggery-pokery on the issue must be challenged, day in, day out.

9.29 pm

Harry Harpham (Sheffield, Brightside and Hillsborough) (Lab): Last week the Chancellor tried to paint himself as a champion of working people. In reality, we got a Budget that does nothing to tackle the underlying problems of low productivity and low wages that over the past five years the Chancellor has failed to address. We had an old-fashioned Tory attack on the incomes of low earners, and a gaping hole where measures to increase productivity should have been. Much has been made of

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the fact that this was the first Tory Budget for 18 years, but that is only partly true: the Chancellor has been presiding over the economy for half a decade now. During that time, our growth has been among the slowest in the G20 advanced economies, and was revised downwards by the OBR last week from 3% to 2.4%. Our poor growth is a symptom of our poor productivity, and it means depressed wages for far too many of our citizens. It means lower tax returns and higher borrowing. We cannot provide people with financial security unless we provide strong growth.

If we are going to tackle the productivity gap that is holding back growth, we need firm and decisive action from the Government, but that has been lacking over the last five years—and the Budget sees no improvement. The OBR has revised forecast productivity down for the next four years, and the Chancellor is set to fall short of his target of increasing exports to £1 trillion by 2020 by £367 billion. We need real investment in infrastructure, skills and research, and development to boost productivity.

The Chancellor is very good at announcements, but the Government’s record on delivery is poor. Just ask my constituents—they have been waiting nearly two years for the midland main line to London to be electrified, only to be told that work is being halted. So much for the northern powerhouse.

Despite the increase in apprenticeships, too often they are focused on low-end skills and employers are still complaining that they cannot find people with the skills they need. Likewise, the replacement of maintenance grants with loans for students from the poorest backgrounds is a further example of the Government jeopardising productivity. They may say that most students will not be dissuaded from going into higher education, and that may be so, but there are young people for whom it will matter, and the Budget has let them down.

When it comes to low wages, the Chancellor has outdone himself with the barefaced cheek of what he proposes. He stood at the Dispatch Box and, bold as brass, trumpeted his so-called national living wage. It is nothing of the sort. At best, it is a welcome increase to the national minimum wage, but to call it a living wage is an insult to those who will be paid it. Although it will be around £9 an hour by 2020, the Resolution Foundation has calculated that by then the real living wage will be £10 an hour. If that was not bad enough, young people will not even get the imitation living wage. An hour’s work deserves an hour’s pay, and it is wrong to suggest that the efforts of a 24-year-old have less value than those of a 25-year-old.

All of that is before we take the cuts to tax credits into account. Nearly 12,000 families in my constituency receive tax credits, and I have been inundated with letters and emails from families who stand to lose out from the cuts. Tax credits are a lifeline that make low-paid work a viable option for thousands of families in my constituency, but the Chancellor is cutting that lifeline. The so-called living wage will not make up the shortfall, and the end result will be that thousands of poor working families will become even poorer. Families in my constituency will not be fooled by the rhetoric. They know an attack on their livelihoods when they see one.

On housing, the Chancellor shirked his responsibility to start delivering the 200,000 new starter homes that the Tory manifesto promised. In the first half of this year, first-time buyers spent on average £12,500 more

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for homes than in the same period last year, an increase of 8%. The average deposit they had to put down has gone up by 5%. With the Government’s poor record on house building, it is hardly surprising that for many people the chance of owning their own home is sliding ever further away.

I agree with the Chancellor when he says that we need to tackle low pay and productivity. I only wish that he had announced a Budget that did so.