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The Economy

Volume 638: debated on Thursday 22 March 2018

I beg to move,

That this House has considered the economy.

Today is a good opportunity to reflect on the economic news we have seen this week—the best deficit numbers in 10 years and record employment—and on the Government’s economic strategy over the past eight years and why it has succeeded. It is incredible to think that 10 years ago, we were witnessing the collapse of Northern Rock, and we were in crisis. We saw bankers leaving their buildings, such as that of Lehman Brothers, with boxes, and we were worried about the safety of our bank accounts and our personal finances. We were worried about whether we would have jobs, but here we are 10 years later seeing the positive signs of an economy that has recovered. As Amy Winehouse sang, we are now getting “back to black”.

We are seeing positive news across the board—so positive that even the Chancellor is Tiggerish, although there are still some Eeyores on the Opposition Benches. GDP has grown for five years straight. Employment is at record levels. Manufacturing has seen the longest consecutive period of growth for 50 years. We have had the two strongest quarters of productivity growth since before the financial crisis. When I travel around the country to see what is happening around the UK, there is excitement. In Liverpool, we have the new Superport. More goods are being traded through that great trading city than at any time in its history. In Cardiff, we have one of the fastest-growing economies in the UK. In Bristol, investment is being attracted from Silicon Valley into tech start-ups. In East Anglia, the food capital of Britain, we have seen exports go up by 10% in the past year alone.

We should not take this progress for granted, however, because we did not get here by accident. We have reached this turning point only because the Government have had a sound economic policy—a policy that the Opposition have opposed at every turn. I want today to lay out the elements of our approach: first, the supply side reforms that have unleashed business and people to succeed; secondly, our fiscal policies that are getting our country back in shape; and thirdly, our macro-prudential and monetary policies that have made sure that people can rely on their finances and have vital financial security.

We know that successful economies are ones that give businesses and people the freedom to succeed—to enable them to reach their potential and to offer what they have to the country. We have reformed our benefits system, our education system and our employment laws, so that people can have those opportunities. We now have record numbers of young people studying maths and science and going on to university. We are getting more people into apprenticeships and are seeing more young people in employment, whereas under Labour, 1.4 million people were left on the scrapheap. It left government with youth unemployment rising. We have one of the best records on youth unemployment in Europe, and we are giving young people opportunities. We have helped companies by lowering corporate taxes and keeping them low, and we have made it easier for them to take on staff, because we know that the risk takers and ideas makers drive forward Britain’s economy in the robust discipline of the free market. That philosophy is encapsulated in our industrial strategy.

Labour has no idea what makes Britain successful. Its approach is to try to close down the new economy. The hon. Member for Westminster North (Ms Buck) wants to restrict Airbnb. Labour authorities are trying to close down Uber, but all these opportunities help the most marginalised in our economy. Two thirds of all those renting out Airbnb apartments are women, helping them to earn vital income for their budgets.

I thank the Cabinet Secretary for giving way. The point about Airbnb is certainly well made. Airbnb does help to underpin the economy of the remote parts of the highlands—there is no two ways about it. This is not an anti-Government or an anti-Labour party point, but the Cabinet Secretary will realise that there are structural issues in constituencies such as mine. We have the long-term rundown of Dounreay, which is a nuclear site. How do we secure replacement employment for that? Of course, the depressed price of oil speaks for itself, and I see the number of drill platforms that are parked up in the Cromarty Firth. I do not want to appear an Eeyore—I try to look at myself as more of a Tigger than an Eeyore—but some deeper problems cross the divide in the colour of Governments, and those are the sorts of things we need to tackle.

I am very grateful to the hon. Gentleman for referring to me as the Cabinet Secretary. I have to tell him that I am not that powerful.

I appreciate that there are Tiggers on both sides of the House who are trying to see the good in what is happening in Britain. I think that there are opportunities to open up all parts of our country to new enterprise. We are, of course, doing what we can to help the oil and gas industry, but we also need to look for new sources of ideas and income.

At the same time as trying to close down the new economy around our country, Labour is trying to take over the old economy. Labour Members believe that it would be better for companies to be run by the Government rather than being allowed to run themselves. Even for companies that they think should remain in the private sector, they want to set up a £350 billion strategic investment board to decide where those companies’ investments should be. That would constitute an unprecedented encroachment by a Government into the business of enterprise and freedom. I find it hard to believe that Labour Members could run anything, given their inability to run their own party.

For many years, the UK has been seen as a desirable place in which to hide suspicious wealth. Can the Minister explain why the Government have so far done relatively little to discourage that activity?

We have introduced more than 100 measures to improve transparency. I agree with the hon. Gentleman that it is important that our finances are transparent and that private as well as public enterprise runs in a transparent fashion.

I want to draw Labour Members’ attention to the huge strides that we have seen in terms of better prices and better customer services, thanks to the privatisation programmes of the 1980s and 1990s.

Does the Chief Secretary share my pleasure at the way in which the economy has confounded the excessively pessimistic forecasts of the last Chancellor for the short-term impact of the Brexit vote? Will she and her ministerial colleagues ensure that the standard of Treasury forecasting is lifted, so that in future we do not see excessive and unrealistic pessimism?

Like my right hon. Friend, I am delighted by how well our economy is doing and how resilient it has been to all kinds of events. As for forecasts, they are simply forecasts. We believe that with the right approach, by liberating businesses and people, we can outperform our forecasts, and that is what we must seek to do.

I was talking about the privatisations of the 1980s and 1990s. What we saw then was more competition, more investment and better management of money and our utilities. Water customers, for example, are now five times less likely to suffer from supply interruptions, eight times less likely to suffer from sewer flooding and 100 times less likely to be affected by low water pressure than they were when the industry was publicly owned. Investment has almost doubled following privatisation, and the average household bill is down by £130. In energy, the number and length of power cuts on local electricity networks has almost halved since 2002, and network costs are 17% lower than they were at the time of privatisation. There are now 66 players in the retail energy market, and the market share of the big six has fallen by 20%.

In the rail sector, the number of passenger journeys has doubled to 1.7 billion since privatisation.

Spending on transport is 12 times greater in London than in Yorkshire, and that is having a negative impact on the growth of the economy in the north. Does the Chief Secretary think that is fair?

The figure that the hon. Lady has given is not correct. During the current spending review period, we are spending more per head on infrastructure in the north of England than in the south. In the longer term, there will be decisions to be made about which projects we fund in the north, but we are absolutely committed to ensuring that the north has its fair share of transport and infrastructure funding.

Since rail privatisation, the number of complaints has fallen by 75%, satisfaction has risen from 76% to 81%, and the days of waiting hours for a train and a stale sandwich from British Rail are long over.

Royal Mail was loss-making when it was in public ownership, sucking up resources that could have been spent on services such as the NHS. By contrast, it has been financially healthy in every year since privatisation. If Labour Members think that they could do a better job of running those services, they need to demonstrate how. On current form, I believe that their proposals would mean chaos and confusion, and if we include the £350 billion for the strategic investment board, they would also mean the addition of an eye-watering half a trillion pounds of debt to the UK balance sheet.

My right hon. Friend is making a very powerful speech. Does she agree that the Government’s approach is about practically achieving the best outcomes for people, whereas Labour’s approach is ideologically driven and will lead the country into more debt and more borrowing?

My hon. Friend is absolutely right. Rather than giving people and businesses the ability to shape their own futures, Labour Members want to put power in the hands of vested interests such as the unions and big companies. They say that they want to get rid of the state aid rules. That would prevent competition from taking place properly, and the end result would be taxpayers, including small businesses and families, picking up the tab through higher taxes. Labour’s plan would mean less money for schools and hospitals, and more money diverted to loss-making businesses.

The reality is that Labour still has not learnt the lessons of its failings in 2010. It has not learnt that a Government with no control over public finances will damage the economy and damage public services. When Labour left office, we were devoting 45% of our national income to public spending, and we have seen the longest increase in debt since the Napoleonic wars. Labour just does not understand that allowing the state to get too big cuts out individual enterprise. It cuts out people’s incentive to take on risk, try new things and do new things. State-owned companies compete for space and resources with private companies, starving them of oxygen. What is worse is that what Labour is planning would have to be funded through higher taxes.

Under the last Labour Government, we saw public services that did not improve in terms of the outcomes for patients or students, but we also saw huge amounts of money squandered. The hon. Member for Stalybridge and Hyde (Jonathan Reynolds) is laughing. Is he laughing at the fact that in the international education league tables, the UK ended up 26th in mathematics? We saw no improvement, although vast amounts of money were squandered.

Through the fiscal discipline of the last eight years, we have reduced the deficit by three quarters to 2.3%, and we have reached the turning point of debt falling as a share of the economy in the coming financial years. Our efforts, needless to say, have been opposed at every turn by the Labour party, but they have restored confidence in our economy. They have boosted investment, and they have led to more jobs and growth. The Government’s concrete plan to get debt down has given us a competitive advantage. If businesses know that we can keep our house in order, they will base themselves here in the UK, creating highly skilled and well-paid jobs.

At the same time, we have ensured that our public services are improving through public sector reforms such as the introduction of academies and free schools, and programmes that have put more people into work. We are seeing record cancer survival rates, better school results and record employment levels, because we have made the decision to reform the way in which our public services work. Because of our stewardship of the economy, we are now able to target Government spending where it is needed and where we recognise that there are issues.

Alongside our national retraining programme, we are tripling the number of fully qualified computer science teachers, so that our young people are able to succeed in the modern economy. We are increasing infrastructure spending on things like transport, which the hon. Member for Colne Valley (Thelma Walker) mentioned, to a 40-year high, even though we are having to make difficult decisions elsewhere. Yesterday we struck a deal to give nurses and other NHS staff a 6.5% pay rise over three years in exchange for reform that will improve patient outcomes, to make sure we can continue to recruit high-quality people in the NHS. We can do that only because we have got control of the public finances and we have fixed the economy, measures that Labour opposed at every turn.

So let me be clear: if we had listened to Labour and let the public finances spin out of control, there would be no money to invest in public services, and there would be no money now for that NHS deal, so nurses would not get their well-deserved pay rise. It is Labour that put public services at risk by losing control of spending and crashing the economy. Conservatives are delivering a stronger economy, stronger public services and a pay rise for hard-working NHS staff.

We are not out of the woods yet, however. Debt and borrowing are still too high. Debt is forecast to peak at 85.6% of GDP in 2017-18, the highest it has been for 50 years. That leaves us vulnerable to economic shocks in the future that are by their nature hard to predict, but—worst of all—it places a burden on the next generation, because we are still spending £50 billion a year on interest payments, more than the combined amount we spend on the police and armed forces. So in order to ensure the UK’s economic resilience, improve sustainability and reduce the burden on future generations, we need to get our debt falling. However, even despite all these obvious facts that are all there in black and white, the Opposition continue to call for big spending announcements.

On debt interest repayments, will my right hon. Friend explain further how even a relatively modest rise in interest rates would make what is currently £50 billion of interest repayment completely unmanageable if Labour got in and we had a run on the pound?

My hon. Friend makes a good point, and the reality is that the Opposition are planning for a run on the pound; they have actually released documentation that suggests that this is a real risk should they get into power. I find that incredibly worrying.

As I mentioned, the Opposition have called for big spending announcements. That is fiscal fantasy land, and there are only two ways it could be achieved. First, we could borrow more and plunge ourselves further into debt, making us less resilient to any potential shocks that might happen to the economy. Secondly, we could increase taxes, which would be bad news for families, bad news for businesses and bad news for the economy.

The Opposition claim that they could just increase taxes on the highest earners. That is simply not true. The levels of taxation they are talking about for their plans for a state on steroids would lead to the highest taxes we have seen in peacetime history, and the people who would really suffer are ordinary working people struggling to get by, and struggling to get on the housing ladder. Those are the people who would be hammered by Labour’s tax increases.

Alongside our fiscal policy, we have a clear independent monetary policy and a macro prudential framework that has helped to bring inflation under control and promoted financial stability. We must remember what happens when the Government do not get this right: the banks had to be bailed out under the failure of Labour’s tripartite regimes. Our reforms, which included establishing the Financial Policy Committee in the Bank of England, have made sure we have the sound financial institutions that people can rely on. In 2017 the Bank of England tested the financial system against a scenario that was more severe than the global financial crisis, and our system had the capital to cope. Our independent monetary policy regime has also kept control of inflation, which is set to fall this year, easing pressure on living standards.

Ten years ago we were on the brink: we were teetering on the edge of a very serious crash, and public spending was out of control. Over the past eight years, and as a result of the policy decisions we have taken, we have seen a huge growth in the number of new businesses opening in this country; we have got more people, particularly the young, into employment; and we have put our public services on a sustainable footing.

We are getting our public finances back to black. This week’s economic news has been positive, but we are not complacent. We recognise that there is more work to do and we will continue to work hard to make sure our economy continues to grow, because as Britain prepares to leave the EU it is more important than ever that we unleash businesses and the people of Britain to fulfil their true potential.

I do not know how the Chief Secretary managed to keep a straight face throughout that speech, and I am confused, too: listening to her, I thought I was in some sort of utopian democracy, but I am afraid it is completely not like that. It is a little over a week since the Chancellor stood up in the Chamber and delivered the first spring statement, proclaiming that there was light at the end of the tunnel, yet at the same time the Government have presided over the slowest recovery since the 1920s. The Chief Secretary did not mention that, so it is no surprise that for many people across this country her words rang hollow and untrue. The Tigger-like demeanour of the Chancellor and the back-slapping and self-congratulatory tone of his Cabinet colleagues, rather than reassuring an increasingly fearful public, reek of a complacency that betrays the poor state of the public finances and the challenges our economy faces.

The Chief Secretary referred to facts so let us have a few, because the facts do speak for themselves. Last year growth in the UK economy was the lowest in the G7 and the slowest since 2012. Inflation is the highest in the G7. Despite the marginal upward revisions last week, the Office for Budget Responsibility has revised forecast growth down in both 2021 and 2022, and growth is lower in every year of the forecast compared with March 2017. Those are a few facts I thought I would chuck in.

Meanwhile the economy, according to the Institute for Fiscal Studies, will now be 3% smaller in 2020-21 than was forecast just two years ago. Another fact: real wages have fallen every month in the last year and are lower today than they were in 2010. The OBR has said that it expects wages to remain subdued—an understatement if ever there was one—over the next five years, and the Resolution Foundation has gone further, arguing that the last decade has been the weakest for average earnings in two centuries after adjusting for inflation. So that is a strong economy, is it? It does not look very strong from where I and millions of other people sit.

Meanwhile, personal debt, which has risen to worryingly high levels, and stronger world growth are helping to keep the show on the road, masking just how useless the Government’s economic policy is. The reality is that the Government’s bluster and bravado are fooling no one, particularly at a time when their failed economic policies continue to harm the UK economy and not just the most vulnerable in society, but millions of people who are in work.

Whatever positive spin the Chancellor and the Chief Secretary want to put on it, this Conservative Government have missed every deficit target they have ever set. [Interruption.] It would be a lot better than under this Government; they have not really invested, and the investments they have made are pretty poor. Public sector borrowing is still higher than forecast a year ago, and public sector debt is over £700 billion higher than when the Conservatives came to power. This is hardly a record of economic competence, but is instead reflective of just how out of touch Ministers are. And may I remind the Chief Secretary that they supported all Labour’s financial spending plans in 2007-08?

Does the hon. Gentleman not find it a little ironic that he is criticising my colleagues on this side of the House when his own party’s plans would plunge our country into even more debt, which we would be paying off for another two generations?

The hon. Gentleman is living on the same fantasy island as the Chief Secretary to the Treasury.

Outside the corridors of Whitehall and the Conservative cocktail parties, the reward for such a consistent record of failure in any job would be the boot. Instead, this divided and increasingly paralysed Government linger on, propped up by the Democratic Unionist party, with not much of a legislative agenda to speak of. It is almost like being on a zero-hours contract, which I know the Chief Secretary to the Treasury loves, while still being paid. It is clear that the Government are running scared. It is been seven weeks since the Public Bill Committee stage of the Taxation (Cross-border Trade) Bill, yet there is still no sign of Ministers putting it before the House for its Report stage. They are frightened to death to come to the House on that matter. Instead, we have been subjected to the reckless and misinformed musings of the Transport Secretary, who has speculated that customs checks will simply not be enforced at the port of Dover. Similarly, Ministers have refused to bring back the Trade Bill, at a time when President Trump is on the verge of starting a trade war.

I want to take the hon. Gentleman up on his point about personal debt levels. Does he agree that it is because this Government’s fiscal management has been so sensible—and recognised as such by the international markets—that interest rates have been kept low? This means that personal debt repayments are now lower on average than they were when the Labour party left office.

We lost our triple A rating under the hon. Gentleman’s Government, so I do not think he has any room to point the finger at anyone.

While stressed-out doctors and teachers go to work every day, the Government duck responsibility and parliamentary scrutiny at every opportunity. The Chief Secretary to the Treasury might call these hard-working people “blobs”, but every day they run our health service and educate our children. Rather than spending her time attacking workers and the professional classes, the blob snob Chief Secretary should instead focus her attention on lifting the public sector pay right across the board and stepping up and taking action on our schools.

The point I was making was that, rather than supporting the vested interests, as the Opposition want to do, we want to get rid of state aid roles supporting the big companies and those who want to stop new people entering professions. I am on the side of people who have not got on the housing ladder or who have not entered a profession but who want to set up a new business. We want to deal with the vested interests that prevent that from happening.

I will tell the right hon. Lady what those professionals have: they have a vested interest in the health of our people, and in the health and education of our children. They have a vested interest in those people, unlike those on her side of the House.

Does my hon. Friend think that a massive increase in the use of food banks, homelessness and child poverty—and women’s life expectancy going down for the first time since 1920—suggests that we have a healthy economy and a compassionate Government? I do not think so.

My hon. Friend is absolutely right. Those are yet more facts that the Government will not listen to.

The Chancellor has chosen to play things down, and he has desperately attempted to diminish the importance of his spring statement. He might have ditched the Red Box, but he has not ditched the plethora of problems facing this country. From social care to children’s services, our public services are stretched to breaking point, and it is the most vulnerable people in our society, and working people, who are paying the price.

I note that only two Labour Back Benchers think that this is an important issue. Does the hon. Gentleman agree that it is an awful lot better to be living in the United Kingdom’s economy today than it was in the last Labour year, when we had a banking crash and a great recession?

I remind the right hon. Gentleman of the document that he oversaw, “Freeing Britain to Compete”. In it, he proposed even more deregulation. He said at the time that if Labour regulated the banks even more, they would be stealing all our money. Well, in effect, they did, because they had to have a £1.5 trillion bail-out, yet he wanted more deregulation. We are not going to sit here and listen to all this fantasy from the Government.

If the hon. Gentleman had read the whole report, he would have seen the clear warning that the banks did not have enough cash and capital. We said that they should have more.

I actually did read those turgid 300 pages. It was my penance to have to read that document. I will most probably get time off purgatory for that.

On the subject of children’s services, the decision on free school meals is unforgivable. It was made by the Chancellor and his colleagues in the full knowledge that it would have a detrimental impact on people up and down this country who rely on those kinds of services. In relation to social care, no amount of kicking things into the long grass will make up for the inaction and indifference that the Chancellor has displayed.

Does my hon. Friend agree that, with one Tory council having gone bust and others forcing unprecedented cuts on local services, the Government are failing local government? Does he agree that the Chancellor has not funded local government finance properly, leading to suffering among the most vulnerable people?

Yes, and quite frankly, what the Government tend to do in these situations is stick their fingers in their ears. They do not want to hear these facts.

I know that the Chief Secretary to the Treasury has been much more active, particularly on our trade deficit in regard to dairy products and the interests of cheesemakers. This has led her to extol the virtues of “unfeta-ed” markets on so many occasions that I have begun to feel that I “camembert” it any more. It has become increasingly clear that the Government’s economic policy has more holes in it than a Swiss cheese. But there is a serious point here. During her seemingly endless public interventions, the Chief Secretary to the Treasury can only focus on a single theme. She has brought it back to us today, and I thank her for that. It is her belief that the state should continue to recede under permanent austerity. Schools, hospitals, social care, childcare, road maintenance, pollution standards and local government services more generally are all under the cosh, while her beloved market forces create new vape shops on every corner, and more misery.

To be more accurate, was not the Chief Secretary to the Treasury actually talking about a percentage of the total GDP of the state, and not the quantum amount? The heart of her argument was that if we continue to grow the economy as we are doing, we will have much more money for our public services. That was the real core of the point she was making.

Look, the reality is that the economy is not growing to the level it should be, because this Government are not investing in it. Actually, something like 50% of the growth in the economy is going to the most well-off 10%, and that is not reasonable. It is not fair. I ask the hon. Gentleman to bear those figures in mind. It is not simply a question of the growth in the economy; it is a question of where that growth goes and whether it is being shared out reasonably.

Given that we are talking about growth figures, will the hon. Gentleman welcome the export boom in the north-west that has seen exports increase in the billions for Cumbria and Liverpool?

Of course, and I am glad that the Chief Secretary mentioned the port of Liverpool, which is actually in my constituency. She should have popped in for a cup of tea.

I know; I was busy here. The hon. Member for Ochil and South Perthshire (Luke Graham) makes a point about exports, but we have seen the biggest devaluation in the pound for as long as anyone can remember, and I suspect that that has had something to do with it. It is hardly down to the policies of the Government; it is an unexpected consequence.

Let us move on to something released today. Her Majesty’s Inspectorate of Constabulary and Fire and Rescue Services yet again reports huge pressures on police forces, with emergency services responding not in seconds, minutes or even hours, but days. The “golden hour” is being stretched to up to a week—there is an achievement by this Government from a strong economy! It comes in the wake of the UK Statistics Authority having to correct the Prime Minister’s imaginative—not a word that we often use in association with the Prime Minister—use of police funding figures. I cannot see much cause to celebrate the current state of the economy after eight years of Tory austerity.

Britain continues to have astonishingly low levels of productivity compared with other G7 countries, which is a direct result of this Government’s failure to invest productively and proactively in the economy. Bizarrely, however, the Chief Secretary wants to celebrate—she did it again today—the poorly paid, precarious labour market that has fostered unproductive business models, which rely on exploitation instead of innovation and investment. For example, much of her Policy Exchange speech was spent singing the praises of Uber, as she did again today, but Uber’s labour practices and poor track record on safety have made it the subject of an investigation by Transport for London. She sits in awe of some large corporations that use every opportunity to dodge their taxes. Yesterday, we heard about Facebook misusing people’s personal data for profit. Is that the sort of country we want to live in? Of course it is not. Is that the sort of company that the Chief Secretary thinks is marvellous, wonderful and a model?

The Labour party embraces the opportunities of a fourth industrial revolution that empowers working people to take control of their own lives, yet the Conservative party wants to return to the practices of the first industrial revolution, when the world was dominated by the interests of the few. It is strange that the Chief Secretary talks about freedoms while advocating a society in which the broad mass of citizens are denied basic rights. For example, how has the slashing of public services, while tax breaks are being handed to big corporations, made us freer? It has only trapped people in poverty and poor health.

The hon. Gentleman’s speech illustrates the big dividing line between the two sides of the House. The Chief Secretary is concerned with people and consumers having access to high-quality, well-paying jobs and high-quality public services; the Opposition and the hon. Gentleman are obsessed with vested interests and the producers, many of which are not providing a good service to the British people.

Things are not going very well on that basis, but the bottom line is that that is the Tories’ one-dimensional approach to things. Producers and consumers often interact. The person who works in the factory is a consumer and a producer. This goes to the heart of why the Tories just do not get it. They are the one-dimensional party.

The Government’s entire economic strategy has been the transfer of private losses on to the public sector through austerity, using the state to pay for the losses built up by their donors. In other words, the Chief Secretary’s free, lightly regulated markets have ended up costing us all a good deal, and she now wants to expand that even further at greater expense to us all. Her Government’s economic strategy has left us buckling under huge national debt, with public services in crisis. It has left us with NHS trusts ending this financial year with a £1 billion deficit, and we have seen capital transfer to revenue for about the past four years, which is hardly the sign of a strong economy.

I hate to go back to A. A. Milne, but I am hearing Eeyore all over the place. In the past half an hour, I have received news that Dura Composites in Clacton-on-Sea is going to start exporting to India. There is great news everywhere if we just look for it, but if the hon. Gentleman keeps talking things down, that will not do the country any good at all.

Well, I have been hearing a lot of “Pooh” today, quite frankly. I remind the House that, yes, Tigger was the one who bounced all over the place, but he also created inventions that always went wrong. That is what is going to happen here, so I ask Members to go and read about that.

The reality is that the economic strategy has left us with a Government who are trying to deprive 1 million children of a decent school dinner in the name of tough choices. In local government, it has left us with Conservative councils going bust, a 40% cut in early intervention to support families, the highest number of children taken into care since the 1980s, and 400 women seeking refuge being turned away because there were no places available for them last year. That is the reality of the Chief Secretary’s vision of what she referred to as the Government’s “success”.

May I call on the hon. Gentleman, who is meant to be good at maths, to withdraw his statement about school dinners? Instead, will he confirm that following the debate and vote that we held last week, we will give school dinners to 60,000 more children, including young Josh whom I met in my constituency last week?

The hon. Lady is quite simply wrong—it is as simple as that. That debate went on for a considerable period of time and the hon. Lady is wrong. Try telling that to the 4,000 affected families in my constituency! I will hear none of it.

Will the Chief Secretary to the Treasury tell me exactly how having fewer refuge places makes a woman trapped in domestic violence freer? How much freer are the unprecedented numbers of children being taken into care as a result of cuts to early intervention? Finally, how are children who are unable to concentrate at school, because they have not had a decent meal, more free to pursue their life chances? This tired nonsense, full of old chestnuts, continues to be peddled by this Government as a cover to disguise an economic strategy in tatters—[Interruption.] The right hon. Lady talks about rhetoric, but there is nothing rhetorical about cuts to the NHS, education services or universal credit. There are cuts right across the system. There is nothing rhetorical when somebody has to sleep on the streets. There is nothing rhetorical about having the largest number of rough sleepers.

The Conservative Government cannot face up to the fact that we are living in a country that is denuding its citizens of the services to which they are entitled. That is happening due to not our ideological views, but the Government’s. Their lofty talk of abstract freedoms is an attempt to steer the conversation away from hard facts about who has paid the price of their failure: the poorly paid, precarious workers stuck in in-work poverty in one of the companies that the right hon. Lady hails in her speeches. Sixty per cent. of people in poverty now live in a working household. Does that indicate that the country has a strong economy? Millions are struggling to find a decent roof over their heads because of this Government’s refusal to invest in the houses we need. They are the mañana Government. They will do it tomorrow or next week or the week after. It is a little bit like the police turning up next week or the week after when they were supposed to be here today. They will eventually get there—it is just like this Government’s attitude to public services.

Disabled people have borne the brunt of austerity cuts by a Government who do not believe them when they say that they want to work but need more support. So have the 4 million people waiting on the NHS treatment list at the end of June. So have the thousands of our fellow citizens sleeping rough on Britain’s streets—twice the number in 2010—in possibly the coldest weather we have experienced for a decade. To talk about abstract freedoms when the basic needs of citizens are not being met is at best folly and at worst an insult.

Thankfully, there is only so long that the Government can try to hide their failing economic policies behind abstractions before the citizens of this country elect a Government who stand for the rights to freedom and justice of the many, not just the privileged few. I note that the Minister talked about nationalisation. The Conservative party believes in public ownership, as long as that means other countries owning our public services.

This should be a serious debate, given that future generations will look back at the economic situation over the past decade, and to the political leadership that we have all given, and ask this generation, “What did you do to secure our economic future?” I am therefore pleased to be able to contribute.

As my right hon. Friend the Chief Secretary to the Treasury said, 10 years ago this month, the last Labour Government introduced a Budget. The then Chancellor of the Exchequer, Alistair Darling, in his Budget speech in this Chamber, promised

“stability, now and in the future.”

He committed the then Government to

“maintain stability through the world economic slowdown.”

He proclaimed:

“Britain is better placed than other economies to withstand the slowdown in the global economy.”

He also forecast that

“the British economy will continue to grow throughout this year and beyond.”—[Official Report, 12 March 2008; Vol. 473, c. 285.]

That year’s Budget committed to £43 billion of borrowing. The then Chancellor forecast that that would fall to £38 billion in 2009-10 and then continue to fall to £23 billion in 2012-13. What followed was the deepest recession in modern history, which hit Britain harder than most. Of course, it led to a sharp increase in unemployment, destroying the life chances of a generation of young people. As we know, borrowing did not fall, but rose to record levels, going on to add over £150 billion a year to the national debt—and that was when the moderates were in charge of the Labour party.

Since 2010, the responses of the Labour party to our Budgets and fiscal statements have moved further and further towards the hard left. Over the past year, we have heard the Leader of the Opposition, the shadow Chancellor and other Members make reckless and irresponsible pledges and commitments. They fail to understand that the more we tax and borrow today—guess what?—the more that costs the country in the long term. Higher borrowing today means less money to invest in key frontline public services tomorrow. That approach to fiscal policy wiped more than 5% off the economy during the last downturn. The British public should be in no doubt of what that would mean for the long-term health of the economy, with more services starved of cash, and greater suffering when it comes to jobs, economic growth and prosperity.

This Government, through what was then our long-term economic plan, went out to reset the nation, and to support economic growth and investment. That growth and investment was possible, of course, as a result of very courageous decisions that led to unemployment falling, more young people in work than previously, and a record 32 million people in jobs. Growth has been steady and sustainable, and more businesses are being set up. Thanks to that economic plan, in my constituency there are 17% more enterprises than there were in 2010, and the claimant count is 70% lower than at its peak under Labour.

Let us not say that the job is done, however, because it is not. There is much more to do. The economic downturn created long-term damage to the public finances. It also led to something else that this generation of politicians must address: it damaged trust in politics. It threw open questions about the relationship between power and wealth throughout our society. There was a re-evaluation of the traditional economic models—monetary models, fiscal models and how we invest—but we have also seen quantitative easing, which has worked through the economy, making possible a new era of low borrowing costs and cheap debt, which has affected the burden of household debt.

We have a country with tensions between those who benefited from the boom years, whose assets have appreciated, and a generation under 40 who have effectively inherited a broken model of public finances and are now struggling for a secure prospect of owning assets and having a home of their own. That is why this Government need a radical economic vision—a challenge for us all—to really take the Conservative Government forward; to energise an economic revolution across our country that embraces freedom and opportunity; and to provide the next generation with the prospect of being able to provide for themselves, invest in housing, and hopefully raise a family as well—something which many of us have historically taken for granted, and which, of course, young generations want to do. They want to have the freedom to succeed. They want to have the economic freedoms that across the generations we have been able to take for granted.

People whom I meet day in, day out, tell me that they do not want a Government who tinker at the edges or the margins. They certainly do not want a Government who believe in the “nanny knows best” approach—centralisation and the command-and-control politics of the left. They want radical policies to tackle injustices in our country, to deal with the housing crisis, to promote genuine competition and choice in utilities, banking and other services, and also, importantly, to put families, consumers and entrepreneurs first. That means a coherent economic programme to tackle the underlying economic causes of the injustices that people feel today. It also means a more distinctive Conservative programme of economic reforms: opening up markets to new entrants; empowering consumers; setting free the power of technology and innovation; empowering local leaders across our communities; offering economic devolution across the country; accelerating housing and public transport investment; empowering and incentivising policies across the full spectrum of the public sector; and demonstrating leadership and reform alongside a skills revolution, a training revolution and education, supporting the practical impact of lifelong learning that future generations will experience.

My right hon. Friend the Chief Secretary spoke about the inspirational political leadership in the 1980s that adopted a bold policy of redistributing economic power and opportunity, and putting it in the hands of the people, when Britain became a share-owning and property-owning democracy. Of course, it was Margaret Thatcher who led that economic revolution. I pay tribute not just to the former Prime Minister, but to my right hon. Friend the Member for Wokingham (John Redwood), who was one of the economic advisers at the time, for putting power back in the hands of consumers and the public.

We must always be radical and reforming in government: shaking up the status quo and empowering consumers; unleashing the power of technology and innovation; and opening up markets here and around the world to new entrants, and a new cycle of growth and prosperity. Now, more than ever, for future generations, it must be our national mission to lead a new wave of economic reforms that ensures that we keep taxes low for families and businesses, provide more choice in public services, put pupils and patients at the heart of our education and health services, and back more reforms to skills and training to ensure that school leavers do not just have opportunities but become the market makers of the future. We must ensure that people can upskill and retrain in later life to enable them to adapt to a changing, vibrant economy.

We also need to continue our programme that empowers Mayors and local councils with more powers and freedoms to retain the proceeds of local economic growth. Our economic strategy must drive growth. Infrastructure bonds and other financial measures can be used to invest in infrastructure and regeneration throughout the country, and that programme grows the economy through investment in the country’s key strategic infrastructure, such as the great eastern main line, the west Anglia line, the A12 and the A120. We must ensure that we get Britain not just moving again, but accelerating in the 21st century.

We must be ambitious for British companies, both at home and abroad, and give dynamic innovators and wealth creators the freedom to succeed. Our economic freedoms matter, which is why this Government must continue to bang the drum for British businesses, of every shape and size, every minute of the day. British firms want to know that their Government are on their side no matter what, and that has to be at the heart of our economic strategy.

As well as focusing on our domestic reforms, in any debate about the economy we must look forward to our bright future as a free and independent nation when we leave the EU. Brexit should serve as a time of national renewal. We are seeing now more than ever—my right hon. Friend the Chancellor mentioned this in his statement last week—that this will be the start of the shaping of a new liberating chapter in our long history in which we will have many economic benefits. We will be a beacon for global free trade and pursue new trade and investment partnerships. My hon. Friend the Member for Clacton (Giles Watling) has already mentioned new partnerships with India, and I hope that you will appreciate, Madam Deputy Speaker, that where Essex leads, the rest of the country will follow.

By the middle of this century, the EU’s share of the global economy will fall below 10%. The old global economic order is being replaced by a new wave of economic powerhouses in Asia, Latin America and Africa. We are seeing change and we must ensure that we are at the front of the queue, leading that revolution of change, and that Britain is the first port of call for growing and newly emerging markets. As we reflect on the economy today, let us welcome not only the transformation, but the long-term economic stability that we have seen due to the macro and fiscal policies of this Government. I commend the Chancellor for his statement, but we must continue to be bold and ambitious for the future.

In coming to this general debate on the economy, I reflected on a couple of things. The first was that Papa Thewliss always told me that before I died I should do a night course in economics, and he was probably right, although he did not know at the time that I would end up here. I was also reflecting on my good friend Miriam Brett, a former employee of the Scottish National party group at Westminster, who took away some of the concerns I had about my right as a woman who did not know so much about these things to speak about the economy. She said, “Those guys who stand up and talk about figures all the time usually have no idea what they are talking about anyway. They just sound a bit impressive because they’ve got the figures in front of them.” Taking the things she used to encourage me with, as well as some of the work the Women’s Budget Group has produced over the years on the gender impact of the Budget, I thought a bit about who the economy is for and what it is for—is it about figures or people? Fundamentally, it is about people.

I put this question out last night to people on Twitter, half fearing what would come back, but I got some excellent contributions—all from women, as it happens—about their thoughts on the economy and how they fit within it. Lorraine Gillies said:

“It’s about making decisions in a people before process way that enable people to achieve economic health. It’s about spending to save.”

That chimes clearly with the things I have heard from experts such as Sir Harry Burns, who talks about the importance of people having a sense of control over their lives. What I have seen in my three years in this place and in my eight years previously in Glasgow City Council is a decline in the amount of control people feel they have over their lives. They feel they are tiny cogs in a huge machine that does not recognise them, does not recognise what they have to contribute and does not recognise the skills they have. Instead, they are in a system that punishes them every day, in a range of different ways, whether through the welfare system, through the immigration system or just through the precarious nature of employment in these islands now. They feel that they do not have any say in this economy and that this economy does not work in any way for them.

We see that reflected in the figures that show wages stagnating and in the increasing difficulties young people find now as compared with the situation for the generations that came before me. Young people now cannot afford to buy a house; they find it more difficult even to rent a house in lots of places in the UK. They have insecure employment and insecure prospects. Some of them are very well qualified—far better qualified than young people have ever been—but they cannot get a say in the economy round about them.

Ministers and other Members have talked about the public finances, but as far as I can see these public finances are not to the public benefit—a lot of the time they are for private benefit. They are for companies and organisations, rather than for the people in the economy itself. Another woman, Fiona Brown, said:

“I’d like the economy to serve me, mine & the common weal. Currently we seem to be enslaved to it and the elites who remain the beneficiaries. FAIRNESS needed.”

Fairness runs through a lot of the things the SNP has said on the economy in this place. We have seen banks bailed out while people have lost their jobs. We have seen banks closing their branches right across the country, yet the corporate executives are running away with lots and lots of money, their pockets stuffed full of the people’s cash. We need to reflect on that when we see people so disenfranchised in the economy.

We also continually see loopholes. I see those in the complexity of the tax code, having sat through a couple of Finance Bill Committees. I have seen the huge complexities we are building in, layer upon layer, to the tax code in this country. That allows people to find other ways to manipulate money and take it away from where it should be: in the public coffers and being used for public good. We see things such as Scottish limited partnerships. My former colleague Roger Mullin has worked incredibly hard to bring these issues to light, as has the journalist David Leask and Richard Smith, the researcher and an expert on this issue. We have seen how money has been funnelled and hidden away and how we have no accountability over that money, who owns it, where it goes and what purposes it is used for at the end of that process. We have seen how this can involve Soviet oligarchs or various regimes in the world that want to hide their money. We need to get to a point where there is a lot more public accountability.

We facilitate these loopholes in the economy by allowing people to register a company at Companies House for just 12 quid and do none of the anti-money laundering requirements that would usually have to be done. This has to stop. The Government have to say, “If you want to register a company, that due diligence must be there.” The UK Government cannot be turning a blind eye to companies that are ripping off people right around the world.

Some of the women who contacted me talked about the role of carers in our society. Lynn Williams said that the economy

“doesn’t recognise or reward my unpaid care and those of us at the hard end of cuts do not benefit from growth...such as it is in Scotland or UK.”

We can stand here and talk about growth figures and other economic figures, but if people out there on the street are not feeling that—if they are seeing prices going up and they are struggling every day to put food on the table—we are failing them and not recognising the difficulties they are going through.

The injustices continue. The Resolution Foundation says:

“The coming year (2018-19) is set to be the second biggest single year of welfare cuts since the crisis…at £2.5 billion”.

That is £2.5 billion more in cuts, and they will affect people who have already found themselves losing out as a result of cuts. Welfare reform is rolling on and is damaging people who come to my surgeries and even those who do not come to my surgeries. I want to be able to help them, but they never make it through the door because they are so beaten down by the system. This is hitting families and disabled people the most. Figures just out from the Glasgow Centre for Population Health say that 24% of the working-age population in Glasgow have a disability that impacts on the work they can do. We need to think about that, because many of these people will want to work, but they find themselves trapped in a system that punishes them whichever way they go. It makes them feel as though they are being put upon for the very act of claiming something they are absolutely entitled to get; they are going through all this trauma again and again, proving to faceless bureaucrats that they have a right to something.

The Child Poverty Action Group says that child poverty has gone up three years running and that 67% of that child poverty is in families where the parents are working. That should shock us all, because those families are working damned hard every day to put food on the table. The constituents I see at my surgeries are working incredibly hard to try to put food on the table, but they cannot. Families come to me to ask me to get school uniforms and Christmas presents for their children because they cannot afford it. This is happening in 2018.

The hon. Lady is making a powerful speech about the impact that welfare reform is having on our economies. Does she agree that the other people who suffer are small retailers and providers, because the people who are not receiving that welfare support any more are not spending that money in small shops? It is estimated that in my constituency £83 million will be lost from our local economy through welfare changes alone, so lots of our small businesses will simply struggle to employ people in the future.

Absolutely; it is well known that people will spend money in local shops and support the local economy. Welfare reform has had a similar impact in Glasgow. The welfare rights department of Glasgow City Council says that 636 households in Glasgow, where housing costs are relatively low, are affected by the benefit cap, and 94% of those households have children. The Government should know that they are taking food out of the mouths of bairns. That is what is happening, and they should be ashamed.

Ethnic minorities are affected as well. The Equality and Human Rights Commission report that came out last week highlighted that three quarters of the cuts to welfare benefits affect Pakistani families. The Government deny that they have done any such thing and do not regard that report as important, but it really is, because it is relevant to how people can be included in the economy. If people are having all agency and money taken away from them and the cuts disproportionately affect particular groups, the Government have a real problem on their hands. They have to acknowledge that.

There has been a significant impact on women. Engender has highlighted in its excellent reports how 86% of the cuts to welfare benefits have come from women’s pockets. There are households in which women are not getting money and are not being able to put food on the table, as I have already outlined, and women have less capability in the world. That makes it far more difficult for women facing domestic violence to leave the situation, putting them in danger. It makes it far more difficult for women to achieve all the things that they could do in life and ruins women’s potential. If women who have had children want to go back into the jobs market, it makes it far more difficult for them if they do not have the means to get by as they work their way back in.

I pay particular tribute to the Women Against State Pension Inequality campaigners across the country who see this at first hand. Those women have worked their whole lives, often in low-paid, strenuous jobs, lifting and shifting and moving people and goods around, only to see just as they approach retirement age—the goal that they were set to reach—the date move away from them in the cruellest possible way.

I wish to mention Rosemary Dickson in particular. Rosie is a stalwart WASPI campaigner in Glasgow. She was raised in Calton by a single mum. She started working at 15, while she was still at school, to get through her exams, and since then had always paid the big stamp. At 17, she moved into the NHS and qualified as a clinical perfusionist. She ran heart-lung bypass machines and was in organ retrieval teams. That job took its toll—it was very strenuous—and she retired. She is now 60 and cannot find employment. She has tried all different places—she even applied for a job with the Department for Work and Pensions, but was told she was not qualified enough. As advised by the Pensions Minister, she tried to get an apprenticeship, but was told that she was not qualified and that if she wanted to be trained, she would have to pay £2,000 to get the qualification. She is really struggling.

Rosie has seen her dreams of a happy retirement—of moving on to spend the retirement time that she wanted in the way that she wanted—fade. She may have to sell her house. Many women she knows now find themselves dependent on their husbands for the first time in their lives. It does not say very much for gender equality in 2018 that women who have worked their whole lives in jobs that made them work hard and paid them less now find themselves dependent on their husbands when they thought they would get some time and independence back for themselves. That is a stain on all our consciences.

I wish to mention the hugely valuable contribution that people who were not born in the UK make to our economy. They may be EU nationals or non-EU nationals, but so many of them make a tremendous effort and contribute hugely to our economy but have not seen that effort rewarded by the UK Government. I could list any number of immigration cases, although I see you indicating that you do not want me to, Madam Deputy Speaker. I see again and again people who have come here, worked, set up a business and employed native Glaswegians in that business, only to find that, for some small, technical reason with which the Home Office seems to have no flexibility to deal, they are no longer allowed to work or to get public funds. They are left absolutely high and dry with a family to feed, a house to pay for and bills to pay and—nothing. That is really cruel. These folk have so much to contribute to our economy, and we should thank them for their efforts. We owe them a great debt of gratitude for all that they have done for choosing to make Glasgow, Scotland and the UK their home.

I wish to raise the issue of those who have been caught out by paragraph 322.5 of the immigration rules. They made a legitimate change to their tax returns, sometimes years ago, and are now told, when they apply to regularise their status here, that they are a threat to national security under the discretionary powers of paragraph 322.5. It is absolutely ludicrous and I would be grateful if the Minister looked into the issue. We encourage people to make minor changes to their tax return—we do not want people not to make changes to their tax return if they are due—but this group of people who have come here to work hard in highly skilled jobs and never taken a day’s benefits or anything like that, now find themselves at risk of removal from this country under this discretionary rule. If people feel so unwelcome because of that, it will be a huge threat to the economy.

Finally, we need to talk about austerity. We have to look at its long-term impact on the nation’s health and wellbeing and the knock-on effect on our economy, and we need to consider women’s place in that. Women’s Aid Northern Ireland told me that most women’s equality issues are in fact economic, but wrongly get described as fluffy, marginal social quibbles. Caring work, which has propped up our economy since Adam Smith’s ma fed and clothed him every day, is not counted as a valuable contribution to the UK’s economic functionality. If we want to be a country that, as the Prime Minister says, works for everybody, we need to recognise what everybody brings to the country, and we need to make sure that people are rewarded properly.

I have declared my business interests in the Register of Members’ Financial Interests, but I do not plan to talk about them today.

What a catalogue of misery we heard from the Scottish National party spokesman, the hon. Member for Glasgow Central (Alison Thewliss). It was just bizarre. I thought there was an SNP Government in Scotland and that she might have found something about Scottish public services or the state of the Scottish economy of which she was proud, but no, everything is miserable and, of course, everything is the direct fault of the Westminster Parliament. The SNP takes no responsibility for anything. I thought the Scottish Government had put up taxes and were going to endow their public services with even more, but the hon. Lady did not mention that. Perhaps she does not like the potential economic consequences of that, but it is absolutely typical that we get nothing positive and the SNP accepts no responsibility for the economy.

I wish to talk about the huge opportunities for the United Kingdom economy as we leave the European Union. I know it is fashionable for Labour Members to be wholly negative about the Brexit for which their constituents voted and which—to try to keep their constituents’ vote and have some confidence from their vote—they said in their 2017 manifesto they would deliver, but their voters, like me, think that there are huge opportunities for a United Kingdom that will be more prosperous and successful outside the European Union than inside it.

The right hon. Gentleman says the SNP talk about misery; may I enlighten him with a little reality? This week, Dunnes Stores, an Irish company, announced that its store in the Parkhead Forge in my constituency was closing down. The company said that that is because of Brexit, and it will have a direct impact on jobs in my constituency. That is the reality.

I can find many examples of companies that have come pouring in with extra investment post the Brexit vote. The national figures show that we have had more jobs, investment and growth following that vote. Those ridiculously pessimistic Treasury forecasts were launched just in time for the referendum vote. At the time, I and a few others put our professional reputations on the line, said that the forecasts were completely wrong, explained why the economics behind them was misleading and why the forecasts were likely to prove widely inaccurate. We were right; the Treasury, World Bank and others were comprehensively wrong and have been rightly confounded.

I am pleased that my right hon. Friend the Chief Secretary to the Treasury agrees with me that it is a pleasure that those forecasts were wrong. She and the Chancellor are exactly right to be cautious about the latest set of official forecasts, which are likely to prove too pessimistic for the future years. It is important that we aim to beat those forecasts. We know that they keep changing the forecasts and that they tend to be too pessimistic, on average. Now is a good opportunity to go out and beat those forecasts. We should make that one of the main aims of our policy. I look forward to Opposition Members trying to help us, instead of doing all that they can to peddle misery and gloom to try to dampen spirits and reduce confidence at a time when there are good reasons to be more confident and to believe that those forecasts were wrong.

Let me take one obvious point. I have some disagreement with my Front-Bench colleagues, because I would like to stop paying any money to the European Union after March 2019. Some of my Front-Bench colleagues seem to wish to be more generous than me, but I think they agree that we must quite soon get to the point at which we are not paying any more money to the European Union. When we have full control of our money, which is what we voted for, we will have £12 billion to spend on our priorities here in the United Kingdom rather than on the European Union’s priorities somewhere else across the continent. That will give us an immediate 0.6% GDP boost. When a country is growing at 1.5% to 2%, an extra 0.6% represents a material improvement in its growth rate. We will not just get that £12 billion as a one-off in the first year; we will get it in every successive year, because we will have that money available to spend.

I campaigned in the previous election for the Brexit vote to be properly implemented, and my constituents gave me a majority knowing that that was my view. I also campaigned on the ticket of prosperity not austerity. I do want more money spent on the schools and hospitals in Wokingham and the local area. I am very pleased with our latest settlement, because health staff need more money. I am also very pleased that the weighting of the percentage increases is much more generous to those on low pay, because in my area it is extremely difficult getting by on those low pay rates. We need to recruit and retain more and to give more people in those jobs the hope that they can go on to better paid jobs with good career progression.

I want more money spent, but I do not want it spent irresponsibly. I am offering the Government the biggest spending cut that they will ever make, which is the £12 billion a year that we do not need to keep on sending to Brussels. In the spirit of the Brexit vote, I say bring our money back, take control of it and spend it on our priorities.

Before the referendum, I took the precaution of setting out a draft Budget that I would like the Government to adopt. I explained that I was very unlikely to be the Chancellor of the Exchequer and that people could not take my draft as a promise; it was a set of ideas on how that money could be spent. I suggested, mainly, more spending on areas such as health and social care and education, and also on tax reductions—getting rid of our damaging VAT rates on green products, on feminine hygiene products and on domestic heating fuel, which hit those on the lowest pay most heavily. Those are things that we cannot do for ourselves all the time that we are in the European Union.

The Government’s failure to negotiate a zero-rate tampon tax does not give us great hope for any further negotiations with the EU.

I think that the hon. Lady will agree that this is one area where even she must see that getting out of the EU is a big positive, because she and I will be able to unite on something for once, and shove the abolition of this much-hated tax through the House. Is it not a disgrace that the world’s fifth largest economy and an important country cannot even control its own taxes? Over all those years in the EU, we were assured by Governments of all persuasions that tax was a red line and that the House of Commons would always be able to decide what the tax rates would be and what was going to have to be taxed. That simply will not be true until we leave the EU.

That is the first bonus. The Brexit dividend is to take control of our money and to spend it on our priorities. It will have a double advantage: not only will it give a boost to growth the first time we do it, but it will cut our balance of payments deficit. I am more worried about our balance of payments deficit than our state deficit, because the Government have done a great job in getting the state deficit down to perfectly reasonable levels, whereas the balance of payments deficit needs working on. The simplest way of cutting it is to stop sending money to the EU, because that is like a load of imports.

I wish to ask a serious question. The right hon. Gentleman is very well remunerated for his views on finance and is very much sought after for advice in the City. He will know that, if we were to lose just 10% of, say, the financial services sector in the UK, as a result of market access ending through Brexit, that would constitute a loss of £8 billion to £9 billion in taxation to this country. Is he genuinely not worried at all that we need to retain some elements in our economic relationship with the European Union as part of those Brexit talks?

I am an optimist. We will have a perfectly good economic relationship even if we do not get a comprehensive formal deal of the kind that I know those on the Front Bench would really like to secure. The hon. Gentleman shakes his head. Well, let me give him the evidence. When I studied this subject before the referendum—I always like to ensure that I give good advice, so I try to find out what I am talking about and have some facts—I looked at the economic performance of the United Kingdom during the early 1970s, when we first entered the European Economic Community, and took great interest in the economic growth rate around 1992 when the single market was completed, which people say is so crucial to our growth rate. From that, I can assure the hon. Gentleman that we cannot see any positive kick up in the graph of UK growth either when we first joined the EEC or when the single market was completed in the early 1990s. Indeed, the growth rate fell off on both occasions. I do not blame the EU for all of that, but it shows that there was no great benefit.

If there was no benefit going into the thing, why should there be something negative when we come out? It is not asymmetric. There will not be a hit. I promise him that when we look back on it all in five years’ time, he will not be able to see that—certainly on world growth graphs and, I suspect, on UK economic graphs—when we left the EU. It will not be a big economic event. It is a massively important political event, but it will not be a significant economic event, because joining it was not. Indeed, even worse, in the immediate aftermath of both joining the EEC and of completing the single market, there were very big recessions where our growth rate took a very big hit. I do not blame the EEC for the first one—that was more to do with international banking and the oil crisis—but I entirely blame the EU for the second one, because it was the European exchange rate mechanism that ripped the heart out of our companies and our economy and led to a boom and bust that was almost as big as Labour’s at the end of the last decade. That was why we did so badly.

Let me now go into a little more detail on some of the crucial sectors that have been badly damaged by our membership of the EEC, and then the EU and single market. We can do rather better in those areas once we are out of the legal entanglements.

Let us start with the most obvious and topical one this week—the fishing industry. When we first went into the EEC, we had a flourishing fishing industry, with a large number of trawlers and successful fishing ports in Scotland, England and Wales, and a net surplus of fish. We were an exporter of fish because we had access to one of the richest fishing grounds in the world in our own territorial waters and beyond. The common fisheries policy destroyed much of that. Many of our boats were lost, and much of our fishing capacity was lost. We are now a heavy net importer of fish, as a result of being part of the common fisheries policy. Our fishing grounds have been greatly damaged, because too many industrial trawlers have been allowed in from outside to do damage to the seabed and to the shoals of fish that we once had. The quota system has not really worked because of the discard policy.

It would be easy to design a UK fishing policy through which we would have both more fish to eat and we would take fewer fish out of the sea. We would do that by not having the discards. It would also be easy to design a policy in which the fish was landed in the UK, so that there would be more economic benefit for us in processing and selling it on, and in which we would have much more capacity in the English and the Scottish fleets so that we could capture more of the added value. I look forward to the Secretary of State publishing a detailed strategy and offering us draft legislation, and I look forward to the Scottish National party supporting that legislation, because it must know how important the recovery of our fishing industry is.

I know that Mrs Thatcher was a great heroine of the right hon. Gentleman. She said:

“Just think for a moment what a prospect that is. A single market without barriers—visible or invisible—giving you direct and unhindered access to the purchasing power of over 300 million of the world’s wealthiest and most prosperous people.”

It is now 500 million. Was she wrong at the time?

Mrs Thatcher was not always right. As her chief policy adviser, I gave her extremely good advice on the single market, which she did not actually accept. She took most of my advice on a lot of things, but I told her not to give the veto away—it was not worth it, because we needed to keep control of our own law making. However, the Foreign Office was more persuasive than I was, and that was where things started to go wrong. We were tricked into accepting what she hoped—and what a lot of British people thought—was just going to be a free market where there were fewer barriers for trade.

What actually happened was that we were entrapped in a massive legislative programme, which meant that more and more controls—often of an anti-business nature —were imposed, even when the UK did not want them and even when we had voted against them, when we were in the minority. That is why many British people fell out of love with the Common Market that they thought they had voted for in the early 1970s; they thought that it would just be about more jobs and more trade, but discovered that it was about the EU taking control. I am afraid that, on that occasion, Margaret Thatcher was less than perfect. She did not choose the right advice to follow. If she had vetoed the loss of the veto, the hon. Gentleman might have had his way and we would still be in the European Union with a rather different relationship from the one that we were forced into taking.

I turn now to the energy industry. Under European rules we were trapped in a common European energy policy, which meant that we went from being entirely self-sufficient in energy to being quite heavy importers. There is a wish to make us more and more dependent on imported electricity and gas through interconnectors with the continent, meaning that we have less security of supply and are more dependent on the good will of many people on the continent—ultimately, on Russian good will, because of the importance of Russian gas to the energy supply on the continent. Fortunately, the situation has not gone damagingly too far, and we can rescue it when we come out of the European Union. Our gas supplies can be much more dependent on Norway and Qatar, which are not members of the European Union. That is a useful precaution because we can trust those suppliers and the supply will not be subject to the same common problem that might arise in the European system.

We need to be careful about the framework of regulation. I am all in favour of cleaner air and looking after the environment, but the rapid and premature closure of coal power stations before we have good, reliable alternatives puts us in a bit more jeopardy. We have already experienced cold days, when there is big industrial demand but very little wind; it is extremely difficult to balance the system and keep up the full amount of power that people want. We may have to go on to industrial rationing in some cases. If we follow European policy and shut all the coal stations without having proper, reliable alternatives in place, running a good industrial strategy will be that much more difficult.

What would I put at the top of my list for a good industrial strategy? My No. 1 need would be a plentiful and cheap supply of energy. Having had jobs that involved running factories and dealing with transformation materials that have a high energy content, I know the importance of reliability and relatively low price for running certain kinds of process industry. The United States are now reindustrialising because they will have access to a lot more cheap feedstock and fuel as a result of their drive to have much more domestic energy, at a time when we have been going in the other direction by becoming more reliant on other systems that are not reliable and on imports. We are now finding that we are becoming short, and our power—certainly at peak demand—can be extremely expensive unless people have a long-term contract that properly protects them.

I urge Ministers to use the opportunity to rethink our energy strategy, and to put it at the top of the list for the industrial strategy they tell us they want, because it is the No. 1 requirement for a strong industry across the piece. The other day I was talking to my hon. Friend the Member for Stoke-on-Trent South (Jack Brereton), who reminded me just how important cheap and readily available gas is to the Potteries. We want those industries to grow and flourish—I used to be involved in them a bit—and there is huge scope for that, but it will require a sensible, UK-based energy policy.

I turn next to the vehicle industry, which I think will be just fine. It has been built, with a lot of foreign investment and local talent, into a very fine industry. But we need to remember its exact shape. The UK has the capacity to make about 1.7 million cars per annum, but it has the capacity to build 2.7 million engines. Last year 1 million of those engines were diesel. Successive Governments have done a good job of persuading large motor and engine manufacturers to come to or expand in the UK. We now have a centre of excellence in diesel engine technology, and engine production generally, for passenger cars and light vans. We should be rightly proud of that, but it is important that the Government understand this achievement and do not do things that inadvertently damage it.

Car sales continued to rise very nicely after the Brexit vote. We experienced a very strong market and there was a good trend of car sales in the UK for the first nine months after the Brexit vote, as was happening before. But in spring last year there was a sharp reduction, which has continued. Why has this happened? Well, it is nothing to do with Brexit. It is to do with policy decisions taken in the United Kingdom. Three things happened at the same time.

First, it was decided that too many car loans were being advanced, so there was a restriction on car loan credit. I think we worry too much about that. There is security: people who get car loans usually have reasonable jobs and incomes. I am pleased to say that we are not looking at a set of job losses any time soon, so I cannot really see the big problem. Secondly, there was the imposition of much higher vehicle excise duty, particularly on higher-value cars, which are particularly profitable and successful to make.

Thirdly, of course, there were the general arguments that diesel is no longer acceptable. Diesel technology in this country, and through European regulation, has reached much higher standards of cleanliness and control of exhaust. As far as we know, all these engines are more than meeting the legal requirements, because we all want cleaner air. But if the idea gets abroad that all these standards are actually going to be tightened very quickly, or that it is going to become unacceptable to run a diesel engine, it puts people off buying. There has therefore been a big collapse in support for diesel engines and cars, which explains the pattern in that market. I hope that the Government will look at a sensible compromise. Yes, we want clean air, but we also need to say and do supportive things for what is now a very important industry in our country.

There is huge scope for farming. The Secretary of State has made a start with his White Paper, but it still of a fairly high level of generality. I look forward to more detail soon. The motif of the policy must be that we can and should grow more for ourselves. In the early days after we joined the European Community, we were about 95% self-sufficient in temperate food, which is the kind of food that we can produce; we are now under 70% self-sufficient. We import a lot of food from the Netherlands and Denmark—countries with similar climates to our own—and quite a lot from Spain, which produces some things that we cannot grow for ourselves, although we could buy cheaper alternatives from South Africa or Israel if we were allowed to do so. We need to look at all that and do a better deal for the lower-income countries that can sell us food that we cannot grow for ourselves without the same kind of tariff barriers. We also need to do a lot more work on how we can grow more of our own food.

The right hon. Gentleman’s point on growing our own food falls if we do not have the people here to pick that food. It will be rotting in the fields, as is already starting to happen, because EU workers who have come over to do this job are leaving, and our own workers do not want to do it.

There is still quite a large number of net inward migrants to this country. I look forward to higher wages and more automation. All these problems are perfectly soluble. There are now some good automatic systems for picking produce, if people do not want to do those jobs. I hope that there will be more productive ways of employing people so that they can be paid more—for instance, if they work smarter and have more technology to support them. That would be good for the employee and for the farming business. Some of this is about scale and some is about investment.

I hope that we develop a farming policy that still provides public money to support farms sensibly, but that will be more geared to the production and successful sale of food, particularly domestically. We want fewer food miles on the clock and rather more local produce. I hope that the policy will allow and encourage more agricultural businesses in the United Kingdom to add value to the product coming from the field, shed or farm, because that is an important part of developing a prosperous and more successful economy.

The UK has enormous scope in sectors such as the media because we have the huge advantage of the English language. We largely share that advantage with the United States of America, which is also very good at media and internet-related businesses. I look forward to the tech revolution being an important part of our better-paid jobs and in the increase in jobs in the future. Once we are out of the EU, we will also be able to choose our own tax and regulatory regimes. I trust that we will choose a best-in-class, world-leading regime for both tax and regulation. Although I understand some of the irritations that the EU and others have with existing large technology companies, it is important that we also understand how phenomenally popular their services are, how hugely important they are as wealth generators, the choice they offer customers and the new jobs that they will create. We therefore need a tax and regulatory regime that is fair and is not part of a trade war between the EU and the United States of America, which seems to be developing at the moment in an unfortunate way.

Infrastructure is very important. One thing that perhaps unites the House is that we would all like more investment in infrastructure, although we then have disagreements about pace, style, and ways of financing it. There is huge scope for more infrastructure in this country. If we wish to take advantage of our greater freedoms and the kinds of business developments I have been sketching in different sectors, we will certainly need a lot more capacity in road and rail. Rail capacity can be increased more cheaply and more rapidly if we go over to digital controls. One of the features of our railway system is that we run very few trains an hour on any given piece of track. With better controls, we could increase the number of trains we ran on existing track—a quicker and cheaper solution than having to build lots of new tracks.

We are going to need improved road transport. Internet styles of purchasing require road capacity for all the van deliveries that will be made when people have bought on the web. Road capacity is also needed for those who still like going to a traditional shop and expect to find somewhere to park when they do so. Only the shopping centres that have really good access and really good parking are likely to flourish in today’s world, because people naturally want convenience. I trust that the Government will find sufficient public capital support for these necessary programmes, but will also be imaginative in finding new ways of harnessing private finance where that is appropriate, as it clearly is in areas like energy and communications where there are defined revenue flows that should be financeable through the private sector.

The aim of Brexit is to cheer the country up, to get wages up, and to get jobs up. So far it is all going reasonably well. There are more jobs after the Brexit vote, despite the false forecasts. Pay is going up a bit. We would like more improvement in real pay, and it is good to see some moves being made in the public sector. The big Brexit bonuses we want comprise spending our own money and knowing when, how much, and what we are going to get for it; having a fishing policy that makes sense both for British fishermen and for British fish; having a better agricultural policy that means we can grow more of our own food; and having an energy and industrial policy that supports more investment and more growth.

The right hon. Gentleman is an advocate of a united kingdom, especially as we are coming out of Europe, but there is the vexed question of Northern Ireland. How does he see that fitting in with his vision for the future? It is very important for Northern Ireland, as part of our UK economy, to understand where he is coming from on this matter.

I trust that Northern Ireland, as part of the United Kingdom, will benefit from the economic policies I have been describing. It is the settled wish of a majority in Northern Ireland that they stay part of the United Kingdom, and they are very welcome. If the hon. Gentleman is referring to the alleged difficulties regarding the border, I simply do not think that that is a serious, real problem. It is obviously a political problem because the EU wishes to make it so, but the EU needs to understand that this border is already a complex one. When goods are being moved either way between the Republic of Ireland and Northern Ireland, there is a currency change to be effected, and there are different incidences in excise rates, VAT, income tax and corporation tax levels on each side of the border. Yet we do not have a man or a woman at the border stopping every truck and working out the sums on what has to be done on the excise tax or the currency, because that would be ridiculous. If we end up with World Trade Organisation-based trading so that there do have to be tariffs at the border, it is no more difficult to calculate the tariff electronically and charge it away from the border than it is to charge the excise and the VAT at the moment. We know how to do it; it is not that complicated: we live in the electronic age. I can see that Labour Members want to live in the pre-computer world and do not think that we can send data electronically, but I assure them that it is a magical development.

The slogan of the leave campaign was “Take back control”. What does that mean if it does not mean taking back control of one’s borders? There are movements of people that need to be considered. There is still the common travel area between this country and the Republic of Ireland. One cannot simply introduce borders and then tell the British public that those borders will not be physical, or even exist, because there will somehow be a digital solution. It is not practical to say that those borders are going to be put in place and then they will not exist.

The hon. Gentleman has been here long enough to know that all parties have always agreed that we keep the common travel area with the Republic of Ireland. That has always been a given. It was not dependent on the EU in the first place, and everybody wants to keep it.

Let us deal with the question of our UK external border, wherever it may be, and the issue of migration. Yes, the British people voted to have more controls over the number of people who come to work and settle here. The Prime Minister has promised on several occasions that she will get the net migration total down to tens of thousands from the quarter of a million-plus we have been experiencing each year, and I wish her every success with that. We do not need new hard border checks because, as I understand the way that thinking is going in the Government—the way I encourage it to go—we just want to control two things. We want to control the right to work through a work permit system and we wish to control the entitlement to benefit by making sure that people are properly qualified for it. That does not require big controls at the border. Anybody is welcome to come as a tourist, to come and spend their own money, and to come and invest. That is not what we are trying to stop. We can control the things we wish to control through a work permit system and through a benefit system.

I am listening carefully to the right hon. Gentleman, if only out of a sense of morbid curiosity, with regard to how he is going to explain practically the situation in Northern Ireland. We have heard a lot of abstract ideas; we need practical solutions. It is incumbent on him to give us a serious, practical way forward in relation to that problem, which is very serious, notwithstanding what he says.

I do not agree. It is already a complex border. There are already anti-smuggling arrangements. There are already methods that satisfy those on both sides of the border as regards the possible passage of criminals and so forth. All those things will stay in place. They are not made that much more complicated by our leaving the EU. The Republic of Ireland is not part of Schengen; it does not have those special arrangements that the rest of the EU has, so this is making a mountain out of a molehill. Indeed, I do not think it is even a molehill. I just do not understand why serious people can think that it is a serious issue. I understand why political people want it to be an issue—because they want to extract a price from the United Kingdom, as if we had not already offered enough in the interests of friendly relations, in due course, with the European Union. I assure Labour Front Benchers, who are meant to be pro-Brexit and have a lot of pro-Brexit voters, that I cannot see any extra complication that cannot be solved by a bit of electronics and the development of what we already have, because it is already quite a complex border.

There are huge opportunities. If we take advantage of these freedoms, we can boost our growth rate. I have shown how we can do that in a few individual sectors. I have shown overall how we will do it by spending our own money, and explained how we have a huge opportunity to rein in some of the excessive imports we are taking in at the moment by replacing them with home production. We can do many good trade deals around the world to extend and improve our trade with the rest of the world, which is already good, growing and flourishing despite tariffs and WTO terms: we know how they work and they work just fine. I just say this to the Government: let us get on with it; let us not make any more concessions; and let us make sure that if we do end up with a deal, it is a deal worth having.

I am grateful for the opportunity to participate in this general debate on the economy. The right hon. Member for Wokingham (John Redwood) said that this should be about prosperity, not austerity, but it is increasingly clear that we need to listen to our councils when they advise us that their struggle is real. The Minister referred to Eeyore. I have heard that a number of times from Conservative Members and I consider it quite apt, because I believe that Eeyore means “eight years of rogue equality” with regard to economic policy. We cannot keep on cutting funding and expecting people, especially councils, to do more with less. Councils are dealing with an unprecedented surge in demand, with a 140% increase in child protection inquiries in the past 10 years. Even the Local Government Association has raised concerns that there is still no clarity about how local government will be funded after the four-year funding deal runs out in March 2020.

The Government urgently need to get a grip of the crisis facing children’s social services as the £2 billion funding gap that those services face by 2020 threatens to put more children at risk. The number of children taken into care is at its highest since 1985, yet according to the National Children’s Bureau, more than one in three councillors nationally warn that cuts have left them with insufficient resources to support those children.

Between 2010 and 2020, Peterborough City Council, which covers my constituency, will have had its direct funding cut by 78.7%. How is my authority expected to meet the rising demands of adult social care and children’s services with such devastating funding cuts? Austerity has not tackled the deficit; rather, it has passed it on to public services.

In March 2018, the National Audit Office reported that many local authorities rely on using their savings to fund local services and increasingly find themselves in an unsustainable financial position. In my constituency, there has been a real-terms cut of 10.6% in adult social care, which is almost double the national average, and the Government committed no further funding for social care in the Budget. The money offered to councils in the local government finance settlement is nowhere near enough to calm this crisis. Those services are overstretched, and the recent trends in funding are unsustainable and unacceptable.

For far too long, Peterborough’s needs have been attended to on the cheap. As a consequence—cuts have consequences—cracks are beginning to appear in our services. The needs of my constituency have not been properly or adequately addressed, and the current settlement is blatantly below par.

I believe in helping others and I am seeking to do so in my constituency, as is my council. However, it is finding it increasingly difficult to do so because of the budgetary cuts. It is therefore no surprise that Peterborough is ranked 46th on Shelter’s list relating to people who are in temporary accommodation or sleeping rough.

Support and praise must be given to the Light Project and its work on the Peterborough winter night shelter. It is actively looking into daytime provision for homeless people, as well as mentoring and befriending them, in order to aid my city and step in to fill a void to which austerity has contributed.

I conclude with the words of a volunteer who helps to serve the homeless of my constituency:

“Homelessness and loneliness go often hand in hand

You walk on past,

don’t see me here, a living breathing man

I smile at you the best I can, shivering in the cold

You turn your head and pass on by,

how can you be so bold?

Before you knew it I was here,

I used to be like you

And now I sit here all alone,

with nothing much to do

Just one crisis from the street, I wonder if you care

Open your eyes up to the truth,

it’s happening everywhere.”

It is an honour to follow the hon. Member for Peterborough (Fiona Onasanya), and I do so with good heart, because although Tendring District Council has experienced year-on-year revenue support grant reductions, we are flourishing and have not cut one frontline service. That can be done; we are a lean, mean administration machine.

Unlike the hon. Member for Bootle (Peter Dowd), I recognise that it is springtime and our economy has gone beyond green shoots. The financial sap is positively rising: unemployment is at a near record low; the deficit is down; and there is more investment in our vital public services, including £4.2 billion for our NHS. That means that the “Agenda for Change” staff in England are to receive a pay rise of at least 6.5% over the next three years. As the Secretary of State for Health tweeted yesterday:

“Rarely has a pay rise been more deserved.”

I thoroughly agree.

I was delighted to hear in the spring statement that there may be capacity for further increases in public spending and investment in the years ahead. Of course, that would be done while continuing to drive value for money to ensure that not a single penny of precious taxpayers’ money is wasted. It is therefore good news that the most recent forecasts of the Office for Budget Responsibility suggest that economic improvements will be maintained. It is also clear to me that the economy is already beating the forecasts and correcting the naysayers, and I have no doubt that it will continue to grow, create jobs and beat those expectations after we leave the European Union. This is a time to celebrate those improvements, not talk them down, which can only do damage to our prospects.

I was also pleased to hear the OBR’s projections that following Brexit our payments to the EU will be £4.9 billion lower in 2025 than they are today. Consequently, I maintain that there will be opportunities to spend in both the short and the medium term, which brings me neatly on to the question of where that money should be spent.

I believe that some of the money should certainly be spent on business and infrastructure. In a previous life, when I was Tendring’s cabinet member for regeneration and inward investment, I saw at first hand how support for businesses and infrastructure can pay tremendous dividends for economic growth. At the core of all that is the need not just to make cash available, but to make sure that it is spent in a timely and appropriate manner, and used to build infrastructure for future growth. It is a question of i before e—infrastructure before expansion.

In my previous role, I made grants of up to £150,000 available to businesses in Tendring so that they could grow, flourish and create new jobs in manufacturing, engineering, energy, low-carbon, maritime, and research and development activities. That cash came from the Tendring District Council small and medium-sized enterprise growth fund, which I introduced. We could move quickly and effectively, and therefore grow a great reputation as a business-friendly council. Moreover, being a district that very much marketed itself as open for business meant that we turned heads towards our glorious sunshine coast.

For example, with £16,000 from our growth fund, we managed to attract the Lampshade Company, a bespoke shade manufacturer, to our patch. We also got Ball Launcher with a £70,000 grant. It makes a football launching device to train players—very topical. When it came, it brought jobs with it, and that happened because Tendring was a council that was out there touting for business. Those are examples of committing cash for infrastructure. Business gets excited and then wants to work with us and to invest—it is a win-win situation.

That is why, like my right hon. Friend the Member for Witham (Priti Patel), I regularly use my position in this House—I am sure that many hon. Members have noticed this—to call on Ministers to spend more on roads and rail for Clacton and the east coast to address the fact that it takes far too long to commute from Clacton to the capital. The distance is only 70 miles, but the journey takes nearly one hour and 40 minutes by train. If we cut that journey time to closer to an hour, we would regenerate the east of Essex at a stroke.

It will come as no surprise to hon. Members that I ask the Chancellor to consider diverting some of the Brexit dividend to Clacton’s much overlooked infrastructure. Investment should be delivered locally, to unlock the economic potential of communities such as Clacton; regionally, to improve connectivity between our economic hubs, including through the improvements to the A120 that we have long called for; and nationally, to rebalance our economy. Crucially, that investment will not only attract business, but upgrade the UK’s infrastructure and underpin the Government’s modern industrial strategy, which is good for our economy and our country.

It would be remiss of me if I did not ask, during this period of strong economic development, that the Chancellor listens to the representations of my right hon. Friend the Defence Secretary and ensures that our military gets the £2 billion a year it needs to deal with constant and growing threats, and rising equipment costs. I am a member of the armed forces parliamentary scheme, and I have worked closely with our military personnel, who do an exceptional job in difficult circumstances. As a result, it has become clear to me that while our forces are, on the whole, superbly equipped, they need serious support to enhance their capability. It is imperative that those hard-working, brave men and women feel valued and supported.

Following our success in removing the cap on the police precept, I have no doubt that the Government fully support our hard-working local police forces, for which I am incredibly grateful. I would, however, now ask that the Government use some of the Brexit dividend to do the same for our valiant and professional armed forces.

If I visited Clacton and then decided to go across the water to the continent, would the hon. Gentleman think that my new blue passport should be made in Britain or in France? Will he give me a bit of advice on that?

I can give the hon. Gentleman some great advice, and one of the first pieces of advice would be that he comes to Clacton. It is one of the most beautiful places in the country. We have 36 miles of unspoilt coastline, some of the greatest beaches and great backwaters. I am very proud of my passport—I have it with me now—and if it is blue, let us make sure that we get the best value for money in the printing of the things.

I am absolutely delighted by the hon. Gentleman’s invitation to Clacton—I am more than happy for us to compare our diaries—but he really should answer my question: does he think that my new blue British passport should be made in this country or by the French?

I draw the hon. Gentleman’s attention to the fact that I did answer his question—I said that we have to get the best deal possible. We are still a member of the EU, with its rules and regulations in place, and we have to look for the best possible deal. I would prefer that we made everything in Britain, but we cannot go down that road.

I am certain that the hon. Gentleman will remember that not that long ago—in 2010—the drawer had no money left in it. Well, we are filling it up again, and we must never again leave it in the hands of those who might want to empty it and impoverish our nation, damage our economy and hurt those least able to help themselves. This period of economic growth presents us with funding opportunities, and I hope that the Chancellor will make the best use of those opportunities by investing in our infrastructure, which will attract new business to participate in the Great British economy.

Well, how do you follow that, Madam Deputy Speaker? It is a pleasure to follow the hon. Member for Clacton (Giles Watling), who delivered his speech in his own inimitable style.

I must say that I am a bit disappointed that the right hon. Member for Wokingham (John Redwood) has now left his place; I am sure he is away to have a cup of tea or something like that. He spent a huge amount of time saying how terrible Treasury forecasts were, and the irony of that was not lost on me. I was an activist during the entire Scottish independence referendum campaign, and we were told by the UK Government, Conservative Members and, indeed, Better Together, how terrible the forecasts looked, so it was ironic to listen to him rubbishing such forecasts. I will certainly bear that in mind when Scotland gets another independence referendum.

Does the hon. Gentleman agree that the Scottish Government were wrong in their forecasts? They said that £1.8 billion came in from oil revenues in 2015, but that went down to £60 million in 2016. Their White Paper was very much based on such oil revenues coming in, but that would never have been the case.

At least the Scottish Government produced a White Paper, which was a heck of a lot more than the UK Government provided in the run-up to the Brexit referendum. Perhaps the fact that there was not enough information was the reason why a number of people in the UK felt they could not make up their mind on the referendum.

The right hon. Member for Wokingham spent a lot of time talking about fishing. One of his great heroines is Margaret Thatcher, but it was of course Margaret Thatcher who said that the Scottish fishing industry was “expendable”, so I will take no lessons from him on fishing.

I am very grateful for the opportunity to contribute to this debate on the economy. My Chief Whip, my hon. Friend the Member for Glasgow North (Patrick Grady), who has just come into the Chamber, tells me that the debate can last until 5 pm. I will not speak for the next two hours and 45 minutes, because some members of the Press Gallery would not be happy, but this is a good opportunity for us to focus on the record of a UK Government who are very much asleep at the wheel.

I am sorry that I was not in the Chamber earlier, but I was watching the debate, and I listened very carefully to what the right hon. Member for Wokingham (John Redwood) said. As a socialist of the left, I clearly have some differences with him, but he focused on one thing with which I agree—the balance of trade and our enormous net financial contribution to the rest of the EU. That contribution amounts to about £100 billion this year: we are paying 5% net of our total GDP into the EU. Does the hon. Gentleman not agree that that is a very valid point?

I am grateful to the hon. Gentleman for that point, and I am about to come on to Brexit. We know that Brexit is casting a very large shadow over the UK economy, and precious Government spending—up to £3 billion—is being set aside to counter the self-inflicted harm of a hard Brexit. After the Prime Minister took office, she said that she would deliver a red, white and blue Brexit, but I certainly did not expect such a Brexit to mean that passports would be made in France. But by all means—there you go.

One announcement that I do welcome is the Government’s decision on NHS staff pay. I welcomed it for the SNP from the Front Bench during yesterday’s urgent question. I commend the Government for taking action finally to give England’s hard-working NHS staff a pay rise, and I very much hope that the Welsh Labour Government will follow and do likewise.

Of course, in Scotland, the SNP Scottish Government was the first devolved Government in the UK to commit to lifting the public sector pay cap. We have already delivered on our promise on public sector pay, setting a 3% pay increase for those earning up to £36,500, which has the potential to benefit three quarters of Scotland’s public sector workforce. It is only fair that I declare an interest at this juncture in that my wife is a primary school teacher employed by Glasgow City Council and will receive that pay rise. Those earning over that threshold of £36,500 but less than £80,000 will receive a pay rise of up to 2%, and those earning over £80,000 will receive a £1,600 uplift. The 3% increase potentially covers 82% of NHS staff in Scotland for the next financial year, 2018-19. The Chancellor’s announcement will of course result in Barnett consequentials being allocated to the Scottish Government, and Ministers in Scotland have indicated that they will use this money to support “Agenda for Change” staff in Scotland.

Today’s general debate on the economy allows us the opportunity to take stock of the current economic climate, which does not make pleasant reading for Treasury Ministers. The independent Office for Budget Responsibility forecasts economic growth to be lower in each of the next five years than annual growth was in 2017, when it was 1.7%. Indeed, the Institute for Fiscal Studies notes that this puts the UK’s growth prospects

“among the worst in the G20.”

The right hon. Member for Wokingham—I am afraid that he is not in the Chamber—felt that my hon. Friend the Member for Glasgow Central (Alison Thewliss) painted a somewhat doom-laden picture, but that is just the reality. We can argue about politics, but we cannot argue about the facts. The IFS goes on to warn:

“Dismal productivity growth, dismal earnings growth and dismal economic growth are not just part of the history of the last decade, they appear to be the new normal.”

Britain now has the worst wage growth in 210 years, with a hard Brexit threatening to provide further shocks to an already fragile economy.

Treasury Ministers know that Brexit will be an economic disaster, and that is why the Government are setting aside £3 billion in 2018-19 and 2019-20 for expenditure on Brexit preparations. The Scottish Government will receive only 2.5% or £37 million of the funding allocated for 2018-19. I would be keen for the Exchequer Secretary, when he sums up, to explain how that figure was actually arrived at, because I certainly cannot work it out. It is deeply frustrating that the money we are receiving falls significantly short of the full Barnett share of the funding allocated at UK level.

I would be doing a huge disservice to Scotland if I did not take this opportunity to call once again, as many SNP colleagues have done, on Treasury Ministers to return the £175 million in past VAT payments to Scotland in respect of Police Scotland and the Scottish Fire and Rescue Service. I know that my own area commander would be more than happy to see some of that money coming back, and he could invest it.

Does the hon. Gentleman not agree that the great advantage of being a United Kingdom is that we can redistribute from the wealthiest areas to those in greater need? Sometimes, through the Barnett formula and regional spending, money can be redistributed from places such as the south-east, which is very wealthy, to places that are less wealthy, such as Scotland.

Yes, and one of those less wealthy places is my constituency of Glasgow East, but people there do not regularly come to me and say how wonderful the United Kingdom is because it has these lovely nuclear weapons that can defend the foodbank in Parkhead. I welcome the decision to include the police and fire and rescue services in the exemption from UK VAT, but it is only fair that the £175 million is returned to Scotland, so that we can invest.

Does the hon. Gentleman agree that the Scottish Government were well aware of the implications of a Scotland-wide police force, yet they still forged ahead with it?

Indeed, that is correct, and I am sure the hon. Lady will also take the opportunity to place on record the fact that the Scottish Conservative party also went into the election with that as a manifesto commitment. It is not a strong point for the Conservative party.

This Government’s stewardship of the economy is based on the choices they make. In one respect, the Chancellor and his Ministers paint themselves as fiscally prudent Steady Eddies who wish to avoid a spending splurge. They will tell the WASPI women that there is no money for transitional arrangements and implement painful social security cuts for the disabled. They will depress wages for young people who are unfairly excluded from the national living wage. They will tell us that fiscal prudence and sensible spending is the order of the day, but then they will magic up £1 billion pounds for their grubby confidence and supply deal with the DUP. They will magic up £4 billion to tart up this royal palace and all our lovely offices, and £3 billion for Brexit spending. In truth, how we run our economy is about the choices we make, and this Government’s choices have failed the basic tests of investing in people and public services and of delivering social justice for the most vulnerable in our communities.

It is now nearly eight years since Labour left this country in the grips of an economic crisis, and it is undeniable that we have come a long way since then. Unemployment is now at lows last seen in the mid-1970s, and not even in the years before the last recession were so few people out of work. Indeed, we used to debate whether such low unemployment rates were even possible in a modern economy and whether “full employment” these days means simply a higher level than it used to be.

Under this Conservative Government, we have proved the doubters wrong. Our economic policies, such as cutting corporation tax from 28% to 19%, have spurred job creation, and our welfare policies—in particular universal credit—have stopped the scandal of people being punished by the benefits system for entering work or increasing their hours.

Employment is not the only area of success. The UK’s economic growth continues to outperform expectations, and the £154 billion a year deficit that Labour left us with has now been cut to just £45 billion. Conservative policies have cleared up the mess left behind by Labour and brought prosperity back to Britain. That makes me all the more angry and disappointed that, thanks to SNP misrule, Scotland is not fully sharing in that prosperity. The story of Scotland under the SNP is an outrage in itself, but it is also a cautionary tale about what the SNP would do to Scotland if it achieved its dream of independence and about what a hard-left Labour Government, propped up by Scottish Labour and the SNP, would do to Britain.

Scotland’s economic growth has been well below 1% for two years in a row, while the rest of the United Kingdom races ahead. Once population growth is accounted for, Scotland is hardly growing at all. Even more shocking is the fact that the Scottish Fiscal Commission expects that stagnation to continue, until growth finally limps above 1% in 2022. That would mean six consecutive years on the brink of recession—a malaise the likes of which we have not seen in 60 years.

Where is he indeed? We heard the right hon. Gentleman completely distance himself from Mrs Thatcher, which is an achievement in itself. I now give the hon. Member for Angus (Kirstene Hair) the opportunity to distance herself from Mrs Thatcher’s policies, which saw mines and shipyards closed down and industry completely decimated in Scotland. Will she apologise for that?

I thank the hon. Gentleman for his intervention, but I am most concerned about the Labour leader, the right hon. Member for Islington North (Jeremy Corbyn), leading Britain.

The Salmond-Sturgeon era is turning into a dark period in Scotland’s history. Let there be no doubt that the blame for Scotland’s stagnant economy lies squarely with the SNP, which has made Scotland the most taxed part of the United Kingdom.

During my time in Parliament as an MP and before that as a researcher, I heard Conservative Members say often that Scotland has tax powers, so why are they not being used. That is precisely what the Scottish Government have done. It may be that I and the hon. Lady will pay more tax, but that is fair because we earn a pretty good salary. In reality, however, most people in Scotland are paying less tax. Will she acknowledge that?

I campaigned hard about the fact that some people, such as members of the armed forces, cannot choose where they are stationed. They are being stationed in Scotland not through choice but because that is where they are posted, and they are being unfairly taxed. The hon. Gentleman’s colleagues in the Scottish Parliament stated in their 2016 manifesto that they would not increase rates of tax, and they have yet again broken a manifesto promise. I find that disrespectful to the people of Scotland.

The hon. Lady is being most generous in giving way, as was I. Does she acknowledge that 83% of members of the armed forces in Scotland will now pay the same or less tax than before?

In fact, 70% of members of the armed forces who are stationed in Scotland will be hit by the SNP’s income tax hike. That is a fact and that is why I was so delighted that all the campaigning carried out by my hon. Friend the Member for Moray (Douglas Ross) and me since that announcement was made by the Scottish Government in December has enabled the Secretary of State for Defence to review the situation and consider how the UK Government can try to mitigate that tax increase. We need to encourage people into our armed forces, not push them away.

While the UK Government pursue competitive, pro-growth, low-tax policies, the SNP is taking Scotland in the opposite and, in my opinion, wrong direction. The SNP has created a society where everyone who earns more than £26,000 a year—that includes nurses, primary school teachers, and corporals in the Army and Royal Marines—is labelled a “high earner” and forced to pay more tax than their counterparts in Wales, England and Northern Ireland. Taxpayers in the rest of the United Kingdom should be warned that that is the reality of asking “high earners” to pay more. Despite all that tax, Scottish schools and NHS Scotland services are still chronically underperforming and disgracefully understaffed. That is the picture I see in my constituency in Angus.

I am genuinely grateful to the hon. Lady for giving way again. She talks about the NHS and schools being underfunded. How on earth does she expect to fund them by cutting taxes?

I strongly believe that we should allow working people to keep more money in their pockets. The Conservative party has always been the party of low tax, and the contributions from Conservative Members today have shown how that is in the best interests of growing our economy.

The Scottish Government have made an immense mess of business rates, with Scottish businesses having to pay £14 million more in tax than they would if they were based in England. Small wonder that Scotland now has the lowest rate of business growth in the United Kingdom. Of course, it is again the nationalists who are holding Scotland back with their constant threats of putting us through a second independence referendum, which the people of Scotland do not want.

The SNP’s goal of independence inside the EU single market would destroy the internal market of the UK, which accounts for 61% of Scotland’s exports, yet the SNP turns a blind eye to that. Is it any surprise that businesses and investors are deterred by the SNP holding the threat of a second independence referendum over their heads? The Scottish Government want to sacrifice the UK internal market on the altar of the EU single market, which is almost four times less important to Scotland’s economy. They want to take Scotland back into the EU and—inevitably—subject Scottish fishing communities to the unjust common fisheries policy in perpetuity. For coastal communities in Angus and across Scotland, getting out of the CFP is the first, necessary step towards reviving our fisheries and wider coastal economy. Fishing already contributes greatly to the Scottish economy, and once out of the CFP, it will have even more to offer. I have said openly that this week’s transition deal was disappointing, and the UK Government will have to be extremely vigilant to ensure that the interests of our fishing industry are defended until the end of 2020.

I apologise for intruding on private Scottish grief. Does the hon. Lady not accept that the real reason we have sluggish growth in the United Kingdom as a whole is because of Tory austerity, cuts in public spending and low wage growth?

The contributions from my hon. Friends, which I do not need to reiterate, showed the very positive steps the United Kingdom as a whole has taken. Scotland, however, has done less than half of that, which is why it is incredibly important to highlight.

Moreover, the UK Government must deliver full control of our waters, with no compromise on any final Brexit deal that sells out our fishermen in exchange for something else. But the facts remain the same: the Conservative UK Government want us out of the EU and out of the CFP so that our fishing industry can flourish again. The SNP Scottish Government want to fail coastal Scotland again by taking us back into the EU and back into the CFP.

The truth is clear. While the rest of the United Kingdom shares the fruits of successful Conservative policies, Scotland stagnates under the SNP. If anyone wants to know about the SNP’s attitude to economic growth, know simply that in 18 months it still has not spent a penny of its own £500 million growth scheme. I very much welcome the UK Government’s investment in the Tay cities deal. This will be a welcome boost to my local economy in Angus and I am working incredibly hard to ensure that rural areas receive their fair share.

I am counting down the days, as are many others, until 6 May 2021, when Scottish voters will give their verdict on the SNP’s era of stagnation and bring it to a close. In the meantime, we can only point out what must be done if Scotland is to return to prosperity: an end to the menacing speculation about indyref 2; a clear commitment to preserving the UK internal market through Brexit and beyond; the abolition of the “Nat tax” to ensure that Scotland is no longer the most taxed part of the Union, either for individuals or businesses; and the cutting out of waste and diverting that money to promote growth and make our public services functional again. I hope that, at some point in the next three years, the Scottish Government will see the light and allow Scotland to fully benefit from the strong UK economy that the Conservatives have built, but it is looking increasingly likely that that task will fall to our next First Minister, Ruth Davidson.

It is always a pleasure to speak in a debate, even if, as often happens, it is at the tail-end. I thank all right hon. and hon. Members for their contributions so far and for their specific interests in the economy. I would like to bring a Northern Ireland perspective to the debate.

The economy is an issue that affects every village, town and city in the United Kingdom of Great Britain and Northern Ireland. We all read the grim, doomsday predictions about Brexit, yet we are still here and we are still standing. We will still be here and we will still be standing after 31 March 2019. I am a proud Brexiteer. Indeed, I think the Democratic Unionist party invented the word, because we were Brexiteers before the word was ever mentioned. We have always had concerns about Europe. It is good that we will now leave, and the sooner the better.

Like all Members, I am always interested to receive the constituency-tailored claimant counts, which indicate how the labour market is performing in our areas. I thank the economics, policy and statistics section of the Library for its sterling work, which it provides to us on request and as a matter of rote. Northern Ireland unemployment is down by 3,400 and now stands at 29,000. There has been a very focused economic strategy for Northern Ireland, which has worked out extremely well. We stand at 3.4% across the whole of Northern Ireland. Some constituencies are below that figure and some may be above it.

The total number of jobseeker’s allowance claimants in my constituency in February 2018 was 1,370, or 3.2% of the economically active population aged 16 to 64—the 207th highest of the 650 UK constituencies—but that is down from 5% when I first came into the House in 2010. The equivalent UK claimant rate was 2.7%. The UK unemployment rate, which includes people not claiming benefits and is estimated from survey data, was 4.3% between November 2017 and January 2018. The number of claimants in Strangford constituency is 115 lower than in February 2017, which perhaps indicates that we are moving in the right direction. There were 290 claimants aged 18 to 24 in February 2018, which is 75 lower than February 2017. That, to me, is an indicator that we are progressing. Indeed, as a party colleague highlighted, the latest labour market statistics show Northern Ireland moving in the right economic direction.

It is important to say that we have not had a working, functioning Northern Ireland Assembly for 14 months. In that time, we have experienced some of the greatest growth in Northern Ireland for employment, job opportunities and the economy as a whole. Those are good things, even though we have not had a Northern Ireland Assembly to drive it. Significant employment opportunities have taken place because of the good work of, and the foundations laid down by, the Northern Ireland Assembly, when it was working, and the Department for Enterprise, Trade and Industry. One of my DUP colleagues, in the Belfast Telegraph, said:

“Boosting the economy through private sector growth has been a key DUP priority over the last decade. It is very welcome that private sector jobs are now at their highest level since records began in 1974. We want to see that grow further and significant funding secured through the Confidence and Supply agreement to deliver on key infrastructure projects such as the York Street interchange and the superfast broadband are the foundation of future growth.”

Some Members have referred to the £1.4 billion that the DUP secured with the Conservatives as part of the confidence and supply agreement. We would be happy to assist those who are interested in how to negotiate a good deal.

I am pleased that Northern Ireland is doing relatively well, in spite of difficulties. Does the hon. Gentleman not accept that a factor in manufacturing doing relatively well in Northern Ireland, and in the rest of the United Kingdom, is the depreciation of the pound following the referendum, and that keeping the pound at a sensible level would be better for Northern Ireland’s future and for the United Kingdom’s future?

It would be remiss of me to say other than that the value of the pound has enabled our exports to grow and our manufacturing base to maintain its position. The hon. Gentleman is absolutely right.

The DUP’s confidence and supply agreement with the Conservative party has brought in money for everyone in Northern Ireland, regardless of whether they are Unionist, nationalist or anything else. Everybody gains from that agreement.

The House has seen progress on business rates and the small business rates relief scheme. I am very pleased that the Government have continued to ensure that that happens, because it will definitely bring benefit to all the high streets across the United Kingdom. Rates relief has brought opportunities and retained employment in shops in places in my constituency such as Newtownards, Comber and Ballynahinch. Rates relief ensures that we do not have empty shops. Those involved in the retail business say that we have some of the best shopping opportunities in the whole of Northern Ireland.

We have pursued the issues of air passenger duty and tourism VAT, negotiating and consulting with the Conservatives on how the confidence and supply agreement can benefit us, as well as the whole of the United Kingdom. There are advantages for others across the United Kingdom in a reduction to air passenger duty and tourism VAT. We need to be on equal terms with the Republic of Ireland to be able to grow our tourism sector. The DUP is continuing to work on issues that affect the local economy in Northern Ireland, as well as the whole of the UK economy. We are pleased to be part of the economic success story we have in the whole of the United Kingdom of Great Britain and Northern Ireland.

As the briefing paper succinctly put it, in terms we can understand, in 2016-17 the Government borrowed £46 billion to make up the difference between their spending and the income raised from taxes and other sources. Since 2009-10, the UK’s borrowing—often referred to as the deficit—has fallen by 70%, which again is good news. Borrowing is now at a similar level to that before the 2007-08 financial crisis, and the OBR forecasts that it will fall each year to just over £1 billion in 2022-23, which is equivalent to around 1% of GDP. If anyone thinks that this is not good news, they need to take another look at what it is saying. In laymen’s terms, we still have a massive debt—there is no doubt about that—but, in fairness to the Conservative party, it is trying hard to reduce the deficit, and if we continue along the lines we are on, it will be to the benefit of everyone in the Chamber and every one of our constituents.

Does the hon. Gentleman agree that it will be to the benefit not just of this generation but of the next generation, given that we currently spend on debt interest alone a sum greater than the entire NHS wage bill? We have to get that down so that future generations can have the public services they deserve.

The hon. Gentleman is right. It is not just for us as MPs and our constituents; it is for our children and our grandchildren. We are building a base here, as we have done in Northern Ireland through the Assembly, for a stronger economy in years to come. It is important that we move towards that.

I agree with the Government’s goal of reducing the deficit yearly, but while we must aim to do this, things arise outside of our control, and we must always be able to access spending power to meet those needs. We seem to be stabilising, and yet I am aware of the adverse effect of the roll-out of universal credit. I must put on the record my concern about its effect on the disabled and vulnerable. Opposition Members who have sat with me through many debates will understand my concern.

I am also very aware of the needs of the NHS, which the hon. Member for Cheltenham (Alex Chalk) referred to in his intervention, and the importance of providing advantages and opportunities to the NHS when it comes to funding. In the words of an elderly constituent of mine, the NHS “needs to rubbed out and drawn again, as our highly trained NHS staff are at the end of themselves and living on their nerves with no breaks and crisis management from one hour to the next”. That is why I welcome the Government’s commitment to a 6.5% wage increase for NHS staff over three years. That is good news, and we should all welcome it, because it is a step in the right direction. The DUP asked for that in our negotiations and discussions with the Conservative party, and the Conservative party has accepted it.

Fishing, which has come up on both sides of the House, is hugely important to me and my constituency, particularly in the village of Portavogie. Since we have an absentee MP for South Down, I should add that it is also important to those from Ardglass and Kilkeel. It is very important that we have a good fishing industry and sector. We are sick and tired of EU bureaucracy and red tape, of quota restrictions and days-at-sea restrictions, of boat numbers reducing in my village of Portavogie from 120 to about 75—the reductions are similar in Kilkeel and Ardglass.

The fishing sector is under pressure, but with Brexit we will have what the hon. Member for Angus (Kirstene Hair) said: a stronger fishing sector and industry, more employment, more opportunities and more jobs. I, like others, would like to see landings landing on UK soil. That is important. The voisinage agreement is a legal agreement under which we will take back some of the waters that are ours but which under another legal agreement the Republic of Ireland looks after. That will happen, and we will have more control over our own waters. So Brexit brings good news for the fishing sector.

I say the same thing to the Minister today that I said to the Secretary of State for Environment, Food and Rural Affairs the other day. I want us to make sure that in 2020 we are out. It is the responsibility of Ministers to make sure that happens. The Secretary of State gave me that commitment, and other commitments have been given as well. Those who represent fishing villages understand our concern and angst.

My constituency has seen enormous growth in the agri-foods sector. I think of businesses such as Willowbrook Foods, Mash Direct and Pritchitts—also known as Lakeland Dairies. The latter has three factories, two in the Republic and one in Northern Ireland, and if ever we needed an example of why we need to transition to a soft border, that company is it. Its process involves milk crossing the border three times: first, it comes across in fluid form; then it goes back in powder form; and then it comes back again to Newtownards, where it is packaged and processed, and sold across the world. Rich Sauces is another agri-food business in my constituency that is doing extremely well, and we must remember that this is about not just the guys in the factories doing the production and manufacturing, but the farmers supplying the milk, and those providing arable goods for vegetable firms. Those are the success stories, and we need to reach a satisfactory arrangement for them.

We have also seen new markets created. Lakeland Dairies, for example, is marketing a new milk powder in China. The Minister has been involved with that. He has been helping us to get through the red tape we sometimes have so that we can secure that opportunity. Pharmaceuticals, insurance and light engineering are other growth industries in my constituency, like others. We have many small companies that started off with perhaps half a dozen employees and then grew. Patton’s is one that comes to mind right away. It started off with a van and three people; it now has a dozen vans and a workforce of 65.

Good things are happening, so let us talk about them. I do not mean to be disrespectful to anyone—that is not my nature—but if people talk things down enough, they will be down. We must talk them up. Let us talk up the good things—we should not ignore the negatives—and be positive. Positivity is what we want—it is certainly what I want.

I am aware that even small tax rises—for example, the 4.5% rise in rates for Northern Ireland, coupled with the almost 3% local rise in my constituency, results in a 7.5% rate increase for families slightly above the threshold for help through tax credits—can have an impact on people’s quality of life. We tell parents not to feed their children crisps as a lunchtime snack. Crisps cost 10p, but we tell them to give the children an orange, which costs 20p, so that is financially illogical. We tell parents to take their children to after-school clubs to help their social development, but they have to fund that themselves, because cuts have stopped Sure Start and other places from funding classes for children.

Members have referred to food banks. People are always being negative about food banks, but we should be positive. The Trussell Trust food bank in Newtownards in my constituency—we were the first to have one in Northern Ireland—has brought the churches and many individuals together. Every one of them is concerned for those who have nothing. Is it not a good thing when people come together to do something really good, substantial and positive to bring about change?

The hon. Gentleman knows that I have huge respect for him and count him as an hon. Friend, but the reality is that the top three reasons why people go to food banks are changes to benefits, low incomes, and insecure employment. I am sure he will put that on record. We do not seek to use this as a political football, but the statistics back up my point.

The hon. Gentleman beat me to it—I was going to come to that point. Why do people go to food banks? I sign their chits every week, so I know why: because of benefits and delays in receiving them. We have to sharpen our system up. When people are living under a far lower threshold than anyone in this House and many people outside it, we recognise that there are problems. Food banks have brought people together with the right motivation, but they are here for a reason. The hon. Gentleman is right about why that is: because of benefit changes, benefit delays, and marital and relationship break-ups; and because people have lost their jobs. It is good to have the food banks, but they are there for a purpose. I am very pleased to commend the Trussell Trust and the food bank that works through the Thriving Life church in Newtownards in my constituency on what they do. Their volunteers do marvellous work. They are people with passion, belief and concern, as we all have in this House and hopefully outside it as well.

We ask women to get into work, but not enough funded pre-nursery places are available to help them with childcare. We tell parents that they do not get pre-nursery places because they do not meet the benefits threshold. We tell them that they must spend time reading with their children and doing imaginative play after they have had to work all day, although they pay out most of their money on getting an acceptable level of childcare. We say that they should ensure that they take time off for their own mental health.

The Government have tried to address the issue of childcare, and we tried to do so in the Northern Ireland Assembly. However, there is still some way to go on providing childcare, and I say that respectfully. The Minister might want to come back on that. Other Members feel similarly to me and know where the voids are. For some reason, there is certainly a void in childcare. If we want a woman to work, we have to make sure that she has somewhere to take her children that does not cost her the earth. There is no sense in people working if every pound they get goes on paying for childcare. People want to work to keep them sane, but they also want to be financially better off. I make those points with respect to the Minister.

We encourage family units to provide childcare while, at the same, putting the retirement age up by six years. Again, I feel greatly aggrieved that women have to work beyond their time. Many of us in this House and my party have had discussions with the Government about the WASPI women. We all know what the issues are—those are very clear—and what has happened niggles me and my constituents. Those people have to continue to work, and their children must pay someone to mind their children. It is an advantage when someone has parents, grandparents, aunties and uncles who can do the childcare for them. However, if those family members have to work for another six years, that opportunity is never there.

Does not the hon. Gentleman agree that often these women worked while their children were small and looked forward to the treat of spending quality time with their grandchildren?

I absolutely agree. The hon. Lady and I have discussed these things on many occasions. We have a very similar opinion.

I feel that the failure is one that society and perhaps the Government need to address. It has accumulated over a number of years. The economy is essential, as is reducing the deficit, and I support sustainable borrowing, but it is also essential that we provide the support and level of care to make life bearable for our constituents.

Interest rates were referred to earlier. It is absolutely critical that they do not increase so that we keep the economy stabilised, provide opportunities and make sure that we put money in the pockets of our constituents. That will also keep the economy going in the direction that we want so that we make sure that we create more jobs and employment.

I am aware that we bit off too much before the financial crisis, but we cannot compound the problem by putting constituents in debt, or close to debt, as they pay the continual minimal rises that we place on their shoulders. We must do as much as we can to economise while not asking too much from people who are squeezed to the limit. We are moving forward and reducing our nation’s debt, but that must not be at the expense of our constituents. I feel that we face that danger at present, and I ask the Minister to take that into account in his response.

On a point of order, Madam Deputy Speaker. I have listened to representations following my business statement. For the benefit of the House, I can say that Monday’s general debate will now be on national security and Russia.

I thank the Leader of the House for her courtesy in letting us know as quickly as possible that the debate has changed.

On a point of order, Madam Deputy Speaker. I draw attention to the statutory instrument that I mentioned this morning at business questions in relation to nursing bursaries that are changed into loans for postgraduate students. Have you heard whether a debate will be scheduled before 28 March, which is the last day for praying against the statutory instrument? If a debate is scheduled after the recess—from 16 April—I ask your advice on whether I could seek an undertaking that if the House agrees to vote against that statutory instrument, it will be revoked.

I thank the hon. Lady for her point of order. I have not received any information from the Government on the matter she raises, but the Leader of the House is here, and I suggest that the hon. Lady discusses the specific point she raises through the usual channels.

It is a great honour to follow the hon. Member for Shannon, which is a beautiful part of our United Kingdom, and it is great to hear so much positive news. [Hon. Members: “Strangford!”] I mean the hon. Member for Strangford (Jim Shannon). I know the area well.

I have frequently said that the economy must come first, because only with a strong economy can we maintain our public purse and fund our other ambitions for healthcare, welfare, education and security. That is why it is such excellent news that the deficit is under control, the debt is falling, employment is at record highs, unemployment is at record lows, inflation is coming back down, real wages are set to rise, and our economic performance is outstanding. Manufacturing output is up for, I think, the ninth month in a row. It is almost impossible to open a newspaper today without seeing yet another good-news story about our economic statistics. [Interruption.] I hear Labour Members laughing, but let us not forget the state in which they left the economy.

A strong economy, however, must be a strong economy for all, and that is why I am also pleased that wealth inequalities are shrinking and the gap between the richer and the poorer is becoming less enormous.

As I said in my maiden speech, innovation drives growth, and science and research are at the heart of that innovation. I am a member of the Science and Technology Committee. We are in the middle of a digital revolution, the world’s fourth industrial revolution. We are world leaders in science and technology, and it is key to our success that we maintain that status. I am therefore delighted that science and research are at the heart of the Government’s industrial strategy, and that the commitment to increasing investment in research and development to a massive 2.4% of GDP is coupled with the largest investment in research and innovation by any Government in 40 years.

Is it now the largest ever? I thank my hon. Friend.

Those are phenomenal targets, ambitions and spending, but they are coupled with specific, targeted actions to unlock some of the most innovative sectors. It has been great to be in the House when we have been discussing how to unlock investment in the next generation’s batteries so that we can get the automated vehicles sector up and running and leading the world. My constituency is the home of radio. The first ever radar messages were sent out to the world from Chelmsford. The Space Industry Bill will mean that this country can not only make satellites and be part of their manufacture, but actually launch them.

I also spoke about productivity in my maiden speech, because it is key to our success. I said then that the people of Chelmsford spent too much time sitting in traffic jams and waiting for delayed trains, that it was a waste of their personal time, and that it hit the nation’s productivity. I was so pleased yesterday when the Government identified 44 parts of the country that would receive a further £4.4 billion of investment in our roads, railways and infrastructure. My part of Essex is a key element of that. The infrastructure in which the Government are investing will help not just to deliver new housing for the future, but to unlock our productivity and enable people to get on with their lives.

I want to say something about taxation, because it is part of the big picture of how we get the economy working. Under the last Labour Government, I was working as a volunteer chairing the local free school. I recall one of my best members of staff coming to me and saying that she had to hand in her notice because she simply could not afford to work any more: she would be better off claiming benefits. Ensuring that the tax system works for those who are on the lowest incomes, and ensuring that work pays, has been key to the Government’s success. That is why I am so proud that 4 million people have been taken out of tax altogether, and 24 million, I believe—the figure may have increased—have benefited from tax cuts. The tax gap has in fact narrowed, and those on the lowest incomes are now paying the lowest tax, with those on the highest paying more.

Does the hon. Lady agree with the leader of Chelmsford council, Councillor Roy Whitehead, who said that the Government cuts to education were short-sighted?

I agree with my council leader in so many ways, but the leader of Chelmsford City Council is not responsible for the education budget; that is covered within the Essex County Council area, where more frontline delivery of children’s services is happening every year.

On the issue of tax, it is vital to remember that it is this Government who have made sure that the wealthier pay the largest share of tax, and the top 1% of earners are paying more tax than ever before.

Does the hon. Lady not acknowledge, however, that ONS statistics show that the top decile pays less than the bottom decile? I believe she is talking only about income tax, which is very limited, and not the whole burden of tax.

I refer the hon. Lady back to what my right hon. Friend the Prime Minister said at Prime Minister’s questions yesterday, when she reaffirmed that the top 1% of earners are paying more tax than ever before.

Skills are absolutely vital to our future. I remember that under the last Labour Government over 1 million young people—those under the age of 25—were not in employment, education or training. It was completely shocking, but now youth unemployment is at all-time lows, and that is not by accident. In my constituency, 5,350 young people have started apprenticeships since 2010.

I take an interest in this as someone who was an apprentice, and I am also probably the youngest Member taking part in this debate. I absolutely support whatever we can do to get young people into work—[Interruption.] The Chief Secretary suggests that the Exchequer Secretary is younger than me. I support getting people into apprenticeships, but does the hon. Member for Chelmsford (Vicky Ford) agree that we need to pay them a proper, real national living wage? At the moment under UK law they can still be paid as little as £3.50 an hour. How does it help to build a country that works for everyone when some get paid so little?

The benefit of apprenticeships is that apprentices are earning as well as learning. When I met some of those 5,350 young people who are doing apprenticeships in my constituency—especially those in financial services, which I will talk about later—they told me how happy they were to be earning while also learning.

I also recognise that enabling small businesses to take on apprentices is key in some areas. That is why I was so pleased to hear the Chancellor mention in the spring statement new measures to help unlock the opportunities for small businesses to offer apprenticeships.

We must also remember that apprenticeships are not for everyone. Britain is home to some of the world’s leading universities—more than any country other than the US. Our universities are the jewel in the British crown. I am a member of the Science and Technology Committee, and we have been hearing from some of those universities. We bring students, researchers and ideas-generators from all over the world here, and it is absolutely key that they can continue to collaborate and work together and with leaders in other worlds. That is why I was so pleased that the Prime Minister talked in her Mansion House speech about a science and innovation pact between the UK and Europe after Brexit. There is still work to do on the detail, but we must ensure that that detail is focused on, which is why it is great that the negotiations in Brussels this week are going to mean we can start the next stage of our discussions.

I want to mention a couple of sectors, the first of which is financial services. It is probably the largest contributor to the tax-take in this country, accounting for about 11% of total tax, with £72 billion paid in tax by the sector last year. It is also really important to remember that this is not just about jobs in London. Even in my constituency of Chelmsford, there are about 2,000 jobs in the insurance sector. That is probably the largest sector there. I travelled to Canary Wharf to listen to the Chancellor’s speech on the future trade agreement on financial services. It is key that we get this right, and I am really pleased that we are now focusing on this. The Prime Minister said yesterday how important it will be to have a bespoke deal on services and financial services.

Another sector that I want to mention is the life sciences sector. We are the world leader in many areas of medical research, which makes a £30 billion contribution to the economy and provides 480,000 jobs. None of this has happened by accident. It was here that the human genome was discovered, and the human genome campus is here. The previous Prime Minister’s visionary 100,000 Genomes Project signalled the start of a massive revolution in medical research. There are, however, a few areas in which we could do a bit more to unlock the benefits of that research. The first involves unlocking the benefits of medical research for the NHS. There is still a bit more that we could do to get the synergies working together there.

I should like to advertise something to the House. Immediately after this debate, I am going to be leading the Adjournment debate, in which I will be looking at a very rare disease that affects one of my constituents. No other Member has debated this before. To help medical research in our life sciences sector, we need to ensure that new treatments are not only discovered here but trialled, tested and prescribed here. That is what I shall be discussing with Members later.

The hon. Lady is making a very good case about where the UK stands on the life sciences and other sciences, but does she not recognise that a lot of this work—including that being done at the rheumatoid arthritis pathogenesis centre of excellence at the University of Glasgow, which I visited recently—depends on European collaboration, on researchers and funding coming from the EU, and on being able to share excellence in techniques?

Absolutely. I thank the hon. Lady for that intervention, because I was the only British MEP involved in the negotiations on the last European collaborative research project. I was pleased to hear the Minister responsible for science and research confirming that he intends to continue that type of collaboration—provided that it is still focused on excellence, value for money and so on—as part of the science and innovation pact that the Prime Minister intends to deliver. This sector is vital, and we need to ensure that our world-leading scientists can continue to work easily with those in other areas.

My final thought is—[Interruption.] No, I have got my new medical school. This is an enormously important year, because it is 100 years since women got the vote, and it is also the Year of Engineering. I want hon. Members to focus for a moment on young women considering careers in engineering. This country needs 20,000 more engineers every year, and we absolutely need to invest in our science, technology, maths and engineering skills. The number of professional women engineers in this country is shockingly low. Only one in 10 are female, a lower figure than in nearly all the other European countries. There are fantastically good reasons why girls should go into engineering. One third of all businesses say that they want to recruit more people with STEM skills, and women who study science tend to earn an average of 30% more than their peers. A recent study said that 85% of women engineers were either happy or very happy—

I will give way to my right hon. Friend, because she has done something amazing in relation to maths skills.

I completely agree with my colleague on the vital importance of more girls studying maths. Does she agree that we should encourage girls who are considering their A-level options at the moment to think about studying maths A-level, because their school will get an extra £600 maths premium if they make that excellent decision not only for their own future but for the future of the country?

I am so delighted that my right hon. Friend has said that, because that is exactly the point. The Government have done a transformational thing by saying that we will give schools £600 more for every pupil who studies maths, which will be great at getting more pupils to choose the subject. However, if I may say so, the issue is not just with maths, but with physics. Forty per cent. of pupils studying maths are girls, but the figure for physics is only one in five. The last, tiny tweak that I would like in the autumn Budget would be for the premium to apply to physics, too.

It is real pleasure to close this debate for the Opposition and, it is a pleasure, as always, to follow the words of the hon. Member for Chelmsford (Vicky Ford). Like me, she entered this Parliament from the European Parliament, and while I may not always agree with everything she says, I know that she says it with a great deal of sincerity.

I am sure that we will all remember, back in 2010, when George Osborne, in his first speech as Chancellor to the Conservative party conference, maintained that we are

“all in this together.”

As he put it:

“The public must know that the burden”—

of deficit reduction—

“is being fairly shared.”

But opinion polls show that the public know that the opposite has occurred over the past eight years. The Conservatives have failed to deal with the long-term problems of our economy, at the same time as peoples’ living standards continue to fall. The Government have failed time and again—four times, precisely—to be on track to meet their own deficit elimination targets. The figures presented in the spring statement last week were hailed by the Chancellor as a turning point and, if I may say so, we had the same hubristic performance from the Government Front Bench today.

Closer examination reveals a deeply disturbing picture—a “lean, mean” picture, to use the perhaps rather ill-chosen phrase of the hon. Member for Clacton (Giles Watling). Public sector borrowing is still higher than was forecast a year ago, and debt is over £700 billion higher than when the Conservatives came to power. It is not “talking Britain down” to point out that the UK is headed for lower-than-expected growth by 2020 and 2021, as noted by the OBR. Expectations are not being exceeded, as suggested by the hon. Member for Angus (Kirstene Hair), but dashed.

I note that the Chief Secretary to the Treasury did not mention economic growth once. Perhaps the Exchequer Secretary to the Treasury, the hon. Member for Newark (Robert Jenrick), will come on to that in his final remarks, and I hope so because the Opposition believe, and many economists agree, that a significant reason for the lower-than-expected growth is the UK’s lower-than-expected productivity rates, with productivity increases having been revised down for 2018, 2019, 2021 and 2022. In fact, in 2017, business investment—a core element of improving productivity—was half its average level between 2010 and 2015.

Last year, economic growth in Britain was the slowest in the G7, which is in contrast with the situation when Labour left office. I take up the suggestion of the hon. Member for Chelmsford to remember the situation when Labour left office, because I do not want to forget it. When Labour left office, the economy was growing rapidly, and the second quarter of 2010 saw the fastest growth since 2008. Our economy recovered after the crash under Labour, and we have had eight wasted years that have led to a lower trajectory of growth than under Labour. It is necessary to look at the facts and to discover how this Government have slowed our economy, particularly in international comparisons.

The Opposition are the real optimists. When we look at our economy’s performance and compare it with those of other OECD and G7 nations, we see that we are not fulfilling our potential. That is holding our citizens and our country back. We can do so much better. We do not want to just talk things up, as the hon. Member for Strangford (Jim Shannon) advocates; we want to make them better. That is the difference between our position and that of the Government.

The Government’s economic policies have clearly failed on their own terms, but in addition the pain of deficit reduction—to the extent that deficit reduction has occurred—has not been equally distributed. I return to that conference speech by George Osborne, painful as it may be for the Government. In that speech, he stated that he would impose a permanent tax on banks, and that he would stick with the 50p tax rate for the highest earners. This Conservative Government have done the opposite. Just a few weeks ago, Labour gave the Conservatives the chance to reverse their reduction in the banking levy, to release funds to fill the gaping hole in children’s services, and they refused. In an eloquent and well-informed speech, my hon. Friend the Member for Peterborough (Fiona Onasanya) drew attention to the enormous stress that is being placed on children’s services in Peterborough. She is a very strong advocate for those children in her area.

Overall, this Government will have cut taxes for the best-off and for profitable corporations to the tune of £70 billion over the course of this Parliament. The Government have also failed to tackle illicit financial flows vigorously enough, as the hon. Member for Glasgow Central (Alison Thewliss) said. I can reveal to the House today, as a result of my own work and research, that this Government have lost the eye-watering sum of £2.2 billion by failing to tackle the problem of Scottish limited partnerships. That is a problem that many of us have been raising for many months, but the Government have not got a grip on it, and furthermore, they have not dealt with it through fines. They have lost £2.2 billion.

Everyone, aside from the very best-off, has felt the pinch from this Government’s approach. As many have mentioned, real wages continue to fall. We have had a tiny tick up—the first for very many months—but overall we have had the longest squeeze in wages in this country since Napoleonic times. Indeed, we learned yesterday that, according to the Office for National Statistics, the average worker now brings home about £15 less a week than they did before the financial crisis. Nurses, teachers, police and other public sector workers had their pay frozen until recently. The cost of lifting the cap for the police had to be found from existing funds; and it remains to be seen whether decent pay for nurses will be at the expense of terms and conditions. Teachers and other public sector workers must struggle on as their wages become increasingly out of step with the cost of living.

All that, of course, is before even mentioning the omnishambles of this Government’s approach to Brexit. I have lost count of the number of business people I have spoken to who are incredulous at the Government’s lack of grip on the negotiation process, and their ideological decision to rule out potential membership of a customs union. But it is all right; we learned today from the right hon. Member for Wokingham (John Redwood), to whom I am most grateful, that we can solve all these problems with just “a bit of electronics”. So that is fine. Just a bit of electronics and it will all be fine.

All sorted.

The worst impacts have been concentrated on the least well-off people. Earlier this month, the Equalities and Human Rights Commission published its report, “The cumulative impact of tax and welfare reforms”. The report showed, on the basis of the commission’s exhaustive research and modelling, that overall, changes to taxes, benefits, tax credits and universal credit announced since 2010 have been regressive, however measured. Those in the bottom two deciles have lost, on average, approximately 10% of their net income, with much smaller losses for those higher up the income distribution.

The hon. Member for Chelmsford is usually very accurate and committed to accuracy, but I regret having to say that perhaps she needs to look again at the latest figures around taxation. Indeed, the Prime Minister was wrong on this. I was in a television studio with the Chief Secretary to the Treasury when I heard what the Prime Minister said, and the Prime Minister was incorrect on this. The most recent ONS statistics show that the best-off people pay 34% of their gross income in tax, and the worst-off 10% pay 42% of their gross income in tax under this Government. That is the reality. Yes, those at the top may pay more income tax, but the overall tax burden is unequal and regressive, and this Government are doing nothing to deal with that.

Moreover, the analysis by the Equality and Human Rights Commission showed that the changes put in place by the Conservative and coalition Governments will have a disproportionately negative impact on several protected groups, including disabled people, certain ethnic minorities and women. Appallingly—I will finish on this—for households with at least one disabled adult and a disabled child the average annual cash losses are just over £6,500—more than 13% of average net income for those families has been lost since 2010. The hon. Member for Hitchin and Harpenden (Bim Afolami), who is no longer in his place, stated that his Government were focused on practically achieving the best outcomes for people. Perhaps he can tell me and other Opposition Members, and indeed his constituents, how that loss represents a good outcome for disabled people. To use the buzzword of the right hon. Member for Witham (Priti Patel), the economy has been reset—it has been reset in the wrong direction.

I note that this Government are also trying to reset their economic language. We did not hear this during the debate, but perhaps we will hear it in the Minister’s closing remarks. We no longer hear from the Government about poverty according to its usual definition, which traditionally, in Britain, has been relative poverty. Now they will talk only about absolute poverty, because they know that when we talk about relative poverty, the usual measure in this country and internationally, we see that we are sliding backwards.

That is the legacy of this Government: tax cuts for the best-off, and reduced incomes for disabled people and those on average and low salaries. Another approach is possible; and it is the approach that Labour has developed. It is one that we have costed, unlike the Government in relation to many of their current items of spending. We need to have a Britain that is growing sustainably at a rate comparable to that of other countries like ours, rather than lagging behind them. We need to have a Britain that halts the scourge of child poverty, which will soar by 1 million children under this Government unless checked. We need a Britain that truly enables the potential of everyone. That is ambition, and we would like the Government to start listening to it.

I thank all right hon. and hon. Members for their contributions today. We have heard a succession of Opposition Members espousing doom and gloom. There was one honourable exception—the hon. Member for Strangford (Jim Shannon). In that cocktail was mixed a dose of collective amnesia about the legacy of the last Labour Government. The shadow Minister, the hon. Member for Oxford East (Anneliese Dodds), could not even acknowledge the incredible, unprecedented economic success of her own constituency, where, thanks to this Government, we have seen record jobs levels and record levels of low unemployment. In the spring statement, we heard about further progress with the great Oxford to Cambridge and Milton Keynes corridor, one of the greatest growth and prosperity generators this country has ever seen. The shadow Chief Secretary, the hon. Member for Bootle (Peter Dowd), a proud Liverpudlian, could not bring himself to acknowledge the investment we are seeing in Liverpool. Well, this son of a Liverpudlian will tell him that there is unprecedented foreign and domestic investment being made into Liverpool’s ports. We even heard an unprovoked attack on Tigger by the shadow Chief Secretary—this time, of course, I do not mean on the Chancellor of the Exchequer.

What a difference we heard in the contributions from Conservative Members. My right hon. Friend the Member for Witham (Priti Patel) set out a bold plan—a vision for economic renewal as we leave the EU. My right hon. Friend the Member for Wokingham (John Redwood) invoked the legacy of Margaret Thatcher, going further than she ever went, exhorting us to take advantage of the opportunities presented by Brexit. We believe that Brexit will not determine the future of this country—rather, it is about the choices we make next. We are going to ensure that those choices are the right ones and that they are pro-innovation and pro-growth.

What infectious enthusiasm my hon. Friend the Member for Clacton (Giles Watling) shows for his constituency. What a difference a Conservative representative makes. I knew I was making a good investment in Clacton when I went there to support him in 2014. I am afraid it took him a little longer to come to this place, but we in the Conservative party believe in making long-term rather than short-term investment. He could not be a member of the class of 2014, but he did get in a few years later.

We heard from my hon. Friend the Member for Angus (Kirstene Hair) a devastating critique of the SNP’s failing economic record and about the fact that the greatest, most enduring and important single market that this country has ever known is the single market of the United Kingdom, which we will always support.

Six themes emerged in the debate. First, of fundamental importance to us all—our central mission since the Conservatives arrived at the Treasury in 2010 and found that note on the desk saying that there was no money left—has been to restore the public finances so that we can live within our means and provide the confidence and credibility that every economy requires. We need that confidence to create the jobs, which have been created, to secure the inward investment, which is at record levels, and to keep interest rates low so that people can stay in their homes and continue to have economic security. We will continue to work towards that, today and in future.

As my right hon. Friend the Chancellor said at the spring statement, debt is now forecast to be nearly 1% lower than at the autumn Budget, and we will see the first sustained fall in debt for 17 years. That is a turning point in the nation’s recovery from the financial crisis that was left to us in 2010.

We have heard today about manufacturing, which is enjoying its longest period of sustained growth for a generation. UK foreign direct investment is leading Europe—it is third in the world behind only the United States and China—and is continuing to grow, even after the Brexit referendum. What do we hear from Labour Members on that? That they have learned nothing. We heard a series of bad puns and jokes with which the shadow Chief Secretary, the hon. Member for Bootle, managed to outdo his usual record. The Labour party would destroy the credibility that we have built up over the past few years. It does not know how to manage an economy. The last time the shadow Chancellor, the right hon. Member for Hayes and Harlington (John McDonnell), managed anything was before I was even born—and then he was sacked by Ken Livingstone for being too left wing.

Secondly, we have heard how, as a result of our hard-won economic credibility, we have secured the prize of record high levels of employment and record low levels of unemployment. Nothing matters more to our constituents than the dignity and security of a job. More young people, women and disabled people are enjoying employment. Some 3 million more jobs have been created and there are more jobs in every region and nation of the United Kingdom.

Does the Minister acknowledge that under his Government, record levels of in-work poverty are affecting children?

I am surprised that the hon. Lady cannot bring herself to welcome what I have just described, even in her own constituency, where jobs and employment are booming—

I will come to the hon. Lady’s point.

It is not just important to us to create a country of working people; it is our mission to create a nation of well-paid people in secure and fulfilling careers. We are doing that by tackling the root causes of our low national productivity as no Government have done before. We are seeing some positive signs. Inflation is falling—it fell from 3% to 2.7% in February—and the OBR has said that it will keep falling, leading to real wage growth.

Two thirds of children in poverty are in working families. Does the Minister regard that as a positive sign?

I am proud of the fact that more people are in work. When I go back to my constituency, Newark in the north midlands, where unemployment is currently at 1%, I am proud of our record and that more families are enjoying the key ingredients of economic security: a job and a reliable wage.

Did the Minister notice that the hon. Members for Oxford East (Anneliese Dodds) and for Glasgow Central (Alison Thewliss) on the Opposition Front Benches failed to remind the House that many people on lower incomes have been taken out of income tax altogether, that the living wage has been raised so we are dealing with this issue of low pay, and that inequality, as normally measured, has come down? Why do they never mention those things?

My right hon. Friend makes a series of important points. Let us look at them. By increasing employment and reducing unemployment, we have sought not just to increase employment, but to tackle those people who are on the lowest wages and secure a better tax environment for them. The living wage will rise to £7.83 next month, which is £2,000 more for the average person in full-time employment.

I am most grateful to the Minister for giving way. I hope that he will clarify to the House that that rise in the national living wage—and indeed the national living wage itself—does not apply to those under 25. Will he clarify that for Hansard?

Our priority is to ensure that younger people in the workplace gain the skills that they need in good and secure employment and then, in time, they will benefit from the living wage, which did not exist before this Government created it. We have increased the personal allowance; we have taken 4 million British people out of tax altogether; and we have reduced the tax of 31 million of our fellow citizens.

On the subject of fair taxation, which was raised, the top 1% are paying 27% of the income tax in this country. On the subject of enforcing tax and reducing avoidance and evasion, the tax gap in this country is at its smallest ever level. It is one of the smallest of any developed country in the world and it is certainly smaller than the previous Labour Government left it. The bottom 20% of earners—this is an important statistic—have seen real wages increase by 7% since 2015. We have high levels of employment and we are working hard to support the lowest paid in society.

Thirdly, we have addressed productivity by investing in skills to ensure that our workers and fellow citizens have the skills that they need for the jobs of the future. We have seen that in many of the measures that we have discussed today: in increasing vocational and technical education; in our apprenticeships; in the advent of T-levels, one of the greatest innovations in our secondary education system since the creation of the A-level; in increasing numeracy and digital skills in schools with maths teachers, with IT teachers and with coding at primary level; and in the creation of the national retraining partnership—a partnership between the Government, the private sector, the CBI and the TUC, which was launched last month by the Chancellor—to ensure that workers have the skills that they require as the world of work changes in the years to come.

For small businesses and family businesses, we have increased management training and skills training, so that the greatest innovation in our economy is diffused throughout the regions and to the smallest businesses, we are backing people such as Sir Charlie Mayfield with his Be the Business movement, and we are undertaking a review of the long tail of British businesses, which was announced by the Chancellor in the spring statement. All of that will help to ensure that productivity increases in all parts of the United Kingdom and in all parts of the economy. What are the early results of those efforts? We have 2 million more children in good or outstanding schools than in 2010.

Fourthly, addressing productivity also requires us to invest in our infrastructure. The level of infrastructure investment—both public and private—by the end of this Parliament will be greater than at any time since the 1970s.

I thank the hon. Gentleman for mentioning my constituency earlier. I would like to mention his if he does not mind. Roger Blaney, the leader of Newark and Sherwood District Council, was speaking in response to a report that ranked the district near the foot of the social mobility league table. He put Newark and Sherwood

“323rd out of 324 local authority areas based on factors such as education outcomes, employability and housing prospects.”

Does the Minister still think that he is doing a good job for his own area?

I most certainly do. That report revealed decades of underinvestment and neglect by Labour councils in Nottinghamshire, which let down their old former coalfield communities—the communities that they have taken for granted for too long. We are changing that, and the policies of this Government have seen, in my constituency, 40% more young people in good or outstanding schools, and a new free school in Newark, which I have created and of which I am proud to be a governor. Those are the practical changes that will transform the lives of local people. In the midlands and the north, we do not take them for granted; we get things done for them.

We are making long-term investments in infrastructure —road, rail, broadband and mobile—in all parts of the United Kingdom. The Infrastructure and Projects Authority, which measures our spending in those areas, said that there will be more central Government investment in the north of England over the course of this Parliament than in London or the south-east. We have created a pipeline of £600 billion of investment in construction and other infrastructure. The challenge now is less about money and more about ensuring that we have the construction workers and skills that we need to deliver on those projects. We are backing the midlands engine, the northern powerhouse and the Oxford-Milton Keynes-Cambridge opportunity. We are creating new deals in Sheffield, hopefully in the borderlands between England and Scotland, in north Wales and in other parts of the United Kingdom, where we believe in allowing local people to have greater say over their own lives. The Mayors whose positions we created—including Andy Street and, in the Tees Valley, Ben Houchen—are already making a huge impact and putting their own areas on the map.

Fifthly, we are embracing new technology, not turning away from it. We want to ensure that the United Kingdom leads the world in the technological revolution, but we also want to ensure that that works for everyone as the world of work changes profoundly. The pace of change has never been faster, but it will never be so slow again. The tech entrepreneurs and investors I meet are not preoccupied by Brexit. Their eyes are fixed on the horizon and so are ours. This is true of companies in FinTech, life sciences, artificial intelligence, autonomous vehicles and electric cars, and green growth, all of which we are taking seriously in our industrial strategy and in other policies. At least 15 UK tech companies could float today for in excess of $1 billion—companies that did not exist five or 10 years ago, including Citymapper, Deliveroo and Farfetch. This country is on the cusp of something great and we do not want the Labour party to lose that.

Does the Minister agree with Councillor Blaney that his constituency is the “Cinderella of regional funding”? What is he doing about that?

Well, we have been investing in all parts of the United Kingdom, including the east midlands. We created the midlands engine, which I just mentioned and which is designed to unleash the economic potential of the midlands. In the west midlands, we have seen the huge potential that Andy Street has now given to a city that has been run by the Labour party for too long.

What are we doing to invest in new technology? As my hon. Friend the Member for Chelmsford (Vicky Ford) described, we are investing more in research and development than has been invested since the 1970s, when the statistics were first recorded, so we are probably investing more than has ever been invested in modern times. We have made the R&D tax credits more generous. We are investing in the enterprise investment scheme and the entrepreneurs’ relief that are so important to crowd in investment to the United Kingdom from all over the world. The Chancellor is today at the FinTech summit that the Treasury is hosting, with 600 investors from all over the world coming to the United Kingdom to see some of our most exciting business that are creating 60,000 new jobs in the FinTech sector alone.

What have we done to create a business environment? We have lowered capital gains tax and corporation tax, and committed to lowering it still further. Labour would reverse those changes. Our reductions in corporation tax have actually resulted in more tax revenue for the Treasury and more money for public services. That is prosperity over ideology.

I am sure that the Minister wants to be accurate on these matters. Therefore, perhaps he will slightly correct his suggestion that the increased revenue was due to the reduction in corporation tax. So many commentators—including, I believe, the IFS—have said that the increase in revenue is due to, for example, banks returning to profitability, and it should not be connected with the reduction in rate.

In the Treasury we try to deal in facts, rather than in comments, and the effect of reducing corporation tax has been an increase in revenue.

The Chief Secretary and other Conservative Members have said that we must make the case once again for free markets—something we thought we might never have to do again. However, as Margaret Thatcher and, I think, Tony Benn—an unusual pairing—used to say, “There are no final victories in politics, and if you want to continue to win important arguments, you have to keep making them and restating them over and over again.” The case for free markets is threatened as never before by the hard-left, heirloom policies and personalities of Labour Front Benchers. As someone who used to work in the auction business, I can spot an antique a mile away.

The central battle on this conflicting vision of our society is being fought again. That matters for two reasons. First, just as our parents and grandparents paid the price for this ideology last time it was employed in this country, we do not want our children and grandchildren to pay the price for its resurrection today. Last time, it left us a weak country saddled with debt and high taxes, unable and unwilling to embrace new technology or to invest in public services—and working people paid the price.

Secondly, to paraphrase Robert Kennedy, living in a democracy is not merely about the absence of tyranny but the presence of freedom. A free market matters to us and our constituents not just because we have learned that it is the best way to run an economy but because it underpins all our other freedoms. That is why we will continue to defend it as we build an economy and a country that works for everyone.

Let me just say to the Front Benchers that if they agree 10 minutes, they should stick to that, because I do not want it to break down in future with people taking advantage by allowing the Opposition to have 10 minutes and then you carry on for 17 minutes. I think we have to be fair to both sides. If we make agreements, let us please stick to them. If it is 15 minutes, I do not mind, but at least let us be honest with each other when we make those decisions.

Question put and agreed to.


That this House has considered the economy.