← LEADERSHIP TERMINAL

UK PARLIAMENT · SITTING

Liam Byrne

MP for Birmingham Hodge Hill and Solihull North · Labour · United Kingdom

IN THEIR OWN WORDS

The loss of 4,000 jobs at Jaguar Land Rover is a body blow for workers, families and communities across the west midlands, so I commend Richard Parker, the Mayor of the West Midlands, for moving quickly on Monday to put £500,000 on the table to help ensure that everybody gets back to work.

JAGUAR LAND ROVER: REDUNDANCIES · 2026-09-09 · READ IN HANSARD

I wholeheartedly welcome this well-rounded statement from the Foreign Secretary, and put on record my thanks to the new Prime Minister for the hard yards that I know he has put in over recent days and weeks.

ISRAEL AND PALESTINE · 2026-09-08 · READ IN HANSARD

I am grateful to my hon. Friend for giving way, and I offer my warmest congratulations to her on her appointment to the role; she will be a brilliant Minister.

REPRESENTATION OF THE PEOPLE BILL · 2026-09-02 · READ IN HANSARD

Let me start with a word of thanks to my hon. Friend the Member for Chester North and Neston (Samantha Dixon), who is not in her place, who said quite rightly that an awful lot has changed since the Bill was first introduced to this House. Indeed, a lot has been revealed over the course of the summer.

REPRESENTATION OF THE PEOPLE BILL · 2026-09-02 · READ IN HANSARD

The effect of new clause 34 would be to ban off-ramping, ban new forms of digital currency transactions and ban memecoins, which are exactly the kind of measures that Ministers now need to bring forward. If we want to take the crypto system out of political finance, this is what we need to do.

REPRESENTATION OF THE PEOPLE BILL · 2026-09-02 · READ IN HANSARD

No doubt we will learn that Mr Cottrell was in fact on the electoral register when that money was passed. No doubt we will discover that his mother, Fiona Cottrell, declared and did not disguise the fact that the money had ultimately come from her son.

REPRESENTATION OF THE PEOPLE BILL · 2026-09-02 · READ IN HANSARD

The complete record

Every one of 5,360 lines we hold for Liam Byrne, in date order, each linked to its source. Free to read, in full, without an account. Page 71 of 108.

  1. I am grateful to the hon. Gentleman, who is being incredibly generous in giving way this afternoon. He will surely accept that, despite internal debates—all parties have them—when our party presented a Budget to this House in March, it reached a conclusion that ruled out an increase in VAT and set out clearly how £19 billion of taxes would be brought in through a different balance of measures. Is the hon. Gentleman seriously saying that he believes that the £8 billion VAT bill that will be paid by pensioners over the course of this Parliament has been fully compensated for in measures set out in the Red Book?

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  2. We have never seen VAT at these levels. The hon. Gentleman’s own party leader is on the record as saying that he believes that VAT is a regressive tax, and so is the Prime Minister. Surely, before the next Finance Bill, a study should be presented to this House showing what a 20% VAT rate will mean for the people whom we represent, so that we can insist on appropriate remedies from the Government.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  3. The hon. Gentleman is being enormously generous and I am following his argument closely. Does he acknowledge that in the months before the election, while its outcome was still uncertain, interest rates in this country were not going up but coming down?

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  4. The hon. Gentleman is now touching on a debate that is at the core of one of the amendments that I tabled. He needs to be able to tell the Committee which pensioners will be worse off as a result of this £8 billion increase. If he does not know, surely it would be right for him to ask the Government to prepare and present a report for the House.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  5. I hope that the Government see fit to accept the amendments that we have tabled to try to protect people from its most egregious impacts. If they do not, I am afraid that we will have to vote against clause stand part

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  6. It is only a shame that the Liberal Democrat party—the party of Keynes—has abandoned its intellectual heritage and signed up to the economic doctrine of Lord Lamont, the man who famously sang in his bath as unemployment spiralled, “Je ne regrette rien.” All this follows from one decision—that of the Chancellor to bring forward by just a year the date at which debt as a proportion of GDP begins to fall. The price of that is a £40 billion increase in taxes and spending. It means that the Chancellor is now relying on a growth strategy for the next few years that is quite unlikely to come to pass. He has not hedged his bets; he has decided to hit domestic demand and consumption as hard as he possibly can. He is, I am afraid, going for broke. That is why we object so strenuously to clause 3.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  7. The reason we were given was the strange behaviour in the markets, but in fact interest rates and long-term bond yields had been falling for some time before the election. This Budget entirely ignores that point. It hits growth so hard that it has to raise extra taxes, and that is before we address the impact on jobs. We are still trying to get to the bottom of the changes to how the OBR forecasts job losses, but the Red Book’s judgment was grim enough: 100,000 fewer people will be in work as a result of this Budget. That is because the Conservatives have reverted to type and decided that, just as in the 1990s, 1980s and 1930s, unemployment is a price worth paying.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  8. Of course, there has been some confusion about that from Government sources over the past couple of weeks, but the bottom line is pretty clear: employment will be much lower as a result of this Budget, in contrast with previous Budgets. The IMF, if we needed any help reinforcing the point, backed up that argument earlier. We are having this debate ultimately because of the Chancellor’s wrong-headed decision on the fiscal judgment. The Budget was so damaging that his own independent advisers told him that they had no choice but to downgrade the country’s growth forecast, and the IMF rapidly followed suit. Just when Britain needed a Budget to speed up the recovery or, at the very least, maximise its certainty, we were given a Budget that actually slowed the recovery down.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  9. He was right to highlight the commentary in the City outlining the hit that retailers will take, and he had a very good phrase: VAT will be both regressive and regrettable. That is a good conclusion to our debate. My hon. Friend’s speech was echoed well by my hon. Friend the Member for Leeds West (Rachel Reeves), whose constituents, she said, earn just £16,000 a year. They will be hit very hard by this Budget, and that particular unfairness was highlighted by my hon. Friend the Member for Pontypridd (Owen Smith), who made an excellent point about the problem of irrecoverable VAT and how it will hit the national health service. My hon. Friends the Members for Caerphilly (Mr David) and for Hemsworth (Jon Trickett) also made excellent arguments about the hit on jobs.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  10. I was not sure whether that was a device for saying one thing and doing another, but he rapidly disabused us of that with his support for the Government’s case. His was a strange argument, because he said he would not support our amendments to protect pensioners and others, as somehow our arguments lacked moral force. So there we have it: the party of Lloyd George is now so empty of moral momentum that it has to look to the Labour party for its source of ethical locomotion. We heard some powerful speeches from Opposition Back Benchers. My hon. Friend the Member for Nottingham East (Chris Leslie) underlined the point that the Budget does not share out the pain, and that those with children, in particular, will be hit very hard.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  11. He did not want to be drawn into the Chancellor’s wider fiscal judgment, and that was unfortunate; instead, the hon. Gentleman wanted to debate the balance of measures in the Budget, and he sought a different balance. He could have made more of the fact that the Budget hits growth in this country so hard that an extra £9 billion of tax has to be raised to make up for lost growth. The hon. Gentleman’s hon. Friend, the hon. Member for Bristol West (Stephen Williams), confused us—perplexed us, slightly. I was not sure whether he was elected, appointed or anointed to the position from which he spoke, but he confirmed that he was speaking on economic affairs on behalf of Liberal Democrat Back Benchers, rather than Front Benchers.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  12. I am very grateful, Mr Hancock. This has been a good debate. I know that the amendments have been grouped in a certain way because of how they interrelate, but none the less, having heard the debate and the contributions of right hon. and hon. Members, we will seek to divide the Committee on amendments 41 and 46, as well as on clause 3. I think that we will turn to amendment 35 in a moment. This has been an important debate, because we have seen with greater clarity where not only Conservative but Liberal Democrat Members stand on the issue before us. However, the hon. Member for St Ives (Andrew George), looking at tax policy in the round, was right to say that the VAT rise has to be—in his words, I think—among the least welcome alternative proposals.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  13. I know about the difficulties of protecting charities from VAT altogether, and I am sure that the Exchequer Secretary will return to that point, but this is an important debate that we have been pursuing for some time. I know that many charities want to be classified like, for example, local authorities, which do not have to pay VAT in the same way. Many groups, including the Association of Chief Executives of Voluntary Organisations, have been arguing for some time that in the competitive provision of services, especially in the public sector, local authorities are often at an advantage compared with charities and third-sector organisations.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  14. I rise to speak to amendments 35, 36, 37 and 58, tabled in my name and the names of my hon. Friends. This debate has already shed a great deal of light on the impact of this hasty rise in VAT. Over the course of the afternoon we have heard about the impact of the rise on a number of groups about which we are all concerned. We heard about the impact on jobs, the economic recovery, the low-paid and pensioners, and this group of amendments offers us an excellent chance to examine the impact of this rapid rise in VAT on Britain’s charities. I will not speak at length, but I want to make a few quick points. Amendments 35, 36 and 37 seek, in essence, to stop the VAT increase applying to the goods charities buy in to deliver what is called their “charitable non-business activities”, and for which they cannot then charge VAT.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  15. They say that smaller charities such as those with an income of less than £30 million will be hit, as VAT currently accounts for some 3.6% of their income, compared with 2.3% for larger organisations with an income of more than £30 million. In other words, this VAT increase will create a greater gulf between bigger charities and smaller charities. That is obviously a concern because, as my hon. Friend the Member for Wrexham (Ian Lucas) pointed out, there is a big push on at the moment to ensure not a narrower role but a wider role for smaller charities in delivering public services.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  16. Others who read the research will, like me, have been struck by the Charity Tax Group’s case study of Action for Blind People, one of the largest charities in the UK, which provides free and confidential support for blind and partially sighted people. The study makes the point that the rise in irrecoverable VAT for Action for Blind People will total some £100,000 a year. Charities in that sector that are about to take such a hit must immediately look at which services they can no longer offer. That gives rise to a question that will concern Members in all parts of the House, and which demands an answer: how are these charities going to be compensated for this hasty increase in VAT? The increase appears to hit smaller charities hardest—a point made by both the House of Commons Library and the Charity Tax Group.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  17. This is a particular problem, and I was about to pay tribute to my hon. Friend, who has done some important work with the Library in helping us to understand what this VAT increase will actually mean for Britain’s charities. I also commend the work of the Charity Tax Group, which the hon. Member for St Ives (Andrew George) prayed in aid. Its assessment is pretty blunt—that this increase will cost Britain’s charities £140 million to £150 million. Because much of that VAT cannot be reclaimed, Britain’s charities stand to lose £60 million to £70 million. That is a lot of money, and certainly a lot for charities that are already struggling with contributions, which are down because of the recession. Many in the sector are worried about how voluntary contributions will rebound as the recovery sets in.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  18. Over the past 10 years, we doubled the amount of public sector income going to the third sector and Britain’s charities, from £5.5 billion to more than £11 billion. So although we had not finished the job of sorting out VAT, what we had delivered was a doubling of income going into the charitable sector in this country. That was the biggest single increase in income going to the third sector in this country almost on record. In the past 10 years that meant that the sector was stronger in taking on public service delivery contracts. Indeed, those contracts with the third sector doubled since 2000 and by the time Labour left office there were about 60,000 social enterprises, worth £8.5 billion. We are proud of our record.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  19. The Conservative manifesto said: “Britain has a proud and long-standing charitable tradition, and we are convinced that the voluntary sector should play a major part in our civic renewal.” The Conservatives’ specific proposal was to “introduce a fair deal on grants to give voluntary sector organisations more stability and allow them to earn a competitive return for providing public services.” The Liberal Democrats had a slightly different take on the right policy prescription, as page 85 of their manifesto talks about the need to reform gift aid still further. They proposed that it should “operate at a single rate of 23%—giving more money to charity while closing down a loophole for higher rate tax payers.” Labour Members are very proud of our record in supporting the third sector in this country.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  20. With respect, the hon. Gentleman is making a partisan point in a quite unfair way. I was about to make a point on which I hope there is consensus in the Committee. We all now know what the impact of the VAT increase on charities will be, and all of us will be worried about the impact we foresee on smaller charities. The truth is that there is strong cross-party consensus on the need to support charities further. I was studying this afternoon not just the rhetoric but the reality set out in some of the manifestos put before the country at the election.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  21. We ask the most unreasonable things of Governments—we cannot expect them to have the power of omniscience—but we can agree this measure in a way that protects charities. The final point that I wish to make relates to amendment 58, which touches on one particular group of charities—mountain rescue charities—and on which some expectations have been set.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  22. As ever, the hon. Gentleman is on the money. If departmental cuts, particularly to the Cabinet Office, are between 25% and 40%, the impact on public funding for third sector organisations in this country will be devastating. We can all see this coming ahead of us—we can all see this train coming—so these amendments seek to ensure that a report is set out by the Treasury before the VAT hike is introduced. I hope that a bit of good old-fashioned common sense will prevail this evening, and that we will be able to agree to them. I understand that this measure is being introduced at haste. It is perfectly plausible to suggest that the Treasury did not foresee it, and there is something we can all do this evening to ensure that charities are protected from unintended consequences.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  23. My hon. Friend has pretty much made my argument for me. All of us know what an extraordinary service mountain rescue provides. Of course these charities confront a particular problem when using gift aid to provide compensation for the kind of VAT hit that they are about to take, because when someone is collecting money through tins it is sometimes difficult to collect gift aid on the contributions that they receive. So amendment 58 seeks to extend protection to mountain rescue services in England and Wales by, again, asking the Treasury to prepare a report on the impact of the VAT hike on their services. These are common-sense amendments, which draw on a strong cross-party consensus that has developed over the past few years. I hope that the Government are able to support them.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  24. The amendment would replace the Government’s clauses with the same form of clauses used in the Finance Act 2009, and seeks to probe the Government on why they have chosen to introduce a whole new schedule rather than simply to amend a couple of words in a perfectly good schedule that has already passed into legislation.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  25. I do not intend to detain the Committee long. Amendment 38 is a simplification measure to probe the Treasury a little on how it has sought to introduce its anti-forestalling legislation. The Budget made great play of the simplification credentials that the Government wanted to present to the House and convince us with. Obviously, the Finance Bill, as presented, does more to complicate than to simplify the tax system. With the change in the VAT rate, there is a need for anti-forestalling legislation controlling supplies made in anticipation of a change in the rate.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  26. (e) insert new paragraph 13 as follows: “Condition D cases involving hire purchase, conditional sale or credit sale of goods 13 There is no supplementary charge under this Schedule on a supply of goods within paragraph 2 if— (a) the only relevant condition met is condition D, (b) the VAT invoice— (i) relates to a supply of goods made under a hire-puchase, conditional sale or credit sale agreement, (ii) forms part of that agreement, and (iii) is issued in accordance with normal commercial practice in relation to a supply made under such an agreement, and (c) the basic time of supply of the goods is intended and expected to be within 6 months of the date of the VAT invoice which relates to the supply.” (a) replace the existing paragraph 14 with the following: “Normal commercial practice 14 In this Part of this Schedule, “normal commercial practice”, in relation to a supply or grant of a right, means— (a) normal commercial practice of the supplier or grantor at a time when an increase in the rate of VAT in force under section 2 of the VATA 1994 is not expected, or (b) if the supplier or grantor has no such practice, the normal commercial practice of suppliers making similar supplies, or granters granting similar rights, in the United Kingdom at such a time.”.’.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  27. I beg to move amendment 38, page 2, line 16, leave out subsection (5) and add— ‘(5) Schedule 3 to the Finance Act 2009 shall have effect for the purposes of supplementing this section, with the following changes: (a) in paragraph 1(2), “the date of the VAT change” shall be amended to refer to 4 January 2011. (b) in paragraph 8, the reference to section 839 of ICTA shall be amended to refer to section 1122 of CTA 2010. (c) omit paragraph 11. (d) renumber paragraphs 12 and 13 as 11 and 12 respectively.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  28. I am not entirely convinced by that and I am sad that the Bill is adding complexity rather than delivering simplification, but on the basis of the Exchequer Secretary’s explanation I beg to ask leave to withdraw the amendment. Amendment, by leave, withdrawn.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  29. This is thus a complicated matter. I do not think the full consequences of the VAT hike are properly understood across the House, so the amendment asks the Treasury to produce a report showing what remedies will be provided for people who need to purchase disability equipment and who will be adversely affected by this rapid increase in VAT proposed by the Government in clause 3.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  30. At present some businesses are able to get VAT relief on putting in place adaptations in order to help people with disabilities come to work in their work places, but other businesses do not enjoy those reliefs. It would be useful to understand the Minister’s thinking on that, too. My final point concerns transport. UK VAT law provides limited reliefs for the purchase and lease of certain cars by disabled people. A good example is the Motability scheme, but it excludes people not in receipt of the higher rate Motability component of DLA. The Government have told us they want to reform DLA. We have not yet heard precisely how, but many people will be concerned that eligibility for such schemes will be curtailed and that some individuals may face a tax problem as a result of the Government introducing VAT increases at the pace they propose.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  31. Friend the Member for Pontypridd (Owen Smith). It concerns people with mental health needs. Annex III does not make any distinction between equipment needed for people with mental health needs and that needed for those with physical health needs, yet at present there are discrepancies in UK law that still need to be ironed out. Thirdly, there are issues to do with the accessibility of work places. I think there is agreement across the House that it is important that there is extra support to get people with disabilities back into work. Obviously, that is going to be more important after the Government’s reform of disability living allowance with, as they say, a more stringent—or, rather, a different—test for work capability assessment; we do not quite know what that test will look like.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  32. I should like to know what the Government think about four issues related to reform. The first is the contrast between European Union and United Kingdom law. The Exchequer Secretary will have already memorised annex III of Council Directive 2006/112/EC. As he knows, it allows reduced rates for “medical equipment, aids and other appliances normally intended to alleviate or treat disability”. He will also know that the application of UK VAT law does not mirror that flexibility precisely. A restriction now applies to many items because they must be designated solely for use by a person with disabilities. That appears to be a more stringent test than the one set out in EU legislation, and it would be useful to understand the Minister’s attitude to that. The second issue touches on a point made by my hon.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  33. Amendment 47 is a probing amendment. It touches on a complicated area of VAT law which was in the process of undergoing a degree of reform. I know that there will be no instant answers, but I think it would be useful for the Committee to know more about the direction that the Government are seeking to take in reforming this area over the next year or two. Let me record my thanks to the Low Incomes Tax Reform Group, which published an important report entitled “VAT and disabled people—the case for removing the barriers”. It identified a number of cases in which existing zero-rating provisions for people with disabilities are inadequate. The fact is that the increase in VAT to 20%, with no kind of balancing relief, on many supplies that are still needed by people with disabilities will cause some hurt and some cost.

    FINANCE BILL · 2010-07-13 · READ IN HANSARD

  34. I wish to pursue the question asked by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper). What is the Treasury’s analysis of how much of the £8 billion in tax and benefit measures will be paid for by women?

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  35. Perhaps I can help the Chief Secretary. There is a precedent for business investment matching the figures in the OBR’s forecast: it has occurred once in the past 40 years. That is the rarity of the precedent on which he now relies for his future growth plan.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  36. Factory orders in May dropped after eight consecutive months of improvement, and confidence surveys last week showed the biggest falls for some time—far bigger than expected. Last week, we heard that the number of Americans in work has fallen by almost the largest number since 1995, and new figures for the eurozone show unemployment stuck at more than 10%. The news from new markets is likewise not great. China’s stock exchange hit a 15-month low yesterday, and confidence surveys have reported the worst outlook for a year and a half. Therefore, we cannot blame British businesses, investors and exporters for being somewhat depressed. They know that the odds of success in the gamble on which the Chancellor has embarked are slim, and they know very clearly who will pay the price for his failure.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  37. British families and businesses fought so hard in the past year and a half for this country’s recovery, but the Bill puts all that at risk. We can see from the Bill that the Chancellor would like us to believe that size is not everything—although it is very thin, it is none the less very dangerous. We all enjoyed the Chief Secretary’s summary of business opinion, but Opposition Members thought it odd that he missed some of the news that has appeared since the Chancellor gave his Budget speech. The truth is that, as we warned last week, the dangers in the global economy have become not less visible—they have not ebbed away—but, if anything, become more visible and more dangerous. This week, for example, the news from our trading partners and from the United States, which is our single biggest export market, has not been good.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  38. May I begin by putting on record the Opposition’s thanks to Sir Alan Budd for his excellent work in the short months that he has served the Government? May I also congratulate the Chief Secretary, who is rapidly becoming one of the Chancellor’s longest-serving advisers? After his performance this afternoon, I think we can see why that is. He is pursuing what is now a noble Liberal Democrat tradition of fronting up some of the Government’s nastiest and most regressive policies in the House. His speech was a Liberal Democrat defence of an emergency Budget—an emergency so great that the Chancellor could not be bothered to join us this afternoon to listen to the House’s deliberations. It is fair to say that since we met last week to debate the Budget, the economic horizon has darkened.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  39. The right hon. Gentleman has today put out a number of very constructive suggestions—for example, urging people hit by budget cuts to wear more clothes, to turn down the thermostat and to eat more vegetables—[Hon. Members: “Withdraw!”] I am merely quoting the Daily Mail , which is a source I trust—it is, of course, beyond reproach.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  40. It is for those reasons that a wise man once said that “the next government has to recognise the fragility of the economy and not take action which would precipitate a double dip recession leading to more unemployment and even bigger budget deficits.” That was, of course, the Business Secretary in April—once a prophet and now a lost cause.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  41. The chief economist of the British Chambers of Commerce has said that the scale and severity of the Budget “inevitably increases the danger of an economic setback”. The Chartered Institute for Purchasing and Supply has said that its managers have “voiced grave concerns that budget cuts and VAT will tip the scales and amplify the likelihood of the UK slipping back into recession”. The confidence of Britain’s finance directors has fallen to a 12-month low—just one in four is optimistic, and two thirds say that tighter fiscal policy will hurt their business. Yesterday, the confidence of Britain’s supply chain had its largest monthly fall since 1997.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  42. I am happy to withdraw comments published in the Daily Mail . The point that I was about to make was that the business community, having had a chance to reflect on the Budget, has come to some conclusions, and I was surprised not to hear about them in the Chief Secretary’s remarks. A fortnight ago, the Chancellor told us that the Budget was “a balanced package that will send the signal that Britain is open for business.” —[ Official Report , 22 June 2010; Vol. 512, c. 176.] In the weeks since, it is fair to say that business has not been hanging out the bunting. The stock market has now recorded its worst quarterly fall for eight years, as it fell to its lowest point for 10 months. Goldman Sachs has warned that tighter fiscal policy now “would make it hard to deliver improving growth for all, or possibly any” country.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  43. That news was somehow absent from the Chief Secretary’s remarks. He and the Chancellor may now think that everything is fine. I know whose verdict I would rely on, and it is not the Chancellor’s. I do not want to depress the House unduly and I have a little bit of good news—

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  44. That is precisely right and I will have more to say on that in a moment. I promised a ray of good news among all the bad news and depressed expectations from the business community. A command paper was sneaked out last week. It had barely a press notice—it ran to a grand total of six lines—and there was no written ministerial statement with it. What could justify such secrecy? All is revealed on page 52 of the public expenditure survey, published last week, wherein we discover that Departments under Labour’s management underspent their budgets last year by £5 billion. Anyone would think that the Government wanted to keep that news secret. In a knee-jerk response yesterday, they decided to cover it up by announcing another £1.5 billion of spending cuts instead.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  45. Whereas the Labour Government planned to halve the deficit in four years—a plan that the Chancellor’s own independent advisers said we were on track to deliver, and which the G20 said met its timetable—this Chancellor has added nearly £40 billion in new tax rises and spending cuts. He has locked us on a course to slash away come what may, and, in a world full of risk, he is now preaching to others to do the same.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  46. One of the great flaws in the Budget is that the Government are relying on a bounce-back in private investment, for which there is barely a precedent, and nor is there any evidence from the business community that it might happen. Make no bones about it, since the Chancellor sat down a fortnight ago, the gloom has grown. However, the Finance Bill does not adjust the Government’s strategy. All we have heard from the Chief Secretary this afternoon is a very clear economic credo: where there is worry, let us spread fear, and where there is risk, let us bring danger.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  47. If growth fails, the structural deficit as a percentage of our economy goes up, yet the timetable for its elimination remains unchanged, so the Chancellor’s only course of action is to cut deeper and deeper. If growth falters or the economy shrinks, the Chancellor cannot stimulate the economy, but can only respond with cuts. It is not a plan to manage the economic cycle; it is a plan for an economic death spiral. Like some kind of self-flagellating penitent who believes borrowing is so morally wrong, he responds to any new urges with another bout of whipping. He might feel it gets him to heaven a little faster, but I am afraid it is no way to run an economy.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  48. My hon. Friend is right. One reason the British supply chain is now so worried about the Government’s intentions is that it has seen these knee-jerk reactions, such as yesterday’s decision, of which the Chief Secretary was so proud he did not dare come to the House to say a word about it. I want to make a point that follows on from what my hon. Friends have said. Rather than balancing spending over the economic cycle, we now have, in the Budget, a plan to eliminate in just five years the structural deficit. However, the Finance Bill ignores the question of what happens if growth is weaker than expected. It is worth for a moment the House exploring the economic consequences of this Chancellor’s proposals.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  49. I note that the hon. Gentleman was so eager to participate in this debate that he missed the beginning of it. The words I used were not my words, but the words from a wide section of the British business community. [Hon. Members: “Who?”] Well, Goldman Sachs, the Chartered Institute of Purchasing and Supply, and the judgment of the stock market. This is not a perspective held by a narrow corner of the business community. The judgment on this Budget is widely shared across this country.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD

  50. Absolutely. Jim O’Neill is a very respected economist, he is chief economist at Goldman Sachs, and his opinion was echoed by the chief economist at the British Chambers of Commerce. So this is not a narrow perspective from any one particular corner of the business community. This view is widely shared.

    FINANCE BILL · 2010-07-06 · READ IN HANSARD