Fiscal Responsibility Bill

We have had a wide-ranging debate. I agree with those hon. Members who said that clause 1 is a crucial part of the Bill. However, I have found it difficult to agree with most of the other things that hon. Members have said about the Bill. That is a shame, because there are some strong arguments that can be made about focusing on structural borrowing, but they were not made by the Opposition. I will come to the amendments in a short while, but given the instruction that this should also be a stand part debate, let me say something broader about the economic and fiscal context. I shall do so briefly, because all Members will be aware of the events that have taken place over the past 18 months to two years, the actions that the Government have taken to stabilise the economy, and the situation that we now face, with a pressing necessity to reduce the overall national debt. I want to focus first on the areas on which we can all agree. There is wide agreement across all political parties that we need to see fiscal consolidation in this country. One of the big issues between us is the pace of that consolidation. If we strip away the political rhetoric, we find that there are two judgments: one that has been made, and one that needs to be made. Going into the recession, it was quite clear that the Conservatives would have spent less. They opposed the fiscal stimulus, so they would not have spent money on it. We wanted to see investment in public services, and we believed that the fiscal stimulus was necessary. We also believe that debt would be higher now if we had not taken the action that kept people in work. I think that every political party agrees on the need to use automatic stabilisers. The second judgment relates to the speed at which we get the debt down. The difference between the parties relates to whether we cut immediately or wait until we are sure that the recovery is locked in before we take action. The Government's view is that we should do the latter. We want to ensure that the recovery is in the bag. We do not want to jeopardise the economy or risk falling back into recession by taking precipitate action.