Fiscal Responsibility Bill

When talking about amendment 4, the Economic Secretary recognised that there were circumstances—he cited natural disaster, but the most obvious example is another recession in the next few years—whereby it would be impossible or at least extremely difficult to stay within the Bill's parameters. The Chancellor has acknowledged the same point, but there is no provision, save for getting rid of the Bill, for the necessary procedures to take account of issues of great budgetary consequence, whether natural disaster, another recession, a war and so on. That rigidity is a failing of the Bill. I can understand the Economic Secretary's point that too much flexibility means that the Bill loses worth. In my view, it has little worth anyway. However, if targets are to be set, even though they are based on forecasts that get harder to project with any accuracy as we go into the future, such an approach must make some provision—as the Chancellor and the Economic Secretary acknowledged—for events overtaking the predictions. That is why amendment 4 tries to include some flexibility that would not mean ripping up the Bill. The amendment would provide for a suspension for one year, which would take effect when the Bill came into force. The Conservative spokesman was anxious about that, but the provision must take effect from day one. The amendment would provide for suspending the Bill for a year if the situation were sufficiently grave. Of course, it could be suspended for a second or subsequent years, but that could be done only by an order laid before Parliament—it could not therefore be done by Executive fiat—and a positive resolution of the House. We would have to make a conscious decision if the Chancellor came to the House and said that he or she was unable to continue following the timetable in the Bill because of factors so grave that it would not be in our national interest to abide by it.