The Economy

I am not taking any more interventions. As I say, there are 33 JSA claimants chasing each vacancy in my constituency, but only two and a half in the Chancellor of the Exchequer's constituency not that far away. If we are going to recover and see jobs and growth, we need capital investment. My right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) spoke about the importance of housing investment and my hon. Friend the Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) spoke about high-speed rail, so let me say something about schools. The decision to cancel the Building Schools for the Future programme has not only had an impact on educational opportunities for children and young people in constituencies like mine, as it has had a devastating effect on the construction industry. I urge the Government to look again—not at recreating the Building Schools for the Future programme, as we have moved on from that, but at the critical importance of investment in schools in our communities. My hon. Friends have already mentioned the future jobs fund, from which more than 90,000 young people directly benefited—6,500 in the city of Liverpool alone. The Government's own study from the Department for Work and Pensions this January described the fund as"““successful in preparing customers for work…The improvements to customer skills sets are likely to remain for the long term.””" I want to address a specific question to the Economic Secretary, who is responding to the debate. Last night, I tabled early-day motion 1960 on the issue of asset sales by regional development agencies. Nationally, these assets are valued at about £500 million, and the Treasury plans to have a fire sale of these assets throughout the country—except in Greater London, where the assets of the London Development Agency have been gifted to the Mayor. I have no quarrel with that decision. It is a good decision, and I do not disagree with what is being done in London, but I do not see why we cannot have the same decision for local authorities and local economic partnerships outside London. I asked that very question at Business, Innovation and Skills questions recently and I was told that the reason was that the London Development Agency had been merged with the Greater London Authority. Actually, that has not happened, as the legislation is still going through Parliament. I urge the Treasury to think again, because if assets can be gifted to Boris Johnson, why on earth cannot they be gifted to local authorities and local economic partnerships outside London? Let me deal now with the issue of fairness. I have already drawn one contrast between my constituency and the Chancellor's. Another contrast is on the scale of the cuts. Of course there have to be cuts to local government funding—we accept that—but Liverpool city council has seen its spending power cut by 8.8%, resulting in cuts of £91 million this year. Cheshire East, which is where the Chancellor's constituency is based, has had a cut of 1.7%. That is why people are angry—not because they deny the deficit, but because they see the burden of deficit reduction falling far more on some of the most deprived communities in the country. The Government need to think again. Even in these tough times, Labour's Liverpool city council is working to improve things. It is working on a plan B for Building Schools for the Future. I urge the Government to engage with it. The council is working with the Government on the enterprise zone and it is creating 133 new apprenticeships to give opportunities to Liverpool's young people. Finally, on the cost of living, in the year to April, we saw average weekly earnings rising by 1.8% while inflation was at 4.5%. For a family on average earnings with both adults working, that is loss of £1,000 to the household income each year. The pain is not being shared. When the Government abolish the bankers' bonus tax, yet go ahead with that cut in real earnings for average families, it is not about protecting low and middle-income Britain. An economic gamble is being played by the two parties in the coalition. The speed and scale of deficit reduction could itself damage our ability to reduce the deficit, by damaging growth and increasing unemployment. Yes, we need cuts; yes, we need to reduce waste: but we need to protect the front line as far as we possibly can. If the Government continue down this path, there is a serious danger that they will both weaken the prospects for economic recovery and create an even more divided society in our country. I urge them to think again.