The Economy

This debate is not about denying the deficit, and nor is it about never reducing public spending: it is about if and how we reduce the deficit and how we use public investment to grow the economy. I intervened on the Chancellor earlier in this debate and asked the Chief Secretary to the Treasury a question at Question Time because they ignored an important part of the OBR report, which they have quoted extensively—indeed, the Chief Secretary is still ignoring this point. He argued that we do not have growth because the OBR discovered that the recession was deeper than previously thought. However, the OBR also said that the recovery had been quicker and stronger in 2009 than previously thought and that the decline in growth came in the latter part of 2010. That is when the famous oil tanker that people have talked about threw out its anchors and started moving backwards. The 2009 recovery did not happen by accident or because the sun was shining; it happened because the previous Government took steps to stimulate the economy. Such steps can be taken. It is not true, as has been argued, that if we simply use Government money, we will never pay off the debt. The National Housing Federation, which represents housing associations, has made a small but helpful suggestion. It says that if the Government put £1 billion towards shared-ownership housing, the housing association sector could put £8 billion towards it. That would grow 400,000 jobs and build the 66,000 shared-ownership houses that are hugely needed by many low-income families, and at the same time reduce spending on jobseeker's allowance and housing benefit. Many who would live in shared-ownership houses would previously have lived in high-rent private sector housing, which causes the housing benefit bill, which the Government say they are worried about, to escalate. That is just one small example. When we create jobs in that way, we create not just that one job. It is not a question of saying, ““We spent all that money creating those jobs. Okay, those people will pay more tax and will not be on benefit, but that is not growing the economy.”” Those people exist within local communities. If people have jobs and incomes, they will buy goods from other businesses. It is no accident that many of the businesses in difficulty during the recession and after are related to the housing world. I know of one firm in Edinburgh that not only sold furniture but built it. The furniture-building side of the businesses has closed because the market has declined. People are not buying houses and they are not moving into new ones or redecorating, and they are not buying furniture.