Let me start by doing my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont) a favour and correcting the hon. Member for Leeds North West (Greg Mulholland). It was a Labour Government who introduced the welfare state, not a Liberal Government—I am damn sure there was not a Liberal Government after the war.
I heard the Secretary of State defending the Bill on Radio 5 Live this morning. He made two important comments. The first was that the Government had underestimated the size and scale of the economic problems the country faces; the second was that the proposal to cap benefits was based on fairness. The two issues are, of course, inextricably linked, but what he failed to mention was his Government’s contribution to the size and scale of the economic problems we face. Without that part of the story it is difficult—indeed impossible—to put into context the proposal before us, nor is it possible to understand the rationale that the Government are setting out.
The economy is not in good shape, but if the Prime Minister was too weak to move the Secretary of State from office in the last Cabinet reshuffle, he is certainly not going to move his Bullingdon club buddy. That is a pity, because it is the Chancellor’s quick-fix agenda of raising taxes and cutting spending too far and too fast that has spectacularly backfired on our economy. Because the benefits bill is going up while tax revenues are down, borrowing continues to rise. [ Interruption. ] The Secretary of State should listen to this; he might learn something.
We hear a lot about the great work that the Government have done to reduce the structural deficit, but very rarely do we hear anything about the debt. A perfunctory look at the numbers tells us why. The Government claim they have clipped the structural deficit by £37.5 billion, but they have also increased borrowing by £212 billion since they were elected. It seems neither appropriate, reasonable nor sane to claim that we have reduced the household budget— to use the litmus test of Mrs Thatcher, the great saviour of the Conservative party—while simultaneously borrowing more than five times as much as we claim to have saved. Like so many other claims that the coalition parties make, it is spurious. Their economic competence is indeed questionable.
All this is important because if we had steered a different and more sensible course, the economic condition of our country would be immeasurably better. That takes us back to the Bill. Who is being asked to pay as a result of the Government’s mishandling of the economy? We all agree that it would be foolish to disagree or take sides on arithmetic, but it appears that the Government wish to do so. May I remind hon. Members that jobseeker’s allowance is £71 a week? Under the proposal in this Bill, it will increase by 71p this year. It might interest the House to know that since this Government took office, the cost of the average weekly shopping basket has risen by 17%. Most importantly for the poorest people in our country, figures from the Department for Environment, Food and Rural Affairs show that falling income and rising food prices reduce food affordability by 20%. For the record—I draw this to the Secretary of State’s attention—the proliferation of food banks across the UK is not a cause for celebration.
Increases in prices have the ability, or at least the potential, to be absorbed by a working household’s budget. Although Labour Members do not deny that times are tough for everybody under the current economic circumstances, to suggest that there is a level playing field between someone earning even the minimum wage and someone receiving £71 a week in benefits is an utter fallacy. This is not about fairness; otherwise, 8,000 millionaires would not be getting a tax cut of £107,000 a year. The Secretary of State’s halo has fallen and crashed to the floor, and the Bill is sadly another example of the true character of Conservative politics. In difficult times, they see nothing wrong in helping the rich at the expense of the country’s poorest people.
5.54 pm