If the hon. Gentleman looks again at the numbers in the Budget Red Book, he will see that the automatic stabilisers have been more than functioning. Under this Government, public spending has gone up considerably while borrowing has remained at extremely high levels. The borrowing levels the Government inherited were off the chart compared with those in any previous cycle we have witnessed in the British economy. Levels of public borrowing are still well above the peaks in previous cycles. The hon. Gentleman must understand that the numbers show that plenty of automatic stabilisers are in operation—the question he needs to answer is why they are not working. Of course, they are not working because of the other problems that have been inherited, such as the broken banks, the difficulties with tax rates and the large structural deficit. Those are all part of the problem and we can debate them at another time during a general debate on the economy.
The Government are attempting, through their tax and benefit changes, to tackle the problem of people asking, “Why work?” I have two bits of advice for my right hon. and hon. Friends on the Front Bench that might be more to the liking of the Labour party. If my right hon. and hon. Friends are going to pursue and sustain the policy of very low benefit increases for the next period, it is important that two other conditions are met. The first is that every action should be taken to get inflation down. If inflation suddenly took off, this would become a much tougher and crueller policy than Ministers have in mind. That would be extremely difficult. So it is in everybody’s interest—not just of those in low-paid work and not just those on benefit, but those people in particular—that more is done to sustain and control price rises.
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I hope my right hon. and hon. Friends on the Front Bench will make sure that their contacts with the Bank of England stress the need to do a better job of controlling price inflation than the Bank has been able to do in recent years, and I hope they will also be looking at reforms in a number of areas, particularly in energy, for example, because it is energy prices above all which have done so much damage to people at all income levels, but especially to people on low incomes and benefit incomes. There are other things, which are not the main subject of this debate, that could be done to tackle high and rising energy prices. This policy will be much easier to sell and to sustain if Ministers can say, “The real cut is very small because we are doing a better job now of controlling price inflation than was the case in the past.”
The second condition picks up on a point that has already been mentioned by the Opposition. The policy will also be much easier to sustain if more jobs are flowing into the economy. I pay tribute to those on the Front Bench for what they have achieved so far. Some 1.2 million new jobs have been created in the economy during their period in office. That is extremely welcome. We need to make sure that more people already settled here and down on their luck get access to those jobs and can take them so that they can enjoy the benefits of higher income in work.