It is a pleasure to follow the hon. Member for Southport (John Pugh), who began by underscoring how important it is to have retrospective analysis, which is exactly what the new clause asks for. It is difficult to see how it can be argued against. It says:
“The Chancellor shall publish, within six months of Royal Assent, a review of the impact on revenue from rates and measures in this Act, resulting from the Spending Round 2013.”
That would assist good governance and assist the people out there whom we come here to represent. Indeed, so far the arguments have been supportive, although there has been useful interrogation of the issues as the debate has progressed, which everybody has welcomed.
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The economy expands and responds positively to acts by the Exchequer or the behaviour of individuals, the Government or business. At the time of the 2010 election, our economy was not in great health but was steadily moving in a positive direction. There was growth and good stimulus in the economy through, in particular, the strong infrastructure spending that was driving it forward. The then Government were, properly, using their resources to drive forward spending, confidence and movement in the right direction. This Government came into office in a state almost of panic and switched
off of the tap of infrastructure spending. The figures now show that infrastructure spending is much less than it would have been if the plans that were in place and were helping to drive the economy forward had been continued.
That has had an impact on business confidence. We have already highlighted the crucial importance of construction as a driver of the economic health of the nation. Construction businesses have been having a torrid time over the past few years. Sadly, a serious number of subcontractors have gone out of business. Local construction companies tell me that the difficulty they are having in getting sufficient credit from their builders merchants to do the jobs which are now beginning to emerge in the economy presents another structural problem. The root cause of that is the fact that so much Government infrastructure spending was taken out of the economy in 2010, 2011 and 2012.
Many businesses have struggled and lacked confidence. Some do have reserves, but they are wisely holding on to them for a rainy day. They are not spending and making the investments in the future direction of their businesses that they might otherwise have done because they do not have the confidence to do so. The Government are not spending, businesses are not spending, and, equally, individuals are lacking confidence and not spending. When we debated VAT earlier, the Minister posed an interesting question, and rightly so. However, the reality is that putting up VAT when his Government did had an immediate hit on individuals’ spending confidence which has helped to create this downward spiral.
The new clause would ensure that there are marks in the ground to show where the Government must come back to the House to account for the impact of their policies. When the Chancellor set out his policies in his emergency Budget, which has led us to the sorry pass we are in today, he was confident that we would be in a completely different place. If he had implemented the provision in new clause 10 at that time, that would have assisted him in rethinking his policies. It would also have assisted the British people in not having to suffer the consequences of those policies for so long, because he would have reappraised the situation.
The new clause is needed to help every Member carry out one of our fundamental duties on behalf of our constituents, namely taking action to improve the nation’s economic performance and to build the confidence of businesses and individuals.