---

Government Capital Expenditure

I support my right hon. and hon. Friends on the Front Bench. Irrespective of the crisis that we face in international banking and the financial sector, the strategy of co-ordinated investment in social and economic regeneration over the past decade has worked and continues to work. Without it, communities such as my constituency would still have Dickensian schools, hospitals and GP surgeries, and we would have had construction workers on the dole for the past decade and more. If we are serious about regenerating communities and engaging the private sector to reinvest in communities, the public sector requires a co-ordinated approach to replenishing the public realm. I invite my right hon. Friend the Financial Secretary to visit us in my area of Wigan. For the past decade, we have worked with the private sector to reinvest in our townships, abandoned by the last Conservative Government, and our pit villages and our textile communities, left almost overnight with no economy and a disinvestment in our public services. That caused great social and economic dislocation. Some parts of our community are still grappling with the consequences a decade or more later. It is important that we do not look for merely a short-term fix to get us out of our fiscal difficulties because of the failure of the American and other banking systems. We must sustain our investment for social and economic good. If we are serious about re-skilling and up-skilling our work force and giving every kid in Britain the right to be the best they can be, we need a co-ordinated approach at local level, with public investment linked to engagement with the private sector in order to develop our infrastructure and encourage investment in communities where previously the private sector had disinvested for a decade and more. In our community, the local authority worked with the private sector to encourage the creation of public sector campuses in our small townships and our larger ones. We want the Government to utilise capital investment in the NHS, the education system, housing and local government, and to bring those investments together, instead of allowing investment by individual Departments to be made in a pepper-pot way. We need to bring forward those investments to ensure a better-resourced outcome from public investment. During this crisis, the Government have established a National Economic Council. Before Christmas, we in Wigan met the banks, building societies and private sector developers to create our own economic council to ensure that work introduced at the top line happens locally, on the front line. I say to the Exchequer Secretary that when top-line announcements are made, we must have the capacity to ensure that they are followed through at a local level. We will be judged by communities when they can see what we talk about in this place making a difference in their everyday lives. When we say that we will invest in schools and colleges, we have to ensure that that investment is set out in an effective way over the next two or three years, and that we are certain that local authorities can invest in them. We have to be sure about investment in housing, whether it is social housing or public-private investment to bring back private sector housing into public use, such as old stock that needs refurbishing, or new stock that cannot be sold in the marketplace today. We need a time scale that ensures that people can see the differences made. It is important that alongside those public investments, we ensure that the banking system generates enough resources, so that where public investment with the engagement of the private sector is needed, the private sector can work in sync with us. That is critical to the LIFT—local improvement finance trust—strategy for NHS investment, particularly in primary care. We can get an agreement with the national health service, but without investment to encourage the private sector to engage in big infrastructure projects, and without banks agreeing to participate with private sector developers as part of the LIFT company, some of the Government's priority projects will be delayed. It is important to listen to voices at ground level to ensure that top-line announcements by Ministers are delivered on the bottom line, in the local community. We must not allow the Conservatives to get away with what they have attempted to get away with tonight. They have made it absolutely clear that there would be immediate removal of capital investment in this country under a Conservative Government, leading to dislocation for the private and public sectors. The consequences for public services, and private sector companies engaged in public services, would be double what they were under the last Tory Government during the 1980s and 1990s. It is not rocket science. The policies advocated by the Tory Front-Bench spokesman, the hon. Member for South-West Hertfordshire (Mr. Gauke), were those pursued by the last Conservative Government during two recessions. At that time, the consequence of those policies was a laying waste of my community and its public services. We were trying to provide public services in our community at a time when nine out of 10 people on council estates had to rely on some form of state benefit. That was the level of dislocation caused the last time the Conservatives put into practice the policies that the hon. Gentleman advocated in relation to this recession. These are siren voices: they were wrong then, and they are wrong now. It is important, in arguing our corner, that we do not just become administrators of Treasury policies. We should be enthusiastic and tough in arguing our corner on public service investment. My final point is about the banks, and it is not an easy hit. It is important, having rightly saved the banking system from meltdown, that the system does not revert to type. We saved the banking system for a simple reason: to protect the long-term future of business and commerce, and to protect pensions and other assets. It is no job of ours to sit back if a bank allows 12,000 jobs to go to the wall, as one bank in my constituency is doing. Why is that happening? Because the bank will not implement the strategy that the Government rightly outlined weeks ago. It is our task not only to ensure that public services invest in the way we want them to, but to make sure that the banking system fulfils its side of the bargain. Good businesses in our constituencies are going to the wall not because they have failed—they have not—but because they need support from the banking system to get them through this recession into better days. I hope that, in her response, my hon. Friend the Exchequer Secretary gives a clear indication of how the Government are ensuring, alongside local authorities, that public sector investments will take place in a time scale that will make a difference. They must take further action, if necessary, to protect individual companies when the banks are acting inappropriately and putting those businesses at risk.