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Amendment of the law

Indeed, a depression. After that, his contribution went downhill. We probably do not agree on much more. He is at least in favour of a fiscal stimulus, and we had some discussion about the size of that. Of course, that puts us on the same side of the argument, against those who said that we could not afford a fiscal stimulus. The Opposition voted against the fiscal stimulus that was a centrepiece of the pre-Budget report. They would have put us in a position where we would have been unable to bring forward the £3 billion of investment that was already planned, as my right hon. Friend the Chancellor announced. We would not have been able to stimulate the economy in order to support people now. The hon. Member for Wellingborough (Mr. Bone) made his usual trenchant remarks. I hope to see him in the Committee on the Finance Bill, so that we can carry on our jousts there. Naturally, I do not agree that the Labour Government have destroyed the economy. He needs to take into account what is going on outside the country. We have had a massive unexpected global banking shock, which has created the first synchronised global downturn and decrease in world gross domestic product since the first world war—[Interruption.] It does not say that anywhere; I am just describing what is happening in the world economy. I know that it suits the Opposition to pretend that all these problems and the sudden huge shock in our financial services have somehow been generated internally in this country, leading to the deficits that the Opposition go around the country trying to scare people about, but the circumstances of the credit crunch and of events in the global international financial system are unprecedented. Inevitably, those circumstances have had a big effect on all economies in the world, both advanced and developing, and we face major economic challenges as a result. I would have thought that, just once, an Opposition Member might acknowledge that that is going on, instead of peddling the view that all the problems were internally generated in No. 10 and No. 11 Downing street—that we could all have foreseen them somehow and that we have deliberately got ourselves into a situation where we have to deal with a borrowing requirement of 12 per cent. of GDP. If the Opposition were being more honest, rather than talking in their slogans for the forthcoming general election, they would acknowledge that we have been affected by an unprecedented global situation and that we have to recover from that. It is important that we acted to shore up the banking system. That was essential, but it was done at a cost. Initially, the Opposition opposed our action, then they were in favour of it, then they opposed it again. Their thoughts on what we should be doing to save the global banking system seem to change from one day to the next. They spent years acknowledging that financial services were a major part of our economy and that we are an open and trading economy, but they now blame the Government for the fact that the global downturn is having an greater effect on our economy than on some more closed economies. That is true, because ours is an open economy that had a comparative advantage in financial services. That is why we have been hit more severely than some economies. Japan and Germany, neither of which have large financial sectors in the same way as we do, have been hit even harder because they manufacture and export. They are being hit by the same sort of global slow-down—the stalling of the economic engine—that was the result of the credit crunch. We have to get the world economy through the present problems, and we have to get this country through the challenges that we face, so we acted to shore up the banking system, despite the Conservatives' less-than-helpful approaches. That was essential, but it had a cost. We acted in the pre-Budget report to provide real help for people and businesses, and that included the fiscal stimulus that the Conservatives voted against. A tax cut for the 22 million basic rate taxpayers will go into their pay packets this April. The Conservatives have to explain to the people of this country why they voted against it. They have to explain why, when things are so challenging and difficult, their priority for expenditure is to spend £1 billion on giving £200,000 each to the 3,500 richest estates in the country. Our priority is giving a tax cut to 22 million basic rate taxpayers. They have to explain why they refused to change their mind about that when they had the chance to do so—the shadow shadow Chancellor, in his usual way, suggested that perhaps they should change their mind about the policy. They have to explain why it continues to be their priority. The Conservatives also have to explain what they will do about the increase to a tax rate of 50 per cent., which we have had to introduce to deal with the unprecedented situation that we are in. They have to explain why the Mayor of London today announced that he was against it and that the Conservative party should vote against it, when the Conservative Front Benchers are being rather coy about their view. The Conservatives have had much fun talking about potential leadership challenges in our party—they even tried to provoke my right hon. Friend the Secretary of State for Energy and Climate Change, who is doing a fantastic job where he is, to join the next leadership contest—but the Mayor of London is stalking the leader of the Conservative party before the latter has got anywhere near the gates of No. 10. He announced that he might not even bother to stand for a second term as Mayor, and that he might be looking for a seat in this place, so that he can see whether he can cause a leadership election in the Conservative party.