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The Economy (Supporting Business)

I beg to move,"That this House has considered the matter of the economy: supporting business." British businesses are fundamental to our success and prosperity as a nation and supporting businesses through these tough times has been, is and will continue to be a priority for the Government. As many commentators have said, what makes this downturn different from those seen in the past is the fact that it is not a domestic problem, or a problem restricted to a small number of countries, but global. World gross domestic product is forecast to contract by around 1.25 per cent. this year—the first full-year shrinkage since the second world war—and many of our international partners are in recession. In the first quarter of this year, the UK economy shrank by 1.9 per cent. Across the EU, the fall was 2.4 per cent. Germany saw a contraction of twice that in the UK in the first quarter, and the Japanese economy contracted by 4 per cent. This downturn is hurting people and businesses, but the Government are not ducking the hard questions. We led the world in taking action to stabilise the banking system. We have put in place a £20 billion fiscal stimulus package to boost the economy. We have introduced a range of targeted measures to provide real help to businesses, individuals and families. As the International Monetary Fund noted in its annual statement on the UK economy, our response has been bold and wide ranging, and it has helped to contain the impact of the global crisis on the country. The fact that this downturn is global means that we need global action as well as action on the home front. That is why the Prime Minister and the Chancellor have worked with our international partners to ensure that we have a co-ordinated global response to the economic crisis. In April at the G20 summit meeting in London, agreement was reached on collective action that is necessary to mitigate the risk of an even more severe downturn while reshaping the financial system, preserving the world trading system and laying the foundations for a sustainable recovery. The London summit was an important step in the journey towards restored stability and economic growth globally, and the Government are committed to ensuring that further progress is made between now and the next meeting of leaders to be held in the US in September. Here at home, we have taken decisive steps to support the UK's financial system, given its fundamental importance to the basic functioning of our economy, and to provide real help for people and businesses.