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Budget Resolutions and Economic Situation

This will probably be the last speech I make in Parliament as the Member for Sheffield, Attercliffe. I do not intend to lose in the general election, but unfortunately the Electoral Commission, in its wisdom, decided to rename my seat Sheffield, South-East, which is rather disappointing. Although that is a technically accurate geographical description of the constituency, the Sheffield, Attercliffe constituency has existed since 1885—125 years—and I like the idea of continuing to use historical names. I am slightly disappointed about that, but I nevertheless hope to represent the constituency under its new name after the election. There have been many speeches from right hon. and hon. Members who are leaving Parliament, and we wish them all well. I have enjoyed the companionship of my hon. Friend the Member for Nottingham, South (Alan Simpson), who has just left the Chamber, and I value his friendship. We have not always seen eye to eye or been on the same side of arguments, but we have certainly always been on the same side in the parliamentary football team, where we have enjoyed several games together. I also want to comment on the contribution of the right hon. Member for Skipton and Ripon (Mr. Curry). Over the years, I have enjoyed many debates with him, both in the Chamber and in Committee. He did his best to argue the case for, and the cause of, local government when he was Local Government Minister. Many on the Government Benches have great respect for what he has achieved and how he has put his views forward, and for his great wealth of knowledge on local government, housing and planning. Unfortunately, his time as Minister was rather constrained by the yoke of Thatcherism, under which he laboured—he did not always agree with it—but we will be sorry to see him go. Before he does so, perhaps he could give a few tips on the real meaning of localism to one or two Conservative Front Benchers. I shall come to my right hon. Friend the Member for Sheffield, Central (Mr. Caborn) in a minute. At a recent meeting of the Select Committee on Yorkshire and the Humber, regional representatives from the Federation of Small Businesses, the British Chambers of Commerce, the CBI and the Engineering Employers Federation were united in giving us two messages: first, that Yorkshire Forward, the regional development agency, is doing a good job in helping them through the recession, and that we should not get rid of it; and, secondly, that we should not start making cuts now, and that the recovery is too fragile and limited to run the risk of pushing them back into a double-dip recession. Industry and business made that argument clearly and with a united voice, and we ought to pay heed to it. This morning, I visited a company called Birley Manufacturing. We talked briefly about the Budget, but also about the company's interest in the Government's long-term commitment to spending in certain areas. We often forget that public spending is not simply about jobs and service provision in the public sector; it is also important for private business. That company makes the skirts that go under high-speed trains and it has had a major programme of investment over the past few years, so it is important that it knows what the future holds for Government commitment to public investment in transport. Sheffield is clearly having a difficult time in the recession, like the rest of the country, but we are not experiencing anything like what happened in the 1980s—the scenes of devastation and destruction, with 40,000 people losing their jobs in steel and engineering over a decade in the Lower Don valley, in my constituency and that of my right hon. Friend the Member for Sheffield, Central. Of course, there have been some redundancies, but there have also been some real success stories. My right hon. Friend mentioned Sheffield Forgemasters, which has seen a management buy-out with the workers owning a large percentage of the company. It is going from strength to strength, with 70 apprentices taken on. It is also making a multimillion pound investment in a major new forging press so that it can be a significant producer of parts for the new nuclear programme here and overseas. Some £80 million of Government assistance has been given. We should not return to old policies of supporting failure in business, but the Government should consider how we can enable successes, and Sheffield Forgemasters is a major success. I congratulate the Secretary of State for Business, Innovation and Skills and Ministers in that Department, but I especially congratulate my right hon. Friend the Member for Sheffield, Central. He really underplayed his involvement, but if it had not been for his knowledge, understanding, commitment, drive and refusal to give up, that investment would not have been made and those jobs for the future in our advanced manufacturing sector—not only for Sheffield, but for the UK—would not have been secured. Advanced manufacturing is the way forward for Sheffield and the UK. We should not forget that we are the sixth major manufacturing exporter in the world. When I went the other week to the advanced manufacturing park that my right hon. Friend mentioned, it was put to me very simply: ““If the Chinese can produce goods with wage costs at 20 per cent. of ours, we have to be able to produce goods with a labour input of 20 per cent. of that of the Chinese.”” With ceramic cutting tools, machines can do a job in less than 20 per cent. of the time they used to take with the old tools, and that is how British manufacturing will move forward. The Government have to be part of that, and the advanced manufacturing park is supported by Yorkshire Forward with the university of Sheffield, Rolls-Royce, BAE Systems and Japanese machine tool companies all working together. That is the future, so that when we start producing new nuclear plant in this country, much of it will be made here. It is also right that we should do more to ensure that parts, equipment and machinery for the green energy revolution are made in this country. I therefore welcome the commitment to a green investment bank and the decision by Siemens—another company with a base in my constituency—to start producing wind turbines here. That is another important step forward for advanced manufacturing and future industries. Sheffield now has a diversified economy, so I also welcome the help for the computer games industry, which is partly based in the city. We should think more about new industries. We do face a reduction in public expenditure, but I notice that the Conservatives have not undertaken to protect schools. I am pleased that this Government have done so. Since 1997, spending per pupil has gone up roughly 100 per cent. in secondary and primary schools in Sheffield. In 1997, we were spending £4 million on school buildings, but last year we spent £70 million. Does that make a difference to the pupils? Of course it does. Some 38 per cent. of pupils got five or more GCSEs at grades A to C in 1997, but 60 per cent. did so in 2009. That shows that the investment in education is working. Some 58 per cent. more young people in my constituency now go to university than did in 1997. Of course universities have to make efficiency savings like everyone else, but I caution Ministers to remember that it is vital to keep a thriving university sector, because it is universities and business working together that will create the advanced manufacturing industries of the future and ensure that we can sustain the cutting edge of efficiency and productivity that we need to survive. Local government will go through a difficult period, but over the past few years it has achieved 2 per cent. efficiency savings, and we should give it credit for that. We need to protect hospitals and health services, but it would be folly to protect the health service while forcing major cuts in social services. We have to take a more joined-up view of those services. We must learn from the pilot programme on Total Place. Efficiency savings can be found in overlap and duplication, but let us look at the services in totality instead of as separate entities in different silos. The public do not see those services that way, and we should not do so either. That will be a challenge, but I am sure that local government will rise to it. We have to give it greater freedom and the ability to connect and share budgets and resources with other government activity in the local area. I have a particular interest in housing, and I am pleased by the Government's efforts to help people through the recession, including help with mortgages to reduce the number of repossessions and the start of a council house building programme again. I welcome the housing revenue account reforms, which will guarantee 10,000 new build a year in the local authority sector, and provide 10 per cent. more money for management and maintenance to try to secure the future finances of social housing. But there is still the challenge of how to increase the number of social houses built. When the recovery comes in the housing market, housing associations will be able to do more, but we have to find a way to bring more private sector financing into arm's length management organisations and more investment in long-term private rented housing of good quality. When it comes to cuts, it is often easy to cut long-term capital projects to protect ongoing revenue expenditure. That would be folly. The Government are right to commit to long-term investment in high speed rail and a line from Sheffield to Leeds—rather than the ridiculous suggestion of a link from Manchester across the Pennines to Leeds. Sheffield and Leeds are united in supporting the Government's proposals. The commitment to further electrification is right, and I want the midland main line to come as soon as possible. I also welcome developments such as tram trains. It is important to continue to invest in transport infrastructure not only because it is important for the economy directly, but because supplying the carriages, the locomotives and the infrastructure of the track should be done by British companies with a base in Britain. Those companies need certainty, not the swapping and cutting that often happens in recessions, when capital expenditure is the first to go. That causes real problems for the long-term plans of the private sector, which wants to be part of delivering those projects. I am still not sure about the Government's answer to binge drinking, which is to put alcohol duties up regularly. The supermarkets will still sell lager at a discounted price, and pubs will continue to struggle—although I welcome the help that the Government have offered. This is a sensible Budget. It is not dramatic, but it is a difficult Budget given in difficult circumstances. My right hon. Friend the Chancellor is right to make support for business, skills and jobs his priority, because the long-term recovery will be based on those.