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Budget Resolutions and Economic Situation

Heaven forfend. I like the tower and I always go there when I am in Blackpool. My party used to go there and I also have fond memories of it as a child. The tower is a national monument and £8 million is no doubt money well spent. [Interruption.] I am being told that Blackpool has a Conservative council. Indeed it does, but it has two Labour seats, both of which used to be Conservative seats. This is, thus, a mere coincidence. One of my hon. Friends was unkind enough to mention that after a wait of all these years £8 million has gone to Blackpool tower. This is part of the £7 billion that is suddenly being disbursed. Where is the money coming from? It is being borrowed. Is it the Government's money? No, it is the taxpayer's money, which the Government hope that eventually some Chinese investor will help to finance. At the moment, the necessary bonds are presumably being printed by or bought by the Bank of England. [Interruption.] The only person who Lord Mandelson ever consults on political tactics is the Children Secretary. They are the architects of new Labour, a movement that we all know is, in essence, a media management and party political campaigning organisation. Lord Mandelson would, of course, want to know whether or not I oppose each and every one of those grants. it. He knows perfectly well that if I say that I oppose a certain grant, that information will go to the relevant place and people will say, "If you vote Conservative, there will be X million less in Barsetshire." People will say that there will be less of a grant for this or that, so I do not do that. I have a good reason for looking at those grants, some of which—the bigger, more substantial ones—I would probably approve of, but I have no access to the business plan. I am not able to ask any great, international company, "Why are you not able to get this money from your normal sources? Why can't you go to the markets?" I cannot say, "Explain to me why the taxpayer must borrow this money to make a contribution," so I do not oppose the grants. When I used to shadow the old industrial strategy of Wilson and Callaghan, I did not oppose them all because I could never get enough information, but sometimes one could look at the political map and get a pretty good indication of why grants had been so surprisingly successful. It is cynical electioneering and the election must bring it to a satisfactory end. That grave problem is not addressed by the Budget, the background to which is appalling. The decline in manufacturing as a proportion of gross domestic product has been faster than at any time in our history. The most worrying manifestation of the crisis is the huge fall in the level of business investment. When business investment goes off a cliff at a faster rate than at any time since records began, which I think was in the 1960s, that tells us how near we are to the end, and, in reality, how likely we are to have growth. That is what happened in the second half of last year, and it tells us we are at risk. Labour caused the crisis in the first place. When the Prime Minister was the Chancellor, he contributed to the global crisis. It was not just Wall Street; it was also the City of London. It was a failure not just of regulators in New York, but of the Prime Minister's own regulatory system in London. Everyone outside the Anglo-Saxon world knows that Bush and Brown, when he was Chancellor, were two of the principal architects, by their negligence—two of the principal contributors—to the folly that we all suffered from because of the hubris of bankers. The Prime Minister lost control of public sector finances when he was the Chancellor. While he was bound, by his electoral pledge, to follow my policies and my figures until 2000, he was the Iron Chancellor, whose work was based on prudence. If only he had stuck to my rules—balance the Budget over the cycle; no more than 3 per cent. deficit on GDP; and limit debt to GDP ratio to 40 per cent.—all of which were hit and maintained when Labour stuck to my fiscal policy for its first three years of government. Thereafter, it went completely mad and ignored all the warnings. The hon. Member for Twickenham (Dr. Cable) constantly claims that he foresaw the dangers. I think he would agree that when he and I spoke in Budget debates, we used to say the same things about the sea of debt that was piling up and the fact that the level of household debt, let alone Government debt, was unsustainable. We were treated as a couple of Jeremiahs who did not understand the modern economics that the current Prime Minister was taking such credit for. He gave knighthoods to successful bankers; he did not regulate them. And he did not doubt for one moment that he could sustain the whole thing on the basis of what was the most foolish and extraordinary bubble. I spent last night reading a very interesting book by Malcolm Balen about the South sea bubble. Although it is not quite so bad, this financial bubble is quite high up the league table. It is worse than the dotcom nonsense we had about 10 years ago, and is absolutely absurd. In this case, I do not believe for one moment that there is the slightest hint in the House of Commons of the corruption that was at the heart of the South sea bubble, but the sheer incompetence and the credulity of the worst Chancellor of the Exchequer we have had in modern times, and the iron control of the new Labour movement that made sure there was no real challenge until the crash came in 2008, is, to a certain extent, reminiscent of past financial scandals. The outcome should be that the Government pay the penalty. They have caused and contributed to the crisis and they currently have no answer to precisely how they will get us out of debt and deficit. They cannot seriously offer themselves for re-election. It appears that most former Cabinet Ministers are planning their future careers in various branches of private enterprise. Where legitimate, I wish them success in the private sector phase of their careers, although one or two have been going near the wind when it comes to what they are contemplating. I very much hope that most of them are thinking about what they can take up as an alternative to Government for the next few years, as the British economy cannot possibly stand their return. This hopelessly inadequate Budget is the last sad epitaph on a history of failure.