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Legislative Programme and Budget Statement (Wales)

I visited the Table Office earlier in order to take advice on this speech, because this is the first time that I have made a speech in Parliament since returning to the House after an absence of 13 years— 10 of those being spent on missionary work in the European Parliament. I asked whether this counts as a maiden speech, and I was generously told that my maiden speech took place 18 years ago. That is not an invitation to intervene, but it does set the context, which is that I will reflect the tone of such speeches by first paying tribute to my predecessor, Julie Morgan. There is nowhere better to do so than in this Committee, not least because as I look across the Committee, I see so many people who worked so hard to try to ensure that I did not return to the House. [ Interruption. ] The result was indeed very close, which was a strong reflection of the high regard in which Julie Morgan was held in the constituency—she was well regarded here in the House, too. It was a testament to her personal service in the constituency that she secured only 40 fewer votes than in 2005. Having said that, I am delighted to be here, because I feel that I have arrived at a rather historic time, in which we are living new constitutional history. In that context, I remind the Committee of the remarks made by Mervyn King during the election campaign, which were not announced publicly but which were subsequently leaked. He said that the party that won the election would be out of office for a generation. I do not know whether that will prove to be true, but we would do well, in the context of this debate, to reflect on those words. Why did he say that? He said that because he recognised the enormity of the financial challenges that faced our country. In the time that I have been back in the House, I have not received the impression that that is totally appreciated by Opposition Members, so I will remind the Committee of a few facts. We already know that the budget deficit is £153 billion —it is endlessly discussed—but we do not speak so much about the level of personal debt that was racked up over the course of the Labour Government. The hon. Member for Clwyd South discussed the advances that she feels that her constituents have experienced; the reality is that her constituents, along with my constituents and those of all Committee members, are more heavily indebted personally than they have ever been. Personal debt is equal to 100% of GDP, and savings are at their lowest level since the 1950s. That is a stark picture, not only in the personal finance sector but in the company finance sector, because although personal debt represents 100% of GDP, company debt makes up 110%. Sure, we had all those years in which the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) and Tony Blair were cutting the ribbon of Lehman Brothers and the rest in the City of London and getting the resources from that growth in the financial sector, but the reality during that period was that many of those companies were themselves existing on significant debt. I repeat: the amount of company debt in our country represents 110% of GDP. When the tsunami of the financial crisis hit us, it was claimed that our country was best placed to withstand the recession. That was not true. It was the worst placed, and if anybody doubts that, a McKinsey report published in January described our country as the most indebted in the world. That is the stark message. I was surprised when, within a day of the election, having come so near to an overall majority, my right hon. Friend the Member for Witney (Mr Cameron) gave a speech offering the opportunity of a real, open coalition with another political party. I thought subsequently that that was a brave move on his part, because it was not universally popular on my side of the House. Going into coalition was a big challenge not only for our party, but for our Liberal Democrat colleagues, given the slings, arrows and insults that they have received. That is, however, a recognition of the enormity of the problems that we have been left and that have to be grappled with. During the election campaign, Labour recognised that those challenges had to be faced and that £40 billion had to be cut from the Budget, but watching Prime Minister’s questions or other debates, or what took place earlier in this Committee, that would be hard to believe. I have not heard any specific proposal on reductions in Government spending that has been accepted by Labour Members. That is a matter for the Opposition, but the reality is that it falls to us to try to address the challenges that we face.