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26 Nov 2009 : Column 702

Mr. Speaker: Very briefly.

Dr. Harris: Further to that point of order, Mr. Speaker. I apologise for not making my question clear enough. My point of order is not about the amount of time, but the assertion that discussions had taken place. If that remains on the record and is not the case, the House is in the position of being misled. Those discussions did not take place. Will not the Leader of the House correct the record?

Mr. Speaker: I am grateful to the hon. Gentleman. I understand what he is saying, but I still maintain that at stake is essentially a disagreement about who said what, when and whether it was reflected in practice. That is not a matter for me. If the Leader of the House wants to come back on the hon. Gentleman's point, she is free to do that. I give her one last chance, but she is not under any obligation to do so. I do not think that she wants to say anything further, and she is under no obligation to do that.

Mr. Andrew Pelling (Croydon, Central) (Ind): On a point of order, Mr. Speaker. On the continuing discussions about the usual channels, it is surely important for the House's reputation that Back Benchers, particularly independent Back Benchers, are given the opportunity to speak on issues such as the local government financial settlement. In places such as Croydon, we get the minimum increase in grant, and we have extra asylum seekers to deal with because of changes in Government policy. Can you advise me on the way in which the usual channels can start being used for the benefit of the House rather than for ensuring that Back Benchers do not get the chance to contribute?

Mr. Speaker: I am grateful for what the hon. Gentleman has said. I am always seeking to champion the rights of Back Benchers, and it is always a pleasure to hear his views.

We now proceed to the main business- [Interruption.] If the hon. Member for Taunton (Mr. Browne) would allow us to proceed with the main business, that would greatly assist us.

Corporation Tax Bill

Motion made, and Question put forthwith (Standing Order No. 60(2)),

Question agreed to.

Taxation (international and other Provisions) Bill

Motion made, and Question put forthwith (Standing Order No. 60(2)),

Question agreed to.

26 Nov 2009 : Column 703

Debate on the Address

[6th Day]

Debate resumed (Order, 25 November) .

Question again proposed,

The Economy and Business, Innovation and Skills

Mr. Speaker: I inform the House that I have selected the amendment in the name of the Leader of the Opposition. Standing Order No. 33 provides that, on the last day of the debate on the motion for an address to Her Majesty, the House may also vote on a second amendment, selected by the Speaker. I have selected the amendment in the name of Mr. Nick Clegg for that purpose. The vote on that amendment will take place at the end of the debate, after we have disposed of the amendment in the name of the Leader of the Opposition.

12.40 pm

Mr. George Osborne (Tatton) (Con): I beg to move an amendment, at the end of the Question to add:

Today we discuss the economy and two Treasury Bills soon to come before the House, and we also bring the week-long debate on this empty Queen's Speech to a close. Apparently, we have something to look forward to at the end because my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) has just informed me that it has been 20 years since he last wound up a debate on a three-line Whip in the House of Commons. In a few hours' time, we will get to hear that.

We have this debate, of course, the day after the Office for National Statistics confirmed through its revisions that the British economy continued to contract in the third quarter of this year. While we all hope, indeed expect, some kind of recovery by the end of the year, Britain is still officially in recession a full 20 months after it entered it. That makes it the longest recession since the second world war and, of course, the deepest recession as well.

The economy has contracted by far more than the 3.5 per cent. that the Chancellor forecast in his Budget this spring. That poses a question that should hang over our debate today and every contribution to it: why is
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Britain still in recession when the rest of the world is recovering? Why is Britain still in recession when America, France, Germany, Japan, Italy, Austria, Belgium, Brazil, the Czech Republic, New Zealand, the Netherlands, Poland, Portugal, Russia, Sweden and virtually every single other country in the world have come out of recession? The Government have absolutely no answers.

Mr. Jeremy Browne (Taunton) (LD) rose-

Mr. Osborne: Perhaps the hon. Gentleman does.

Mr. Browne: Given that the state of the British economy is as bad as the hon. Gentleman describes, why is it that I am unequivocally in favour of Labour losing the next general election, but the right hon. and learned Member for Rushcliffe (Mr. Clarke), who is winding up the debate, does not share my view?

Mr. Osborne: What my right hon. and learned Friend is completely against is having to rely on the Liberal Democrats-and with an intervention like that, we can see why.

The Government have no answer to the central question of why Britain is still in recession when the rest of the world is recovering. If one pauses to think about that question, one realises how the entire edifice of the Government's argument over the past two years-the argument that Britain was better prepared; the argument that the great helmsman, the Prime Minister, would steer us through the storm; the argument advanced by the Prime Minister that, thanks to his policies, Britain would, in his words, be "leading the world" out of recession-has come crashing to the ground when we face the simple fact that Britain has not led the world out of recession, but the rest of the world has left Britain behind in recession. That is what has happened. Confronted with this truth and unable to provide a convincing answer to how the Government got it so wrong, one would have thought that they would use this Queen's Speech as a moment to pause and rethink.

Mr. Chris Mullin (Sunderland, South) (Lab): I may be able to assist with the hon. Gentleman's inquiries. I had lunch the other day with someone who works for a very big bank in the City, as one does, and he told me that he thought the official figures were wrong and that we were already out of recession. That was his opinion, which he said was also the opinion of his bank. Last night- [Interruption.]

Mr. Deputy Speaker (Sir Michael Lord): Order. I think that the hon. Member has made his point.

Mr. Osborne: I look forward to reading the diary entry about that one. I am sure that the hon. Gentleman was served a lot of very good wine at the lunch.

My point is that a lot of hope was placed in the fact that when the Office for National Statistics came to revise its figures for the third quarter, they would show that the economy was, in fact, expanding rather than contracting. Well, we have had the first revision, which is often the most significant one, and the figures show that the economy is still contracting. We all wish that that were not the case, but those are the official figures, no doubt endorsed by the Government and the Treasury,
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and that is the reality with which we have to deal. The fact is that Britain is still in recession when almost every other country in the world, including the United States, has now come out of recession.

One would have thought that the Government would use the last opportunity in this tired Parliament to address the fundamental problems that hold back a sustainable and strong recovery: the lack of credit and the lack of confidence in the British economy-the lack of credit to finance the recovery, the lack of confidence that the country can deal with its debts and go for growth. But no, the Government have not addressed those fundamental problems and instead they chose to use this Queen's Speech to try to establish their famous political dividing lines.

Many Back Benchers have taken part in these six days of parliamentary debate on the Queen's Speech, but as it happens, the most accurate analysis of what this Queen's Speech was really about was provided by the very first Labour Back Bencher to be called by the Chair to speak in the main debate. The right hon. Member for Norwich, South (Mr. Clarke) said this, just minutes after the Prime Minister had sat down last week:

in 2010. There we have it: no constructive ambition for the future and not the best way to govern the country. That is not a Conservative MP speaking, but a former member of the Labour Cabinet. Some Labour Members will, of course, dismiss their former Home Secretary as one of the most usual of the usual suspects, always plotting to unseat the leader of the Labour party-and always, to our great relief, failing in those plots.

The truth is, however, that the right hon. Member for Norwich, South is not the only one who thinks that the Queen's Speech was little more than a cynical exercise in political calculation. My attention has been drawn to the blog of the hon. Member for Hyndburn (Mr. Pope). It goes under the inspired title of "The Audacity of Pope"- inspired because it presumably attracts millions of unwitting visitors who thought they were hitting on something a bit more presidential. If we look at this Labour Member's blog, we discover that "Pope" has the audacity to say this about the Government's programme that we are being asked to vote on tonight. He says:

The hon. Gentleman then says:

I can reassure him that no, he is not, as this has been the most transparently cynical, empty and political legislative programme put before this Parliament in living memory.

Our country is in recession as the rest of the world recovers; the great social problems of our age go unanswered; our political system has lost all trust. It is
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time that we had strong national leadership. Instead, we have a Queen's Speech that even the Government's own supporters say has everything to do with the narrow interests of a beleaguered Prime Minister and nothing to do with the national interest.

This is what a member of the Cabinet could not resist boasting to The Times newspaper two days before the Queen's Speech was even delivered. It will be, he said, the

Mr. Deputy Speaker, I would like to use the protection of parliamentary privilege to name the Cabinet Minister I believe responsible for saying that. I have done my research, cross-checked with past records, and I believe those remarks were made by the Secretary of State for Children, Schools and Families. It is exactly the pattern of behaviour that we have come to get used to from him. In June, for example, he told everyone he was going to have the Chancellor's job in a couple of days' time, while earlier this month he briefed on how he was winning his spending battle with the Treasury.

I wonder whether the Chancellor-I do not expect him to say anything-has noticed the similarity between the Secretary of State for Children, Schools and Families and one of those James Bond villains, who sits in his secret lair, stroking the cat, cooking up his dastardly plans for world domination, and then, just before he puts them into effect, he is unable to resist the temptation to show off and tell everyone about those plans. We know what happens next in the films: Bond escapes, the plans collapse, and our villain departs in an escape pod and abandons the imploding mother ship. We fully expect to see the Secretary of State for Children, Schools and Families attempt the political equivalent in the next few months. It is precisely because Cabinet members have told us that this Queen's Speech is so cynical, so transparently an attempt to draw artificial dividing lines, and so little motivated by what would serve the national interest, that we must approach each measure with considerable suspicion about its motives.

The Treasury has put two Bills before us: the Financial Services Bill and the fiscal responsibility Bill. Do either of those Bills even begin to rise to the economic challenge that we face? Will they provide the credit and confidence that is so badly lacking? Will they tackle the deficit and go for growth? No, they will not. As we will debate the Second Reading of the Financial Services Bill on Monday, I will not dwell on it today, except to comment on the Walker review published this morning. Everyone wants the boards of banks to do their job better and to understand more fully the risks that they are running. We do not want a repeat of what happened at the Royal Bank of Scotland, where an all-powerful chief executive went unchallenged by his own board, by Government regulators, and by a Government who instead chose to knight him for services to banking.

I spoke to David Walker this week, and we support his plans to shake up the bank boards and improve their risk controls. We also support his proposals to make those banks disclose the number of their employees who are on high salaries. What happened to all the talk from the Government that they would disclose people's names as well? Lord Myners said just two months ago that the pay and the identity of the highest-paid bankers
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would be disclosed by the Government. However, when asked about that on the radio this morning, David Walker said that

That is not what one would call a ringing endorsement of the Chancellor's City Minister from the Chancellor's City adviser. Perhaps Lord Myners will be the next GOAT to slip the tether. When it comes to the Government and the banks, surely the public are entitled to ask why the Government talk tough and make promises, but then fail to deliver. As we wait to see bonus payments over the coming months, we will remember the Prime Minister's promise that the era of the big bonus is over.

We will look in detail at the Financial Services Bill next week, but we know that it will do nothing fundamental to alter the tripartite system of regulation that failed Britain so spectacularly. Why? The simple and political reason is that the Prime Minister is the sole architect of the structure and does not want to admit that he got it wrong. We also know that the Financial Services Bill will do nothing to address the real financial scandal in our country today-that tens of thousands of businesses are still facing a credit crunch.

The debates on the Queen's Speech have been littered with contributions from Members on both sides of the House who have firms in their constituency facing bankruptcy because they cannot get reasonable access to credit, on reasonable terms. The Bank of England's figures show lending to business continues to contract, and the chambers of commerce say credit conditions are getting worse.

A year ago, the Chancellor talked at length in the Queen's Speech debate about all the Government programmes that would help. Let us look at what has happened to them 12 months later. What happened to the capital for enterprise fund? It has helped seven businesses. The Chancellor told us that the trade credit insurance scheme would provide £5 billion of credit insurance; instead, it has provided £18 million of credit insurance. What about the guarantee for asset-backed securities, which, we were told, would tackle the heart of the credit crunch? Not a single guarantee has been provided by that scheme.

If we want answers to the central question of why Britain remains in recession while the rest of the world recovers, we can start by looking at the dismal failure of this Government to deliver on their promises to get credit flowing in our economy.

Peter Luff (Mid-Worcestershire) (Con): My hon. Friend has been uncharacteristically generous to the Government. Will he also remind the House that the automotive assistance programme, which was promised as a £2.3 billion scheme in January, turned out to be a £400 million guarantee, and so far just one loan of £10 million has been made, to Tata?

Mr. Osborne: My hon. Friend speaks not only with his experience as Chairman of the Select Committee on Business, Innovation and Skills, but as a west midlands Member, and he is absolutely right that the promise of credit assistance to the car industry has not been delivered on.

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