Derby Telegraph Article: The Economy

As published in the Derby Telegraph, 27th July 2012

Parliament went into recess last week with some good news in the form of the upgrade and electrification of the Midland Mainline network to electrify the rail all the way from London to Sheffield. This project, part of an £800 million infrastructure investment scheme, will reduce journey times to London and help deliver growth in our area and so should be a real boost to local employers in and around Amber Valley.

The coalition came together two years ago to tackle the terrible financial position left behind by the Labour government, and despite the ongoing financial crisis, we have taken difficult decisions and already reduced the Government’s structural deficit by a quarter – getting the country to a position where we are living within our means is a vital part of our plan for recovery.

We have managed to cut corporate taxes to the lowest levels in the G7 – meaning that there are more incentives to invest, to create jobs and to create growth. We’re helping working people by increasing the personal allowance for income tax for everyone in this country – by the end of this Parliament nobody will pay tax on their first £10,000 of annual income.

What’s more, we’ve made sure that hard-pressed families don’t pay for those that can but refuse to work. Benefits have been capped, housing benefit reformed to stop excessive rents, medical checks are carried out to ensure those fit to work are not left on sick benefit and those who are offered opportunities but do not take them will face real consequences of their inaction under this Government’s welfare reform plans. It’s right that we give generous help to those in need but not to those who can help themselves.

We want to prevent a repeat of the financial crisis, when a broken banking system, made only worse by Ed Balls’ light-touch regulation as City Minister, brought this country to its knees. The Vickers Report recommendations will be implemented by this Government and will aim to ensure any failure of a bank cannot cause such turmoil once again.

But the drag from Labour’s debt and banking crises, along with problems in the Eurozone, is weakening growth in Britain. This week, we saw a highly disappointing further quarterly contraction in the economy. That’s why it’s important to help where we can. We have launched the National Loan Guarantee Scheme, which has seen banks offering 13,000 more affordable loans since March. Two weeks ago the Government, alongside the Bank of England, launched a further cash injection scheme into our financial system to boost confidence and help banks to lend. We also launched the Funding for Lending scheme, which will help make mortgages and loans cheaper and more available.

It’s vital that we continue to tackle our debt – it’s the only way that interest rates will remain low for mortgages being paid by families here in Amber Valley. If the Government did not have a deficit reduction strategy in place, interest rates would be higher. Spending more money on debt interest payments than educating our children is simply unsustainable. Unfinanced and unsustainable spending cannot be the answer to a problem that is in part due to high Government debt levels.

The Government has limited tools at its disposal to boost the economy, but I am glad that it has taken the decision to use its balance sheet to accelerate infrastructure investment like the Midland Mainline electrification. I am confident that my constituents will feel direct benefits from this move with more jobs to be created in the local rail industry and much-needed added security for those already in employment.