UKPOL.CO.UK

Tag: Danny Alexander

  • Danny Alexander – 2012 Speech at the IFS

    Below is the text of the speech made by the Chief Secretary of the Treasury, Danny Alexander, to the IFS on 23rd April 2012.

     

    Good morning, it’s a pleasure to be here at the IFS.

    When this coalition government came into office, Britain faced some of the most substantial fiscal challenges anywhere in the world.

    We had the largest forecast budget deficit in the G20 – bigger than many of those European countries whose fiscal challenges are regularly in the news.

    The gap between what we raised and what we spent was the greatest in our post-war history.

    It’s because of this Government’s leadership that we have sheltered the UK economy from the worst of the storm that continues to affect our Eurozone neighbours.

    Britain is contributing to the global rescue package, not seeking support from it.

    It’s worth remembering that it’s almost two years since the first Greek bailout, the trigger for a crisis that rumbles on today.

    In contrast, only two weeks ago, Standard & Poors reaffirmed the UK’s triple A rating with a stable outlook.

    In S&P words “We believe that the UK Government maintains a strong commitment to implementing its fiscal mandate, and has the ability and willingness to respond rapidly to economic challenges.”

    Fiscal discipline is not ideological.

    It is core to good Government. And it necessary to deliver fairness too.

    Be in no doubt, it is the poorest and most disadvantaged, not the wealthy, who are hit hardest when a country loses control of its public finances.

    It is fair that we tackle our debts today so that we don’t burden our children tomorrow.

    Ensuring that we can continue to provide high quality public services and support to those who need it the most.

    And even as we take the tough decisions to tackle that debt, we are making sure that it’s not the poor and vulnerable who are forced to carry the burden, and that those who have the most contribute the most.

    Secondly, fiscal discipline is the vital precondition of growth.

    Our commitment to fiscal discipline and economic stability has helped secure record low market interest rates.

    Rates that support households paying mortgages, and businesses securing loans, right across the UK.

    It is that credibility that is the essential precondition for private sector investment, growth and job creation…

    226,000 new private sector jobs in the last year

    634,000 since we came into Government

    Private sector growth built on a foundation of economic stability.

    Our Budget went even further in that ambition.

    Sticking to our plans on fiscal consolidation to safeguard our economic stability.

    Driving through reforms to support the private sector enterprise and innovation that is critical to our recovery.

    Reforms that include an extra one percent cut in corporation tax…reducing it to 22 per cent by 2014.

    The lowest rate in the G7, the fourth lowest in the G20.

    Cutting the ineffective top rate of tax…a rate that was higher than the likes of America, Germany, Italy and France – and replacing it with new measures that ask the wealthy to pay 5 times more than the cost of lowering the top rate.

    Increasing the personal allowance – within a hairs breadth now of our £10,000 tax free goal – through the largest tax cut for a generation for the working people of this country.

    Investing to provide ultra-fast broadband in ten super-connected cities, with plans to fund a second wave of cities.

    And continuing to support the establishment of a new Pension Infrastructure Platform owned by pension funds to bring as much as £2bn of investment by early 2013.

    Investment that is critical to renewing our nation’s infrastructure, and catalysing growth in key and established industries right across the UK.

    Of course, the damaging legacy of the financial crisis, and the headwinds in the global economy, means the road to recovery is a long one.

    The latest assessment of the scale of the damage done to our economy by the financial crisis shows that the damage is greater than was thought at the time.

    According to the Office for Budget Responsibility, the part of our deficit that is structural was greater than previously thought.

    The structural element of the deficit is the part that will not disappear as a consequence of economic growth – it requires policy choices, tax rises or spending cuts, to deal with it.

    Put simply, our economy is now forecast to be 11% smaller than it would have been had the crisis not taken place.

    For every £9 we thought we would have, we will only have £8. We simply can’t afford to go on spending and borrowing as a country as if we will still have the £9.

    There were basically three options about how we could have reacted.

    We could have done nothing- and put at risk our country’s economic credibility, seemingly as the official opposition continue to urge us to do.

    Or we could cut more now.

    But when you have set out detailed spending plans as we have done, credibility comes from implementing those plans, not tearing them up.

    The credibility which we have secured means that we have not been forced by the markets to tear up our plans because of rising interest rates and economic instability – as some in Europe have been forced to do.

    Instead, we set out plans for further spending reductions into the next parliament.

    We have made clear that the total amount of public spending in this country will fall at the same annual pace as in this Parliament, for a further two years.

    The OBR forecasts that at that point we will have successfully eliminated the structural current budget deficit as promised, and of course different political parties will quite properly have different ideas for the appropriate path thereafter.

    But even as we galvanise our efforts to tackle the deficit, we are also concentrating our minds on the much longer term prospects for public spending.

    As last year’s OBR Fiscal Sustainability Report said “There is considerable uncertainty surrounding the scale of the fiscal challenge that confronts future Governments, but the fact there is such a challenge is not in doubt”

    In particular it says that “future Governments [are likely to have to undertake some additional fiscal tightening beyond the current parliament in order to] (have to) address the fiscal costs of an ageing population.”

    Quite simply, the world is a different place to than it was two, ten or twenty years ago. These are pressures that have been building for many years.

    The simple truth is that the choices we faced in the last Spending Review and the choices that will have to be made in the next Spending Review are inescapable.

    If we want to continue to act fairly, improve social mobility, provide good public services,  provide capital investment that continues to grow, and educate a workforce that is able to drive this economy forward, we will need to work out where and how we save to make those things possible.

    And we will need to respond so some of the huge challenges that governments in the past have mistakenly believed they could afford to duck.

    That debate is a vital one for the country in the coming years.

    But today I want to dwell in more detail on the progress we are making on the plan we have set out, and announce some further measures that reinforce our commitment to delivering on it.

    In an environment of economic uncertainty, with ongoing instability in the Eurozone, the UK’s large deficit remains a crucial economic vulnerability.

    It remains a clear and present danger to stability.

    Carrying on as we were means accepting that we spend even more on debt interest as a share of public spending.

    Leaving things as they are for longer would mean higher debt, higher interest payments, and that means even bigger cuts in the long run.

    Instead, we argue that we have to cut our cloth today to reflect our means, and show that we can be trusted to restore our public finances to health.

    Building that trust has two elements: figures that people believe, and a plan that is being delivered.

    The significance of the creation of the Office for Budget Responsibility is often underestimated in the UK debate.

    Historically in the UK, politicians had been tempted to adjust their economic forecasts to suit their policies.

    So when last autumn the OBR chose to substantially change its assessment of the damage done by the crisis, and so of the spare capacity in our economy, the government could not sweep this uncomfortable judgement under the carpet.

    Instead, as I explained earlier, policy had to respond.

    This is a structural shift that will shape Government for decades to come.

    Never again will politicians be able to fiddle their forecasts in the face of the uncomfortable truth…

    And never again will Government’s be able to spend the financial mirages these forecasts create.

    It is also an example of the UK leading the way.

    The existence of a strong, effective institutional framework is a significant strength for the UK compared to other countries, and the creation of the OBR has further enhanced that strength.

    Many other countries are now seeking to emulate this change as they seek to rebuild their fiscal credibility

    For instance, the European Commission has now proposed that Euro area Member States put in place an independent fiscal council to monitor the implementation of national fiscal rules.

    At home, we set out in the 2010 Emergency Budget, the standard by which we would measure our success: the fiscal mandate.

    Achieving a cyclically adjusted current balance by the end of the rolling five year forecast period.

    And for debt to be falling as a share of GDP by the end of this Parliament.

    As well as some tax increases, we set out a fixed envelope for public spending for the remaining four years of this Parliament. And in the spending review in 2010, we set out budget reductions by department.

    In particular we focused on reducing welfare costs and wasteful spending, for instance…

    Saving £18bn by 2014-15 through welfare and public sector pension reforms

    £6bn through efficiency savings in 2010-11, and another £6bn by 2014-15 by cutting Whitehall by a third

    £3.3bn through a two year freeze in public sector pay

    And £1.5bn a year by 2014-15 by abolishing the Regional Development Agencies.

    In all, Departmental budgets other than health and overseas aid were cut by 19 per cent.

    These were tough decisions to make, but within these overall reductions, we were able to make some important positive choices for the country to promote growth, fairness and social mobility:

    Protecting health and schools spending in real terms

    Investing more in the life chances of disadvantaged children, and shifting education spending towards the early years

    Investing more in transport infrastructure than our predecessors had managed in the previous 4 years

    Reforming the welfare system

    Getting defence spending under control

    And we are already making good progress.

    According to the OBR, in 2011-12, departments exceeded budget reductions, forecasting around £6bn of lower spending than planned.

    By the end of 2011-12, almost 30 per cent of the spending reductions planned for the 2010 Spending Review period will have been achieved.

    And the deficit in the cyclically adjusted primary balance, a key measure of fiscal sustainability, has been halved from its peak in the last two years, going from 7 per cent to 3½ per cent, and is forecast to approach zero by 2014-15.

    The cyclically adjusted primary balance is a strong measure of the structural consolidation we need to deliver debt sustainability.

    It excludes debt interest payments and the economic cycle on the deficit, and is widely used by international organisations to illustrate the underlying fiscal position.

    It shows that we are on the right path.

    But with 3 years to go, very difficult decisions remain to be implemented.

    And while many departments have made significant changes, we need to do more to change the Whitehall spending culture for good.

    We need to ensure that old habits that led to waste and unnecessary spending cannot re-emerge, and that new focus on getting better for less is permanently ingrained.

    So today, I am setting some new and tougher rules around spending that the Treasury will be enforcing from this year on.

    These are rules have been drawn up with finance directors from across Whitehall, and are designed to fundamentally change and improve financial management across all organisations spending public money.

    Rules that demonstrate the collective determination of government to ensure that never again will our nation’s finances be allowed to get into such a mess.

    From arms-length bodies, to Whitehall departments, to devolved administrations…we must all work together to play our part in improving financial performance.

    There are three core elements to this more rigorous approach:

    Improving our monitoring of spending…

    Improving our management of spending…

    And improving our oversight and scrutiny of spending.

    Let me take monitoring first.

    Delegated responsibility for spending cannot be an excuse to hide information, close the books, or weaken financial management.

    For too long financial management in Government has been stifled by poor information sharing and poor incentives.

    On the one hand, this Government has made huge strides to make more information available to the public as part of our drive for transparency.

    But that same ambition has not been matched within our own walls.

    That has to change.

    From now on, all departments must monitor and share spending information with the Treasury on a monthly basis.

    And that data must be consistent, allowing us to build a shared understanding of where the risks lie and how they are managed, as and when they arise.

    Not months or years down the line.

    Not when we’re trapped in the wrong track.

    But in real time.

    And improved monitoring will help change incentives on financial management.

    The old system of financial management implicitly rewarded those who didn’t manage their finances.

    In the end, when departments faced policy problems or where difficulties have emerged, they felt they could simply turn to the contingency reserve to bail them out.

    We have to change those incentives.

    That’s why in the spending review, we deliberately kept the reserve small in order to get the most money out to departments.

    It means that departments have to be able to deal with problems that arise from within their own budgets.

    Many departments already operate a small ‘unallocated provision’ in their annual budgets, to meet smaller pressures that arise.

    And, under the new rules I have asked all departments to identify around 5% of their resource budget that could be re-prioritised if new pressures emerge or new policies have to be funded, so there is a shared understanding of how it could be paid for.

    To be clear, no departmental budget is being changed as a result of this exercise. It is simply about good financial management, of the sort practised by families and businesses across this country.

    And in future I will take performance in financial management into account when deciding whether to grant claims on the reserve.

    That means punishing poor management, but it also means rewarding those with a record of good financial management with greater freedom over their budgets.

    But that freedom comes with higher scrutiny. Where the Treasury has concerns that Accounting Officers may be falling short of fulfilling their responsibilities for managing public money, I will write to the Secretaries of State and the Head of the Civil Service to set our those concerns.

    These new controls are not just a tweak to the Whitehall machine.

    They are another signal of our unwavering determination to deliver the fiscal consolidation we promised.

    It is this focus on delivery that is the cornerstone of our country’s credibility. Credibility, let us not forget, which is delivering the record low interest rates that are benefitting millions of families across the UK.

    We have taken some very difficult decisions to restore this country’s financial credibility and economic prosperity.

    The delivery of those commitments will be enhanced by the measures I have announced here today. And it will require further difficult decisions to be taken as this Parliament progresses.

    Because we literally cannot afford not to change the way we do things.

    Thank you.

  • Danny Alexander – 2011 Speech to the Centre Forum

    Below is the text of the speech made by the Chief Secretary to the Treasury, Danny Alexander, at the Centre Forum in Guildhall on 10th May 2011.

     

    Today, what I want to focus on is the role the financial sector has to play in our economy.

    Now, as a topic, this is not something new.

    Much of the economic and political debate of recent years has revolved around this issue.

    But instead of discussing the importance of tighter regulation or banking reform, what I want to concentrate on is the industry’s role in restoring trust in the financial system and how your actions can help with the rebalancing of our economy, and its success in the future.

    And there are a number of reasons to look to the future with confidence.

    Of course the recovery is, and will be, choppy.

    But, the manufacturing sector has experienced incredibly strong growth in the last year.

    Our exports are gathering pace.

    Employment is increasing.

    Investment is picking up.

    But the fact that we can now look ahead with some confidence is only because of difficult decisions we’ve already had to take.

    Decisions that have brought about economic stability.

    Secured our international credit rating.

    And set in place a credible plan to deal with our record borrowing… a plan that has seen us avoid the sovereign debt issues that have engulfed other countries.

    These are tough decisions. It was the need to deliver these decisions that brought the Coalition together. Our commitment to that shared plan is totally unwavering. It is our core task – and we will see it through.

    At the Budget, we set out our long-term strategy for growth, with four key ambitions at its heart:

    – to create the most competitive tax system in the G20;

    – make the UK one of the best places in Europe to start, finance and grow a business;

    – encourage investment and exports as a route to a more balanced economy; and

    – create a more educated workforce that is the most flexible in Europe.

    We also took the first steps towards making these ambitions a reality.

    With cuts to corporation tax – to encourage greater enterprise.

    Support for SME finance – to increase business investment.

    Steps to ease burdens on business to create additional jobs.

    And measures to rebalance our economy – and drive higher exports.

    But as a Government, we can only do so much.

    It’s the private sector who will inevitably lead the recovery.

    And having a strong and stable financial sector is an important part of this story.

    We need a financial sector that supports consumers and businesses up and down the country.

    And is a source of wealth and prosperity in its own right – not just in the Square Mile, or in Canary Wharf, but in every town and city in the country.

    And I feel there are three things that we have to consider if we’re to realise this ambition.

    Reconnect with the rest of the economy

    The first of these is about reconnecting the financial sector with the rest of the economy.

    To strengthen the ties that exist between financial institutions, investors, and their customers.

    And to demonstrate your commitment to the wider business world by providing:

    – the lending that viable businesses need to expand and invest;

    – the advice and expertise that firms need to succeed; and

    – the capital that will help stimulate enterprise across the UK.

    This is vital.

    Because if our financial sector doesn’t meet these tests, then we’ll have an economy that struggles to respond to today’s challenges; a country that doesn’t fulfil its potential; and a recovery that fails to gather momentum.

    If we take access to finance, for instance.

    This remains a key concern for many businesses in the UK.

    Yet I also know that the problem isn’t quite as straightforward as some commentators like to think.

    But we also have to look at the reality of the situation, and why lending conditions have deteriorated since the crisis.

    That the past few years have certainly thrown up some particularly large challenges for the finance industry.

    Institutions up and down the country have, quite understandably, had to retrench; weather the financial storm; and look to rebuild their balance sheets.

    And this has not been a pain free process.

    On the one hand, you’ve had people saying that we should never return to the days when cheap credit was freely available… and irresponsible lending conditions undermined overall economic stability – this is absolutely right.

    But on the other, businesses need affordable credit to help support growth, employment, and additional investment.

    So there’s a very difficult balance to strike.

    As a Government, we’ve been working with the financial sector to get credit flowing again.

    Merlin

    The Merlin Agreement being the most obvious example.

    Among other things, this agreement reached with the UK’s largest banks should see lending of £190 billion to creditworthy businesses for this year… of which £76 billion has been earmarked specifically for small businesses.

    This would mean an overall increase of almost 15 per cent on last year’s lending figures to SMEs.

    But having made this commitment, it’s vital that they see it through.

    This month we will get the first update on progress in meeting this target.

    My message to the banks is simple – this money needs to reach good businesses, no ifs, no buts, no excuses.

    As the Chancellor said in February, if it doesn’t, we reserve the right to take further action.

    Not just for the sake of the wider economy, but also for the banking sector itself.

    People want to see progress.

    To demonstrate the value that financial services have to add.

    To show everyone that the sector takes its responsibilities seriously.

    And improve the links between our banks and our businesses

    They expect it.

    And we expect it.

    Which brings me to my second point for this morning – the need for the financial sector to improve the relationships it has with its customers.

    Relationship with customers

    Because if we’re to improve sustainability and resilience across the economy, we need to safeguard the interests of savers and borrowers and taxpayers.

    Now despite the work of the FSA, I don’t believe that customers always get a fair deal from financial services.

    Personal banking in many ways has become, well, less personal.

    We’re committed to changing this.

    That’s why we’re setting up the new Financial Conduct Authority – or FCA for short.

    The FCA will look at the conduct of all authorised firms – whether they’re prudentially regulated or not. It will be, in effect, a champion for the consumer, with the the primary objective of “ensuring confidence in financial services”.

    And this will be to the benefit of everyone.

    Consumers will obviously benefit from the added protection that this will bring.

    But also financial institutions themselves will reap the rewards.

    Because if customers have effective and appropriate protection, they’ll also have more trust in the financial sector as a whole – and take advantage of more of the services you provide.

    But the FCA alone is not enough.

    With the industry’s support we’re also increasing consumer confidence by making financial markets more transparent.

    So that people can shop around for better rates on their ISAs and have access to financial advice through the Annual Financial Health-Check.

    This will give your customers the confidence to invest in a wider range of products, and this will feed through to the rest of the economy.

    Because a customer who buys a corporate bond is also providing the finance needed to support innovation.

    Money in a cash ISA supports lending to businesses and families.

    While money in an equity ISA or pension can help support private investment.

    Working in the interests of customers is working in the interests of the wider economy.

    The two are mutually reinforcing.

    And we are making other regulatory changes too, to learn the lessons of the financial crisis.

    The Independent Commission on Banking’s work is crucial to protecting taxpayers. Its interim report set the right direction: we look forward to the final report and to action on it.

    Economic rebalancing

    Which brings me to the final point of today – how the financial sector can help support the much needed rebalancing of our economy.

    As a Government, we want to see growth and prosperity spread across all regions of the UK.

    We want to help the economy develop new areas of expertise.

    But we also need to preserve our existing strengths – including in financial services.

    Rebalancing is not about trading the success of one sector for another.

    It is about extending our country’s portfolio.

    Spreading our success more evenly.

    And supporting the world class industries we already have, as well as the new ones that we’re developing.

    If we go back to the roots of the City, for example, it flourished because it supported commerce through insurance and trade finance… it found capital to invest in new enterprise and it developed new and innovative ideas that provided security and certainty for businesses.

    It was this that proved the foundation of your success.

    And it is through insurance, investment and lending that you’ll help support our transition to a more diverse economy.

    One that’s built on growing businesses, not growing deficits.

    Increased exports, not increased debts.

    And green energy, green infrastructure and green technologies.

    This is a huge opportunity for the financial sector.

    To help support our move towards a better balanced economy.

    Where growth is more sustainable.

    More broad-based.

    And more evenly spread across the many places of the UK.

    Let me conclude by saying,

    As a Government, we’ve provided the security and stability that the private sector so badly needed.

    With a credible plan to deal with our country’s debts.

    And an ambitious plan for growth.

    But as a Government, we can’t do this alone.

    We need a strong and stable financial sector to support the recovery.

    One that provides the lending essential for investment.

    Restores trust and confidence in British business.

    And helps rebalance our economy in favour more industries, more exports, and more evenly distributed success.

    That is our ambition.

    And we will work with you to make it a reality.

    Thank you.

  • Danny Alexander – 2011 Liberal Democrat Conference

    Below is the text of the speech made by the Chief Secretary to the Treasury, Danny Alexander, at the 2011 Liberal Democrat Party conference.

     

    I’d like to tell you about a man who’s been a great source of inspiration and guidance to me behind the scenes over the last year.

    Gordon.

    Although outwardly dour, his finely tuned political antennae and no nonsense style make him the perfect sounding board.

    He’s not flash – he’s just Gordon. Gordon Birtwistle, the Liberal Democrat MP for Burnley. One of the most talented and tenacious of our 2010 intake. I’m privileged he agreed to be my PPS.

    Alistair Darling wasn’t quite so keen on his Gordon.

    His Gordon racked up a record deficit fuelled by irresponsible and unsustainable spending.

    His Gordon denied any responsibility for the economic woes caused by his own policies.

    His Gordon “unleashed the forces of hell” simply for sharing his views on the severity of the economic crisis.

    Who was feeding Gordon Brown such advice? Was it Mandy? Or McBride? I think it’s pretty obvious – it was all Balls.

    Unlike Labour, our party has never shied away from telling difficult truths on the economy:

    Vince Cable led the way in warning of the dangers that were building.

    And we made a historic decision last Spring. When we signed up to coalition government, we knew our country’s economic stability depended on it.

    Returning our country to lasting prosperity is the founding purpose of this Government – the overwhelming national interest that motivated two very different political parties to take responsibility together for a full 5 years.

    We resolved to act in the national interest and put our country first. That is what we’re doing.

    “In government, on your side” doesn’t mean telling people there’s an easy answer to the horrendous problems Labour left.

    It means telling it straight.

    To get things right for the long term, we must stick to our guns now.

    And we shouldn’t forget the impact of our unity and our resolve.

    Concern about both sovereign debt and economic growth is at the heart of the current market turbulence.

    Turbulence fuelled by uncertainty about the ability of political leaders across the globe to take the decisive action their countries need.

    Since we came into office, our coalition Government has taken the difficult, and sometimes unpopular decisions necessary to fix our economy.

    This decisive action has made an immediate impact.

    Interest rates have stayed low, keeping workers in their jobs and families in their homes.

    Fellow Liberal Democrats, we played a decisive role in securing our country’s financial credibility. This should make us proud.

    We have built a strong shelter, but the storm is still raging.

    Elsewhere in Europe, the struggle to establish credible deficit reduction plans goes on. In the US, political deadlock brought a historic downgrade of the country’s credit rating.

    Yet despite all the evidence, the party that put us in this hole just want to keep digging.

    Labour say our motivation is dogmatic. They’re wrong. It’s practical.

    Financial discipline is necessary for effective government. It would be completely wrong to leave the bills for past mistakes to be paid for by our children. The economic case is indisputable – that’s what so many of you have done in local government, and that’s what we must continue to do in central government. We must stick to our plans and we will.

    We’ll be straight with people: about how long this will take; how hard it will be, and what we will do to get it right.

    A huge deficit, an unbalanced economy, our trading partners in real difficultly.

    These are very big problems. Solving them will take years, and every one of us has a role to play. To support growth, to help families under pressure.

    As Liberal Democrats, our judgements about what needs to be done should be driven by the liberal economy we want to build.

    A liberal economy shaped by free and open competition,

    A liberal economy built on long-term investment, not debt and waste.

    A liberal economy where growth is shared across the country

    A liberal economy where taxation delivers fairness.

    Sustainable, balanced, competitive, fair. To get the kind of growth we want, we must break down the vested interests – the enemies of growth that stand in the way of future prosperity.

    We are prepared to take them on. We will name and shame those standing in the way of that central national purpose.

    Free trade has been a liberal rallying call for centuries. Offering gains to countries around the world and especially for Britain, with our quality exports and trading history.

    Today our trade policy is being brilliantly led by Ed Davey.

    The inception of the European single market a quarter of a century ago helped create hundreds of thousands of new jobs.

    Astonishingly, the single market is not yet complete. Huge areas of the European economy are still not fully open to British firms – especially in the services and energy sectors

    Completing this work will support growth, jobs and competitiveness not just in Britain but across the whole of Europe.

    There’s an opportunity for Britain to lead this agenda right now – as we did so successfully in the 1980s.

    As the Eurozone seeks to deepen its integration – and we need it to do so more quickly – they will need our support. And they will get it.

    Sadly, eurosceptics on left and right still fail to understand Winston Churchill’s insight that sharing sovereignty strengthens our influence and isolation weakens us. Scottish Nationalists make the same mistake.

    We’ll never let the anti-European isolationists or nationalists frustrate our national interest.

    They are enemies of growth.

    Fortunately, coalition ministers are united in pursuing a policy of practical, pragmatic engagement in the EU.

    Nick Clegg and I are working with David Cameron and George Osborne to make deepening, strengthening, and deregulating the single market a central aim of Britain’s European policy – because it will bring jobs and growth.

    Too many businesses are being held back by congested roads, slow railways, inadequate broadband.

    At the spending review last year, we looked at infrastructure spending in the round, picking only the most economically valuable projects from across government for funding.

    And as a result, we’re investing more in the transport network over these 4 years than Labour managed in the last 4. The redevelopment of New Street Station here in Birmingham, the Mersey gateway bridge, Crossrail in London, and a national high speed rail network.

    And we have prioritised the money to invest to make sure that high speed broadband gets to every part of the country.

    Now more than ever, we need to get on with this work.

    But there’s a major vested interest in the way. Bureaucracy, rules and red tape that mean it takes years to get things done. A planning system that can take more than a decade to allow even modest developments to go forward.

    It has to change. And under the coalition it will.

    I know there are concerns about our planning reforms. So it’s important to understand what we’re really doing. The presumption of sustainable development is right because it establishes the right balance.

    Local communities in the driving seat, local protections in place and yes more local homes and local jobs.

    So while it is politically contentious – we will reform planning.

    As Chief Secretary, I set the rules that control public spending. Mostly, that’s about making sure we stick within our budget, which I’m sure you can imagine doesn’t always make me very popular.

    On infrastructure, I’m pressing departments to make sure they deliver their plans on schedule.

    And we need to do more. More to help support jobs and growth in our communities.

    Because growth can’t be imposed from the centre – it must be driven by businesses, communities and local authorities.

    They are critical to delivering the jobs and homes that our communities need.

    So I’d like to tell you about the next steps in our Plan for Growth.

    To support local growth, I can today announce my decision to reduce the interest rate offered to local authorities by the Public Works Loan Board to finance the £13bn of debt needed to leave the Housing Revenue Account subsidy system.

    I’ve listened to local authority concerns that this is a one-off transaction within the public sector and should be financed as such.

    Let me put it simply – an extra £100m every year that councils can then reinvest in housing.

    And I want to take a further step to support local growth.

    Across the country, projects are being held back by tough market conditions, difficult cash flow and a lack of confidence. Projects where people could be working but aren’t.

    That is why I’m announcing today the creation of a new Growing Places Fund.

    Half a billion pounds that will kick start developments that are currently stalled.

    Half a billion pounds that will deliver key infrastructure and create jobs.

    Putting local areas in the driving seat, to boost the local economy and get people into work.

    Providing flexibility to local areas to recycle funding for other projects once development is completed.

    In South Gloucestershire, £300 million of private investment, 3,000 jobs and 2,200 homes is being unlocked with £6 million of public money to build a link road. Just think what we will be able to do with £500 million.

    Unlocking local growth by freeing businesses to grow, creating jobs, and freeing councils to build housing. Liberal Democrats in government, on your side.

    We’re on your side when it comes to the banks too.

    Delivering on our promise to protect the taxpayer from the cost of future bailouts. Never again should bankers go to the casino with their stakes guaranteed by the rest of us.

    That’s why we commissioned the Vickers report

    It’s why we welcomed his recommendations on ring-fencing.

    It’s why we welcomed his call to extend competition in the banking sector.

    And it’s why we will legislate to protect future taxpayers in this Parliament.

    Of course, our main tool to help low and middle income families with the pressures they are facing is the tax system.

    Thanks to Liberal Democrats there is genuine progress.

    And I’m not just talking about fuel duty cuts for our remotest communities, though I expect we will have that in place next year.

    This year, the average worker is paying £200 less income tax than last year. Next year, the bill will come down by another £120. By the end of this Parliament, most working people will be paying £700 less income tax a year.

    Conference, an income tax threshold of £10,000 was the first priority in our manifesto. Now it’s the first tax priority of the government. We should be proud that in government our ideas are making a real difference to every working family in Britain.

    But we shouldn’t rest on our laurels. In the next Parliament, I want us to go further; our aspiration should be that someone working full time on the minimum wage should pay no income tax at all.

    An income tax threshold of £12,500 – think what that would do to work incentives, think what it would mean for basic fairness.

    Let’s put that on the front page of our next manifesto.

    Some people have argued that we should change our tax priorities and focus our limited resources on cutting taxes for the wealthiest instead.

    At a time of austerity, this argument simply beggars belief. If we are all in this together, those with the broadest shoulders must bear the greatest burden.

    Fair taxation of the wealthiest is key to our deficit reduction plan. Of course, if a better way can be found to raise the money from this group, I will be willing to consider it.

    But right now we must focus relentlessly on those who are struggling.

    And we need to make sure tax owed is tax paid.

    Last year, I announced a package of investment to strengthen our fight against tax evasion, as well as tax avoidance.

    Let me tell you how we’re getting on.

    This year, an additional 2,250 HMRC staff will move into new anti-evasion and avoidance jobs.

    This month, over 1,000 of these jobs are being advertised.

    And already this package is bearing fruit.

    I promised you we’d collect an extra £7bn a year by the end of the Parliament;

    And I can tell you we’re already on track to raise £2bn this year.

    It took 12 years for the previous Government to take action against the wealthiest 5,000 people some of who weren’t paying their fair share of tax.

    We can do better than that.

    In less than a month’s time, a new ‘affluent team’ will be place. This team will look specifically at the next 350,000 wealthiest taxpayers.

    These are the people who pay or should pay the 50p rate of tax. And my message to the small minority who don’t pay what they owe is simple, I agree with the Chancellor. “We will find you and your money” and you will pay your fair share.

    Economic credibility comes from doing the right thing – that’s why Labour lost it.

    At the next election, we can make sure there will be only one party that people trust to both handle the economy and deliver fairness – the Liberal Democrats.

    We’ll win that trust by sticking to our guns, especially when times are tough.

    We’ll do that by levelling with people about the scale of the challenge we face, not offering false promises as Labour did.

    By delivering our aspiration to rebuild a more sustainable and balanced economy.

    By showing that we understand the fears and the pressures on the people of this country, and share their ambition for a better Britain.

    Most of all, we will do that by building a shared sense of national economic purpose so that we are working alongside every person in this country to restore our prosperity.

    Do you remember how Gordon Brown liked to conclude his speeches?

    Long lists – did you find them annoying? I know I used to.

    But not now, with so many Lib Dem achievements already in place, I can’t resist:

    A clear plan to deal with the deficit, removing barriers to business growth, investing in infrastructure, promoting free trade and competition, sorting out the banks,

    tackling tax avoidance, and cutting taxes for those who need it most.

    That is the economic policy of the Liberal Democrats in government and it is a record to be proud of.

  • Danny Alexander – 2005 Maiden Speech in the House of Commons

    Below is the text of the maiden speech made by Danny Alexander in the House of Commons on 19th May 2005.

     

    Thank you, Mr. Deputy Speaker, for the opportunity to make my maiden speech in this House today. I start by congratulating my right hon. Friend—sorry, my hon. Friend the Member for Falmouth and Camborne (Julia Goldsworthy). I was going to say that Cornwall had maybe discovered another star of the future, but perhaps I have promoted her somewhat too quickly. I congratulate her on her maiden speech and I congratulate other hon. Members who have made their maiden speeches today.

    I am personally grateful to hon. Members from all parties, but especially to Liberal Democrat Members and to the staff of the House, whose advice and kindness have helped me and other new Members to find our feet. I am proud to say that I am the first Member of Parliament to represent Inverness, Nairn, Badenoch and Strathspey. This is a new constituency, and there are many in Scotland. Three quarters of the constituency was previously within the Inverness East, Nairn and Lochaber constituency. I pay tribute to David Stewart, who was the Member of Parliament for that constituency from 1997 and the Labour party candidate at the election.

    Mr. Stewart conducted his campaign in the way he conducted himself in this House: he was understated, industrious and gentlemanly. He was a renowned campaigner on many worthy causes, and I would particularly like to highlight his work to tackle global poverty through the Jubilee 2000 movement. I wish him well for the future. Of course, the highlands of Scotland have a long and radical tradition. Hence it has been for many years a stronghold of Liberalism and now Liberal Democracy. Prior to 1997, much of my constituency was represented by that great Highland Liberal Russell Johnston, who continues his service in the other place. Throughout his 33 years representing the area, Russell exemplified the thoughtful and independent-minded approach that is characteristic of the highlands. I was especially grateful to him for spending so much of his time with me during the election campaign. It is striking to think that Russell was a Member of this House for as many years as I have so far spent on this earth. Russell Johnston was to me, as to many others, a political inspiration, but he was not the first Liberal influence on my life. My mother tells me that, when I was three months old, my grandfather was seen rocking me in my pram and saying “Repeat after me: ‘I am a member of the Liberal Party.’”

    A quarter of my constituency was previously represented by my right hon. Friend the Member for Ross, Skye and Lochaber (Mr. Kennedy). Indeed, that is not the only thing that we have in common, for we are both former pupils of Lochaber high school and, as has been remarked upon in the press, share a hair colour that is perhaps more prevalent in the far north of Scotland than anywhere else. I have been very grateful for his help and support locally over the past year as a candidate, as well as for his outstanding leadership of the Liberal Democrat party, which has seen us to our best performance in a general election since the 1920s. Both my right hon. Friend and Lord Russell-Johnston have spoken up loudly for the highlands and for their principles, and if I can live up to their standards in the years to come, I shall be serving my constituents well. Like them, I shall work hard for everybody in my constituency, irrespective of their party preference.

    Inverness, Nairn, Badenoch and Strathspey is the longest name of any constituency in the country—indeed, to some it may prove to be something of a tongue-twister. While many Members can speak of the visual attractions of their constituencies, I believe that Inverness, Nairn, Badenoch and Strathspey can rightly be described as one of the most beautiful of all. It is also one of the most diverse, encompassing the fast-growing city of Inverness, the remote splendour of the Cairngorm mountains, the mysteries of Loch Ness and the popular seaside town of Nairn. I have not yet had the pleasure of canvassing the most famous resident of Loch Ness, but I am reliably informed that she is not a Labour supporter. Like the Prime Minister, Nessie was not seen in my constituency during the election campaign, but unlike the Prime Minister, her reputation has grown as a result. Tourism is one of the most important industries in the area and hon. Members on both sides of the House can be assured of a warm highland welcome as and when they choose to visit. Indeed, I hope that the Prime Minister will now take the opportunity to do so.

    One of the most important recent developments in Badenoch and Strathspey has been the creation of the Cairngorms national park, and I previously worked for the park authority. Readers of the National Geographic Magazine recently voted the highlands one of the top 10 sustainable tourism destinations in the world. Clearly, the need to develop the tourist industry further must be accommodated in such a way that it does not at the same time undermine the natural features that attract the visitors in the first place. We must not kill the goose that lays the golden egg.

    As Members on both sides of the House are all too aware—the right hon. Member for Fylde (Michael Jack) eloquently made the point in his speech earlier—threats to our environment are more often international than local. The threat and indeed the current reality of climate change are all too apparent to my constituents, not least because they are highly visible through the fortunes of the Scottish ski industry. The Cairngorm mountain ski area has successfully diversified into a very popular summer attraction, as the amount of time and the snow available for winter sports have fallen as a consequence of global warming. I hope that we might finally see some genuine progress made on that most pressing question when the G8 comes to Scotland in the summer.

    I am proud to represent the whole of the city of Inverness, capital of the highlands. Britain’s most northerly city is also one of the country’s fastest growing. The quality of life, as well as the quality of employment, have caused the population to rise, especially in the Inverness and Nairn areas. As well as being a service centre for the highlands, with much income from traditional areas such as tourism, Inverness is home to an increasing number of innovative modern industries, particularly in the medical field. The success of LifeScan Scotland, formerly Inverness Medical, which now employs more than 1,200 people, is helping to attract many new businesses to the area.

    Inverness’s growth and success present challenges, not least the fact that, despite recent progress, with wages at 80 per cent. of the UK average, the highlands and islands is still one of the poorer areas in the United Kingdom. Problems caused by remoteness are as pressing as they were when Russell Johnston raised them in his maiden speech in 1964. Of course, there has been progress, and I pay tribute to the work of many public agencies in the highlands. The fact remains that there is considerable room for improvement in all aspects of the transport network—bus, train, road, and air—in my constituency, despite the substantial progress made under Nicol Stephen, our Liberal Democrat Scottish Executive Minister for Transport.

    Effective transport links between the highlands and London are vital for the region’s continued growth, so it is a matter of regret that the Government have so far not seen fit to protect vital air routes between Inverness and London with a public service obligation. Considerable further investment is also needed to improve road and rail infrastructure around Inverness and between Inverness and Nairn, particularly by upgrading the A96 and completing the Inverness southern link road.

    Perhaps the most pressing problem across the highlands—and, as we have heard in other speeches today, in many areas across the country—is the shortage of affordable housing. The rapid rise in house prices has pushed owning a home beyond the means of many local people. One Conservative Member has already confessed to me that he owns a second home in my constituency. I look forward to meeting him there, but I have to say that demand for second homes has enormously exacerbated the problem of the shortage of affordable housing. We need radical solutions, which will be one of my priorities during this Parliament. Although housing policy in Scotland is a matter for the Scottish Parliament, decisions made here can have a significant impact on the problem.

    Our rural areas are home to many thousands of people, so services in small communities such as those that I represent must be preserved and enhanced, not undermined or removed, as has been the fate, for example, of too many post offices in recent years.

    In his book, “Memory Hold the Door”, the author, John Buchan, wrote of the importance of holding public office in words that I believe still hold true today:

    “Here our surface ribaldry covers a sincere respect, and in recent years, when parliamentary government has been overthrown elsewhere, I think we have come to cherish ours more than ever. Public life is regarded as the crown of a career, and to a young man it is the worthiest ambition. Politics is still the greatest and most honourable adventure.”

    I look forward to the next stage of that adventure and I thank hon. Members for their forbearance of my opening foray today.