Richard Spring MP
Member of Parliament for West Suffolk

Last week, new figures released by the Halifax revealed that homeownership rates are at their lowest level for a decade.

The opportunity to own your home is a matter of real aspiration. The Government has impacted ordinary families by making it harder to get on the housing ladder with higher Stamp Duty and additional costs like Home Information Packs.

It has also recently been revealed that the cost of living has been outstripping earnings growth for the past two years. As is evident from talking to people in my constituency, these figures confirm what ordinary people already feel in their wallets.

At a time when people are faced with soaring food and fuel costs, difficulties in buying a home and real take-home pay falling, ordinary families are more squeezed then ever.    

If it is the economy stupid, then there is much rumbling in the real world out there.

I’ve lost count of the amount of times I have spoken to entrepreneurs who have told me that the tax and regulation burdens that have grown so much under Labour are holding them back.

The result of this is Britain has become less competitive and a less good place to grow a business. The Government’s recent proposal to raise capital gains tax is a prime example.

It is then no surprise to see that the UK has slipped from 2^nd to 9^th place in the international competitiveness league. With Britain’s economy is relatively deteriorating and Gordon Brown failing to prepare the economy for the long term, things could get worse still.

Yesterday, George Osborne launched a report providing a blueprint for making Britain the enterprise capital of the world. The report was commissioned by the Conservatives and produced by independent experts.

It calls for simpler taxes, lower Corporation tax rates, more incentives for reinvestment, mentoring systems for young entrepreneurs and a national system of ‘Dragons’ Dens’.

The day before Alan Duncan announced a new deregulation review headed by Sir David Arculus, which includes the former chief executive of the FSA, John Tiner.

Instead of encouraging our enterprise culture to flourish, tax and regulation is causing lasting damage. The business community is crying out for change. As this report shows, a Conservative government could create a better climate for enterprise – the ingredients and remedies are clear.

The comments by IMF head Dominique Strauss-Kahn in the FT today are worth reflecting on. Clearly he does not believe that interest rate cuts will restore calm and stability to the nervous world economy. He suggests that fiscal stimuli are needed. 

The trouble is that in Britain this is impossible. We have a huge and growing budgetary deficit, an all time high trade imbalance and rising record national debt interest payments. 

Our frugal Presbyterian chancellor never saved for a rainy day, so making any recovery that much more difficult. Meanwhile world stock markets remain very volatile, with surges (dead cat bounces) and retreats. 

We simply cannot spend our way out of troubles, unlike when the dotcom bubble burst, so let us hope that others will do so, which will help us. 

Spend, spend, spend is the legacy of Gordon Brown as chancellor with prudence but a distant memory.   

I’ve lost count of the amount of times businesses have told me that they are fed up with constant Government interference, regulation and red tape. And who can blame them? 

There have been more than 14 new regulations every working day under Labour. It is estimated that the cost of new regulations on business over the past decade has now topped £56 billion. This means that the average British company has to spend £14,270 a year implementing new legislation. 

The result of this extra burden is that Britain has become less competitive and a less good place to do business. It is then no surprise to see that the UK has slipped from 2^nd to 9^th place in the international competitiveness league.

I was however even a bit cautiously optimistic when Gordon Brown announced the legislative and regulatory reform bill last year. This bill, according to the Prime Minister, would contain ‘radical proposals for changing the way we regulate.’ 

However, the Financial Times reported this week that the law has yet to cut or even amend a single regulation! In fact the Treasury actually increased red tape by 7%. It is yet another example of the need for central power to be dispersed to a more local level. 

Regulation has grown over many years, but it now infects our lives inordinately. However, if we are to deal with it we have to tackle the culture of risk aversion which has so crept into our national life, including hanging baskets falling and grave stones toppling over. As they say the road to hell is paved with good intentions.   

Messrs Brown and Darling obviously thought that by taking on the policy areas highlighted by George Osborne last week, they were being really politically astute. 

Of course the magpie headlines will convince some people that this is all politicians’ gamesmanship and is in the unattractive nature of the beast. However, it really is a miscalculation. Gordon Brown until recently as Prime Minister sought to project himself as some sort of statesman like figure above the fray. The clever, clever nature of yesterday’s PBR shows him to be the evasive sort of politician, something which over time will become more apparent. I suspect that even Tony Blair, that great actor manager, would have drawn the line at the absurd attempt to outfox the Tories. 

Gordon Brown in retrospect will have been seen to have done himself no favours yesterday. The underlining economic budget reality is obvious to see. It really was cheap and pathetic stuff from a Government that has clearly run out of steam.   

The extraordinary reaction in the conference hall in Blackpool after George Osborne announced a major Inheritance tax cut begs the question as to whether we have reached some kind of tipping point. A common view has been that if politicians promise tax cuts, they are simply disbelieved, to the extent of being counter productive. However, it is just maybe that all those ever rising and multiplying taxes have really made the public fed up – especially when they see such relatively poor value in our public services. In other words, the public’s acceptance of ever higher tax bills may have reached a limit.

It is against this background that Alistair Darling presents his Pre-Budget Report and Comprehensive Spending Review today. He will be reporting slower growth, higher borrowing and spending than earlier projected. Mortgage rates have risen and the price of petrol has now reached £1 per litre. 

The charges made by Labour that tax cuts will mean diminished public services are sticking less and less, especially as the Tories have accepted Labour’s overall control total anyway. The public is beginning to realise that far from being the tight fisted figure he likes to project, Gordon Brown has been spectacularly good at spending (and wasting) our money. Poor Alistair Darling will have to deal with the consequences of this profligate legacy today 

At a breakfast yesterday morning we all agreed that if Britain is to retain its role as one of the world’s leading economies, we need to address one of the problems which threatens to put that reputation as risk – our “skills shortage”.

Last year, Lord Leitch’s Review of Skills Report concluded that “our nation’s skills are not world-class. We run the risk that this will undermine the UK’s long term prosperity. Productivity continues to trail many of our international competitors.” The facts speak for themselves: we have 5 million adults who cannot read or write properly and 17 million adults who problems with numbers. The number of 16 to 18 year olds not in education, employment or training has risen by 40% since 1997.

This is why the Economic Competitiveness Policy Group, set up by David Cameron and chaired by John Redwood has been examining the skills problem in this country and this week published a policy submission entitled “Skills Training for a More Competitive Economy” which is available in full on their website http://www.competitivechallenge.com

It is a thoughtful and insightful consideration of the issues and what we need to put in place so that we can continue to compete globally. The vision entails “significant cultural and social change, including breaking down the current distinction that is made between general and vocational education and the attendant class prejudices.”

They have made a series of recommendations including:

Taxpayer’s money should be allocated in accordance with choices made by the trainees and not the providers

A national Careers Advisory Service that is highly visible to aspiring trainees

Bolstering the Sector Skills Councils (SSCs)

Professionalising apprenticeships and bringing them under the control of employers

What a juxtaposition of contradictions that the colossal fall in the Shanghai share index proved to be. It happened on the very day that the Chinese Prime Minister promised socialism for 100 years. I wonder what Karl Marx would make of yesterday’s events. It also coincided with the beginning of the Year of the Golden Pig, very auspicious, and an event occurring only once a century.

Markets have done very well – not only shares linked to commerce and industry, but also mining and commodity shares. Almost all over the world house prices have soared, on the back of low interest rates and low inflation. The profits outlook for 2007 is good.

However this golden scenario of ever rising asset prices will not continue for ever, that is the only certainty. Perversely, the chances of this extraordinary bull run continuing for longer is greater today than two days ago. Much froth will have evaporated.

As President Kennedy’s hugely successful father Joe once observed about the performance of stock markets – “leave the last 10% to the other guy”.

What it also tells us is the huge global economic importance of China. It used to be that if General Motors sneezed the US economy caught a cold. Eventually one day, we shall undoubtedly suffer from Asian flu – the moment of greatest danger will be when such an eventuality is universally regarded as inconceivable.