As the local Member of Parliament, I see it as my duty to be frank with my constituents – recent events in Westminster have been damaging to economic confidence, and our wider credibility, and I very much regret that we have ended up in a position of senior Ministers changing like pages of a calendar.
Of course, I am bound to say that we are facing a global inflationary crisis, driven above all by Putin’s wholly unjustified invasion of Ukraine. Interest and mortgage rates are rising in comparable western nations, and as previously noted in this column, pre-invasion we were already facing significant upward price pressure following the post-Covid economic reopening. Nevertheless, the public know that we have let them down in recent weeks by misjudged measures that exacerbated – rather than addressed – these underlying problems. I am very conscious of the unease this situation will have created for my constituents, especially mortgage holders and business owners.
At its heart, we have had to learn the lesson the hard way, that Governments have learned before – and will again – that economic policy needs to be based on sound financial measures that balance the books and provide a stable platform, giving confidence to businesses and households. Above all, when our economic circumstances require us to borrow from international markets, we have a duty to carry market confidence – you cannot ‘buck the market’, as someone famously once said. Growth is vital, but sustainable growth is what matters and that depends on enabling all of us to plan with a degree of certainty about the future.
I wrote in my SFP columns throughout the summer that, in my view, the best way to address the cost of living crisis was to combine direct targeted support for energy bills – for both customers and businesses – with sound fiscal discipline, i.e., avoiding unjustified borrowing. To put it in a nutshell, every instinct of mine at a time of rising inflation was to be cautious. I think that even the Prime Minister now accepts that abandoning caution in the previous Chancellor’s statement on 23rd September was a mistake.
So where do we go from here? I had the honour to serve as PPS to our new Chancellor of the Exchequer Jeremy Hunt when he was both Health Secretary and Foreign Secretary. He is an extremely able and intelligent policymaker, combining the compassion and credibility that is needed to navigate the public finances. Of course, further difficult decisions await, but that would have been the case whatever happened of late.
Responding to his first statement as Chancellor, I welcomed the fact that ‘fiscal and monetary policy were now working in harmony’. This rather technical point is more significant than it may appear. For most people, rising prices remain their biggest challenge, from energy to food and other staple goods. Our ‘Growth Plan’ – whilst containing many overlooked measures that will strengthen our economy – risked fiscal policy (tax and spend) and monetary policy (interest rates) contradicting one another; i.e., like driving a car with one foot on the accelerator and the other on the brake. Jeremy Hunt’s recalibration means both primary economic levers are pulling in the right direction, and that will maximise our efforts to fight our greatest economic challenge – inflation.
Whilst we now hope for a more stable environment at a national economic level, we mustn’t overlook the urgency of local action to drive growth and investment. So I continue to back our Levelling Up bid for funding Sudbury’s regeneration, including the Hamilton Road site. But, with so many schemes competing for more limited funding, I believe that we must be prepared, if not successful this autumn, to see how we can deliver this project without central funding. I believe that could be possible with the right partners in place.
After all, we have already benefitted from millions of pounds of public money in Sudbury to fund St Peter’s and most significantly the incredibly exciting new development at Gainsborough’s House. With its official launch to look forward to in the near future, once it is open we must work to promote South Suffolk’s incredible heritage offer, not least to encourage those crucial visitors who can help our high street to survive and thrive. Yes, visitors need to get here – I’ve recently joined with Priti Patel MP to push again for funding for a lift at Marks Tey and will continue to push for investment at Copdock Interchange. These are difficult times, but I am confident that South Suffolk can still look forward to a prosperous future.
Published in the Suffolk Free Press.