Clegg quizzes Brown on Europe

• Nick Clegg (Sheffield, Hallam, Liberal Democrat): ' . . IS the problem not now that, even with a touch of new-found humility, it is hard for him to lead at the G20 summit and in the European Union, because he does not practise at home what he preaches to them abroad?'

I thank the Prime Minister for his statement, in which there is much to welcome. The principle of a common European framework of regulation in financial services is a significant step forward, and one that we have been advocating for many years. There will continue to be differences in detail-he alluded to them himself-but the principle of cross-border regulation of cross-border finance will be welcomed by all but the most small-minded Eurosceptics. The eastern partnership with countries such as Georgia and Ukraine is also welcome, not least because of Russia's sometimes belligerent attitude towards its neighbours.

I remember in years gone by that the whole of Europe would groan every time the Prime Minister made another tub-thumping speech about how superior his policies were to everybody else's, so it is good that the idea finally appears to have dawned on him that he does not have all the answers and that he might even have a thing or two to learn from our European Union neighbours. Is the problem not now that, even with a touch of new-found humility, it is hard for him to lead at the G20 summit and in the European Union, because he does not practise at home what he preaches to them abroad? Would his rhetoric about stopping protectionism not pack more of a punch if he had not indulged in populist rhetoric about "British jobs for British workers"? Would his words about cracking down on tax havens not be more compelling if he had not presided for 12 years over industrial scale tax avoidance by British banks and big businesses here in Britain?

When the Prime Minister tries to act as President Obama's agent in Europe and persuade his European counterparts to issue another fiscal stimulus, would those leaders not listen to him more if he had not blown £12.5 billion on his wasteful VAT cut? Would those leaders not be more likely to listen to his recommendation that economic recovery must be driven by green investment if he was actually making those investments at home, rather than talking-as he did the other week-about 400,000 fantasy green jobs, which he has no idea how to create? If he had used the VAT money, as we proposed, to invest in public transport and in a transformation of our housing stock, he could have created 100,000 new jobs starting right now.

It is becoming increasingly clear that it will be difficult for Britain to afford a sustained, major new fiscal stimulus to boost our economy. Is it not therefore clear that we must take drastic action to ensure that we stop wasting any more money on things that do not create jobs? Will the Prime Minister commit immediately to cancelling the VAT cut and investing what money there is left in green transport, in the insulation of our homes, schools and hospitals, and in jobs? Did he not wonder, as he looked round the table at the other EU leaders at the summit, why not one of them had copied his cut in sales tax? Will he admit that they were right to choose to invest money in jobs instead?

Gordon Brown (Prime Minister; Kirkcaldy & Cowdenbeath, Labour): The right hon. Gentleman wants us to spend money on insulating homes, and we are doing that. He wants us to spend money on investing in schools, and we are investing more than in any previous year. He wants us to invest money in hospitals, and we are doing more than we have done. I thought that he would support the £44 billion of public investment that is being put into the economy, instead of failing to support it today.

As far as tax havens are concerned, in every Budget since 1997 we have tried to crack down on the use of tax havens. We have taken action that, since 2005, has secured £14 billion of funds that would otherwise have been lost in tax avoidance. We know that we have to get a global agreement, however, and that is why we are pressing other countries to sign up to the international standards that are necessary. That means that Switzerland, Liechtenstein, Hong Kong and Singapore-areas that have been regarded as tax havens in the past-have got to come within the net. [ Interruption. ] And, yes, other parts of the world have got to come in, and I hope that the Opposition will join us in demanding that.

As far as the low-carbon recovery is concerned, the right hon. Gentleman should know that we are investing, and ready to invest, as I announced today, in major projects of energy infrastructure- [ Interruption. ]

Michael Martin (Speaker): Order. Mr. Mackay, you are another regular who seems to want to shout across the Chamber, particularly at the Prime Minister. You are down to ask a question, but you cannot keep shouting and then expect to be called.

Gordon Brown: As I was saying, Mr. Clegg can be sure that we are investing in low-carbon projects, and that we want to continue to do so. On the fiscal stimulus, I am not surprised that he is opposing it now. The reason for that is that he is committed to £20 billion of public spending cuts.

Related Links

• • Full Debate in Parliament