The Tories Stopped Talking About The Economy Years Ago, Says Conservative MP
5 min read
A former Conservative Cabinet minister has said it is “distressing” that his party has “stopped talking” about the economy.
Kit Malthouse, the Tory MP for North West Hampshire, told PoliticsHome that the Conservatives have stopped thinking seriously about economics over the last decade.
“When I came into the party in the 80s, it was all about economics.
"It was all about the model of the economy that we wanted to build. We recognised that the society in which we live was a product of the economy, and so getting that right was critical, and we stopped talking about it."
Reflecting on his roles in recent Tory governments, he said: “When I raised economic matters with Cabinet, it was sort of like a Bateman cartoon.
"Everybody looked a bit embarrassed and didn’t really want to talk about it, and nobody has really grasped this notion that actually what Conservatives do, what we do first and foremost, is get the economy right.”
Malthouse warned that a "financial reckoning" is coming to the UK, arguing that the country is in a "doom loop" of debt growing faster than the economy and that if he were chancellor of the exchequer, he would "tighten the fiscal rules", not loosen them.
To tackle economic malaise, the Tory backbencher said, the UK must embrace what he described as risk-for-reward policies.
“I chair the All-Party Parliamentary Group for Life Sciences, and we [the UK] are incredibly good at inventing new drugs, finding new molecules, and new therapies, but we are dreadful at scaling them up and turning them into world-beating businesses," he said.
"That's because people can’t get the capital, and where they can get it is in other countries, so they disappear.”
Malthouse, whose most recent Cabinet job was education secretary during the brief premiership of Liz Truss, also wants to see fundamental reform of tax, telling PoliticsHome that the Treasury should "simplify" the system by introducing a single consumption tax that would "effectively be a kind of larger VAT".
“Our tax system is becoming more and more arcane and difficult to navigate, as human ingenuity both attempts to avoid tax and attempts to capture tax. We’re in a kind of arms race.
"It struck me that, at some point, we’re going to have to simplify, and a big way of doing that is by shifting to a universal sales tax – effectively a kind of larger VAT – but getting rid of everything else.”
He added: "Getting rid of everything else seemed to be like a good deal for the consumer, because it makes the payment of tax voluntary. You only pay it if you spend money; if you're a saver, you don't pay it. If you're a spender, you pay it."
Malthouse said his party's "high command" has shown interest in the idea, and that he plans to use Conservative Party conference in October as a way of getting other Tory MPs on board.
First elected to the House of Commons in 2015, Malthouse is now on the backbenches, a political lifestyle which he described as "frustrating, with benefits", including having the freedom to “speak out in a way which I wasn’t before” on issues that he cares about.
One of these issues is Gaza, on which the former Cabinet minister admits he is in a "minority" when it comes to Conservative MPs.
Speaking in the House of Commons last week, Malthouse warned Foreign Secretary David Lammy that he could "end up in The Hague" over the UK government's "inaction and frankly complicity" in relation to Israel's actions in Gaza.
“Can he not see that his inaction and frankly cowardice is making this country irrelevant?
“Can he also not see the personal risk to him, given our international obligations, that he may end up at The Hague because of his inaction?" Malthouse told Lammy.
In response, the Labour Foreign Secretary said that while he understood Malthouse's anger over the situation in the Middle East, it "demeans his argument when he personalises it in the way that he does".
Speaking to PoliticsHome following that exchange, the Conservative MP said the international rules-based system set up following the Second World War was created to "prevent exactly what we are seeing in Israel and Gaza".
“In between those two sides, there are an awful lot of innocent human beings, millions of innocent human beings, on the Israeli side and the Palestinian side, and hundreds of them are dying – thousands of them are dying, mostly women and children.
“And what people need to recognise is that the peace, if you like, a relative peace of the Western world since the Second World War, was built on the basis of a set of rules, and those rules were devised in the aftermath of the horror of the Second World War, and they were devised to prevent exactly what we are seeing in Israel and Gaza," he said.
The former Cabinet minister added that there is "no military solution" to the conflict.
"You can drop as many bombs as you like, but the fundamentals of the conflict are not going to go away, and until you can find a political solution to it, all we’re looking at is years and years of war and aggression, and to me, that just seems pointless.”
