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CHRIS PHILP: Urgent action needed to beat credit crunch blues

PUBLISHED: 10:20 22 January 2009 | UPDATED: 15:50 07 September 2010

A week or two ago, I received an email from Stephen (not his real name) in Kilburn. He had just lost his job – not a particularly high paying one – as a result of the credit crunch. Stephen was concerned that unless he could find another job soon, he woul

A week or two ago, I received an email from Stephen (not his real name) in Kilburn. He had just lost his job - not a particularly high paying one - as a result of the credit crunch. Stephen was concerned that unless he could find another job soon, he would be unable to afford his mortgage repayments and might lose his house. He has a young family to support, so this is a very serious situation.

Stephen's story is now being repeated around the borough. Recent figures for Camden show hundreds of our neighbours have lost their jobs in the last year, and the figures are mounting. For too many Camden families, the future is suddenly frighteningly uncertain.

Small retailers face serious challenges too, highlighted by the Ham&High's recent Keep It Local campaign.

Estimates suggest that one in 10 shops could close during the credit crunch, with the brunt falling mostly on the independent shops that make our area so special. One Hampstead retailer even had a sign up just before Christmas saying, "Come in while we're still here".

Other groups are affected too. For residents with 'defined benefits' pension schemes, the lower stock market means their pension will be much less than they had thought. One unexpected beneficiary, however, is the Car Club in Camden, which has seen membership soar now fewer people are able to afford to run their own car.

Overall, we in the UK seem to be feeling the effects of the credit crunch more than in most countries. One reason is that over the last decade the Government has spent enormous amounts of public money, not all of it wisely. A local example is the £7m computerised records system at the Royal Free that doesn't work properly - nationally, the same system has wasted billions.

The Government spending splurge was funded by a mountain of debt - equating to £30,000 for every Camden family which we will have to pay back. This in turn means the Government now has little room for manoeuvre, hence half-measures like the 2.5 per cent VAT cut, which will really make no difference at all.

What can we do to minimise the effects of the credit crunch in our neighbourhood? Keeping council tax bills as low as possible will help pensioners and those on lower incomes. This is why I am pressing hard for a council tax freeze. I also join the Ham&High in urging all our neighbours to try where possible to use local shops, as these are some of the businesses most immediately threatened.

The council should organise more job fairs to connect local people with jobs, which has already started. Finally, it is vital that we help the next generation into work. To this end, I am hopeful we can introduce apprenticeships for local youngsters with council contractors in the near future.

National solutions are needed too. The Conservatives' idea to allow smaller businesses to defer paying VAT bills would save thousands of companies and tens of thousands of jobs. We also need to manage down Government debt and taxes, by being much more careful with public spending in the future.

The planned National Identify Card Scheme is a waste of £20 billion (and an affront to civil liberties) that can be immediately scrapped. Lowering the burden of taxation will stimulate the economy, because individuals are generally better than the government at spending their own money.

Both nationally and in Camden, we need to focus again on the fundamentals that go towards making a strong economy: building genuinely world-class educational standards, encouraging entrepreneurship, ending welfare dependency, ending Government waste, lowering taxation and stimulating innovation.

In the short term, the credit crunch will cause great pain. The Government's policies over the last 10 years has made the problem worse than it needed to be. We must urgently work to alleviate this. But I am optimistic and confident that with the right action plan, we can enjoy truly sustainable economic growth in the future. Stephen and his family are counting on it.

Chris Philp is a local councillor, and Conservative Parliamentary candidate for

Hampstead & Kilburn


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