Autumn Statement

Theresa May Excerpts

Thursday 17th November 2022 Commons Chamber

[Jeremy Hunt]

I thank the hon. Lady for her comments. She is complaining about economic instability damaging business in Scotland, but she supports the most destabilising policy of all: separation from the United Kingdom. She complained about Brexit, but 1 million voters in Scotland voted for Brexit, and we are implementing the will of the British people. Behind the sparring in this House, we actually have very good relations with the Scottish Government. My right hon. Friend the Chief Secretary to the Treasury has already met John Swinney, the Finance Minister, and we have good co-operation.

I need to correct the hon. Lady on one point. She said that we are not investing in energy efficiency. What I said—if she listened to my words—is that in this Parliament we are spending £6.6 billion in energy efficiency, and a further £6 billion from 2025. I understand that separation means more to her than anything else in politics, but families in Scotland heard other things today. They heard about the £600 million for the Scottish NHS, £385 million for schools and more than £4 billion to help Scottish families with their energy bills, on top of £4 billion to build the latest frigates. That is because we are more than neighbours; we are family, and Conservatives always back families.

[Mrs Theresa May (Maidenhead) (Con)]

I welcome and commend my right hon. Friend’s and the Government’s commitment to sound money and sound public finances. I also welcome the commitment my right hon. Friend has given to innovation and R&D in developing and rebuilding our economy, but could I ask him to go further and look again at the definition of what qualifies as R&D for tax credits? I think more can be done to boost our economy for the future.

[Jeremy Hunt]

I thank my right hon. Friend for the tremendous support she gave to science and innovation when she was Prime Minister. That is very much something we want to build on as we go forward. We are looking at all the taxes around R&D relief, which we want to encourage. There has been a certain amount of abuse, but we particularly want to encourage use of the relief among small companies, which can often be the most innovative, so I will take away her comments and maybe talk to her separately about what can be done better.

Budget Resolutions

Theresa May Excerpts

Wednesday 27th October 2021 Commons Chamber

[Mrs Theresa May (Maidenhead) (Con)]

I refer the House to my entry in the Register of Members’ Financial Interests.

First, I commend my right hon. Friend the Chancellor for the good news in the Budget. It is indeed good news that the economy is growing faster than was predicted and it is good news that we are bouncing back from the pandemic not just faster than predicted but faster than other countries in the G7, with the OBR confirming the 6.5% growth that the International Monetary Fund and OECD predicted. It is good news that unemployment is lower than the very dire predictions that we heard at the beginning of the pandemic, largely owing to the action that the Government have taken. It is good news that, as my right hon. Friend announced, the national living wage has increased to £9.50, thereby putting, as he said, just over £1,000 into the pockets of some of the lowest paid. It is also good news for public sector workers that the pay freeze is going to be lifted.

It is good news that the Chancellor has felt able to announce, albeit over a number of days publicly rather than to the House today, increased spending on issues such as infrastructure, the NHS and science. I agree with my right hon. Friend that we must today start to build the new economy post covid and that we are on the verge of what could be an economy fit for the new age of optimism. Like my right hon. Friend, I have always been optimistic about what can be achieved by the talents, hard work and initiative of the British people and what they can do to build a brighter future for themselves, their families and the country. But the brighter future will not be built simply by telling people that it will be there: a new economy needs sure foundations and optimism needs to be backed by practical delivery.

As we know, there are headwinds that mean that however optimistic people are for the future, many are finding it difficult to manage today. As the Chairman of the Treasury Committee, my right hon. Friend the Member for Central Devon (Mel Stride) said, there is a debate to be had about what is going to happen to inflation and whether higher inflation is here to stay or just temporary. Of course, that will have an impact on interest rates.

Increased taxes will have both direct and indirect impacts on individuals, as will increased costs in other areas. We must never forget, as the Labour party so often does, that people are hit by increased taxes on business, because those increased costs often cannot be absorbed and are passed through to consumers—to members of the public.

I welcome the significant cut in the universal credit taper rate announced by my right hon. Friend the Chancellor. It is true to say that it is something that Conservative Governments have been working for, but previous cuts have been rather less dramatic than the one he announced today. What he has done is extremely good news.

Let me focus briefly on three particular issues in the Budget and spending review, the first of which is the forecast for the future growth of the economy. As I said, yes, we are bouncing back well, but our economy will be smaller for a number of reasons, some of which are specific to the UK, and the predicted rate of growth is below that which would normally be seen as an acceptable growth trend rate.

I am interested by the fact that the Government appear to think that they can sustain a situation wherein public spending increases by, as I think my right hon. Friend the Chancellor said, 3.8% a year, but the economy grows at less than half that rate. I welcome the fact that my right hon. Friend has introduced new fiscal rules, but I may have misheard or misunderstood: I think he said that the new fiscal rules will be met in the third year of every forecast period, but the forecast period rolls forward every year, which suggests to me that we will never reach the fiscal rules and they will just be rolled forward every year. As the Chairman of the Treasury Committee said, it is not the case that previous Governments have not been guilty of changing the date at which the fiscal rules were going to be met, but it seems to me that, unless I have misunderstood, it is baked in that they never necessarily need to be met.

The answer to the issue of the balance of increased public spending versus growth is, of course, to increase the growth rate of the economy. I support the desire for a green industrial revolution, but that brings me to my second point: the green industrial revolution is about not just providing support to businesses, to different sectors and to initiatives such as hydrogen. Those moves are important, though, and I welcome the fact that the Minister of State, Department for Business, Energy and Industrial Strategy, my right hon. Friend the Member for Chelsea and Fulham (Greg Hands) has introduced the Nuclear Energy (Financing) Bill and is finding a way to ensure that the RAB—regulated asset base—financing model will work for new nuclear in future.

To deliver the green economy of the future, we will have to ensure that we have the green skills of the future, which means that the issue involves not just the Treasury and the Department for Business, Energy and Industrial Strategy but the Department for Education. It is about ensuring that at every stage in our education system we prepare people for the jobs of the future and ensure that they have green skills. There were a lot of references to skills in the financial statement, but I did not hear any specific reference to green skills, which are very important. Young people are hugely enthusiastic about saving the planet, as I know from when I raised the seventh green flag for St Mary’s Catholic Primary School in Maidenhead recently. We need to ensure that young people’s education provides them with what they need to be able to take up the green jobs of the future.

[Caroline Lucas (Brighton, Pavilion) (Green)]

I am grateful to the right hon. Lady for giving way and even more grateful that she is mentioning the whole issue of the climate emergency and green skills. It felt like the Chancellor was skating over that vital issue—I do not think he got the memo on the climate emergency. Does she agree that if we had much greater investment in the net zero review, we would be able to scale up the jobs at the level she is describing? At the moment, we have a pitiful amount going into that net zero review. We have a Budget that is making more car driving more likely. It is making that cheaper. It is making short-haul aviation less cheap. So it is sending out the wrong messages at the wrong time. We need a test that would make sure that every single spending decision is measured against its climate impact.

[Mrs May]

The hon. Lady has always spoken passionately on these issues in this House, but I think she has overlooked the fact that the Chancellor announced a significant number of green jobs—several hundred thousand of them—for the future. Investment is going in from the Government, but the point I am making is that it is not just about the investment that the Government are putting directly into these areas; it is also about ensuring that our whole Government, on a cross-Government basis, understand the importance of this issue. That includes education. I had a positive meeting with the Secretary of State for Education earlier this week on that and other issues. So it is a cross-Government exercise and it needs to be understood as such.

My third and final point is on a different issue, which is about the NHS and social care spending. I recognise the increased money going to local authorities, but there are local authorities that feel they will be hit with significant costs with the new social care provisions. This is about not just the costs over the next couple of years before the levy money comes into social care, but those authorities that are in areas where the provision of care is more costly than in other parts of the country and where they have a very high proportion of self-funders. That includes both Wokingham Borough Council and the Royal Borough of Windsor and Maidenhead.

My main and final point is that in the necessary bid to deal with the backlog in the NHS—obviously more funding has been announced in relation to that—we do not lose sight of the long-term plan. Crucially, the long-term plan had commitments on areas such as mental health, prevention and workforce planning. Those commitments need to be met if we are to put the NHS on a sustainable footing for the future. For example, the young person whose mental health needs are identified and provided for at an early stage is the person who will not then turn up at A&E in a crisis situation, costing the NHS more.

Another important aspect in the long-term plan is that it was matched with measures and metrics that the Treasury was going to be able to use to ensure that money was spent effectively and wisely. As we know, the NHS does not always spend the money as well and as effectively as it could. People want to see more going into the NHS, but they want it to be spent properly with value for money, so it is important that the Government do not lose sight of that.

As a Conservative, I believe in low taxes, fiscal prudence, and sound management of the economy. I look forward to our being able to be in a position to deliver that at the same time as we are delivering that green economy for the future and that optimistic future that the Chancellor referred to in his speech.

0.7% Official Development Assistance Target

Theresa May Excerpts

Tuesday 8th June 2021 Commons Chamber

[Mrs Theresa May (Maidenhead) (Con)]

Thank you, Mr Speaker, for granting permission for this debate.

I oppose the cut from 0.7% in international development funding for three reasons. First, I stood at the election on a manifesto that said:

“We will proudly maintain our commitment to spend 0.7 per cent of GNI on development”.

Now, the Government will say, as the Chief Secretary has today, that covid has changed the circumstances, but the Government are also taking pride in and responsibility for the fact that our economy will bounce back this year, and covid has also changed the circumstances for the poorest people around the world. For many of them there will be no bounce back, because for some of them it will simply be too late. So I urge the Government to stand by their word and stand by our manifesto commitment on international development funding.

My second reason is the impact, which I have just alluded to, that the cut will have on the poorest people around the world. My right hon. Friend the Member for Sutton Coldfield (Mr Mitchell), in his thought-provoking and forceful speech, gave us some examples of the impact the cut will have—the damage it will cause to lives; the lives that will be lost. I want to mention just one particular area of interest to me: modern slavery. As one example, the global fund to end modern slavery is having its funding cut by 80%. That means that programmes will be lost, including programmes to work to end the commercial sexual exploitation of children, with all the damaging and devastating impact on young lives that the loss of that programme will have. The global fund will try to restore that money from elsewhere, including from other Governments. The United Kingdom has been the world leader in tackling modern slavery. Now we see organisations having to go cap in hand to other Governments to make up for the shortfall caused by the UK’s decision to cut international development spending.

Aid spending is not just about people in countries far away. Tackling modern slavery has an impact here on the streets of the United Kingdom. Supporting economic development elsewhere will help to cut the number of people who feel they have to migrate to the UK in order to look for work, and cutting ODA spending has an impact on other Departments. I recall in the Home Office that we used ODA spending to fund some of the work we did with refugees. If we cut that funding, either the work will not be done or the Home Office will have to find that money from other parts of its budget.

The third reason I oppose the cut is the impact on the UK’s standing in the world. People have respected us for our commitment to 0.7%; now, as we have heard, we are the only country in the G7 that is cutting aid at this time. People do not listen to the UK because we are the UK; they listen to us because of what we do and how we put our values into practice. Our commitment to that 0.7% has, for example, enabled us to argue the case for different definitions of ODA spending. Cutting this spending will have an impact on our standing.

Will we suddenly see countries cutting us off? No. Will we suddenly be kicked off international tables? No. But the damage it does to our reputation means that it will be far harder for us as a country to argue for the change that we want internationally—and that is across the board, including at COP26 and in respect of our setting out and putting into place the ambitions of the Integrated Review, which does not even mention modern slavery as one of the Government’s development priorities. I only hope that modern slavery is still on the G7 agenda, as it has been in the past.

The cut from 0.7% will have a devastating impact on the poorest in the world and it will damage the UK. I urge the Government to reinstate the 0.7% target: it is what they promised, it will show that we act according to our values and it will save lives.

Commission on Race and Ethnic Disparities

Theresa May Excerpts

Tuesday 20th April 2021 Commons Chamber

[Kemi Badenoch]

Before I begin to answer the hon. Lady’s questions, I would like to point out that the PM wrote to devolved Administrations shortly after the commission was established to invite them to engage with this work. It is noticeable that Northern Ireland was keen to take part, and hosted the commission on crime and policing matters. However, the Scottish National party Administration did not engage, so I believe that the words the hon. Lady is now saying about how dedicated they are to fighting racial inequality are completely hollow. When the commission was set up, I am afraid that they did very little indeed to engage.

Regarding the statement by the UN experts, the group grossly misrepresented the commission’s report; the statement is clearly born of the divisive narratives perpetrated by certain media outlets and political groups that are seeking to sow division in our ethnic minority communities. It is also quite clear that the UN experts did not read the commission’s report, judging from some of their statements, which seem to have been cut and pasted from a Labour party press release. The obvious flaw in their critique is that there is no comparison to be drawn with peer countries in Europe, especially because they do not even collect data on race and ethnicity. As such, I share the commission’s disappointment in, and rejection of, yesterday’s statement by the working group of experts on people of African descent, and I will be writing back to them in the strongest of terms.

It is no surprise that the hon. Lady has listed a lot of left-wing groups that disagree with the report. Disagreement and debate is part of politics. We have no issues with people disagreeing with the substance of the report; what we do have an issue with is people misrepresenting it. This report was tasked with finding out why disparities exist. It was not supposed to define where exactly we are seeing institutional racism, but to call racism out where it exists, and it did that. Perhaps if the hon. Lady spent some time reading the report, rather than remarks on Twitter, she would be better informed about what it actually says.

[Mrs Theresa May (Maidenhead) (Con)]

The chief economist of the Bank of England has said that

“Published pay gaps are a starting point for corporate and national accountability”.

Business groups have called for mandatory reporting of ethnicity pay gaps. The commission recommended investigating the causes of pay disparities, but then did not recommend mandating the reporting that would identify those disparities, so will the Minister now commit to taking a different approach from the commission, and commit to mandatory reporting of ethnicity pay gaps?

[Kemi Badenoch]

I thank my right hon. Friend for her question, and I pay tribute to her for setting up the Race Disparity Unit, which has allowed us to carry out so much forensic research.

On the issue of ethnicity pay reporting, the commission pointed to statistical and data issues that affect ethnicity pay reporting, and makes a recommendation as a way for employers to overcome these challenges and report ethnicity pay accurately. As I say, the Government will consider the report in detail, and we will work with colleagues in the Department for Business, Energy and Industrial Strategy to assess the implications of this recommendation for future Government policy and respond in due course. However, I take my right hon. Friend’s comments into account, and will make sure that they are addressed in the Government response.

Financial Statement

Theresa May Excerpts

Wednesday 8th March 2017 Commons Chamber

[Mr Hammond]

The one place where I will not hear the voice of business is on the Opposition Benches.

I committed at the autumn statement to review, with business, our R and D tax credit regime. We have done so and concluded that it is globally competitive. But to make the UK even more attractive for R and D, we have accepted industry calls for a reduction in administrative burdens around the scheme and will shortly bring forward measures to deliver that.

In a digital age, it is right that we develop a digital tax system, but in response to concerns about the timetable expressed by business organisations and by several of my right hon. Friends, including the Chairman of the Treasury Committee, I have decided that for businesses with turnover below the VAT registration threshold I will delay by one year the introduction of quarterly reporting, at a cost to the Exchequer of £280 million.

I have heard, too, the calls by North sea oil and gas producers and the Scottish Government to provide further support for the transfer of late-life assets. As UK oil and gas production declines, it is essential that we maximise the exploitation of remaining reserves, so we will publish a formal discussion paper on the options in due course.

There is one further area in which I can announce action to back British businesses. My right hon. Friend the Communities and Local Government Secretary and I have listened to the concerns raised by colleagues in this House and by businesses about the effects of the 2017 business rates revaluation. Business rates raise £25 billion per year, all of which, by 2020, will be going to fund local government, so we cannot abolish them, as some have suggested; but it is certainly true in the medium term that we have to find a better way of taxing the digital part of the economy—the part that does not use bricks and mortar. In the meantime, there is scope to reform the revaluation process, making it smoother and more frequent to avoid the dramatic increases that the present system can deliver. We will set out our preferred approach in due course and will consult on it before the next revaluation is due.

The revaluation itself is by law fiscally neutral. Ahead of this revaluation, the Government committed to a package of cuts to business rates now worth nearly £9 billion, permanently doubling the rate of small business rate relief to 100%, and raising the thresholds so that 600,000 small businesses are taken out of paying rates altogether. The revaluation has undoubtedly raised some hard cases, especially for those businesses coming out of small business rates relief, so today, as I promised many of my right hon. Friends, I address those concerns with three measures which apply to the national business rates system for England. First, any business coming out of small business rate relief will benefit from an additional cap. No business losing small business rate relief will see their bill increase next year by more than £50 a month, and the subsequent increases will be capped at either the transitional relief cap or £50 a month, whichever is higher.

Secondly, recognising the valuable role that local pubs play in our communities, I will provide a £1,000 discount on business rates bills in 2017 for all pubs with a rateable value of less than £100,000—that is 90% of all pubs in England. Thirdly, on top of these two measures, I will provide local authorities with a £300 million fund to deliver discretionary relief to target individual hard cases in their local areas. This fund will be allocated to local authorities by formula, and my right hon. Friend the Communities and Local Government Secretary will set out details in due course. Taken together, this is a further £435 million cut in business rates, targeted at those small businesses facing the biggest increases, protecting our pubs, and giving local authorities the resource to respond flexibly to local circumstances.

Just as a strong economy requires a tax system that is competitive, a strong society requires one that is fair; and because I have committed to funding my spending decisions in this Budget rather than borrowing more, I make no apology for raising additional revenues and for doing so in ways which enhance the fairness of the system. First and foremost, that means collecting the taxes that are due. Since 2010, we have secured £140 billion in additional tax revenue by taking robust action to tackle avoidance, evasion, and non-compliance.

These actions have helped the UK achieve one of the lowest tax gaps in the world, but there is more that we can do. In this Budget, we set out further actions to stop businesses converting capital losses into trading losses; to tackle abuse of foreign pension schemes; and to introduce UK VAT on roaming telecoms outside the EU, in line with international standard practice. From July, we will introduce a tough new financial penalty for professionals who enable a tax avoidance arrangement that is later defeated by Her Majesty’s Revenue and Customs. Taken together, these measures will raise £820 million over the forecast period.

As well as collecting taxes that are due, a fair system ensures that those with the broadest shoulders bear the heaviest burden. As a result of the changes we have made since 2010, the top 1% of income tax payers now pay 27% of all income tax, a higher proportion than in any year under the last Labour Government. But a fair system will also ensure fairness between individuals, so that people doing similar work for similar wages and enjoying similar state benefits pay similar levels of tax. As our economy responds to the challenges of globalisation, shifts in demographics, and the emergence of new technologies, we have seen a dramatic increase in the number of people working as self-employed or through their own companies. Indeed, many of our most highly paid professionals work through limited liability partnerships and are treated as self-employed. There are many good reasons for choosing to be self-employed or for working through a company—indeed, I have done both in my time—and I will always encourage and support the entrepreneurs and the innovators who are the lifeblood of our economy.

People should have choices about how they work, but those choices should not be driven primarily by differences in tax treatment. My right hon. Friend the Prime Minister has asked Matthew Taylor, chief executive of the RSA—the Royal Society for the encouragement of Arts, Manufactures and Commerce—to consider the wider implications of different employment practices. I look forward to his final report in the summer, and am grateful to him for sharing his preliminary thoughts. He is clear that differences in tax treatment are a key driver behind the trends we are observing—a conclusion shared by the Institute for Fiscal Studies and the Resolution Foundation.

An employee earning £32,000 will incur, between him and his employer, £6,170 of national insurance contributions. A self-employed person earning the equivalent amount will pay just £2,300—significantly less than half as much. Historically, the differences in NICs between those in employment and the self-employed reflected differences in state pension entitlement and contributory welfare benefits, but with the introduction of the new state pension last year, these differences have been very substantially reduced. Self-employed workers now build up the same entitlement to the state pension as employees—a big pension boost to the self-employed.

The most significant remaining area of difference is in relation to parental benefits, and I can announce today that we will consult in the summer on options to address the disparities in this area, as the Federation of Small Businesses and others have proposed. The difference in national insurance contributions is no longer justified by the difference in benefit entitlements. Such dramatically different treatment of two people earning essentially the same undermines the fairness of the tax system. Employed and self-employed alike use our public services in the same way, but they are not paying for them in the same way. The lower national insurance paid by the self-employed is forecast to cost our public finances over £5 billion this year alone. This is not fair to the 85% of workers who are employees.

The abolition of class 2 NICs for self-employed people announced by my right hon. Friend the Member for Tatton (Mr Osborne) in 2016 and due to take effect in 2018 would further increase the gap between employment and self-employment. To be able to support our public services in this Budget, and to improve the fairness of the tax system, I will act to reduce the gap to better reflect the current differences in state benefits. I have considered the possibility of simply reversing the decision to abolish class 2 contributions, but the class 2 NIC is regressive and outdated—it is absolutely right that it should go—so, instead, from April 2018, when the class 2 NIC is abolished, the main rate of class 4 NICs for the self-employed will increase by 1% to 10%, with a further 1% increase in April 2019.

The combination of the abolition of class 2 and the class 4 increases I have announced today raises a net £145 million a year for our public services by 2021-22. That is an average of around 60p a week per self-employed person in this country. Since class 2 contributions are payable at a flat rate while class 4 is chargeable as a proportion of profits, all self-employed people earning less than £16,250 will still see a reduction in their total NICs bill. This change reduces the unfairness in the NICs system and reflects more accurately the current differences in benefits available from the state.

Alongside the gap between employees and the self-employed, there is a parallel unfairness in the treatment of those working through their own companies. Britain has the most competitive corporate tax regime in the G7, and we are determined to make Britain the most attractive place to start and grow a business, but to do that, we must ensure that our corporate tax regime does not encourage people across the economy to form companies simply to reduce tax liabilities, pushing the burden of financing our public services on to others.

HMRC estimates that existing incorporations cost the public finances over £6 billion a year, and the OBR forecasts that at the current rate of increase, an additional annual cost to the Exchequer will occur from those choosing to incorporate of £3.5 billion a year by 2021-22. The gap in total tax and NICs between an employed worker and one who has set up his own company will normally be greater even than the gap with the self-employed, and there are several perfectly legal ways in which that gap can be made bigger still. This is not fair, and it is not affordable. Fairness demands that this discrepancy in treatment be addressed, just as I have addressed the discrepancy with the self-employed.

The dividend allowance has increased the tax advantage of incorporation. It allows each director/shareholder to take £5,000 of dividends out of their company tax-free, over and above the personal allowance. It is also an extremely generous tax break for investors with substantial share portfolios. I have decided to address the unfairness around director/shareholders’ tax advantage, and at the same time raise some much-needed revenue to fund the measures I shall announce today, by reducing the tax-free dividend allowance from £5,000 to £2,000 with effect from April 2018. About half the people affected by this measure are director/shareholders of private companies. The rest are investors in shares with holdings typically worth over £50,000 outside individual savings accounts. Of course, everyone will benefit from the generous £4,760 increase in the annual ISA allowance to £20,000, and the further increase in the personal allowance to £11,500 from April.

I now turn to duties and levies. Unusually for a Chancellor, I am delighted to announce a reduction in the expected yield of a tax—the soft drinks levy. I can confirm today the final rates of 18p and 24p per litre for the main and higher bands respectively, but producers are already reformulating sugar out of their drinks, which means a lower revenue forecast for this tax. This is good news for our children. In further good news for them today, I can confirm that we will none the less fund the Department for Education with the full £1 billion that we originally expected from the levy this Parliament, to invest in school sports and healthy living programmes.

I am freezing for another year both the vehicle excise duty rates for hauliers and the heavy goods vehicle road user levy. I am introducing a new minimum excise duty on cigarettes, based on a pack price of £7.35, and I can also confirm that I will make no changes to previously planned upratings of duties on alcohol and tobacco. The tax measures I have announced enhance the sustainability of our public services into the future and, by improving the fairness of the system, help us to keep tax rates low.

Economic policy does not exist in a vacuum, and economic growth is a means, not an end in itself. The objective of our economic policy is to support ordinary working families and to build an economy that works for them. Government Members know that we can achieve rising living standards and deliver investment in our vital public services only if we have a strong economy and sustainable public finances. It is a simple proposition, yet one that Opposition Front-Benchers seem to find strangely difficult to understand.

We start from a strong base: real wages have grown for 27 straight months; the wages of the lowest-paid grew faster last year than in any of the previous 20 years; and the poorest households have seen their labour incomes rise more since 2010 in the UK than in any other country in the G7. Last year, we delivered a pay rise to over a million of the lowest-paid through the national living wage, and next month we take more steps to support working families with the cost of living. The national living wage will rise again to £7.50 in April, which is over £500 more for a full-time worker than this year and £1,400 more than when the national living wage was introduced. The personal allowance will rise for the seventh year in a row to £11,500, and the higher rate threshold to £45,000; 29 million people will be better off, with a typical basic rate taxpayer paying £1,000 less than in 2010. We will meet our manifesto commitment to increasing the thresholds to £12,500 and £50,000 respectively by the end of this Parliament.

I can also confirm today that the new National Savings and Investments bond that I announced in the autumn statement will be available from April, and will pay 2.2% on deposits up to £3,000—a welcome break for hard-pressed savers. The universal credit taper rate will be reduced in April from 65% to 63%, cutting tax for 3 million families on low incomes.

Next month, we will see the introduction of our flagship tax-free childcare policy, which will allow working families across the UK to receive up to £2,000 a year towards the cost of childcare for each child under 12. The scheme will be rolled out to all eligible parents by the end of the year, and in addition, from September, working parents with three and four-year-olds will get their free childcare entitlement doubled to 30 hours a week. That is worth around £5,000 a year to a young family with a three-year-old and both parents working. By the end of this Parliament, this Government will be spending on childcare £6 billion a year.

These childcare measures represent a further huge step forward in support for ordinary working families, and for women in the workplace. I am delighted to use the occasion of International Women’s Day to announce three additional measures—well, not quite announce them, because my right hon. Friend the Prime Minister has already announced two of them.

[The Prime Minister (Mrs Theresa May)]

It is International Women’s Day!

[Mr Hammond]

It says here that I will commit a further £20 million of Government funding to support the campaign against violence against women and girls, which, as my right hon. Friend the Prime Minister said earlier, takes the Government’s commitment to this campaign to over £100 million in this Parliament. That is on top of the tampon tax, which today delivers another £12 million in support of women’s charities across the UK. The Prime Minister also mentioned earlier that the Government will commit a further £5 million to promoting returnships to the public and private sector, helping people back into employment after a career break.

Next year is the centenary of the Representation of the People Act 1918, which was the decisive step in the political emancipation of women in this country. I will commit a further £5 million to projects to celebrate this centenary, and to educate young people about its significance.

As well as knowing that the Government are on their side, people want to know that they are getting a good deal from private markets. A well-functioning market economy is the best way to deliver prosperity and security to working families, and the litany of failed attempts at state control of industry by Labour leaves no one in any doubt about that—except, apparently, the right hon. Member for Islington North (Jeremy Corbyn), who is now so far down a black hole that even Stephen Hawking has disowned him.

The Government recognise that sometimes markets, particularly in fast-developing areas of the economy, can fail people. Sometimes the market does not deliver the outcome that the textbooks suggest that it should. When that happens, the Government will not hesitate to intervene. We will shortly present a Green Paper on protecting the interests of consumers, but ahead of the Green Paper we will take the first steps to protect consumers from unexpected fees or unfair clauses, to simplify terms and conditions, and to give consumer bodies greater enforcement powers. Together, those measures will boost incomes, help family budgets to stretch a little further, support parents back into work, and tackle some of the frustrations that sometimes make it seem that the dice are loaded against ordinary people going about their everyday lives.

The House knows that the only sustainable way to raise living standards is to improve our productivity growth. Put simply, higher productivity means higher pay. The stats are well known: we are 35% behind Germany and 18% behind the G7 average, and the gap is not closing. Investment in training and in infrastructure will start to close that gap. The Government place addressing the UK’s productivity challenge at the very heart of their economic plan, because the cornerstone of an economy that works for everyone must be rising living standards for ordinary working people.

A key element of our plan is the £23 billion of additional infrastructure and innovation investment that I announced in the autumn statement. Today, to enhance the UK’s position as a world leader in science and innovation, I am allocating £300 million of that fund to support the brightest and the best research talent. That includes support for 1,000 new PhD places and fellowships, focused on STEM subjects: science, technology, engineering and maths. I am allocating £270 million to keep the UK at the forefront of disruptive technologies such as biotech, robotic systems and driverless vehicles—a technology that I believe the Labour party knows something about. There will be £16 million for a new 5G mobile technology hub, and £200 million for local projects to leverage private sector investment in full-fibre broadband networks.

On transport, I am today announcing £90 million for the north and £23 million for the midlands from a £220 million fund that addresses pinch points on the national road network, and I am launching a £690 million competition for local authorities across England to tackle urban congestion and get local transport networks moving again. My right hon. Friend the Transport Secretary will announce details shortly.

Because we believe that local areas understand local productivity barriers better than central Government, we will make further progress with our plans to bolster the regions. In May, powerful Mayors will be elected in six of our great cities. Across Britain, local areas will take control of their own economic destiny, and we will support them. I can inform the House that I have reached a deal with the Mayor of London on further devolution. Tomorrow, I will follow the launch of the northern powerhouse strategy in the autumn statement by publishing our midlands engine strategy, which will address productivity barriers across the midlands.

For the devolved Administrations, our announcements today deliver additional funding of £350 million for the Scottish Government—[Interruption.]