House of Commons
Oral Answers to Questions
(1 day, 4 hours ago)
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Joe Morris (Hexham) (Lab)
The Minister for Digital Government and Data (Ian Murray)
By means of commercial and subsidised delivery, the Government are ensuring that gigabit-capable connections are available to 99% of UK premises by 2032 through, for instance, Project Gigabit. This is critical for all UK communities if the public are to take advantage of the opportunities of technology, including the transformational investment in AI that the Chancellor announced yesterday, and if the United Kingdom is to win the global race for AI and be at the forefront of quantum computing as a result of the Government’s pledge to procure those connections. If everyone in every community across the UK is to win, they need to be connected, including those in Hexham.
Joe Morris
Yesterday I spoke to my constituent Luca, who has spent months campaigning for the investment that is needed to secure a reliable internet and phone connection for his community in the village of Lambley. He has been pushed from pillar to post between private companies, national agencies and local government, and meanwhile the residents of Lambley continue to live without effective internet connection. The solutions depend on funding and co-operation, which are challenging owing to the location and the lack of accountability. Will the Minister meet representatives of Coanwood parish council, Luca and me to try to find a way forward for Lambley and other rural communities?
Ian Murray
I am happy for that to be arranged with Luca, the parish council and my hon. Friend, along with officials from Building Digital UK, so that we can explore the solutions that are possible for his constituents. The Minister for Digital Economy, who sits in the other place, will be holding a surgery for Members of this House on 14 April, and I think my hon. Friend should go along and discuss these issues with her as well.
Greg Smith (Mid Buckinghamshire) (Con)
I could reel off countless examples of villages in my constituency where hard-to-reach areas simply have no broadband at all, let alone fibre broadband. Constituents and businesses are tearing their hair out. At what point will the Government possibly accept that if the millions—if not billions—of pounds are to reach those hard-to-reach places, it would probably be better to help those people to get, for instance, satellite broadband instead, so that they can have access to the internet now rather than having to wait for years?
Ian Murray
I am happy for the hon. Gentleman also to meet representatives of BDUK and the Minister for Digital Economy. He is absolutely right; while there will continue to be gaps for the very hardest-to-reach places, there are solutions out there, like wireless solutions, fixed-wireless access and, indeed, satellite broadband, which BDUK is examining now.
Mr Speaker
I call the Chair of the Science, Innovation and Technology Committee.
Dame Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)
Starlink is a US telecoms company owned by a South African American who advocates civil war in the United Kingdom. OneWeb is a European satellite telecoms company, which is part-owned by the UK. Yesterday the Science Minister told my Committee that OneWeb could be used to ensure domestic communications resilience in remote areas. Can the Minister tell me whether our critical rural broadband infrastructure is more dependent on Starlink or on OneWeb?
Ian Murray
We are a shareholder in Eutelsat, of which OneWeb is a part, and we will be examining all these issues. We have asked for Eutelsat to come forward with proposals to ensure that we have that resilience here in the UK, and we want to make more use of that shareholding.
Helen Morgan (North Shropshire) (LD)
The roll-out of Project Gigabit in my constituency has been a failure because Freedom Fibre has handed back the contract, with many thousands of properties unconnected, and the replacement contract is likely to take many more years to deliver gigabit access to thousands of my constituents. The all-party parliamentary group on digital communities, which I chair, has suggested some solutions to the problem. Will the Minister come to one of our meetings, and meet us, in order to understand how critical this is for rural communities?
Ian Murray
I am happy to ensure that the Minister in the other place who deals with this particular issue meets the APPG. However, Project Gigabit is designed to adapt in the event of a contracted supplier no longer being able to complete its planned delivery, using a mix of contracts and interventions. We are keen to hear from the hon. Lady about the experiences of her constituents.
Emily Darlington (Milton Keynes Central) (Lab)
The Parliamentary Under-Secretary of State for Science, Innovation and Technology (Kanishka Narayan)
One of the defining impacts of this Government is the action that we are taking to tackle violence against women and girls, and that means making illegal online that which is illegal offline. Intimate image abuse is now a priority offence; cyber-flashing is a priority offence; nudification apps are being banned, and we are standing up to Grok, and as a result the spread of intimate deepfakes has stopped; and non-consensual intimate images are now taken down within 48 hours. We will of course continue to engage with the BBFC and a range of other organisations in fulfilling our demands for parity.
Emily Darlington
Like many colleagues in this House and the other place, I am deeply concerned about the current unacceptable regulatory gap between online and offline pornography, and the public share that concern. The findings of recent research conducted by the BBFC indicate that 64% of pornography users believe that violent pornography contributes to violent sexual behaviour in the real world, and 80% would support new regulation. Does the Minister recognise the clear public demand for online-offline parity, and will he commit himself to introducing legislation to ensure that content that it would be illegal to supply on our high streets is no longer permitted online?
Kanishka Narayan
I pay tribute to my hon. Friend’s engagement in her constituency and on this debate nationally. She has been a strong champion for the voices of victims, particularly in relation to this question. I entirely agree with her demands for parity, and that is exactly the commitment we have made as a Government. We have set up a cross-Government unit to make sure that we deliver on that plan within six months.
Carla Lockhart (Upper Bann) (DUP)
Some 50% of boys aged 11 to 13 have already viewed online pornography. Clearly, frequent exposure to violent sexual content is damaging young people’s minds and their understanding of relationships. Does the Minister agree that, alongside engagement with platforms, the criminal law must be modernised to ban online extreme pornography?
Kanishka Narayan
I thank the hon. Member for that incredibly important point. That is exactly why we have already made a series of legal changes, not least to ensure that cyber-flashing and intimate image abuse are priority offences under the Online Safety Act 2023. We have mandated highly effective age assurance on pornography sites and sites with content that is harmful to children. We want to go further still where there is clear evidence to do so, and we will do that through the national consultation that we have launched.
Steve Yemm (Mansfield) (Lab)
The Secretary of State for Science, Innovation and Technology (Liz Kendall)
This Government have already launched five AI growth zones, creating 15,000 jobs and unlocking £40 billion of investment in industrial heartlands across the country. The east midlands AI growth zone— a high-potential bid for that is under active consideration —could bring thousands of good jobs to the region, including in Nottinghamshire, unlocking investment, creating opportunities and regenerating the area in partnership with local businesses and universities.
Steve Yemm
Fourteen years of Conservative economic decline saw jobs and opportunity leave places such as my constituency of Mansfield, and AI now presents a chance to turn that around. How will the Secretary of State ensure that the Government roll-out of AI growth zones, creating opportunity across the country, will translate into local jobs and skills in left-behind communities?
Liz Kendall
In the 14 months we have been in government, our AI growth zones have done more to level up the country than Conservative Members achieved in 14 years; these zones are being built in the areas that once led the industrial revolution and will now lead the technological revolution. We are also upskilling 10 million workers with free AI skills, introducing the first dedicated national apprenticeship in practical AI and automation, and delivering our £27 million TechLocal programme to help people from all walks of life move into AI. We are determined to ensure that AI benefits people in Mansfield and every part of the country, so that no one is left behind.
Naushabah Khan (Gillingham and Rainham) (Lab)
Jacob Collier (Burton and Uttoxeter) (Lab)
The Secretary of State for Science, Innovation and Technology (Liz Kendall)
Every child deserves the best possible start in life, and that applies as much to the online world as it does to the real one. We know that families everywhere are grappling with the impact of phones and social media. That is why we have launched our national consultation, and we have had over 25,000 responses so far. We want to hear from everyone, particularly children and young people themselves, and the consultation—with a child-friendly design—will be one of the first of its kind to hear specifically from them. We also want to make sure that we particularly reach out to children with special educational needs and disabilities, and those in care, for their views.
Naushabah Khan
Parents in Gillingham and Rainham strongly back this Government’s efforts to keep children safe online. Does the Secretary of State agree that repealing the Online Safety Act, as Reform has pledged to do, would recklessly expose our children to online predators and leave them without the protections they deserve, and that any party serious about families must have a credible plan for children’s online safety, not simply tear one up?
Liz Kendall
I think the party that wants to repeal the Online Safety Act puts children at risk. Its Members do not stand for British values and they do not stand for British law; Labour Members do.
Jacob Collier
There are strong and differing views across this House and the country on a social media ban for under-16s. Indeed, when I have spoken to young people, that has come out, and there was not a strong feeling in my old school, de Ferrers academy, about this. Can the Secretary of State say what engagement she will have with young people, so that decisions about their lives are directly fed into this consultation?
Liz Kendall
Not for the first time, my hon. Friend is spot on. I spoke to young people at Fullhurst school in my constituency and they had very different views about this proposal. We really want to hear directly from young people themselves—we have already had over 1,700 responses—but especially from children. We are partnering with UK Youth and Volunteering Matters to run a series of seven youth-led events across England, Northern Ireland, Scotland and Wales. We will also pilot other potential interventions, including overnight curfews and daily screentime limits, working with children and parents to see what works in practice and its impact on family life.
Sir Julian Lewis (New Forest East) (Con)
I hope this is a helpful suggestion to the Secretary of State. There have been some objections to a social media ban for young people based on the fact that it would create a cliff edge, whereby they have no involvement with it and then total involvement with it. Does she agree with me that one way to minimise that danger is to encourage children to use the internet, which is not interactive, as that will gradually acclimatise them for the day when they are able to use interactive services more safely?
Liz Kendall
The right hon. Gentleman is always helpful—well, not always, but on this occasion he has been very helpful. The cliff-edge argument has been made to me personally by the NSPCC, the Molly Rose Foundation, the Internet Watch Foundation and others, and it is one that we should take seriously. I have spoken to schools in my constituency about how best to handle it if we were to go ahead with the ban. There is a really important point about young people’s education and awareness, because life is online now and we have to prepare children for the future. That is at the heart of the issues we are debating in the consultation.
Vikki Slade (Mid Dorset and North Poole) (LD)
I recently visited Lytchett Minster school and Queen Elizabeth’s school, and I held a session asking the young people about their views. Overwhelmingly, the children in sixth form supported a ban and the children in the younger part of the school did not. How will the Government tailor the questions for younger children and older children, so that we get a true understanding of the problem?
Liz Kendall
I would love it if the hon. Lady sent me a report or a note on that, because alongside the consultation, which is specifically designed for children and young people, many of us in this House are talking to schools. I say to everybody: do send in those views, and I promise I will read them all.
Adam Thompson (Erewash) (Lab)
The Secretary of State for Science, Innovation and Technology (Liz Kendall)
I am very proud that this Labour Government have put the biggest investment into research and development of any Government ever, with a record £38 billion for UK Research and Innovation, including £14 billion for curiosity-led research. This week, we announced our ambitious plan to buy usable, large-scale quantum computers by the early 2030s, backed by £2 billion of funding—a world first. We are backing our world-leading quantum sector, because we are determined to do everything to back our brilliant British scientists, innovators and entrepreneurs.
Adam Thompson
I thank the Secretary of State for her answer. Despite the massive Government increases in funding generally, in a recent meeting of the Science, Innovation and Technology Committee, we heard how the Science and Technology Facilities Council is currently dealing with a significant reduction in funding, particularly in particle physics, astronomy and nuclear physics. Michele Dougherty, the executive chair of the STFC, placed the blame squarely on decisions made prior to her arrival and explained her efforts to sort out the mess, but it is the scientific community, research professionals and UK science that will feel the brunt of this funding crunch. What is the Secretary of State doing to ensure that UK science is not damaged by STFC’s historical failings?
Liz Kendall
A lot of concerns have been raised by the physics community about this issue. The STFC’s budget is actually flat over the spending review, but, as the executive chair says, there have been overspends in its budget over the past five years or so. Those overspends have had to be met from elsewhere in UKRI’s budget, meaning other things have not been funded as a result. STFC and UKRI are looking at how to get the balance right among their different projects. They, and our Minister for Science, Innovation, Research and Nuclear, will be engaging closely with the physics community over the coming months to make sure we get this right.
Mr Gagan Mohindra (South West Hertfordshire) (Con)
My constituent George works for the Science and Technology Facilities Council. He has highlighted to me that UK Research and Innovation is developing a model that significantly reduces spending for all areas of science under the STFC’s remit, including quantum science, particle astrophysics and theoretical physics. Given that the STFC has already warned staff of potential job losses and that it ran a voluntary exit scheme last year, can the Secretary of State reassure the research community, including my constituent in Chorleywood, by confirming that the STFC science facilities and national labs have the necessary funding and will continue commissioning excellent research for years to come?
Liz Kendall
I reassure the hon. Gentleman’s constituents in Chorleywood—a place I know well—and people right across the country that this Government have provided the biggest ever funding settlement for science. The STFC’s budget is not being cut; it is actually rising slightly, but is flat over the spending review period because of the impact of inflation. Within that context, it is right to ask the STFC and UKRI together to get those budgets under control. Experts will be helping to ensure that we prioritise the most important research. We strongly back curiosity-led research, especially in physics, which is so important for the foundation of our economy and society. However, we do need to sort this problem out.
Dr Ben Spencer (Runnymede and Weybridge) (Con)
Modern warfare is technological warfare, so UK research and innovation is critical for our defence. When the Secretary of State has spoken with the Defence Secretary about the defence investment plan, as I assume she has, which sectors has she prioritised for investment in UK companies in research and development—drones, space, cyber, chips? Could she spell out her vision of the role of UK tech in defence, if she has one?
Liz Kendall
As the former head of MI6 has repeatedly said, the single biggest thing that we could do to strengthen our defence and national security is to invest in research and development. UKRI has had the biggest funding settlement from any Government ever under this Labour Government. The Conservatives want to slash UKRI’s budget by £6 billion, which would wipe out all our funding for AI, advanced manufacturing, life sciences and much more. We are backing our defence sector, with 10% of the defence equipment budget going on backing UK businesses—the Tories would slash the funding on which they depend.
Victoria Collins (Harpenden and Berkhamsted) (LD)
UK Research and Innovation funding will continue to be undermined if the Government’s own procurement strategy sees billions going to companies outside the UK, such as Palantir in the US, when British tech has the solutions. Although we welcome the announcement of AI investment funding, it pales in comparison with the ongoing procurement investment. Will the Government back Liberal Democrat amendments to the Cyber Security and Resilience (Network and Information Systems) Bill for a comprehensive digital sovereign strategy, backing British tech, research and innovation, which is vital for both our economy and our national security?
Liz Kendall
I am proud of this Government’s plan to back UK AI companies and our sovereign capabilities, with £500 million backing our new sovereign AI unit and £1 billion of free compute for British researchers and scientists. We are also overhauling Government procurement to ensure that we back innovative tech companies in the UK, both big and small. That is the way forward to seize the opportunities for growth and secure our sovereign capabilities.
Kirith Entwistle (Bolton North East) (Lab)
The Secretary of State for Science, Innovation and Technology (Liz Kendall)
No woman or child should live in fear of having their image sexually manipulated by technology. That is why in the past six months we have made intimate image abuse and cyber-flashing priority offences under the Online Safety Act 2023; criminalised the creation of non-consensual sexual deepfakes and mandated that those images are taken down within 48 hours; introduced an offence banning AI nudification apps; and stood up to Grok and X. We know that technology moves fast and, as a Government, we have to keep up. Where we need to go further, we will.
Kirith Entwistle
Although I am proud of the steps that our Government have taken to advance online safety, we are merely playing catch-up. What more are the Government doing to ensure that we keep pace with the reality facing women and girls and how will they address emerging technologies such as AI smart glasses, which are operating without scrutiny?
Liz Kendall
One of my reflections in this job is that it took eight years for the Online Safety Act 2023 to come in, and it is still to be fully implemented. We need to move faster. MPs discuss a Finance Bill every year, and technology moves incredibly fast, so I am always prepared to take further action when it is needed.
Peter Fortune (Bromley and Biggin Hill) (Con)
I am asking this question on behalf of my hon. Friend the Member for Hornchurch and Upminster (Julia Lopez), the shadow Secretary of State, who cannot be here today, but wants the House to know how important this issue is to her. The lobular moon shot project is a plan to fund critical research into lobular breast cancer. It is a disease often missed by screening and with no targeted treatment. A total of 463 Members of this House, including the Leader of the Opposition, support this plan. The Health Secretary says that there is no political disagreement on this, yet nothing has materially happened. His Department now says that it is for DSIT and UK Research and Innovation to comment on budget allocations and spending research priorities. I ask the Secretary of State this: is the moon shot project a research priority for her, as it is for 463 of her parliamentary colleagues?
Liz Kendall
Anything that deeply affects the lives of thousands of people is a priority for me. I am more than happy to work with the hon. Gentleman and others to reach a resolution here. My understanding is that we need to get right the quality of bids, but I would of course be happy to meet to discuss this further.
Peter Fortune
I thank the Secretary of State for that response. She should know that, on 22 April, vigils will be held across Westminster for the 22 women diagnosed with this insidious disease every day. I thank her for that commitment to work with the Health Secretary between now and then so that we can highlight this issue. Will she agree to come back to the House and update us on the comments and discussions that she has had with the Secretary of State for Health?
Liz Kendall
Yes, because I always believe in action, not just words.
Gordon McKee (Glasgow South) (Lab)
Liz Kendall
This Government are determined to protect the UK’s position as a world-leading creative powerhouse and unlock the extraordinary potential of AI to grow the economy and improve British lives. Today, we published a report and impact assessment, fulfilling the commitments made in the Data (Use and Access) Act 2025. We have listened to the views on our initial consultation and confirmed that the Government no longer have a preferred option. We have also set out where we will do more work with our creative and AI sectors, including on digital replicas, labelling AI-generated content, creator control and transparency and support for our brilliant small and independent creatives. Every country is grappling with this issue and we are determined to get this right, so that both these vital sectors can continue to flourish, thrive and lead the world.
Sir Edward Leigh (Gainsborough) (Con)
The Parliamentary Under-Secretary of State for Science, Innovation and Technology (Kanishka Narayan)
First, may I affirm the importance of the project that the right hon. Gentleman is talking about? The Government are backing the future of nuclear fusion across the country, and this site in particular has a huge contribution to make. Construction will be on its way by the end of the decade, with research and development tests before that. At the heart of it, we will be backing the use of AI to further our clean energy goals in fusion and beyond.
Graeme Downie (Dunfermline and Dollar) (Lab)
Liz Kendall
Yes. We have already had more than 25,000 responses to our consultation, including 1,700 from children and young people. If my hon. Friend or any other hon. Member wants to send in the views of their constituents, including of young people, I will personally read them.
Wendy Morton (Aldridge-Brownhills) (Con)
The Prime Minister (Keir Starmer)
Our deepest condolences are with the families and friends of the two young people who have died following the outbreak of meningitis B in Kent. Others are seriously ill, and this will be a deeply difficult time for their loved ones. Health experts are working to identify close contacts and distribute antibiotics, and we will begin a targeted vaccination programme in the coming days. Can I take this opportunity to ask anyone who attended Club Chemistry on 5, 6 or 7 March to please come forward to receive antibiotics?
Yesterday President Zelensky addressed parliamentarians, including many Members. I had the opportunity to reaffirm to him that no matter what other international events, the UK’s support for Ukraine will not waver. I also welcomed Prime Minister Carney and NATO Secretary-General Rutte to Downing Street for further discussions on international security.
This morning I had meetings with ministerial colleagues and others. In addition to my duties in this House, I shall have further such meetings later today.
Wendy Morton
May I associate myself with the comments and condolences of the Prime Minister in relation to those affected by the meningitis outbreak?
New data today shows that nearly 60% of hospices are considering cutting frontline services. In the west midlands, St Giles hospice has already reduced beds and staff due to financial pressures. With services being cut, can the Prime Minister explain why hospices are being told to wait until autumn for the new framework, and will he commit today to proper long-term, sustainable funding to secure this vital lifeline for the future?
The Prime Minister
It is important that the funding and framework are put in place. We support the work of hospices and are doing everything we can to support them.
Dr Marie Tidball (Penistone and Stocksbridge) (Lab)
The Prime Minister
My first instinct is always to protect people from the cost of living. The immediate action we have taken in relation to those who heat their homes with oil is the £53 million that we announced this week. That is particularly important for rural communities and for Northern Ireland. De-escalation in the middle east is the quickest way to reduce the cost of living. Anyone who advocated for the UK to rush headlong into the offensive without a clear picture of what it would mean for our forces or without thinking through the economic impact for families should stand up and apologise.
Mrs Kemi Badenoch (North West Essex) (Con)
The Prime Minister tried to avoid scrutiny on the Mandelson files by releasing the documents immediately after Prime Minister’s questions last week, so let me ask him now: did he personally speak to Peter Mandelson about his relationship with the convicted paedophile Jeffrey Epstein before appointing him as our ambassador to Washington?
The Prime Minister
Let me start where I must. It was my mistake in making the appointment. I have apologised to the victims of Epstein, and I do so again. The Government are complying with the Humble Address in full, and we are continuing to support the police in their investigation. The matter of process was looked at by the independent adviser on ministerial standards. It is clear that the appointment process was not strong enough, and that is why I have already strengthened it. It was my mistake, and I have apologised for it. The right hon. Lady should follow suit and apologise for her gross error of judgment in calling for the UK to join the war in Iran without thinking through the consequences.
Mrs Badenoch
I know the Prime Minister does not want to talk about the documents that he tried to bury last week. He is going to try to talk about anything else, but he is not going to get away with it. I asked him a question; he did not answer.
We know that the Prime Minister was warned about the risk of appointing Peter Mandelson. This is not about the process. He knew that Mandelson stayed in Epstein’s house after Epstein had been convicted for child prostitution—he knew that. So I will ask him again: did he speak to Peter Mandelson about that before the appointment? Yes or no?
The Prime Minister
I have already made clear that Peter Mandelson was asked questions and gave untruthful replies. The Government are complying with the Humble Address. The process has been set out. The independent adviser looked at it, and he said,
“the relevant process for a political appointee was followed”.
Obviously, this is a question of my judgment, but what about the Leader of the Opposition’s judgment? She wanted to rush into a war with Iran without thinking it through. At the weekend—three weeks in—she said, “Oh, there isn’t a clear plan behind the US strikes in Iran.” That is the question she should have asked at the start. The decision to commit the UK to a war is the biggest decision a Prime Minister can take, and she was completely wrong.
Mrs Badenoch
I did not hear an answer, Mr Speaker. The Prime Minister is right: it is about his judgment. He has repeatedly told us that Peter Mandelson lied to him, but he will not tell us if he actually picked up the phone and spoke to Mandelson before appointing him. That does not make any sense. The Prime Minister told us on the record that he “believed the lies” that Mandelson told him, but if he did not speak to him, how can he say that?
The Prime Minister
The process is clear, and it has been looked at by the independent adviser. The Leader of the Opposition asked me about the process and judgment on appointments, but she appointed the shadow Justice Secretary, the hon. Member for West Suffolk (Nick Timothy), who said last night that Muslims praying in public—including the Mayor of London, practising his faith—are not welcome. He described it as an
“act of domination…straight from the Islamist playbook.”
It is utterly appalling. If he were in my team, he would be gone. The Leader of the Opposition should denounce his comments, and she should sack him.
Mrs Badenoch
The Prime Minister wants to talk about Justice Secretaries. His Justice Secretary is abolishing jury trials; my shadow Justice Secretary is defending British values. I know who I would rather have sitting on the Front Bench next to me, and it is not the Justice Secretary.
This is important: the Prime Minister wants to talk about anything except what I am asking him. Three times I have asked him whether he spoke to Peter Mandelson; three times, he has refused to answer. We can only assume that he did not speak to Peter Mandelson. From the documents published, we know that he left the questioning about Mandelson’s relationship with a convicted paedophile to two of Mandelson’s closest friends, one of whom was also friends with a convicted paedophile. Asking those questions should have been his job. Why did he fail to do his duty?
The Prime Minister
The Leader of the Opposition’s position is that the shadow Justice Secretary is defending British values when he says Muslims praying together in Trafalgar Square are not welcome. Even Tommy Robinson—I can hardly believe that I am saying this—has said today that if the shadow Justice Secretary had made those hateful comments two years ago, the Conservative party would have kicked him out. Tommy Robinson is not some sort of moral signpost; he was pointing out how much her party has changed—it is more inclined to his views—and he is right about that. The fact that the shadow Justice Secretary is sitting on her Front Bench shows that she is too weak and has absolutely no judgment.
Mrs Badenoch
The Prime Minister wants to talk about my leadership. I am shocked. His former deputy has just fired the starting gun on the race to replace him. I will tell him one thing: she and I both agree that this weak man should be replaced by a strong woman. [Interruption.] But I am not finished, Mr Speaker—I have too much to say to him.
There is still a lot to ask about the Mandelson files. The Prime Minister knew that Mandelson had kept up a relationship with Jeffrey Epstein. The documents released also show that he had been warned about appointing Mandelson. He claims he was lied to. Mandelson had twice been fired for dishonesty, so why did the Prime Minister believe Peter Mandelson over the vetting documents?
The Prime Minister
The Leader of the Opposition asked about leadership. When I see religious events in Trafalgar Square—when I see Hindus celebrating Diwali, when I see Jews celebrating ChanukahLive!, when I see Christians performing the passion of Christ, or Muslims praying—that shows the great strength of our diverse city and country. I have never heard her party call out anything other than the Muslim events; it is only when Muslims are praying. The only conclusion is that the Tory party has a problem with Muslims. [Interruption.]
Mr Speaker
Order. May I just say that I am not responsible for the answers? I just have to say that.
Mrs Badenoch
It is a shame that the Prime Minister is not responsible for the answers either. He wants us to believe that he is a serious leader, but he does not do the work. He outsources the decisions and when things go wrong he blames the vetting, he blames the chief of staff, he blames the Cabinet Secretary—he blames anyone but himself. This Prime Minister appointed Peter Mandelson, but did not bother to ask the questions. If he cannot be straight with the House on something as simple as this, why should we believe a word he says about anything?
The Prime Minister
The Leader of the Opposition talks about doing the work. Three weeks ago she said we should rush into war. She did not do the work; she did not think through the consequences. Committing our military to a war without thinking through the consequences is the gravest mistake for a Leader of the Opposition. She comes back a week later and says, “Oops! I got that one wrong.” She is utterly irrelevant and she has no judgment. This is the Leader of the Opposition who said that I should have empty-chaired the most important NATO summit in years, this is the Leader of the Opposition who said that Greenland is a second-order issue, and this is the Leader of the Opposition who would have jumped into a war with Iran without stopping to think.
On top of that, this week, we have the failure to condemn and sack—[Interruption.]
Mr Speaker
Order. I repeat that I am not responsible for the answers, but this is certainly not Opposition questions.
The Prime Minister
Add to that the failure to condemn and sack the shadow Justice Secretary for the poison and division that he spreads. It is turning out to be quite a month for the Leader of the Opposition who claims that she never makes any mistakes.
Claire Hanna (Belfast South and Mid Down) (SDLP)
We have seen this play out before: a US rush to military escalation with no plan for what comes next. We have seen schoolgirls bombed in Iran, whole families killed in Lebanon, chaos in a region already scarred by repression and genocide, and economic shocks that hurt the most vulnerable at home. In Irish, there is a phrase, “Ní mhealltar an sionnach faoi dhó”—have we learned no lessons? People are asking exactly that: how many times do these horrors play out before the lessons are learned? The Prime Minister has said that the UK
“will not be drawn into the wider war.”
Will he guarantee two things: that that position will hold in the face of mounting pressure from Trump and Netanyahu, and that this House will get a vote before the UK is involved in any further conflict?
The Prime Minister
Unlike the Leader of the Opposition, my principles have been clear and unwavering. We will protect our people in the region, we will take action to defend ourselves and our allies, and we will not be drawn into the wider war. I want to see this war end as quickly as possible. The longer it continues, the bigger the impact on the cost of living. That is where we have intervened to support households with the costs of heating oil. The best way forward is a negotiated settlement, with Iran giving up any aspirations to develop a nuclear weapon.
Ed Davey (Kingston and Surbiton) (LD)
I join the Prime Minister in offering my condolences to the family and friends of the two young people who have been killed by the meningitis bug in Kent and all those affected by this horrifying outbreak.
Britain’s independent nuclear deterrent is critical for the defence of our nation and the whole of Europe, but the current Trident missiles will reach the end of their lives in the 2040s. We have to make a choice now: lease new missiles from the United States, accepting whatever terms the President gives us, or build our own here in the United Kingdom. The Conservatives and Reform say that we have to rely on President Trump and the United States because we could not possibly do it ourselves. Does the Prime Minister agree with them?
The Prime Minister
Our independent nuclear deterrent protects us every day, and we should never forget how important it is. It is important that we renew it. We will do that in the best interests of Britain. The right hon. Member is openly advocating a plan without knowing how much it would cost and how it would work. That is not the way to deal with our independent nuclear deterrent.
Ed Davey
I am surprised by that response. The French can do it—does the Prime Minister really think Britain cannot?
Moving on, a New World investigation into GB News has found hundreds of shocking breaches of the rules of impartiality and accuracy, yet Ofcom has repeatedly refused to take action. Andrew Neil says:
“Just as Fox basically became the channel of Donald Trump, it’s clear they have turned GB News into the Reform channel”.
We cannot let GB News propaganda turn our great country into its version of Trump’s America. Either the Government rules are not fit for purpose or Ofcom is not properly enforcing them—which is it?
The Prime Minister
The right hon. Member is right to raise an important question of free speech and our media. It is a matter for Ofcom, and it is important that we let it deal with it.
Uma Kumaran (Stratford and Bow) (Lab)
The Prime Minister
I thank my hon. Friend and the others who attended the UN Commission on the Status of Women event. We are committed to halving violence against women and girls wherever it takes place, whether that is online, offline or on our streets. That includes banning deepfakes and tackling non-consensual intimate images and abusive, vile content online.
Following up from last week, I was deeply concerned that Travelodge cancelled its meeting with MPs. I want it to put that right and put it right swiftly.
Sir Jeremy Wright (Kenilworth and Southam) (Con)
The Prime Minister
I thank the right hon. and learned Member for raising that, and I acknowledge the question he asked me last year. I pay tribute to him and to Kate for her campaign. It is vital that we look closely at the rare and tragic cases where things went wrong. We must not fail to do so, so that we maintain confidence in our health service—important in relation to covid, of course, but, as he rightly points out, important today as well. We are committed to looking at reforms to the vaccine damage payment scheme and engaging with those affected to ensure that it meets their needs. We expect the fourth module of the covid inquiry to report next month, which will look specifically at the issue he has raised. I can reassure him that we will look at other recommendations very closely.
Dawn Butler (Brent East) (Lab)
The Prime Minister
I welcome the Mayor of London’s crackdown. The Metropolitan police have made hundreds of arrests and recovered thousands of phones, and mobile phone theft has fallen. I agree with her that there is more to do, and we must work with the tech industry in order to do it. If we can reduce the value of stolen phones, it will help to break the business models that drive theft. We are committed to working with the industry, and are willing to consider any further necessary action to drive down that crime.
Martin Wrigley (Newton Abbot) (LD)
The Prime Minister
As the hon. Gentleman says, the Chancellor set out yesterday the huge economic opportunities of innovation and AI. We have put £5 billion behind British start-ups, and we will launch our sovereign AI unit with £500 million to help AI businesses start and grow. We are investing the £2 billion that he refers to in our quantum capabilities so that we can be the first country in the world to roll-out quantum computers at scale. Procurement must be the launchpad for start-ups, and we are determined to deliver that.
Paul Davies (Colne Valley) (Lab)
The Prime Minister
That is a good example. My hon. Friend makes a powerful point. Thanks to our record investment in the NHS, we have the lowest waiting list numbers for three years, the shortest A&E waits for four years, and the fastest ambulance response times for five years. Stronger community health services, such as the local innovation centre that he mentions, are at the heart of our 10-year plan to go further. We would not have come this far already without the decisions made at the Budget, which were opposed by all Opposition parties.
David Davis (Goole and Pocklington) (Con)
The Prime Minister
We are not abolishing jury trials, as the right hon. Gentleman knows. I have worked with women and girls who have been victims of sexual violence and rape, and have waited a very, very long time for their cases to go to court. Many of them drop out because of the wait. They have described to me personally the mental anguish that they go through when their case cannot be heard for years, and when they are told of adjournments time and again. I am not prepared to look them in the eye any longer and not do something about it—we owe it to them.
This is about getting the balance right. We are not abolishing jury trials. About 3% of cases go to jury trial, as the right hon. Gentleman very well knows, while 97% do not. After these changes, it will be 2.25%. That is the difference between the policy that we are advancing and the policy as it now is. We are not abolishing jury trials, and I am not prepared to see victims of violence against women and girls repeatedly let down. That is what happened for 14 long years, and it is not good enough. I set my face against that and I am doing something about it.
Steve Witherden (Montgomeryshire and Glyndŵr) (Lab)
The Prime Minister
I am very proud of our Employment Rights Act 2025. It delivers strong rights and protections, including for all our brilliant school staff. My hon. Friend is right: Reform Members would rip up those protections. They have nothing to offer but grievance and division, and they have no judgment: just like the Leader of the Opposition, the hon. Member for Clacton (Nigel Farage) has said that we should do “all we can” to support the US strikes. He said:
“I make that perfectly, perfectly clear.”
It was perfectly, perfectly clear that he got it completely wrong, and perfectly, perfectly clear that he is now desperately trying to U-turn. Absolutely no judgment: not fit to be Prime Minister.
Nigel Farage (Clacton) (Reform)
The Prime Minister
Oil and gas will be part of the mix of our energy for many years to come, as I have set out many times. The hon. Member is now highlighting the consequences of the war that he said we should rush into. He wanted us to go to war. He said it was “perfectly, perfectly clear” that we should support the strikes. Then, just like the Leader of the Opposition, a week later he said, “Oh no, I got that one wrong.” You cannot make mistakes about decisions as serious as committing to war. It is a gross error.
Noah Law (St Austell and Newquay) (Lab)
The Prime Minister
I am very happy to discuss that with my hon. Friend. We will always protect high welfare standards, and, through our food and drink deal, we are bringing down barriers for farmers selling to our largest market. Alongside our record £11.8 billion farming budget and investment in cutting-edge innovation, our farming profitability review is focused on boosting profitability. I have already acted and set up the farming and food partnership board, investing £30 million in our farmer collaboration fund.
Greg Smith (Mid Buckinghamshire) (Con)
The Prime Minister
I thank the hon. Gentleman for raising this matter. I know how much it impacts his constituents and how deeply they feel about it. It is important, as we reset and clear up the mess that was left, that we have in our mind’s eye those who are most affected, and make sure that it is fair and that their voices are heard, and we will do so.
Oliver Ryan (Burnley) (Lab/Co-op)
The Prime Minister
My hon. Friend is a great champion on this issue and I will ensure that he gets a meeting with the Rail Minister to discuss the detail. The previous Government took the decision not to shortlist Burnley Manchester Road station for accessibility improvements. We are giving Lancashire combined county authority £641 million, with the freedom to invest in its priorities, including better accessibility. That is what a Labour Government represent: empowering local people to make the best decisions for their local area.
Mr Andrew Snowden (Fylde) (Con)
The Prime Minister
We have set out the process and it has been put before the House—[Interruption.] I know why Opposition Members do not want to talk about the war: because they supported going into the war, without thinking through the consequences. That is a huge error of judgment. I realise that they do not want to talk about it ever again—I am not surprised. Nor do they want to talk about the shadow Justice Secretary saying that Muslims are not welcome to pray in Trafalgar Square. The Leader of the Opposition should remove him from the Front Bench, or I suspect he will be sitting up on the Reform Bench next.
Matt Bishop (Forest of Dean) (Lab)
As the Prime Minister mentioned earlier, the chief executive officer of Travelodge has today again refused to attend a meeting with Members of this House and the other place to answer serious concerns about guest safety and safeguarding. This refusal only deepens the lack of trust in the company’s commitment to protecting women and vulnerable guests. Will the Prime Minister meet me and invite the CEO of Travelodge to discuss the issue? Will he join me in urging the CEO to explain directly to all parliamentarians why she is unwilling to face scrutiny on such an important matter?
The Prime Minister
I thank my hon. Friend for raising this issue, and he has raised it with me personally. Our thoughts are obviously with the victim. I was very concerned to hear that the CEO of Travelodge cancelled the meeting with MPs and I would urge them to reconsider. That meeting needs to go ahead with relevant MPs and with the relevant Minister, and the sooner it goes ahead the better. I hope that the CEO of Travelodge is listening to this exchange. I thank my hon. Friend for raising the issue, not just on this occasion but on repeated occasions.
Points of Order
(1 day, 4 hours ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate
Sir Julian Lewis (New Forest East) (Con)
On a point of order, Mr Speaker. You have clearly explained that you are not responsible for the quality, or lack of it, in a Minister’s answers—or even a Prime Minister’s answers—but can you explain for the benefit of the House and the viewing public what Prime Minister’s questions is supposed to be about: namely, that the Opposition and other right hon. and hon. Members get to ask the Prime Minister a question about a subject of their choice, and that it is not an opportunity for him to then berate them for not asking a question about a completely different subject that he wishes had been asked?
Mr Speaker
As a long-standing Member who came in with me in 1997, the right hon. Gentleman knows that that is not a point of order.
Paul Holmes (Hamble Valley) (Con)
Further to that point of order, Mr Speaker. Notwithstanding the rulings that you have made from the Chair, which I think are always perfect and completely right, we are now entering a new period in which a Prime Minister answers a question about a subject that was not asked and then focuses on asking a question of the Opposition Front Bench. Notwithstanding the ruling that you have just made in response to my right hon. Friend the Member for New Forest East (Sir Julian Lewis), can you tell me what parliamentary mechanisms there are and who I can approach to see whether the Standing Orders need to be reformed to give you the power to determine what is an answer to a question and what is a completely pathetic response?
Mr Speaker
There is a real weakness in that, because there is an assumption that the person knows the answer. I will leave it at that.
Dawn Butler (Brent East) (Lab)
On a point of order, Mr Speaker. You are also not responsible for the questions asked. The Leader of the Opposition said that it was following British values to attack Muslims praying. I just wonder if that brings this House into disrepute in regard to British values.
Mr Speaker
This is an important point: we need tolerance, and it is about respecting one another. You have put your point on the record, but I am not going to enter into a debate. I will leave it at that for the moment.
Sir John Hayes (South Holland and The Deepings) (Con)
On a point of order, Mr Speaker. Further to the point made by my right hon. Friend the Member for New Forest East (Sir Julian Lewis), and notwithstanding your ruling, Mr Speaker, “Erskine May” makes it clear that Ministers come to the House to answer questions, does it not? While the Standing Orders might need refining, do they not already make it clear that that is the purpose of the sessions that we have daily and, in the case of the Prime Minister, weekly?
Mr Speaker
Sir John, you are just continuing a debate that I think I have already given the answers to. We will leave it at that.
Menstrual and Gynaecological Health
(1 day, 4 hours ago)
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Ms Abena Oppong-Asare (Erith and Thamesmead) (Lab)
I beg to move,
That leave be given to bring in a Bill to make provision about the teaching of menstrual and gynaecological health in certain educational settings; to provide for training, guidance and resources to support such teaching; to provide that training includes content about awareness of racial discrimination in menstrual and gynaecological health; to require the Secretary of State to take steps to increase public understanding of menstrual and gynaecological health, including measures to counter inaccurate or misleading information online relating to menstrual and gynaecological health; and for connected purposes.
In this Bill, I am addressing one aspect of women’s health: menstrual health. Menstrual health is surrounded by misinformation, fear and a failure to support millions of women and girls. For women who menstruate, their experience of asking for advice or even medical treatment is routinely dismal—ask any woman from their school days onwards. It is a nightmare of stigma, shame and a failure of the NHS to help. The recent Women and Equalities Committee report states:
“Stigma around menstruation, sex, fertility and childlessness is a barrier to discussion of reproductive ill health. It contributes to delays in diagnosis and treatment, and can lead women and girls to turn to online forums to self-diagnose or to avoid seeking treatment altogether.”
That self-diagnosis can be misguided and dangerous, fed by dubious online claims and fake cures. The internet is not a safe place for clear expert advice for girls and women wanting to know about their periods and menstrual health.
A poll commissioned by the Royal College of Obstetricians and Gynaecologists found that more than half—53%—of women in the UK who had experienced symptoms of pelvic floor dysfunction did not seek help from a healthcare professional. One in five—21%—felt too embarrassed to seek support. In 2018, a YouGov poll found that period shaming happens at home, in the workplace and at school in the UK.
The Royal College of Obstetricians and Gynaecologists further noted:
“There is an immense societal pressure on women and girls to conceal their periods due to beliefs that menstruation is unhygienic or unclean, and talking openly about periods is often not considered as a social norm.”
We live in a modern-day society with an openness to addressing all manner of health issues, including mental health, yet talking about menstrual health remains stigmatised, shrouded in shame, embarrassment and the frankly medieval attitudes held by many.
In the call for evidence for the women’s health strategy, 29% of respondents said that they did not feel comfortable talking to healthcare professionals about gynaecological conditions. For teenage girls aged 16 and 17, that figure rose to 40%. Those shocking figures show that this stigma has real-world consequences for women’s health. Women and girls get the wrong advice, dangerous advice or no advice. Their shame means that their conditions and diseases are not diagnosed. Sadly, conditions such as endometriosis, adenomyosis, fibroids, polycystic ovary syndrome, pelvic inflammatory disease, pelvic organ prolapse and ovarian cysts are far too often missed, leaving many women to endure years of unnecessary pain.
The time to receive a diagnosis of endometriosis has actually gone up, not down, with women waiting on average nine years and four months. For women of colour and women from other ethnic minority backgrounds, the average wait for diagnosis is 11 years. We might wonder, “Why are women of colour waiting longer?” Well, I am afraid to say that we suffer discrimination in the health system. Our pain is dismissed and our concerns are ignored. Well-documented bias is embedded in the NHS when it comes to black women’s health, leading to poorer outcomes and terrible experiences for so many women.
We must address the cultural assumptions in some communities that tell girls that periods are a punishment, dirty, something to be ashamed of or something to be kept as a secret. A dangerous cocktail of misogyny, misinformation and myth is leading to girls and women being misinformed, mistreated and misdiagnosed. My Bill aims to tackle that stigma and get society talking about periods and menstrual health. Let us smash the stigma, starting in schools, with teachers being well-equipped to support their pupils. No schoolgirl should suffer in silence.
Let us use the roll-out of more diagnostic hubs and the shift to more community-based preventive care to raise awareness about menstrual health. We need more public awareness campaigns, on the same scale as the NHS sepsis campaign, for not just the public, but medical professionals from the very start of their careers. Every doctor needs proper training in menstrual health to spot endometriosis, fibroids and other gynaecological conditions early; to give proper advice to their patients; to debunk online myths and misinformation; and to be aware of and tackle racial bias in the healthcare system.
We need every employer to be aware of menstrual health, to have proper systems of support in place in the workplace, to have period products available for free, and to recognise that if a woman needs time off because of their blinding pain, they are not making it up. I welcome the work of the TUC and the trade unions in this area.
We also need to have more difficult conversations. We need more men squirming in their seats as we discuss our periods, our bleeding and our pain, and we need to stop talking in euphemisms—all those silly little terms about periods that disguise the reality and stop an open conversation. We need not only more women’s voices to be heard, but women to be actively leading the design and delivery of the healthcare system. The NHS must no longer be male by default. I speak to so many women and girls who have been let down and whose mental and physical health have been damaged. This must stop.
The upcoming women’s health strategy must be more than a document; it must be a manifesto for revolutionary change—what is the point of it otherwise? There must be no more girls crying in changing rooms, no more workers hiding in toilets, and no more shame.
Question put and agreed to.
Ordered,
That Ms Abena Oppong-Asare, Marsha De Cordova, Olly Glover, Paulette Hamilton, Carolyn Harris, Christine Jardine, Tulip Siddiq, Valerie Vaz, Gill Furniss, Kirsteen Sullivan, Simon Hoare and Sir Alec Shelbrooke present the Bill.
Ms Abena Oppong-Asare accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 17 April, and to be printed (Bill 409).
Opposition Day
Fuel Duty
(1 day, 4 hours ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
16:00 - The House divided: - Ayes: 103 / Noes: 259 - Question accordingly negatived.
Mr Speaker
I inform the House that I have selected the amendment in the name of the Prime Minister. I call the shadow Secretary of State.
Mr Richard Holden (Basildon and Billericay) (Con)
I beg to move,
That this House believes that it is wrong to increase the main fuel duty rates on 1 September, then again on 1 December 2026, with a further increase on 1 March 2027, by a total of five pence per litre, as global oil prices are rising; notes that these increases will affect drivers, farmers, businesses and other hard-working people already struggling with higher taxes and higher cost of living as a result of the Government’s economic policies; and calls on the Government to maintain the five pence per litre cut to the main fuel duty rates introduced by the previous Government beyond September 2026.
Once again, this House has come together to hear of yet another egregious tax on transport, pushed out by this Labour Government at a time when people across the country are worried about the cost of getting around. On this occasion, in their infinite wisdom, the Government have decided that this is the opportune time to cancel the fuel duty freeze that the last Conservative Government kept for 13 years, which protected hard-working people from paying extra to get to work, attend appointments and visit friends and family. The Conservatives cut fuel duty by 5p per litre in 2022—the biggest ever cut in fuel duty—which really helped when the economy was facing headwinds from Russia’s illegal invasion of Ukraine.
Under this Government, though, on top of the countless tax rises that they have already shafted us with, we cannot even get through two years before they decide that the British people need yet another tax rise. It is a tax rise that is being introduced in a sneaky and stealthy way. Labour is deploying its salami tactics—1p in September, the back to school tax; 2p in December, the Christmas shopper tax; and 2p in March, springtime for taxes. We should not forget that a 5p per litre increase in duty is actually a 6p per litre increase, because VAT is added on top of that tax.
In September last year in this Chamber, the Transport Secretary trumpeted that Labour had
“frozen fuel duty—that is what we have done”—[Official Report, 11 September 2025; Vol. 772, c. 1021.]
Yet we know that is simply not the case. It reminds me of my childhood, watching Chris Tarrant on “Who Wants to Be a Millionaire?” saying, “But we don’t want to give you that.” The Transport Secretary has said that tax rises are now coming, not once or twice, but three times: in September, in December, and in March next year. With economic growth at a dismal 0%, the British people deserve better than underhand tactics swindling them out of the pounds in their pockets to pay for more welfare. It is a tax on every car, every van, every motorbike and every bus, and it is also a tax on hauliers, businesses and families—it is a tax on the country as a whole. Thanks to the Transport Secretary’s Government, those families will be forking out an extra £156 a year.
Jim Shannon (Strangford) (DUP)
I congratulate the shadow Secretary of State and the Opposition on securing this debate. It is important that we consider this matter, as we are fast approaching a crisis that cannot be circumnavigated. Does the shadow Secretary of State agree that the Government must consider reopening North sea production to produce enough for our needs, if they continue to refuse to play their part in securing fuel elsewhere? Does he not agree that fuel duty would benefit from self-reliance, rather than dependence on volatile nations, as we have at this very moment?
Mr Holden
I could not agree more with the hon. Member. We need to get back to drilling in the North sea. Norway is drilling on one side of the same basin and getting the benefit of those jobs and the tax revenue. It bemuses me why we are not doing that here. The shadow Energy Secretary, my right hon. Friend the Member for East Surrey (Claire Coutinho), has consistently said from these Benches that that is exactly what we should get on and do.
Graham Stuart (Beverley and Holderness) (Con)
My right hon. Friend makes a powerful point about North sea oil and gas extraction. The Labour party says that will not make any difference to the global price of oil and gas, but billions and billions of pounds in tax will be lost as a result of having no new licences in the North sea. Those billions could be used to replace the revenues generated by fuel duty. In fact, if the Government wished, they could convert those billions into cuts in price at the pump for every single family in the country, including those in rural Beverley and Holderness who are suffering today.
Mr Holden
My right hon. Friend makes an incredibly important point. The Government are forgoing tax revenue that is going into the coffers of other Treasuries right across Europe and across the world, but why? To what end? We will see whether Ministers will answer why they are willing to forgo hundreds of thousands of jobs and billions of pounds every year. [Interruption.] They could spend that on anything they wanted to, and they are not even going to do it.
Mr Speaker
Order. Parliamentary Private Secretaries are not there to chirp all the way through and give solutions to a problem. I have great confidence in the Minister’s ability to answer when he comes to speak.
Dr Andrew Murrison (South West Wiltshire) (Con)
Does my right hon. Friend agree that the Government’s policy fails on its own terms, because they say they want to subscribe to net zero and make us much greener in how we approach our energy consumption, yet we know that importing liquefied natural gas from countries such as the US has a carbon cost that is a multiple of extracting the stuff in this country within our own territorial sea? If the Government are serious about net zero, they would therefore be pumping LNG from the North sea, not importing it from the US.
Mr Holden
My right hon. Friend makes an incredibly important point, and he makes it clearly. He is in agreement with the Climate Change Committee, which says that we will have to be using oil and gas well in to the second half of this century. Why on earth should we not drill our own at lower cost and bring in those jobs and taxation, while getting the environmental benefits of doing it on our own doorstep under British regulations? It would not be extracted in other countries with lower regulations and lower environmental standards. The best environmental standards in the world exist in our North sea.
Mr Louie French (Old Bexley and Sidcup) (Con)
Part of this debate is about sustainability and net zero. Colleagues have already made a number of interventions on that, and I understand the shadow Secretary of State’s position. Does he agree that while we are focusing on the hike in fuel duty, the Government are also increasing the charges on electric vehicle drivers? Both sets of drivers are being hammered by this Government, who have not thought through the consequences of their policy.
Mr Holden
My hon. Friend makes an interesting point at this juncture. It is clear that the Government are trying to undo the damage they have done with their new tax. They are having to put more money into the electric car grant than they will get out from these pay per mile schemes, which they had previously said they would not introduce. The Government are costing themselves more money by imposing a tax. Whether it is the North sea or taxation policy, what they are up to is incredible. The TaxPayers’ Alliance has said that, after this tax hike, the average driver will pay almost £40,000 in fuel taxes over their lifetime, and it will be a higher proportion of someone’s income if they are in a lower paid job and need a car to get about.
Matt Western (Warwick and Leamington) (Lab)
The shadow Secretary of State is talking about how money may be spent from taxation. I highlight that local authority road maintenance budgets halved from £4 billion to £2 billion in the 13-year period from 2006 to 2019. If we look at inflation, Bank of England data shows that from 2006 to 2026, overall inflation ran at 74%, but fuel inflation was just 58%.
Mr Holden
Indeed. On the hon. Member’s second point, inflation would have been higher overall if fuel inflation had been higher overall. He makes an important point about potholes and road maintenance. It is interesting that he stood on a manifesto at the last general election that promised to fill an extra million potholes a year. We saw the figures just a few weeks ago showing that exactly the same number of potholes were filled last year as were filled in the last year of the previous Government. I look forward to seeing his Government starting to deliver on any of their pledges. Perhaps they could do so a bit more easily if they had that tax revenue coming in from the North sea, as those on the Opposition Benches would like to see.
This is Labour’s regressive tax raid. Do we expect those on the Government Benches to understand just how punitive this tax measure will be? Of course not. How could they understand, when it is rural communities that will be hit hardest, as it always is with transport? The truth is that the Department for Transport and the Treasury working together is more like watching an episode of “Hustle”. The con is on, and it is being perpetuated by this Labour Government.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
Does my right hon. Friend agree that in large rural constituencies such as mine, it is not just about constituents having to pay additional fuel duty at the pump, because they also pay it through everything they buy? Everything has to be transported into these rural areas, and there are services that they require. They therefore pay twice, which makes this tax rise doubly regressive.
Mr Holden
My right hon. Friend raises an incredibly important point. It is not just those who have a car who will be paying for this policy—although they will be paying the most—and it is not just those who rely on a van for their business or work to get around who will be paying; everyone will be paying, whether they use the bus or are just going to the shops. The truth is that everything has to be transported by road in this country. This tax rise will have huge inflationary pressures right across the board, not just for fuel, whether for heating or for road transport, but, as he is right to say, for so many other areas—areas that have not even been considered by the Treasury.
Dr Luke Evans (Hinckley and Bosworth) (Con)
All my right hon. Friend’s arguments stand, and that was true before the war in Iran. The Prime Minister stood there on Monday saying that the freeze is still in place, but the world has literally changed around us. Does my right hon. Friend share my concern that this Government are not being reactive and following the change? There will be a big impact and a knock-on effect, and the Prime Minister is touting this policy as though it is new, when it was in the Budget last year.
Mr Holden
My hon. Friend makes an important point. He will be aware that when the fuel price goes up, the Government’s VAT revenues from fuel go up at the same time. They are already seeing hundreds of millions of pounds a year extra in VAT, purely from the fact that the underlying price has gone up. My hon. Friend makes another important point, which is that this is a moment for the Government to reconsider. We on the Opposition Benches opposed this measure at the Budget, because we thought hitting working families was the wrong thing to do, but it is doubly the wrong thing to do when prices are also going up internationally.
Carla Lockhart
Does the right hon. Gentleman agree that the £53 million is welcome, but that calculates to about £35 a household, which is nothing in the grand scheme of things? Does he agree that fuel duty should be cut, VAT should be removed and the North sea opened up? That should come alongside dealing with fertilisers and red diesel, which are heavily impacted too. We need support for people now.
Mr Holden
The hon. Lady raises an important point. As she suggests, the tax revenues from reopening the North sea for oil and gas could be spent in a number of ways, but we have to open the North sea—a cost-free and environmentally positive alternative—to obtain those revenues, and then we can consider all the different ways in which Members across the House would want to spend the money.
Since the Labour Government came to office, we have seen just how much they have hit transport across the country. The fuel duty rise of 5p a litre is just the latest example. First they abolished the much-loved £2 bus fare cap, which the Conservatives had pledged at the general election to continue for the entirety of this Parliament: they have put bus fares up by 50%. They have also jacked up airport business rates, by a staggering average of 295%. Who is benefiting from that? Certainly not passengers, certainly not the airlines, and certainly not British business. They have also raised air passenger duty, with passengers facing a 15% jump in one year alone, followed by permanent increases, year after year after year, of between 3% and 4%, just to get on to a plane.
In the last few weeks the Government have raised the price of railcards for the first time since—[Interruption.] Perhaps they would like to chunter about this one. Do you remember this one, guys? We hear nothing from them on this. They have raised those prices for the first time since 2013—the first time for more than 10 years. They have increased the price of senior railcards, veterans’ railcards, young people’s railcards. New taxes on people throughout the country are being raised by this Government. We are seeing a 16% rise for the first time since 2013, and they did not even know about it, because they do not care about young people, about old people, about those who are being affected by the tax rises that will be hitting people all over the country from September onwards.
Labour has also just introduced a new policy that will leave ferry passengers on the Isle of Wight facing bigger crossing charges: £30 more per crossing. That will hit family holidays in the UK, and it will hit people from the Isle of Wight who are just trying to go about their daily lives. Labour is stealthily—
Blake Stephenson (Mid Bedfordshire) (Con)
Is it worth emphasising that the Conservatives froze fuel duty for 14 years, which took £100 billion off the cost of driving? That is an example of taxes that we cut over those 14 years. In contrast, this Government have increased taxes by £66 billion in the past two years. Is it not outrageous?
Mr Holden
My hon. Friend is right, and some of those tax rises are hitting many of the companies that will also be hit by these fuel duty rises. I have spoken to hauliers, in my constituency and across the country, who already face increasing business rates and increasing national insurance costs and are now being hit with a fuel duty rise as well.
Harriet Cross (Gordon and Buchan) (Con)
My right hon. Friend is making a great speech, as we always expect from him. Does he remember that, for the 2024 Budget, the Chancellor stood there and said that increasing fuel duty would be the wrong choice for working people? She said then that that was because of uncertain global events, and that the cost of living remained high. Does my right hon. Friend remember anything changing between 2024 and now? I do not think that the position has got any better—does he?
Mr Holden
My hon. Friend is entirely right. She is also a real champion for the North sea oil and gas sector, which is largely based in her constituency.
What are we seeing on top of those taxes on railcards, ferries and airlines—through increased airline business rates—and, obviously, the 50% hike in bus fares? What else is Labour up to? Well, the Government have been talking quite a lot about something called “simpler fares.” What they are actually doing is cutting out the cheaper fares preferred by passengers and replacing them with more expensive ones. That has been confirmed, in a letter to me, by none other than the Secretary of State for Transport, who I note is not present today. She says:
“Some passengers may pay more under this new structure but will gain”
—perhaps—
“more flexibility for their return journey”.
Well, my constituent Mr Nottage, of Ramsden Bellhouse near Billericay, has been quite perturbed about having to pay an extra 10%, and he is having to pay an extra fiver a year for his senior railcard as well. That hardly suggests that rail prices have been frozen under Labour. In fact, rail prices are going up for working people across the country.
Mr French
My right hon. Friend is making a passionate speech about the increase in rail fares for his constituents in Billericay, but he will be aware that drivers in Billericay, like those on the south side in Bexley, have also faced increases in the Dartford bridge charge, which this Labour Government hiked by 40% last September. Sadiq Khan has introduced the Blackwall tunnel charge for those trying to travel from east to south and in the other direction, and the ultra low emission zone has been expanded for those who need to travel into London—again, against the wishes of people in outer London. Does my right hon. Friend agree that the problem is not just the Government’s increased taxes on drivers, but the increased taxes from the Mayor of London on everyone on the outskirts of London who needs to travel in and out?
Mr Holden
That is an extremely important point. This is not just about the Labour Government; it is also about Labour mayors and Labour councils and their war on motorists up and down the country, whether it is the Dart charge or the ULEZ charge. We have even seen Zipcar having to cease operations in the UK because of the Mayor of London’s extension of that congestion charge to electric vehicles every day. We are actually seeing a reduction in shared transport options under this Labour Government and this Labour Mayor, here in our capital city, and it is an absolute disgrace.
Mr Holden
I am sorry, but I need to make a little more progress, but I will happily come back to my hon. Friend later.
However we travel, Labour is after us. Is it a boat? Is it a train? Is it a plane? No, it is Labour’s taxman coming for us. And where will this money be spent—all the extra money from Labour’s taxes on the public? It will not be spent on hard-working families or to create jobs and boost opportunities; it will be frittered away on more welfare, because this Prime Minister and this Government Front Bench are too weak to stand up to their own Back Benchers and ensure that welfare is kept under control. They are picking the pockets of hard-working people to pay for those who choose not to work.
When it comes to paying at the pump, Rachel Reeves has been happy to try to lay the blame at the feet of the petrol stations, but what makes up most of the cost of a litre of petrol? Her fuel duty is by far the biggest chunk. In fact, taxes make up 55% of the cost of fuel, and it is going up under Labour. When the Energy Secretary was presented with these sickening statistics, he claimed:
“That’s why we’ve frozen fuel duty.”
Why on earth do the Government not do what we did by freezing it all the way through? They could do it today, but they are not going to do it because they are too afraid of their own Back Benchers when it comes to welfare. I am surprised that Members are aligning themselves with the spluttering spinelessness of Mr Miliband—I am sorry; I mean the right hon. Member for Doncaster North. We know that for her and Ed, when the facts change, when countries all around the world change, Labour just digs in.
Mr Speaker
Order. You have referred to “Rachel Reeves”, but she is the Chancellor of the Exchequer. I do not think that “Ed” is quite the right title either, and I know that you would not want to get that wrong.
Mr Holden
Of course not, Mr Speaker. The right hon. Member for Doncaster North (Ed Miliband) should always be given his proper title.
This is very similar to the Government’s pathetic intransigence when it comes to the zero emission vehicle mandate. They remain entirely aloof, soldiering on, whatever the cost is to British companies, British workers and British taxpayers. This is just like the electric car mandate, with its impact on industry. The unions—Labour’s own paymasters, for crying out loud—the Financial Times, and even the renewables sector: everyone knows that we must have a change in the electric vehicle mandate. Everyone on the Opposition side of the House also backs driving ahead with North sea oil and gas exploration, but what do the Labour Government do? They just bury their heads in the sand and turn to taxation instead in order to pay for their policies.
Mr Speaker
Order. Mr Stuart, can you make a better effort than just waving your hand? You are not at a taxi rank. Is the shadow Secretary of State giving way to Mr Stuart? There you are, Mr Stuart: he is giving way to you. If you get off the seat, it might help.
Graham Stuart
I do not know whether I am being picked on or specially singled out, but in any case, Mr Speaker, thank you for selecting me.
One aspect that my right hon. Friend has not mentioned today is the Clean Power 2030 action plan. Bringing it forward from 2035 means that we are overpaying for the renewables, and locking in those overpayments for 20 years. Does my right hon. Friend agree that, along with the immediate negative impacts on our economy and, most importantly, on our constituents, locking in long-term contracts for overpriced renewables will increase the cost of living even further?
Mr Holden
That is another important point, which has also been raised with me by companies such as electric vehicle charge point manufacturers here in the UK. Some of them are on the verge of collapse because of that high cost of electricity. Although the Government say that they are pursuing a green agenda, what they are actually doing is making electricity so expensive that no one can operate a business in this country without paying such high energy prices that it becomes uneconomical to do so.
Dave Doogan
The shadow Secretary of State mentioned his perception of the intransigence of this Labour Government, to which I would add their brittle hubris in their pursuit of not achieving any form of economic growth. Does he agree that the Chancellor would not have to keep dipping into the pockets of hard-working people in the midst of a cost of living crisis if she had a clue about how to achieve economic growth?
Mr Holden
It is not often that I agree with an SNP spokesperson, but I very much do so today. The hon. Member makes an incredibly important point. The Labour party came to office talking about how growth was its No. 1 priority. Has anybody heard Ministers, or heard the Parliamentary Secretary to the Treasury, the hon. Member for Swansea West (Torsten Bell), say that on the telly recently? I certainly have not. Their talking point has, sadly, been put to one side, and we can all see why. On their watch, growth has totally collapsed, inflation has gone up and unemployment has gone up. Growth has collapsed on his watch. For all of his high-falutin’ ideas, he is a member of a Government who have collapsed growth in this country, and he cannot even accept it.
Mr Holden
No, I have already given way to the hon. Member.
We in the Opposition are all praying for a U-turn on the fuel duty policy, which would be very welcome. We would rather that they had never come up with the policy in the first place because, just as with the previous 16 U-turns, we argued against each policy before the Government did it, and they then had to U-turn on them. Just as on the family farms tax, on which they have partially U-turned, the grooming gangs, on which they have U-turned, and winter fuel, on which they have had to U-turn, after sticking the boot in, we really hope they will think again about this, but I am not holding much store by that.
What is really worrying me and families and up and down the country, as well as Opposition Members as they go back to their constituents, is that people are facing cost of living pressures right across the board. Those running businesses are really having to make decisions about whether they hire another person or in many cases, sadly, let people go because of the taxes already imposed by this Government. This is just another tax—another tax on businesses, pensioners and families up and down the country.
Dame Caroline Dinenage (Gosport) (Con)
Gosport is not a rural area, but it is reportedly the largest town in the UK without a railway, so people rely on their cars to get around. We all know that the Chancellor cannot control events in the middle east, but being in government is about making choices. Does my right hon. Friend agree that the choice is whether we are going to keep punishing traders who have already had so much punishment from this Government, and keep punishing people who do not have a choice about using their cars?
Mr Holden
My hon. Friend makes the really important point that this is about choices. She is also right that many people do not have such a choice about their cars, and nobody has a choice about going to a shop to buy food, which will be delivered by some form of road transport at some point. So everybody will be paying for Labour’s road tax or fuel duty increases, and that is what we are opposing today.
My hon. Friend the Member for Gosport (Dame Caroline Dinenage) makes a broader point on the choices that this Government are making about on whose backs they are balancing the books. They are choosing to balance the books on the backs of working Britain. Businesses up and down the country are facing tax after tax and new bill after new bill, in the Government’s relentless pursuit to do our country down and throttle anything that seems to give a half chance of delivering growth, all to pay for a ballooning welfare bill. They would put Dumbo to shame, because they do not have the guts to reduce welfare—heaven forbid—and they do not even have the guts to try to slow the pace of the increase in welfare.
We voted against tax hikes in the Budget because they are the wrong thing to do for growth in our country and for families in our country. We are voting against a tax hike today because of the circumstances now. Especially with an international environment of soaring prices, to saddle motorists with an extra hike in the cost of getting around is the wrong thing to do. That is why the Leader of the Opposition tabled our motion, and why we are urging right hon. and hon. Members across this House to say no to Labour’s hikes on fuel duty.
The Parliamentary Secretary to the Treasury (Torsten Bell)
I beg to move an amendment, to leave out from “House” to the end of the Question and add:
“recognises that, at the Autumn Budget 2025, the Government extended the five pence per litre fuel duty cut for five months and cancelled the inflation linked increase for 2026-27; welcomes that Fuel Finder helps consumers compare prices and encourages competition and that the Government has ensured that all UK petrol filling stations must report prices within 30 minutes of a change; notes that HM Treasury will continue to work with the Competition and Markets Authority on behalf of consumers; and further notes that the Government keeps fuel duty under review and that a rapid de-escalation in the Middle East is the best way to keep prices low at the pump.”
I thank the shadow Secretary of State, the right hon. Member for Basildon and Billericay (Mr Holden), for opening this debate. The Government recognise that fuel costs matter enormously to people right across the country. Fluctuations in pump prices cause fluctuations in working people’s bank balances. The effects are real and, as we have heard, widespread; about 80% of us drive each week. That is why the Government have already taken action to ensure that fuel remains affordable. In November’s Budget, we extended the temporary 5p per litre cut to fuel duty for a further five months. Additionally, we cancelled the inflation-linked increase planned for 2026-27. Our fuel duty changes will save the average motorist over £90. In 2026-27 alone, a van driver will save an average of £100, rising to more than £800 for heavy goods vehicle drivers.
Torsten Bell
I will make a bit of progress, and then I am sure I will give way to the right hon. Gentleman, who is always very enthusiastic. He did actually stand up on this occasion. That is what a learning curve looks like—it is a shame Conservative Front Benchers have not found one in 14 long years.
Torsten Bell
That was not the best; there is much more to come. I am enjoying the enthusiasm.
Sector-specific support continues for the likes of agriculture and horticulture, which retain access to red diesel, after it was withdrawn from most sectors in 2022. Our extension of the temporary 5p fuel duty cut includes a proportionate reduction for rebated fuels, including red diesel.
As the shadow Secretary of State noted, the context is that we are entering the third week of the ongoing conflict in Iran, the effects of which have spread directly across the middle east and indirectly around the world. In responding to that conflict and those effects, the Government’s priority will always be the national interest. The immediate focus is on protecting British nationals in the region, and taking necessary action to defend ourselves and our allies. That is supported by the Chancellor’s decision not just to deliver the biggest uplift in defence spending since the end of the cold war, but to approve access for the Ministry of Defence to the special reserve to deploy additional capabilities to the middle east.
Graham Stuart
I am grateful to the Minister for giving way. With the strait of Hormuz in effect closed, does that not prove the point we have been making for years, which is how important it is for our energy security to have new licences in the North sea? The Minister is known as “Torsten Tax”, so I will ask him about tax. Does he accept that not having new licences in the North sea will lose this country billions in tax revenue—yes or no?
Torsten Bell
Our position is to deliver a stable transition. That was the position of the Conservative party. It is the party that introduced the energy profits levy. [Interruption.] I will answer the question. Gas and energy from the North sea will be part of the energy transition in the UK for some decades to come, as several Members have mentioned. That is why the Chancellor met the industry in recent days, and why we are setting out proposals to allow tiebacks that will help us get gas out of the ground in the near future. Longer-term changes will take significantly longer, but none of what I have heard from Conservative Members is an excuse for rejecting the tens of billions of pounds of renewable energy investment that is important for delivering domestic energy security for this country.
Sir Julian Lewis (New Forest East) (Con)
I like the Minister very much, not least because he represents the Welsh seat of my birth and upbringing, and because I have such respect for him, I am going to try to make the point to him that I have so far made with zero success to the Chancellor of the Exchequer, among others. It is all well and good to talk about the greatest increase in spending on defence since the end of the cold war if we are comparing the post cold war period with what is—shall we say?—a quiet defence period, but we are not. What we need to spend now is not to be compared with what it was like after the end of the cold war, but what it was like during the cold war, and during the cold war we regularly spent between 4.5% and 5% of GDP on defence. If he recognises that there is some merit in that argument, could he try to persuade his colleagues to stop making that false comparison?
Torsten Bell
I thank the right hon. Member for his kind remarks, even if they were driven by geography rather than personality. I will take what I can get in today’s debate! Since we are being kind to each other, I recognise the point he makes about the significant uncertainty we face in this world today. That uncertainty always existed to a significant extent, if we are honest, and I think most Conservative Members realise that defence cuts year after year in the last decade were a mistake—
Torsten Bell
The right hon. Member is nodding. So I would offer that by way of comparison.
Torsten Bell
I will make a bit of progress, and then take some interventions.
As I was saying, we are providing additional capabilities to the middle east, but I want to be clear that the UK will not be drawn into a wider war. We on the Labour Benches have been clear about our approach. We are in the business of protecting British nationals, not of trying to deliver regime change from the air. We need to de-escalate the conflict and we are playing our part in doing so, but the full economic impact of the conflict will of course depend on its severity and duration. Recent events have led to significant increases in oil and gas prices. As of this morning, oil prices remain over $100 per barrel and gas prices at 129p per therm.
Harriet Cross
Yesterday, the Chancellor said it was great that Norway and Canada were increasing their production of oil and gas, and congratulated them doing so. And who could disagree with that—other than, seemingly, herself and the Cabinet? Does the Minister agree that, along the same lines, we should be increasing our production from the North sea and lifting the ban on North sea licences?
Torsten Bell
As I have said, oil and gas will be with us for some time. [Interruption.] Let me finish. That is why the Chancellor met the sector. [Interruption.] I hear all the chuntering from Opposition Members, but I did not hear as much chuntering when we saw a 70% fall in jobs in the North sea on their watch. [Interruption.] That is the truth of what you delivered. Now, on top of that, you are trying to double down. The Conservative party is doubling down on opposing investment in renewable energy, threatening those jobs. The Labour party believes in domestic energy security delivered by a range of sources, including the nuclear that the Conservatives failed to invest in.
Mr Speaker
Order. The Minister has been saying “you”, but I am not responsible for these things; I would not want that responsibility.
Simon Hoare
We see you as responsible for everything, Mr Speaker!
The Minister was clearly right to point out the inflationary cost pressures as a result of the Iranian situation. He might be reminded that the announcement the Chancellor made on the increase in fuel duty predates that situation. Were it not to have been made, and given the impact that we are seeing on, among other things, fuel costs from Iran, would he and the Chancellor be thinking that now is a good time to make an announcement about increasing fuel duty? The world has changed and surely this policy should change as well to reflect the immediacy of the situation.
Torsten Bell
I thank the hon. Member for his question and his invitation to discuss some hypotheticals. I would just point out that it is only next week that the policy of extending the 5p freeze comes into effect. Fuel duty will be frozen until the end of August this year. That is the position as it is. I will turn later to how we think about the future, because that is a fair question, but the policy I am talking about comes into effect next week exactly.
Simon Hoare
There are a huge number of families up and down the country who manage their household budgets incredibly tightly. They will be thinking about whether they can afford a holiday this year and so on. I appreciate that August seems a long way away, but many of those people will be sorting out their budgetary plans now. I am not certain that those “just about managing” families, as we used to call them, can wait until August for any clarity or certainty. Do not play cat and mouse with the British people; take the sensible decision now, and press pause to reflect the dramatic change in circumstances we are seeing.
Torsten Bell
I completely agree with the hon. Member that families up and down the country are worried about what they are seeing on their TV screens about the conflict in the middle east—maybe because they know people directly, but also much more universally about the effect on all of us and on their budgets—and they expect a Government who take a sensible approach, meaning that we protect household finances, which I will come to, as well as the public finances. That means taking decisions based on recognising the unavoidable uncertainty about how the future of the conflict plays out.
Torsten Bell
I am going to make a bit of progress, but I will give way soon, because Members have been very patient.
I was coming on to the fact that we are not in the business of delivering regime change from the air, but we do need to de-escalate the conflict and we will play our part in doing that.
Oil and gas prices remain below the peaks they reached in 2022 following the Russian invasion of Ukraine, but I do not want to hide the fact that, as we have just discussed, these are significant increases. Oil is up by 40% and gas prices have risen by around 64% since the end of February. The movement in energy markets we have already seen are likely to put upward pressure on inflation in the coming months—exactly as we have just discussed—but the ultimate size of the effects is highly uncertain. What is certain is that in the face of them, this Government will take the necessary decisions to help protect both household finances and, as I was just saying, public finances. I want to make it clear that, given the very real uncertainty, the policy and approach we are taking does give an assurance to households about how we will act.
Dr Luke Evans
That is good to hear. As it is under review, it sounds as if, should there be a change, the Government would look to support the British public, and I support that. Is there some kind of framework that the Government are using to make this decision? Is there a trigger point on fuel prices, or on how long petrol prices remain at that level? This relates to the previous question about budgeting. Are the Government using triggers, or is it just finger in the air and wait and see what happens?
Torsten Bell
I understand why the hon. Member is asking that. I would gently point out that the level of petrol prices today is lower than at the time of the election, when the Conservatives had a temporary 5p freeze and explicitly did not include continuing that freeze in their manifesto. I offer that by way of indication of where we are today.
We will keep working towards a swift resolution, one that brings stability back to the region, security to Iran’s neighbours and relief to households in the UK, who are understandably worried about the effect of the conflict.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
The Minister rightly talks about household budgets, but the other impact, particularly of the gas price, is industrial energy costs in this country, not least for the ceramics sector, which is gas-dependent rather than electric-dependent. When the Chancellor was asked about gas prices in her statement last week, she pivoted straight to the British industrial competitiveness scheme, which is an electrical subsidy. What is coming down the line to help the gas-intensive sectors, which currently get no relief and which are seeing, as the Minister points out, a huge increase in the price per therm, particularly for those sectors looking to renegotiate their long-term contracts?
Torsten Bell
I thank my hon. Friend for making that point. I regularly discuss exactly the kind of industries he raises today, because he is such a powerful champion on their behalf. Most firms, obviously, will be significantly more hedged than households against changes in prices, but he is absolutely right to say that the effect of energy price rises is very uneven across our industrial base. He is right to highlight energy-intensive industries and what the Government are doing when it comes to the increase in the discount delivered by the supercharger in the coming months and then the BICS in the years ahead. He is also right to make sure that we keep concentrating on this issue in the months ahead, and I am sure I will be talking to him and others about it.
We want the war to end as swiftly and quickly as possible, because the longer it goes on, the more dangerous the situation becomes and the greater the impact on the cost of living back here at home. A rapid de-escalation remains the best way to protect people from further fuel price increases—despite the bluster today, I think that is the goal of everybody sitting in this House—and that requires a return to the diplomatic process. It also means the security of vessels passing through the strait of Hormuz. On that front, the UK will play its part as the global hub of maritime insurance, but I want to be clear, given some of the things that have been said in recent weeks, that this is a complement—not an alternative—to the physical security of vessels.
As the Chancellor said following her call with G7 Finance Ministers last week, we are supporting a co-ordinated release of oil reserves. That has helped to some degree to stabilise international oil markets. We have also asked the Competition and Markets Authority to remain vigilant on price developments for essentials such as road oil and heating oil. On Friday, the Chancellor and the Energy Security and Net Zero Secretary met petrol retailers to make it clear that the Government will not tolerate anyone exploiting the current situation to make excess profits.
Dave Doogan
What evidence did the Chancellor have to suggest there was profiteering in petrol retailing? The Petrol Retailers Association rightly took umbrage at the implication of the Chancellor; I think that did not go quite the way that she thought it would.
Torsten Bell
This Government are showing that we care about the living standards of households up and down the country, and that is exactly what we should be doing. Encouraging all retailers to engage in the fuel finder scheme, which I will come to in a second, is very important. On heating oil, we had heard worrying evidence from people—I suspect the hon. Gentleman has, too, from his constituents—about the behaviour of some suppliers.
To further support competition in the market, we are introducing the fuel finder to ensure that petrol stations publish their live prices. That will make it easier for drivers to choose the lowest price. Since the beginning of February, all UK petrol stations have been asked to report price changes for petrol and diesel within 30 minutes.
Almost 90% of retailers have already registered. Last week, officials were instructed to accelerate the integration of fuel finder into major digital map applications, which will make it easier for drivers to use.
This tool sits alongside action to support households who rely on heating oil, as I just touched on. As the Prime Minister announced earlier this week, the Government will provide an additional £53 million of targeted support for the vulnerable households who would struggle to make an up-front lump sum to top up their tanks.
Dr Luke Evans
It sounds as though this support will be provided through the crisis and resilience fund, which replaces the household support fund. The problem is that many more people will not fall within that, despite seeing the price of heating oil double, if not triple—plus doubling the amount they have to order. What support is there for them? If those figures are going from £500 to £1,500 overnight, that will be a huge impact, and they will not get the £35 from the Government.
Torsten Bell
The hon. Gentleman is right, at least within England: yes, the funding will be delivered via local authorities, through the mechanism that was the household support fund, which becomes the crisis and resilience fund in a few weeks. We have written to local authorities to make it clear that they do not need to wait for the new fund to be in place and can start making commitments today. The decision on exactly who qualifies as vulnerable sits with local authorities, because one thing we have learned is that different parts of the country have different challenges on this issue.
Torsten Bell
I will make a bit of progress; I have already given way to the right hon. Gentleman.
To reflect the highly uneven geographical spread of heating oil reliance, as highlighted by lots of Members in recent weeks, not least those from Northern Ireland and west Wales, the funding will be allocated on the basis of census data, instead of via usual mechanisms.
I have focused so far on laying out the challenge facing the country and our consistent approach to this conflict, but as this is an Opposition day, it would be rude not to talk a little about the Opposition, who have displayed rank opportunism and incoherence. This week, the Leader of the Opposition has said that she is
“concerned that there isn’t a clear plan behind the strikes”,
which is the opposite of what she has been saying for weeks. She welcomed the strikes and the military action that she now says lacked a clear plan. She called for Britain to get involved in the military action that she now admits lacked clear objectives. She says that her leadership is about consistency, but, on this most important of issues, the whole country can see that she is just making it up as she goes along—a cavalier attitude without a second thought for the consequences for households here in the UK. She does not get to wrap herself up in another country’s flag and play politics with a serious conflict and then pretend she never did so once the consequences for those living in the United Kingdom became clear.
Opportunism is the word for the Opposition on fuel duty, too. For all the froth from the shadow Minister, the truth is that the previous Government did not budget for any extension of the 5p cut—they explicitly said that it was temporary. Here is the truth on the level of fuel duty: through their entire 14 years in office—
Torsten Bell
Wait for it; I am going to come to come to those 14 years. The hon. Gentleman is going to regret saying that. Through the Conservatives’ entire 14 years in office, fuel duty was never lower than it is today. In fact, it was higher than it is today for 80% of the time they were in office.
Several hon. Members rose—
Torsten Bell
I absolutely understand why the shadow Minister is looking so worked up; fuel prices matter for everyone, especially those travelling long distances. After all, it is around 270 miles from North West Durham to Billericay—once he found his new constituency, that is. I know it is called a chicken run, but I am assuming he drove.
The Opposition may not be serious, but these are serious times. The cost of living matters. In a few weeks’ time, fuel duty will be 11p lower compared with the plans we inherited from the previous Government. Our action on fuel duty will save the average motorist over £90, on top of the savings from the Government’s fuel finder scheme. We will, of course, continue to keep fuel duty under close review, but it is frozen now and will remain frozen in the months ahead.
Torsten Bell
We will continue to be responsive to a changing world, be responsible in the national interest and with the public finances, and take the necessary decisions to help families with the cost of living. That is this Government’s promise.
Madam Deputy Speaker (Ms Nusrat Ghani)
Well, it was clear that the Minister was not giving way. I call the Liberal Democrat spokesperson.
Tim Farron (Westmorland and Lonsdale) (LD)
I thank the right hon. Member for Basildon and Billericay (Mr Holden) for bringing forward this debate. It is a really important one because the impact of fuel costs—both for motorists and for those having to heat their homes—is devastating.
Over the past three weeks, people’s entire ability to budget to be able to afford to live, to buy food and to pay the rent or the mortgage has changed. It has been turned on its head. In every city, town and village in our country, everybody is affected one way or another. I do not mean to diminish the impact of fuel price increases in our cities, which has been huge; nevertheless, for people living in a city, the chances are that they work in the same city, and the chances are also that they can, if need be, leave their car at home, if they have one, and take advantage of public transport. I am very supportive of a cap on bus fares—I wish we still had a £2 cap, but the £3 cap is still a lot better than what we had in the past—but they are a fat lot of good if there is no bus to get on at all.
In rural communities like mine, people on the most modest of incomes have to own a car in order to access our economy or any kind of life at all. Somone living in Kendal might work in Grange-over-Sands, or vice versa; someone living in Ambleside might work in Barrow, or vice versa; someone living in Kirkby Stephen might have to travel 60 miles every day to go and work in the hospitality and tourism industry in Windermere or Bowness. The impact of the fuel price rises over the past three weeks is utterly devastating for these people. Diesel in Cumbria is 160p a litre—up to 170p in some cases—and petrol is near to 140p a litre. Indeed, red diesel is passing the £1 mark for the first time.
Mr Andrew Snowden (Fylde) (Con)
Like the hon. Gentleman, I am a north-west MP representing a rural constituency. Even those of our constituents who work in big suburban areas like Manchester and elsewhere still need to get to a train station, so even those who spend significant time in larger urban areas still rely on their car to be able to get to what resembles public transport to commute to and from work.
Tim Farron
The hon. Gentleman makes a very good point. That will be the case across my communities, too; many people will drive to Penrith, Oxenholme, Grange-over-Sands or Windermere to park and then catch the train to their place of work or study. These are significant costs. Of course, it is worth bearing in mind that these fuel costs will also have a significant impact on public transport providers down the line, and will make it hard for them to continue their current services. The hon. Gentleman’s point was well made and well delivered.
We are talking about motor fuel costs rising, but there is also the impact, as has been mentioned already by hon. Members, on heating oil. The costs for people heating and running their homes have been immense and are causing real hardship already. In Cumbria, 46,000 homes are off-grid. About 35% of the homes in my constituency are off-grid, with people relying on heating oil; in Kirkby Stephen, Tebay and Brough, 74% of properties are off-grid, while in Hawksford, it is almost 80%.
I asked my constituents—many of them did not need asking, I have to say—to give me their impressions and experiences of the past few weeks. It is clear that heating oil has literally doubled in price overnight, although I have heard reports of it trebling, too. Many of my constituents cannot afford to get any more heating oil until or unless the prices drop.
It is important to remember that in a community like mine, 25% of our housing stock was built before the turn of the 20th century. This is true of many colleagues’ constituencies as well. Many properties are solid wall properties, which are very difficult or expensive to insulate—a problem that this and previous Governments have failed to deal with adequately. People are therefore spending a fortune heating their difficult-to-insulate homes, and are now in a situation where they are having to spend up to three times more just to keep their homes vaguely warm.
Steff Aquarone (North Norfolk) (LD)
In my constituency there is a mother whose daughter lives with a disability and is reliant on a particular type of prescription food that has to be kept at ambient temperature. If the temperature of their house drops, the food perishes, and she cannot eat. Does my hon. Friend agree that it is not just the concern facing residents now—my constituent was prepared to pay whatever it took, but she could not secure a delivery at all—but the fear of the next crisis in the spike in oil prices? That is why we need to call for a cap on heating oil for our rural constituencies.
Tim Farron
My hon. Friend makes an excellent point. That is a reminder that people’s experiences of increased prices are myriad in type. What those people have in common is a shared and sudden hardship that forces them to make incredibly difficult decisions—or, indeed, choices if they have choices to make.
Ben Lake (Ceredigion Preseli) (PC)
The hon. Member makes an important point about the impact on rural areas. Does he also agree that we should bear in mind the consequences of this price spike on businesses? Many of the businesses in my patch are also off grid. Having gone through the winter period and perhaps hoping for some good fortune in the spring, they are now facing this big barrier. Indeed, some have already told me that they are cutting back on operations and contemplating closure because of this new pressure.
Tim Farron
Any effort that the Government make in supporting people and businesses through this process will have a medium to long-term positive impact on the Treasury: if we can keep businesses in business, making a profit and keeping people in work, those companies and employees will be paying tax and refunding much of that investment—so investment it truly is. Our amendment sets out some practical alternatives. It acknowledges the devastating impact of the Government’s decision to increase fuel duty from September, and it calls for that to be cancelled. It focuses also on the experiences of rural and other off-grid communities that have been left exposed by years of under-investment. It specifically calls on the Government to cancel the fuel duty rise, immediately to zero-rate VAT on heating oil, to develop a price cap mechanism for heating oil and other uses of energy, to expand rural fuel duty beyond the relatively small number of places in which it currently operates, and to invest in an emergency upgrade programme, so that we are not so exposed to these things in the future.
I recognise—and welcome to a degree—the Government’s announcement this week on some support for homes and businesses that are reliant on heating oil. I have done my sums and it works out at £35 per household. That is an inadequate sticking plaster. It will not have much of an impact on household finances. What we need is an energy price cap for people who live in rural communities, otherwise they will continue to believe that this Government, and perhaps others before them, do not really care very much about them. They will focus on the energy bills of other people, but not on those of people in rural communities. Therefore, this announcement does not go remotely far enough, although we are happy that the Government have at least begun to talk about the matter.
The impact of the massive price rises in energy costs—motor fuel, car fuel, heating oil and other forms of fuel—is absolutely local. It is house by house, family by family, community by community, business by business. It is bound to be observed that this has been triggered by the actions of one D. Trump in the White House. The war has entered the lives of people in Iran, and the lives of innocent people across the middle east and a range of different countries. It has also had a massive impact on the global economy. As has been said, it all comes down to who controls the strait of Hormuz, which Iran effectively does at the moment. As long as that is true, whatever the President of the United States says, Iran is effectively winning.
In the meantime, fuel prices are rocketing. Quite simply, as the International Energy Agency has noted:
“The war in the Middle East is creating the largest supply disruption in the history of the global oil market.”
That is quite something. It does not make me an enormous expert in international affairs to conclude that this was all utterly and totally predictable when Donald Trump began this war. As others have mentioned, this is about not just oil, but gas, fertilisers and petrochemicals—crucial inputs, Higher prices and increased scarcity will have a massive impact on our economy more broadly, and on the cost and availability of food production, with the result that, sadly, we can look forward to increased food prices in coming months.
My community is the most visited place—outside London—in the United Kingdom. We are home to a huge tourism economy. Some 60,000 people in Cumbria earn their living in hospitality and tourism, which is already struggling because of the Government’s national insurance rise more than a year ago. We are an economy that very much relies on small businesses. One in four people in the workforce in my constituency works for themself. Smaller businesses, which are much less likely to be able to withstand these shocks, are the backbone of our economy.
I have talked about food prices, and I am bound to mention the impact on our farmers. Let us not forget that by December this year direct payments will be over. So many people in my area, particularly those farming in the uplands of Cumbria, are on incomes that are less than the minimum wage. They seek to look after our environment, our landscape, the backdrop to our tourism economy, and, even more importantly, to feed us. The cost of their production will rise as a consequence of all these events and there will potentially be an impact on our food prices.
I mentioned the rural fuel subsidy earlier, which came about as a consequence of the Liberal Democrats’ time in government, when we were in coalition with our Conservative colleagues. Outrageously, though, it applies to only 21 places in the UK, not one of them in Wales and only one of them in Cumbria—a lovely place called Grizebeck. That means that the Government have a mechanism by which they could help rural communities, and we ask them, at the very least, to double the access and scope of the rural fuel duty subsidy right across the country—including, first and foremost, I am bound to say, in the lakes and dales of Cumbria. Everyone will be hurt by the impact on inflation—reduced demand, inequality and unfairness for those earning the least will potentially be huge.
The Government’s fuel duty rise exacerbates a problem, which has, as I have said, been created in the White House. The United States needs to fix the problem that it created. It cannot be up to others to save it from its failures to think things through. Colin Powell, a person who is perhaps wiser—I think that is fair to say—than the current occupant of the White House, once said to George W Bush that,
“if you break it, you own it”.
That was said of the war in Iraq. Surely the same can be said now to the President of the United States. I gently point out that it applies also to those in the Conservative and Reform Front-Bench teams who egged the President on in the first place.
NATO allies should not be joining Donald Trump in a war that he started without ever consulting his allies or explaining his war aims. He wants us to fall in line meekly, but we must not do so. Donald Trump still cannot articulate his endgame or what victory would look like. He went to war thinking that the Iranian regime would fall quickly—of course, it has not—and that Tehran would not attack the Gulf states or close the strait of Hormuz, which of course was always likely. Why would we align not just with such a moral outrage, but with such epic stupidity? Although I am grateful to the Conservatives for submitting a timely and important motion, we must remember that they are part of the reason that we are in this mess. [Interruption.] I will wrap up, Madam Deputy Speaker.
Meanwhile, against the backdrop of that international situation of extreme danger, my constituent in Kirkby Stephen fills up with diesel that costs 25% more than it did three weeks ago. Her home is cold, because she cannot buy any more heating oil, as it has gone up threefold in the past three weeks. She travels to Windermere to earn the minimum wage, and at the end of the day it is barely worth the bother. Do not tell her that politics does not change things; it really does. Our amendment aims to change things for her for the better.
Harriet Cross (Gordon and Buchan) (Con)
It is great to be able to speak today in this important debate. I am glad that this is one of the topics that the official Opposition, led by the Leader of the Opposition, have brought to the House, because fuel duty impacts everybody. It impacts every family, every household, every business, hauliers—everywhere we go, everything that we see is impacted by fuel duty, and that is no more obvious than in rural areas.
People in our rural communities rely on cars more than anywhere else. We cannot rely on buses, because they are not reliable. We cannot rely on trains, because half of the time they are not there. We cannot rely on tubes, because we do not have any near us. Cars are the lifeblood of rural communities. We would be stuck without them, and therefore they are vital. The majority of the public know that too. There are 36 million petrol and diesel vehicles in the UK, and every single one of them will be taxed when fuel duty goes up. Fuel duty is a tax on every single vehicle, and all those vehicles are driven by somebody, so this is a tax on everybody.
Rural communities will feel this change so much more because they are so much larger. The best way to demonstrate that is to compare the size of constituencies. My constituency in Aberdeenshire in north-east Scotland is large; it is nowhere near the largest Scottish constituency, but it covers 2,076 sq km. That is larger than the combined total of the constituencies of Treasury and Transport Ministers multiplied by three. Indeed, if the large constituency of the Under-Secretary of State for Transport, the hon. Member for Selby (Keir Mather), is removed from that equation, the total combined constituency area of the Treasury and Transport ministerial teams is 380 sq km. I assume, therefore, that it is no coincidence that they do not appreciate how important cars are for getting around large constituencies and how much increasing fuel duty will impact rural constituents.
While distance is important, price is also vital. The “Fuel Finder” tool that has been created is helpful, not least because it tells me that in my constituency fuel is on average 147p per litre, compared with 139p per litre in the constituency of the Parliamentary Secretary to the Treasury. We are already paying more in rural constituencies, and we already have to drive our cars further, so we are filling up our cars more often and at a higher price. Fuel duty rises impact us more than those living in urban areas.
This is a point I keep coming back to, but rural communities do not have a choice—we have to drive. We have to drive to get to work, to get children to school, to go to doctors appointments. To use an example, my constituency has seen many bank closures, meaning that constituents in Ellon have to drive to Inverurie in order to bank. That is a 28-mile round trip—just to bank. That distance is further than the breadth of many Members’ constituencies, east to west or north to south.
It is not just fuel duty that the Government are targeting. At the Budget they announced their new 3p per mile charge for electric vehicles. Constituents of mine who live in Huntly and commute to Aberdeen to work, often in the oil and gas sector, travel 17,800 miles a year—based on their working five days a week, 46 weeks a year—just to get to work. The pay-per-mile system that the Government have brought in will mean that those constituents pay £535 a year just to get to work in their electric car. Perhaps Treasury Ministers cannot imagine having to do a 77-mile round trip to get to work, but that is what my constituents do and they are being penalised for it.
When the Treasury Front Bencher winds up, I would be grateful for confirmation that pay-per-mile for electric vehicles will not be a gateway to pay-per-mile for petrol and diesel vehicles. That would cripple rural communities, rural families, and rural businesses. It is a slippery slope that the Government have started on with EVs, and if the system progresses to cover petrol and diesel vehicles, it will be a hell of a lot worse for a lot of people.
We all know that supply is just as important as price, if not more important; we have been talking about it a huge amount since the events in Iran. People panic when they get to the pumps because they see the price going up, but they will panic more if they get to the pumps and there is no supply at all. I am not saying that we are there at the moment, but we need to consider how important supply is.
Joe Robertson (Isle of Wight East) (Con)
My hon. Friend is giving a characteristically well-informed speech. Might she reflect on the cost of moving around by car for the Prime Minister in his Holborn and St Pancras constituency and the necessity to move around by car for his constituents compared with mine in the Isle of Wight and hers in Gordon and Buchan?
Harriet Cross
Absolutely; I think a lot of us can relate to the fact that in some constituencies people have no choice but to use their car. They will use their car and keep using it, because they have to, and if they are using their car, they need to fill it. Therefore, they need petrol and diesel at affordable prices, and increasing fuel duty is making that less affordable. Fuel duty makes up 38% of the cost of a litre of petrol. The wholesale price is 33%, which feeds into it, so any increase in fuel duty makes prices more and more expensive. The decision to do that is completely under the control of this Government.
Refining is a vital part of the production of petrol and diesel for our vehicles. The UK has a very good record on refining, as we are net exporters of petrol from our refineries, but in the last two years alone, two refineries—a third of the UK’s refineries—have been lost, and our capacity is going down. That is not least because of the carbon tax, which has nearly doubled under this Government. It has made refining in the UK more difficult, putting industries under pressure and ensuring that the de-industrialisation of the UK under this Labour Government continues.
Members need not look any further than the oil and gas sector, particularly in north-east Scotland, to see the de-industrialisation of the UK in action. The coherence of this Government’s oil and gas policy is non-existent. They know that we need oil and gas for years to come, and they say that we need oil and gas for years to come, yet they do not want British oil and gas for years to come. We have the largest tax on any mature basin, which this Government extended and increased in their first Budget. They have banned new licences, meaning that reserves will be left under the North sea. Norway will then drill those reserves, and we will import from Norway. There is no coherence in their strategy.
As a result of the ban on new licences, we are also exporting jobs. The skilled workers in the oil and gas sector who produce our oil and gas and contribute to our fuel security will move abroad. They have the skills and are valued workers, yet other countries value them more than we do in this country. The Government’s policies show that. One thousand jobs a month are being lost, and billions in tax revenue is being lost. Billions in investment is being lost, which I know the Treasury Front-Bench team know very well following their recent meetings with the sector. The Government—either because of their own ideology or the one being imposed on them by the Secretary of State for Energy Security and Net Zero—do not want to use our own natural resources. They would prefer to import, at huge financial and environmental cost and at the cost of work and jobs, in order to satisfy themselves that they are reaching a target that they imposed on themselves.
Some 70% of the UK’s energy still comes from oil and gas, and it will do so for many years to come. Electricity, which is the power that the Government refer to in their 2030 target, makes up only 20% of our energy. In reality, the vast majority of the energy that keeps this country going and powers the UK comes from oil and gas. Some 50% of the gas that we use every day comes from the North sea. Shutting down the North sea impacts our fuel security instantly and into the future, and it will keep doing so.
There are enough reserves in the North sea with the correct fiscal and regulatory conditions to support British energy security, but this Government have decided that they do not want them and would prefer to source oil and gas from elsewhere. We heard that yesterday from the Chancellor herself, who was delighted that Norway and Canada have increased production. Why would we not do the same? We can do the same. Why are we still waiting for Rosebank and Jackdaw to be approved? Why are we sitting on those applications? It makes no sense. All of these decisions affect our fuel security and the cost of living for households. They affect the amount of supply we have for all the things that we use energy for, yet this Government are happy to forgo that just for their headline.
I am delighted that we are discussing fuel duty for our rural communities and businesses, but this debate also shines a light on the vital importance of our oil and gas supply into our refineries and our cars and vehicles. That is why I am delighted to support the Opposition’s motion today.
Simon Hoare (North Dorset) (Con)
It is a pleasure to follow my hon. Friend the Member for Gordon and Buchan (Harriet Cross), who spoke with her usual passion on behalf of her constituents and a sector that is important to her local economy, and with the depth of knowledge that the House has come to expect from her. She raised the important theme—I touched on it slightly in an intervention on the Parliamentary Secretary to the Treasury, the hon. Member for Swansea West (Torsten Bell), as he opened the debate for the Government—of the Government’s lack of consistency or common sense as a starting point, and of fleetness of foot in responding to events as they materialise.
My hon. Friend referred to the absurdity of the Government saying in one breath, “As we transition to a renewable, clean, green energy source, we will continue to need oil and gas in our economy, but we would prefer to buy it from a third country’s production even though we have it literally on our doorstep.” There is a lack of imagination and, as I said, fleetness of foot as the Government respond to pressures in the changing landscape. If the Exchequer Secretary to the Treasury will indulge me, I invite him to consider what he would be saying about the proposals announced in the Budget to increase the main fuel duty rates if he were on the Opposition Benches or at the Opposition Dispatch Box rather than speaking for the Government.
The point that I made to the Parliamentary Secretary to the Treasury was a simple one. I did not support the Chancellor’s announcement on fuel duty, but she had a common-sense approach to it and was perfectly within her rights as Chancellor of the Exchequer to make that rate announcement. It predated the events in Iran. I ask the Minister to consider what he would say if he were on the Opposition Benches and he faced intransigence from a Government who said, “We understand that costs are going up. We understand the volatility of the market. We understand the enormous pressures being placed on all households—in particular those with low incomes, the elderly, the vulnerable and the just about managing—but we are still going to plough on.” If they said that rather than, “We still want to increase fuel duty, and we may very well do so in the future, but now is not the time. We are going to pull the plaster off this thing and reverse the announcement. We are not going to increase fuel duty, because the tail of this fuel pricing crisis will be quite long, irrespective of whether the situation in Iran and the strait of Hormuz comes to a conclusion in the foreseeable future,” I think he would be jumping up and down, pulling his hair out and accusing the Government of being tin-eared and tone deaf.
I hope that the Government Whips get the timing of this week’s debate right so that we do not have the ignominy of the Minister wishing he had spoken for a further 20 minutes and people dramatically falling ill in the Lobby but then miraculously, at the stroke of 7 pm, suddenly rising Lazarus-like from near deathbed experiences to get on with their parliamentary business. When he comes to sum up, I hope that he will reflect on the need for a rapid response in real time.
On that theme, may I address one aspect of the amendment in the name of the Prime Minister? As the Minister probably knows, last week there was a hugely useful meeting with the Minister for Energy and the Financial Secretary to the Treasury, Lord Livermore. Many of us who attended were pleased that it had taken place. We took away a variety of responses, but it certainly seemed that the Government were getting it. However, there is the perpetual repetition of the point that they are continuing to work with the Competition and Markets Authority on regulation of the heating oil market. That is a long-term solution; it will not solve the problems today. I do not think that is a crutch on which the Government can rest and presume that the House and our constituents will be satisfied. There must be two workstreams here, with future regulation in the medium to long-term and immediate help in the here and now.
Fuel Finder, which is referenced in the Prime Minister’s amendment, can be useful. However, the Minister will probably know, or will have heard, that in rural areas we do not have a petrol station by every village green or on every corner, and in my constituency—I will deal in miles rather than the modernity of kilometres, as my hon. Friend the Member for Gordon and Buchan did—which is about 440 square miles, people are having to drive a 5, 10 or 15-mile round trip to fill up their cars. Therefore, Fuel Finder—welcome as the idea that sits behind it is—is really only of use to people who have a larger number of fuel stations where they can fill up their vehicles in close proximity to where they live or work.
I want to say a word or two about heating oil. Thanks to figures produced by the House of Commons Library referencing the census data of 2021, we know that about 7.1% of households in the south-west of England use heating oil; the UK average figure is 4.9% and the figure for the North Dorset constituency is 13.71%. I understand that those figures do not include households using liquefied petroleum gas—they merely include traditional heating oil—and they certainly do not include the vital requirement of red diesel for the farmers of North Dorset.
Not increasing the main fuel duty would help everybody in our country, but it would disproportionately benefit those whom we referred to at a certain time in our recent political history as “just about managing”. Those are not households that are supported by a raft of welfare state interventions and benefits, and they are not people who are disabled and unable to work. They are people who are doing their best and doing their bit—often couples working more than two jobs just to keep the roof over their head and food on the table. I am certain that when one is in the Treasury dealing with telephone-number sums day in and day out, an increase of 5p per litre does not sound like a vast amount, but when the household budget is so finely balanced that a couple of quid here or there makes all the difference, those 5p’s add up.
I do not want to turn this into a rural versus urban debate, but it is important for urban Members of Parliament to hear about the reality of living in rural areas. We are lucky to live in rural areas—we have beautiful environment, lovely countryside and a slower pace of life—but every economist recognises that the cost of delivering services, the cost of produce and the cost of transport is greater in rural areas. That is principally for two reasons that result from sparsity of population: greater distances must be travelled to access them, and there are higher costs in getting to those rural markets because they are further away from the nexus of the transportation networks. All those things have a knock-on effect. If there was a choice and people could say, “Oh, I could jump on a tram, a tube, a bus or a light railway and forgo using my car or my van,” of course they would do so as a way of saving additional expenditure.
It is depressing that although I think I am right in saying that at no time since 1966 has the Labour party in government had a higher number of Members of Parliament representing rural constituencies, unless those MPs are in deep camouflage this afternoon, they appear to be showing what I would describe politely as precious little interest in the welfare of their constituents. Maybe that is because they realise that those on the Treasury Front Bench have almost given up on rural Britain, probably promoted by a lack of knowledge and understanding, and certainly by a lack of curiosity to find out anything about what it is like to live in our rural communities. Maybe they have given up trying to persuade those on their Front Bench of the need for a change of heart. On the Conservative Benches, and on those of the other Opposition parties, we will not give up advocating the cause of our rural communities.
Wendy Morton (Aldridge-Brownhills) (Con)
My hon. Friend is making an important point about rural areas, but those of us who do not represent rural constituencies—mine is neither semi-rural nor urban—face exactly the same issues as the rural areas. The increase in fuel prices is impacting on everybody in their daily lives and most people are now thinking, “Enough is enough”. Does he agree?
Simon Hoare
I do. My right hon. Friend is right to point to the universality of the negative impact of the proposal. As a good Yorkshirewoman who I know is always persuaded by the validity of common sense, I hope that she will accept the point that when everybody says that the impact on rural communities will be disproportionately felt, that is amplified when one recalls that, on average, the annual income of people living in rural areas is lower than that of those who live in urban or suburban areas.
Joe Robertson
My hon. Friend is right to point out that there are only two Labour Members of Parliament sitting on the Government Benches for this debate on the increase in fuel duty. Does he think that the other 400 Labour MPs are right now in a huddle, in a darkened room with the Chancellor, lobbying her to reduce that tax and to freeze fuel duties, or does he think that they might have gone home?
Simon Hoare
I would probably suggest to my hon. Friend that a lie-down with a cold flannel in a darkened room might be a good idea for him if that is what he thinks they are doing. I think that they have broadly given up. Let us just make the point. I do not want to rub Government Members’ noses in it, but with the exception of the Whip, who has to be here, the Parliamentary Private Secretary, who feels that she has to pass important pieces of paper from the officials’ Box to her Minister, and the Minister, who has to be here whether he likes it or not, therein ends the interest of the governing party on this particular issue.
Let me amplify a little further my point about necessity. North Dorset is predominantly an economy of micro and small businesses; a lot are family-owned, many are not. Medium-sized enterprises are often looked at as something to be aspired to, but it is predominantly micro and small. There are also a few large businesses such as Dextra, based in Gillingham in my constituency, and Hall & Woodhouse, a brewery that will be known to many colleagues across the south-west and the south—companies that I would classify as the larger employers of North Dorset—and they are seeing their costs go up.
I know that some have used the phrase “white van man and woman”—I think of the Chair of the Foreign Affairs Committee, the right hon. Member for Islington South and Finsbury (Emily Thornberry), who once said it with a bit of a curl of her lip and a sort of snarl in her voice. I do not say it in that way. I admire white van man and woman, who have got off their backsides and set up a business, entrepreneurially, maybe employing one person. They provide vital services to communities and need that vehicle to either go and pick up kit and product so they may fulfil their jobs, or to travel many miles to their work to put food on their table. They are going to be hit.
I think of my farming vets in North Dorset, who have to travel distances to attend to animal welfare issues. My constituency has a very high percentage of retired people—the highest in the county of Dorset—and I think of the carers who are having to use their cars to travel, to visit, to help and to make sure that those people are okay. I also think of my farmers, who, as the Minister will know, play a vital role in delivering not just environmental management but, crucially, food security. They are seeing prices rise as a result of current pressures, not just for the fuel that they use but for the fertiliser that they have to buy.
Wendy Morton
My hon. Friend eloquently sets out that this impacts just about everybody in their daily lives, up and down the country and across communities. Does that not highlight why we took great efforts to freeze fuel duty when we were in government? I would even go so far as to say that those on the Conservative Benches are the friends of the motorist, in contrast with those on the Labour Benches who simply see the motorist as a cash cow.
Simon Hoare
My right hon. Friend is right. It is important to relitigate this point: we froze fuel duty not merely because we could but because there was a reason so to do. It is why—I say this as a former Local Government Minister—we enhanced and protected and preserved the rural services delivery grant to reflect precisely the additional costs for local government of providing services in rural areas. Again, that was not just slashed but scrapped by the Government in the local government settlement.
There are also the costs of the school run, and I am going to have to declare an interest as a parent of three daughters still at school. When my wife takes our three girls to school, it is a 22-mile round trip from home to school and back, and then again in the afternoon. Forty-four miles for no other reason than to transport three children to school to get an education and to fire up their ambition and aspiration. Hundreds of parents across the constituency do exactly the same, and they will be impacted negatively as a result of this increase.
I think as well about those who are trying to get to hospital appointments. I live relatively close to the West Dorset border, but if a constituent living close to me has to go to Dorchester hospital, they perform something like a 40-mile round trip just to get to a hospital appointment. This is not just a tax increase in isolation; it comes on top of the other inflationary pressures that the Government have authored as a result of national insurance and business regulation and so on making things much harder for businesses, which means that all the costs of those in the business sphere will, by definition, be passed on to customers. I really hope that people do not decide to miss that hospital appointment, not because they no longer need it but because they feel that they cannot afford to travel to and from it.
The Minister does not need me to tell him of the acute pressure that our hospitality sector is facing across the whole UK, and rural areas in particular. Pubs face great pressures, and many in the North Dorset constituency are closing, regrettably. If people cut back on their travel because petrol or diesel has become too expensive and they have reduced their travels to merely just what they would deem to be the absolute essentials, then leisure and relaxation purposes will be eradicated from their menu of choice. That, again, will have a negative pressure on a sector already hit.
I always like to try and wind you up, Madam Deputy Speaker, by saying something like, “To bring my opening remarks to a conclusion”. You will be delighted to know, however, that I am bringing my overall remarks to a conclusion. Sometimes Governments move slowly because the process requires them to. Sometimes, as we have seen in other circumstances, where they have a will, Governments can move incredibly quickly. If the PPS could leave her Minister alone for just a moment, I would appreciate it if he listened to this.
Simon Hoare
This is a point I made to the Parliamentary Secretary to the Treasury. All these increases—in council tax, domestic and transport fuel, food prices and so on—are putting pressure on so many household budgets. The Minister knows that; he will see the data from his officials in real time. Families need to make plans—can they afford that holiday during the school summer holidays or to travel to visit a relative later in the year? I am sure that to the Treasury and to the broad, big-picture statistician, these small matters, individual cases, vignettes and cameos of people’s lives are slightly a nuisance, but these are real lives lived on a daily basis by our constituents.
It would be indefensible, illogical and an act of self-harm for the Government to proceed as the Chancellor suggested that she would and increase main fuel duties from 1 September. Some tactical guy may well be looking at a whiteboard in No. 10, desperately trying to fill in the late summer grid when the House is not sitting, saying, “I know, in the third week of August, we will mention that we are not going to do it.” I can understand that in public relations or media management terms, but I say to the Minister, who is a common-sense man—I hope that he will get the common sense of this—that this has all the signs and hallmarks of an inevitable change of heart from the Government. It is not a question of whether but when. He will be sustained—I am sure there will be other calls on him to spend it—by a massive increase in VAT from heating oil from domestic uses over the next several weeks. If we can agree that it is a question of not whether but when, from the bottom of my heart, on behalf of my hard-working constituents of North Dorset, my farmers and those micro and small businesses, I urge the Minister to recognise the common sense, the necessity and that the landscape has changed in just those few short weeks since the Budget was delivered, to make that change and to announce it soon.
Joy Morrissey (Beaconsfield) (Con)
It is a pleasure to follow my hon. Friend the Member for North Dorset (Simon Hoare), who eloquently championed his local area and covered every point that we could possibly raise—I shall follow humbly on his coat-tails.
Fuel duty is a war on the motorist. It is an attack on hard-working families who have scrimped and saved to drive their child to that special holiday or even to do the school run each day. This tax is regressive. It will hurt normal, hard-working families across Beaconsfield, Marlow and the south Bucks villages. It will also hurt small and medium-sized enterprises, care workers and all the key workers who have to drive from outside Buckinghamshire to work in the area. We have care workers who come from other counties to work in Bourne End, Wooburn and Marlow because the cost of living is so high. That extra driving, that extra cost on their transport, will be devastating to our local care-working community and to those who provide vital services, such as our firefighters and police officers, who often have to drive to the fire station or police station where they are based. That extra cost is the difference between a family making it each month and slightly going under. That is who we are speaking for today: the people who are paying their taxes, working hard and wanting to do the right thing but are being punished by this fuel duty increase.
My constituency is also impacted by rises in off-grid heating oil prices. I myself have off-grid heating oil, and many of my constituents in Dorney, Wooburn, Bourne End, Flackwell Heath and Iver are impacted by price increases. Although we are near London, we are actually very rural. I have more pensioners per capita than pretty much anywhere else—you might be the No. 1 winner, Madam Deputy Speaker, but I would come second. This extra cost will push my pensioners into poverty. They are barely making ends meet right now. They are humbly going about their business, but they all need transport as well. We have poor transport links so people need to use their cars, and my pensioners will be adversely affected by this fuel duty increase. It is incredibly unfair that the increase is coming in now given that world events are causing oil prices to increase anyway, so families, workers and the taxpayer will be further punished.
It would be hard to have this debate without mentioning my right hon. Friend the former Member for Harlow, Robert Halfon, who led the charge on fuel duty. For years, he was the passionate voice making this point clear across the House: high fuel duty taxes are regressive because they affect working people the most. They are a brake on economic growth. We all saw the golden moment on Sunday morning when the harsh inconvenience of the facts hit the Secretary of State for Energy Security and Net Zero: that 38% of the cost of petrol is down to fuel duty, a tax entirely in the hands of the Government. This Secretary of State, who could power the entire country with hot air, seemed to get the message slowly but surely, and there is no problem to which the answer is not a faster and more ruinous race to net zero, putting ideology ahead of working families. To govern is to choose, and this Government always choose the most damaging economic pathway for families.
Katie Lam (Weald of Kent) (Con)
My hon. Friend is giving an excellent speech as usual. Is she aware of analysis from the Taxpayers’ Alliance that says the average household will pay £40,000 in fuel duty over a lifetime under the Chancellor’s plans? That is several thousand pounds more than the median disposable income for a household. Does she feel, as I do, that this is an unsustainable burden on people who are already struggling to get by?
Joy Morrissey
It is a shocking burden and one that many people and hard-working families will not be able to bear. I am often told by the London elite that people need to switch to electric cars and do all these other things, but many people cannot afford an electric car or the cost of electricity, or even to put fuel in their petrol car. Families will be at breaking point, and they have no alternative to taking their child to school or the doctor. That extra burden can push a family completely over the edge.
We need to make our economy competitive again. We need to look at ways to make energy and fuel affordable for everyone. Working people are being saddled with higher costs and taxes while more money is being pumped into benefits Britain because of the weakness of a Prime Minister without a backbone. It is time to put working people first. It is time for another Government U-turn.
James Wild (North West Norfolk) (Con)
Madam Deputy Speaker,
“In these difficult circumstances, while the cost of living remains high and with a backdrop of global uncertainty, increasing fuel duty next year would be the wrong choice”—[Official Report, 30 October 2024; Vol. 755, c. 817.]
Those are not my words, as it happens, but I agree with them. In fact, that was what the Chancellor said in her first Budget. Having increased taxes by £40 billion in that Budget, people might have thought that that would be the end of the talk of fuel tax hikes. However, this Government’s approach is all about higher spending, taxation and borrowing, so it was not that surprising when, in her second Budget, the Chancellor set out plans to scrap the 5p a litre cut introduced by the Conservative Government in 2022—a cut, remember, introduced in the wake of price increases after Putin’s illegal invasion of Ukraine. We introduced that cut to recognise that, for rural communities such as mine in North West Norfolk, a car or van is a lifeline, not a luxury. They connect farmers to markets and help children get to school, as my hon. Friend the Member for Beaconsfield (Joy Morrissey) said. They allow people to get to work or to health appointments, and they keep rural enterprises in business. Every penny added to the cost of fuel has a bigger impact in areas where public transport is limited and journeys are longer.
This would be the first fuel duty rise for 15 years, taking £3.6 billion from hard-pressed motorists. Unless Labour Members support our motion, that tax increase will take effect from September this year, and the average family will pay £150 more a year. The Road Haulage Association estimates that the increase would add £2,300 a year to the operating costs of an HGV. It is little wonder that it described the measures as a “hammer blow” for many small businesses.
It gets worse. Labour Members often like to talk about the past 14 years of Conservative Government, but one thing we did over those 14 years was to freeze fuel duty. From next April, this Government will end that freeze, and inflation-linked rises will follow, making the end of support for motorists that is calculated to have been worth £120 billion over the period of Conservative government. Through this debate, the Conservatives are once again speaking up for the British people. My right hon. Friend the Leader of the Opposition challenged the Prime Minister about fuel duty increases last week, but he wanted to talk about anything but that topic—as he did again this week. Under pressure, he is beginning to shift his position. He has said that the increase is now under review. Where is his leadership? It is utterly lacking.
And where are Labour Members? No Labour Back Bencher is prepared to stand up and speak in this debate. Even the hon. Member for Rugby (John Slinger) is notable by his absence. They will be whipped today to vote against our motion, as they were on the family farm tax, the winter fuel payment cuts, a national inquiry on grooming gangs, and more. Given their absence, I suspect that they sense another U-turn is coming. The Minister will once again have to defend a policy that he knows will probably be changed again, like the family farm tax, and the 3,000% increase in the landfill tax, which the Government also ditched under pressure. The Prime Minister is too weak to make a decision. Now he wants to go up to his study and read more papers alone, ponder it and think about what he should do.
People increasingly feel that they are working harder and getting less, and that too many people are signed off on sickness benefits. The Government are making their life harder. On Labour’s watch, inflation has increased and unemployment is rising month after month. Labour Members’ constituents will see that, when the Government had the opportunity to stand up for families who rely on their cars, for the white van man, and for people in rural communities, they utterly failed to do so.
When the Chancellor was asked whether she would reverse this fuel tax hike, she said something very revealing:
“I’m very loath to spend Government money on something that the market should be doing”.
Government money? There is no such thing. That is taxpayers’ money. This Government think that everyone’s money belongs to the state, and people should be thankful to keep some of it. That attitude explains Labour’s £66 billion of tax increases to fund higher welfare spending, it explains the Government’s failure to control spending and live within our means, and it explains why the tax burden is at a record high and will only increase.
The impact is evident in the latest British social attitudes survey. Support for higher spending and taxation is falling, while support for lower taxes and lower spending is growing. That is the approach that the Conservative party has set out. We would make £47 billion of savings in public spending, including £23 billion in welfare—the Minister can have those ideas for free. We would use half that sum to reduce the deficit, and the other half to get the economy growing by scrapping stamp duty, and scrapping business rates for 250,000 leisure, retail and hospitality businesses.
The Government are putting up tax and making prices rise at a time of growing uncertainty. That is the wrong choice. That is why I will vote to ease the burden on British motorists and against Labour’s fuel duty hike.
Peter Fortune (Bromley and Biggin Hill) (Con)
My constituents have borne the brunt of Labour’s slew of anti-motorist policies. The impending rise in fuel duty is yet another attack on Bromley motorists. Some 80% of households in Bromley and Biggin Hill have at least one car or van—significantly higher than the Greater London average—and driving is often a necessity for my constituents, particularly in Biggin Hill, where public transport is unreliable.
Driving charges in London can now cost up to £40 a day, but it is even more for van drivers. That is a direct result of the policies of the Labour Government and Sadiq Khan. A rise in fuel duty will increase that cost further. In April last year, Sadiq Khan imposed a new toll on the Blackwall tunnel. For car drivers using it at peak times, the toll is £8 a day for a trip across the river and back. For van drivers, the bill is £13. The toll also means that there is now only one free crossing east of Tower bridge, at Rotherhithe. That comes on top of Labour’s expansion of the ultra low emissions zone, and the congestion charge, fuel costs and parking charges. It is becoming simply impossible for people to drive to work in London. That affects everyone who needs to drive, from tradesmen to NHS shift workers.
When I was a London Assembly member, I worked to expose Mayor Khan’s preparations for road pricing in London, which London Centric fully exposed late last year. Under Labour’s plans, motorists could be charged 40p per mile for driving in outer London, 60p per mile in inner London, and £2 per mile, with a £5 fee, for central London. The mayor has repeatedly denied that he plans to introduce such pay-per-mile pricing, but the Government’s decision to introduce a pay-per-mile tax on electric vehicles is exactly the sort of cover that he needs to introduce it. I can reassure my constituents that I remain steadfastly against pay-per-mile pricing.
Naturally, my constituents were furious to hear the Chancellor announce that, from April 2027, the fuel duty freeze, which has been in place for 16 years, will be scrapped—along with the 5p cut that the previous Government put in place—and that fuel duty will begin to rise with the retail prices index. As prices at the pump spike as a result of the conflict in Iran, the argument for retaining the fuel duty relief introduced by the previous Government, to support cash-strapped motorists, is even stronger.
In Bromley and Biggin Hill we do not have the London underground or the docklands light railway, and Biggin Hill does not even have a railway station, so people are highly reliant on cars. The Labour party, here and in City Hall, needs to understand that. The Government and the Mayor of London must end their war on motorists, and scrap their fuel duty rise and any plans for further attacks on motorists, before it is too late.
Siân Berry (Brighton Pavilion) (Green)
Our current and persistent reliance on oil for transport, rising costs as a result of instability in the middle east, and the ongoing fuel duty freeze, all have consequences for people who use any form of transport in their daily lives. I agree with the Government—and with the many Back Benchers who have joined in supporting them—that it is far too soon to consider the Conservative motion’s demand for further multiple and ongoing freezes.
The fact remains that ending the conflict in the Gulf and the wider middle east is the best way to ease fuel market price rises. The risk of profiteering by fuel providers is a far greater threat to household budgets than fuel duty collected for the public purse. The Conservatives should consider the consequences before offering their support for any more of President Trump’s appallingly badly thought-out decisions.
Dr Luke Evans
At what point would the Green party feel that we should step in to support those in rural communities? Green Members often say that the Government need to provide more support, but if we cannot de-escalate because this is not our war, how can we support constituents in Hinckley and Bosworth, in the hon. Lady’s constituency, and up and down the UK?
Siân Berry
My speech will continue to put the case for alternative interventions that will help everybody in every family in the constituencies mentioned.
Campaign for Better Transport has pointed out to the Chancellor that the total cost of cancelling all the planned increases to fuel duty in line with the retail prices index since 2011 has brought real-term cuts for motorists for 14 years, and cost the Treasury a cumulative £133 billion between 2011-12 and 2024-25. The additional 5p cut, meant as a temporary measure when introduced five years ago, has alone cost £13 billion since then.
The fuel duty freeze has been regressive. It has helped the richest tenth of households save nearly three times as much as the poorest tenth. The fact remains that the poorest people, who can afford no holidays whether or not the Government agree to this motion, are not driving or owning cars. Yet through all this time the cost of bus and rail travel, upon which those who cannot afford to own a car rely, has continued to rise.
Adam Dance (Yeovil) (LD)
I completely understand what you are saying about public transport, but in rural communities, such as mine in Somerset, there is no public transport, so how can someone get to college? How can someone get to work? How can apprentices actually get a job? What you are saying is great, but that is a 10-year plan. We need action now.
Adam Dance
I apologise for saying “you”, Madam Deputy Speaker. Does the hon. Member agree that that plan is for the next 10 years? We need change now. We need fuel duty sorted out now.
Siân Berry
I have not yet outlined my plans; I have merely complained about the rising cost of bus and rail fares that has accompanied continued freezes in fuel duty. I will move on to my next point.
I am very aware of the manospherical gender ratio there has been in the Chamber throughout the debate, and that is pertinent to this point. Hon. Members must remember that, in any given family with a car who are just about managing, the poorest and most disadvantaged members of that family will most likely be the spouse and children of the main driver. Those people, in any part of the country, including in rural areas, often have little or no access to the basic mobility that a car can provide. They are dependent on good public transport services—often absent. They are dependent on safe streets—often absent. They are dependent on transport services to access their jobs, daily lives and essential services when the car is in use by the main driver. Members should not forget that.
Several hon. Members rose—
Dr Luke Evans
As the hon. Lady rightly points out, if someone is using alternative transport, such as buses, they are still affected by fuel duty—even more so. On top of that, the Government have already increased the cost of a bus ticket by 50%, so her argument does not hold water.
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. If multiple Members are seeking to intervene, please indicate whose intervention you are taking. It makes it easier for the Chair to know whose name to call.
Siân Berry
My apologies, Madam Deputy Speaker. I confess that I am not used to being intervened on in this fashion as I am such a minority in the Chamber, but someone has to make these points and I will continue to do so. The point about buses is well made. We need bus services and we need controls on bus fares, which we did not have until recent years. These are ongoing injustices that have compounded over the years, while people buying fuel from the pumps have been somewhat protected. But I am not saying there are easy answers.
Greg Smith
The hon. Lady has potentially misunderstood the intervention from my hon. Friend the Member for Hinckley and Bosworth (Dr Evans). She is making the case, perfectly rightly, for better public transport in this country, but bus companies and train operators running diesel trains—of which there are still a number—pay fuel duty, too. If fuel duty goes up, that will impact fares.
Siân Berry
We need more robust interventions on fares as well, and we need much more help for bus companies to be able to switch to electric vehicles and to electrify their fleets. I raised many of those points on the Bus Services Bill Committee. I shall now give way to the hon. Lady.
Helen Maguire (Epsom and Ewell) (LD)
We know that Trump’s illegal war in Iran has driven up global oil prices. To give an example, just yesterday I visited Edward Thomas & Son, a coach company in Epsom and Ewell. Last Thursday, it was forced to accept an unpriced oil delivery for its regular order of white diesel at £31,082 for 18,000 litres. In February, the same order was £23,614. That is almost a 30% increase. Ninety per cent of its work is helping children get to school, go on school trips and so on. Does the hon. Member not agree that this is just unacceptable? These are people trying to go about their day-to-day lives and just get to school.
Siân Berry
I have incredible sympathy for the people whose cases have been outlined in this debate. I am setting out a case for action that is going to make a difference, including de-escalating the conflict in the middle east, which the hon. Member for Hinckley and Bosworth (Dr Evans) briefly supported in his intervention.
I will move on to the alternative plans. Transport & Environment recently reminded us in its briefing, ahead of the spring statement, of the investments and initiatives that are really needed to help people in transport poverty. The Social Market Foundation has pointed out that despite over £100 billion being spent on cuts and freezes to fuel duty, it has made little impact on transport poverty. We have to find ways that are better value for money. Transport & Environment has suggested salary sacrifice, public transport travel cards, reinstating £2 bus fare caps, and, in the current context, targeted payments for vulnerable people and direct support for small businesses, sole traders and low-income households. That would ensure that help reaches those most exposed to the energy price rises, rather than repeating the regressive tax cuts that have taken place.
Catherine Fookes (Monmouthshire) (Lab)
In Wales, it is fantastic news that the Welsh Labour Government have put in place a £1 cap on bus fares for young people and a £3 fare for all people over 18. Does the hon. Lady agree that that is a fantastic use of funding by the Welsh Labour Government?
Siân Berry
I agree that those are good initiatives. I also celebrate the initiative of the Scottish Government, led by the Green party, to make bus fares free for people under 22. Young people desperately need that support because they rarely have access to the family car, as I mentioned.
All these interventions represent good value for money. This month, analysis by the Climate Change Committee has reminded us that we can significantly reduce the UK’s exposure to volatile fossil fuel markets if we just think a little further into the future and get things done. The Committee estimates that the transition will cost around £4 billion a year to make our climate targets. That is the cost of one oil shock like the one we are experiencing now, but it would deliver huge benefits, including resilience, the next time this happens, and we can predict that it might.
Melanie Ward (Cowdenbeath and Kirkcaldy) (Lab)
I thank the hon. Lady for giving way—I thought I would give her some further relief from the interventions from the manosphere on the Conservative Benches. She is talking about the importance of investing in clean energy to make our country more resilient and to do the right thing for the planet. Does she agree that doing that is often more cost effective for families as well? Just last week, I met with Fife Communities Climate Action Network in my constituency to talk about some of its great work to encourage and support insulation of people’s homes, for example. Does she agree that that is positive and that investing in clean energy—
Madam Deputy Speaker (Ms Nusrat Ghani)
Has the hon. Lady finished her intervention?
Madam Deputy Speaker
A point of order in the middle of an intervention, Dr Evans? I assume this point must be very pertinent and very urgent, but I will let the hon. Lady finish her intervention first.
Melanie Ward
Does the hon. Member for Brighton Pavilion (Siân Berry) agree that investing in clean, green, home-grown energy is the way to ensure that we have energy security for our country in the future?
Dr Evans
On a point of order, Madam Deputy Speaker. I am grateful for the chance to make a point of order about the intervention made by the hon. Member for Cowdenbeath and Kirkcaldy (Melanie Ward). She labelled the Conservative Benches “the manosphere”. Do you, Madam Deputy Speaker, think that it is suitable to use sex as a pejorative just because there happen to be only male Members sitting on the Conservatives Benches at this point in the debate? I would envisage it being a problem if I used such a term the opposite way to label only females sitting on the Labour Benches.
Madam Deputy Speaker
Dr Luke Evans, you have most definitely got your point on the record. Unfortunately, the Chair is not responsible for the language used by Members—if only we were—but you have made your point and it is most definitely on the record. Siân Berry may wish to respond to that or to continue with her speech.
Siân Berry
I would very much like to continue with my speech, Madam Deputy Speaker.
I agree with the hon. Member for Cowdenbeath and Kirkcaldy (Melanie Ward). We will never truly protect the families who are struggling with daily living costs, driven by fossil fuel dependence, if we do not get our economy and our transport system completely off the addiction to oil and gas that they suffer from.
I remind the House that every £1 invested in achieving climate targets is estimated by the Climate Change Committee to generate between £2 and £4 in wider economic benefits. These include major public health improvements and NHS savings that could reach another £130 billion by 2050. These are all excellent investments that have been resisted for years and years by people who should know better.
Finally, I would like to quote the Social Market Foundation. It has said that Government policy to keep freezing fuel duty has “inadvertently” hurt drivers,
“with policies that end up encouraging car use arguing that the bigger issue is a lack of investment in alternatives to driving, keeping people reliant on costly cars.”
The Conservatives should consider that if they wanted to carry out the measures that they ask for without corresponding consequences for public services, health and wellbeing, they might have considered that air travellers pay no fuel duty at all in this country. Air travel demand is driven by the most wealthy passengers, with the broadest shoulders, including those in the private jets owned by Conservative party donors and other owners of private jets. The Conservative motion could have gone further, and been more practical and less short term in its thinking altogether. Green MPs will not be supporting the Conservative motion and I am grateful for the time that the House has given me to explain why.
Dr Luke Evans (Hinckley and Bosworth) (Con)
I come here today with a mission. Unfortunately, for the past two years I have not followed closely enough the Labour party’s position on what the Government want to deliver. I have lost track of whether we are talking about pillars, aims, priorities, staging points, milestones or foundations, but at the start of the year the latest reinvention was a mission focused on the cost of living.
That was a slight change from when the Government first took office, because their main aim and their No. 1 priority at that point was to go for growth. Alas, as we have seen, that is not happening—the last figures say growth is 0%. What is more, it was evident that all the Government policies that were being put in place were actually anti-growth, as we are starting to see.
Tom Hayes (Bournemouth East) (Lab)
In a pithy sentence, will the hon. Gentleman describe the mission of the Conservative party?
Dr Evans
To win the next election, because then we can deliver the change that we are talking about.
On reducing the cost of living—the Government’s No. 1 aim for January—it seems bizarre that the measures that are being put in place have done nothing to support that. The Prime Minister went on the news on Monday with a five-point plan to deal with what is going on. He said energy bills would be capped, but we already knew that because it was announced in the Budget and the cap is in place until July. He said the fuel duty cap would be extended until September, but we knew that because it was in the Budget and then it is set to rise.
Melanie Ward
Will the hon. Gentleman tell us what the Conservative policy was in relation to fuel duty at the last election? By my recollection, it was that fuel duty would have been higher under the Conservatives than it is now under this Labour Government.
Dr Evans
The best way to decide how someone is going to behave in the future is to look at their past habits: we froze fuel duty for 15 years, and when a crisis hit in 2022 we reduced it. That is exactly the point that I was trying to make when the hon. Lady intervened. The Government have come up with a plan that is a talking shop and not doing anything. In response to the situation in Iran, they have simply reannounced what was in the Budget and further conversations with the CMA and the heating oil firms to work out whether they should or should not do something. That is precisely the point I am making: the rhetoric from the Government was “We are going to go for growth” but they then put in place some anti-growth policies, whereas now the cost of living is the No. 1 priority, but they are simply talking about that and making things worse.
Catherine Fookes
The Government are not just talking about it—we have put £53 million into supporting the cost of heating oil. That is doing something about it. When the Conservatives were in government, they took 200 days to do that.
Dr Evans
I am grateful to the hon. Lady for pointing that out because I was the energy PPS in the Home Office at that time, so I saw exactly how that worked, what it looked like and how difficult it is to put measures in place. Let me remind her that the Conservatives made a £200 unconditional payment to anyone who could claim that they were living off grid. That is a stark difference from this Government, who have put aside £53 million for the 1.5 million people across the entire nation who use heating oil because they live off grid—£35 per person. The Government have ringfenced that money, so it will only be available to the houses that are hardest hit, meaning that most households will not get any payment at all. That is the exactly the point I am trying to make: the Government talk a good game, but when it comes to delivery, they are not doing what they say.
Mr Luke Charters (York Outer) (Lab)
The hon. Gentleman is making some impassioned points about heating oil. I have a simple question for him: does he believe that the war in Iran increases the cost of heating oil or not, and will he reject the escalation that the Leader of the Opposition has called for in entering that war in the first place?
Dr Evans
Of course the war increases the risk. The Americans chose to go into that war and that is now having an impact on all of us. The question under debate is what are we doing about that and what measures are being taken. We are discussing fuel duty, which, as it stands, the hon. Gentleman’s Government will increase in September.
I have asked the Government to talk about the framework and the trigger points. I was glad to hear from the Minister that that increase is under consideration, but we need to know when that consideration will be made and what the trigger points are, because, as I rightly highlighted, we have seen all this before in 2022. We know what it looks like and we know how difficult it is to get to the canal boats, the park homes and the people living off grid.
The fifth point that the Prime Minister made earlier this week was about de-escalation, but he has no control over that if he says that he is not involved in the war. I am all in favour of de-escalation, but that is not a domestic policy that will bring down the cost of living—nothing tangible can come from that stance.
Why does this all matter so much? I live in and represent a rural constituency that is about 85% agricultural. We sit in the very heart of England, at the centre of the logistics industry. That means that every single day men and women from across Barwell, Earl Shilton and Donisthorpe get up, drive their vans, go out and drive their lorries, and support the economy.
Adam Dance
My constituent Sam works in a local haulage company. He tells me that the average profit margin for a company like his is 2%, while the cost of running a typical lorry has increased by 22%. Does the hon. Gentleman agree that the Government must support rather than damage this industry that we rely on to deliver essential goods, starting by cancelling the plan to increase fuel duty?
Dr Evans
The hon. Member is absolutely right. The Road Haulage Association has estimated that the fuel duty change will involve about an extra £2,000. On top of that, the change will hit the individual householder or car owner by about £140. The Government talk about making a difference, for example with the warm home discount or freezing energy prices, but those measures will already have evaporated given the very nature of the fuel duty escalation, on top of the prices that are rising because of Iran. People who work in the logistics industry are very susceptible to these fluctuations. It is right that we all want to move to electricity, but that is not going to happen immediately. I do not disagree with many of the arguments about the direction that we need to take, but the question is: what can we do now in the light of the reaction from Iran?
My constituents do not have the choice of walking or getting a bus, because we are a rural constituency and they rely on their cars. This increase will hit their cost of living by the very nature of the way it comes in. Let us contrast that with the 14 or 15 years of Conservative Government. That is usually the stock answer we hear from Labour Members. Gosh, 14 years! Yes, for 14 years we froze fuel duty because we recognised the impact it had on our households, on the white van man who is out working, on the delivery driver and on the lady who is driving from Hinckley to take a package up to Appleby Magna. Those people really need that support, and the change that we made and delivered had an impact.
Sir Ashley Fox (Bridgwater) (Con)
Does my hon. Friend agree that small businesses, not only in Bridgwater but across the country, were hit last year by the Chancellor’s jobs tax and have been hit this year by the additional burden of the unemployment Act and higher business rates, and that the prospect of higher fuel duty in September is disastrous not just for families who use their car for personal transport but for every small business?
Dr Evans
In true style, a knight of the realm recognises my very next point, because all these policies need to be set in context. Context is important, because each Government might need to raise taxes at some point, but here we have a toxic concoction of employment rights, more red tape, business rates going up and the support around business rates being taken away, fuel duty going up, national insurance contributions going up and the minimum wage going up. Any of those in isolation might be a good idea and might need to be done for support, but taken together they run against the Government’s milestones, mantras, missions—whatever they want to call them—on growth and the cost of living.
The pay-per-mile proposals for electric vehicles have been touched on, but I would like to expand on the issue. The proposals have brought huge consternation to many of my constituents. When I raised this issue straight after the Budget, I was blown away by the number of people from across the country who contacted me after seeing my question about how the proposals would work. There are simple, fundamental questions that the Government have not set about addressing. For example, what happens in the second-hand market? Who is judging when the mileage is being done? Are we likely to have monitors in our cars? That is meant to be done at an MOT, so what happens if I sell my car six months into it? What happens if someone lives in Northern Ireland and commutes to the Republic of Ireland? Where does the tax go then? What happens if we drive to Europe? For example, many people from my constituency like to take their caravan down to France for a holiday. Where do they pay their tax? How does that work?
The proposals are having the effect of stalling growth in the electric car market. Many people are saying, “I made the choice. I wanted to do the right thing for the environment and for my family, because that was a good decision to make”, but they are now regretting that decision, and the market is stalling as a result. I ask the Government how will that impact be felt in the context of fuel duty, and where will those measures fit into the framework of a continuing Iranian war?
To close where I started, I agree that in this place we can have a difference of opinion on when it is the right time to do something. I am pleased that the Minister said that everything was under consideration. That is really important for those listening outside. After all the Punch and Judy of this place on whose policy was right, whose was wrong and what has happened before, at the end of the day it is the families in Hinckley and Bosworth who will be looking at their budgets and at the uncertainty they see on the TV, and trying to decide what they should do.
I simply ask the Minister to outline what he would consider to be a trigger point for change. Would it be a certain price value for heating oil? Would it be a certain price value for petrol? Would it be a certain duration of the conflict? None of us knows when the conflict will end. All these questions could be addressed in a framework that we learned from during our time in government. In 2022, we had to come up with support schemes from scratch.
Mr Charters
The hon. Gentleman is right to draw attention to that 5p fuel duty cut at the height of the 2022 Russian invasion of Ukraine, but it was too slow. Will he remind the House of the level that diesel had got to at the pump when the 5p cut came in? Was it two quid? It was far too late, wasn’t it?
Dr Evans
Forgive me; I would be happy to give way again if the hon. Gentleman knows what the value was at that point. I do not know what it was because at the time I was working in the Energy Department trying to help support those households who were struggling and suffering, particularly those who lived in caravan parks, static homes and canal boats, who are off-grid and suffered by the very nature of where they got their fuel. He is right to say that we have to take this in the round. I have heard the Chancellor say that multiple times. How long will this go on? The decision is under consideration. I am not asking about when the decision is made or how to make that decision. This is more about understanding at what point we make those decisions and when the Chancellor decides that it is the right time to step in. It may well be that that decision was too late and that lessons could be learned. How do we know? That is the question I am posing to civil servants and this Government, because the hon. Gentleman’s party is now in charge of setting that out and deciding when is too long and when is too late.
I would argue that the current payment of £53 million is not enough for my constituents. Many of them will not benefit, because they will not be covered by the resilience fund. What the Government have done under the resilience fund—formerly the household support fund—is simply delegate the decision making to councils. Under the previous Government, when we were in charge, we chose not to do that because we wanted to support everyone who was struggling. It is this Government’s job to set out why they are not going to do that.
I would argue that keeping the fuel duty rise in September will create a terribly difficult time for any of us who drive cars or run a business that uses vehicles. Let us not forget that the energy price cap will change in July. The Government have rightly said that it is frozen until then, but the impact on prices will not come through the system until July, so we might well see prices and the price cap rise very quickly in July just as the fuel duty is about to come in in September. We are back to the point made by the knight of the realm, my hon. Friend the Member for Bridgwater (Sir Ashley Fox) about this toxic concoction of everything happening at once. I urge the Government to be aware of that and to set out the trigger points and the framework.
Dave Doogan (Angus and Perthshire Glens) (SNP)
I raised this entirely inevitable circumstance with the Chancellor at the spring statement, and she did something that she is given to do, which was to glaze over briefly and then talk about the strength and broad shoulders of the Treasury because of the difficult decisions that she had taken, as though they affected her and not the working people up and down these islands who have had their bank accounts raided by an insatiable appetite for more and more tax from this Government.
Dave Doogan
How could I not give way to the Scottish Labour MP who has managed to come in here for the tail end of the debate?
Melanie Ward
That was a little bit unnecessary. The hon. Gentleman is talking about raising taxes, and I just wonder whether he would acknowledge that the SNP Scottish Government actually have higher taxes in place than the Government in England.
Dave Doogan
I am very happy to explain that to the hon. Lady when I get to that element of my speech, which I will in due course.
The other thing that really irritates me about this Government is the way that they talk about the just transition. They say, “We will be using fossil fuels for another 50 years, and we will be producing them in the United Kingdom”, as though they hold all the levers. Let me explain something to Members on the Government Front Bench: if they continue to apply Labour’s atrophying interventions in the North sea oil and gas sector, the industry, which is global—I do not know whether that is news to Ministers—will go somewhere where it can make a living and a profit and does not have some sort of nefarious Government taxing it out of existence.
The specific 5p fuel duty referred to in the motion, is regressive—that much is pretty clear—and iniquitous. It is particularly iniquitous to people who live in parts of these islands that are more remote, such as my constituency. I see that the hon. Member for Gordon and Buchan (Harriet Cross) is back in the Chamber. She detailed that her constituency is 2,076 sq km. This is not a competition, but Angus and Perthshire Glens is 5,525 sq km and 166% larger than her constituency, actually.
Harriet Cross
I thank my constituency neighbour—almost—for giving way. Although my constituency might not be the biggest, it is definitely the prettiest.
Dave Doogan
This is where I practise respectful disagreement.
For rural areas such as my constituency, the constituency of the hon. Member for Gordon and Buchan, and many other places across all four nations, this issue is really challenging. There is not limited access to public transport in many places such as ours; there is no access to public transport in any meaningful sense. Remote areas get a lot more winter, and the people there tend to work in more agricultural professions. They tend to drive larger, heavier vehicles that are more fuel-hungry, so they will end up paying more. Deliveries have to come from further away, and that all gets added to the cost. Of course, all that adds to the cost to councils of delivering public services. The public services delivered in constituencies such as mine are very much more expensive to deliver than those in Holborn and St Pancras.
It is on that point that we need to see how much harder this issue will impact on people in rural areas. I have looked at the “Fuel Finder” app. At the BP petrol station at the bottom of Montrose before crossing the river, the price of a litre of petrol is 149.9p. If I go to the BP petrol station over at Vauxhall Bridge Road, the price of a litre of petrol is 5p cheaper. People in Scotland are already paying a premium that people in London and the south-east do not pay on their fuel, and the 5p that the Labour party wants to apply will come on top of that.
The UK rate of oil consumption for heating is 4.9%. In Angus and Perthshire Glens, the rate is 13%. Some 6,101 households heat their homes with oil. Oil has gone up sometimes by 150%, so a £300 to £400 delivery is getting on for £1,000. There are also punitive requirements for the volume that people get delivered. A further 2,000 people in my constituency are on tankered gas. That must not be forgotten in this cost spike crisis, which, as I said, I predicted at the Chancellor’s spring statement.
Dave Doogan
Before the hon. Lady gets back to her feet, she asked me about tax and she should be aware—although apparently she is not—that most income tax payers in Scotland pay less tax. Over and above that, her constituents do not have to pay for their tuition fees when they go to university. All her constituents, like my constituents, pay 30% less for their council tax than people in England. The Scottish living wage that her constituents benefit from is 74p per hour higher than the UK’s minimum wage. Of course, her constituents get the £40 Scottish child payment on top of all the other benefits that the SNP has delivered. On that note, I will take her intervention.
Melanie Ward
I could come back to the hon. Gentleman on all the ways in which my constituents are getting really poor value for money in Scotland, such as the cuts to police numbers in Fife and excessively long waiting lists in the NHS that are not falling, as they are under a Labour Government in England.
The hon. Gentleman talks about heating oil. He will be aware—in fact, I think he referenced it—of the additional £4.6 million for the Scottish Government that the Prime Minister announced on Monday to support people in rural areas and vulnerable households dealing with the increases in the price of heating oil caused by the war in the middle east. Can the hon. Gentleman tell us when the Scottish Government will make that funding available to his constituents and my constituents?
Dave Doogan
I do not have the detail of the Scottish Government’s plans, but I am pretty sure that nobody in England or anywhere else in the United Kingdom has received actual monetary support from that funding.
Let us be really clear. The Chancellor talks about the broad shoulders of the Treasury and says that thanks to her fiscal wit—if you can believe that—she has come up with £52.4 million. If we divide that money across the number of people who will need support, it comes out at about £35. That is £35 of support from a Labour Government for people seeing a £700-odd price shock in heating oil. Somebody somewhere in the Treasury needs to get themselves a calculator.
The fuel duty increase is inflationary: it will feed through to the prices of goods and services, all of which will subsequently have VAT added on to them. The 5p added to the price of fuel is actually 6p, because it is added before the VAT is added to the fuel, so it is not 5p at all.
I am pretty certain that we can read in the Government’s amendment to the motion the vacuous nature of their application to this subject. Like other right hon. and hon. Members, I am pretty confident that a wee bit closer to the time of the elections in Scotland and Wales in May, the Government will suddenly find the wit to scrap this hike in fuel duty. I am quite happy for them to do that, but as other people have pointed out, households are in crisis now. Now is the time for the Government to lead, but that will never happen with a Labour Government.
Robbie Moore (Keighley and Ilkley) (Con)
It is good to speak in this debate on a subject that is impacting on all our hard-working businesses, families, hauliers and those involved in the logistics industry—the rise in fuel duty.
It is clear that Labour is planning to put up fuel duty for the first time in 15 years. Despite the conflict in the middle east, which is pushing up inflation and the cost of petrol at the pump, we have a Chancellor who said in her spring statement that this Labour Government have “the right economic plan” and boasted that households would be better off. She is doubling down on her plan to hike fuel duty, fund more welfare handouts and scrap the two-child benefit cap. That is not benefiting the grafters who are driving local economic growth across our constituencies. That is why increasing fuel duty for the first time in 15 years is such a negative approach, and it is impacting on all those across our constituencies.
Robbie Moore
Last autumn, my constituent Lesley O’Brien got in touch with me with serious concerns about the ramifications of any potential fuel duty hikes on the road haulage sector. As well as being a trustee of the Road Haulage Association and the founder of the transport forum Freight People, Lesley is the joint managing director of Freightlink Europe, a haulage company based in my constituency in West Yorkshire. It is a traditional, family-run business, based on the core values of honesty, respect and a dedication to provide the best level of service to customers.
However, businesses such as Freightlink Europe, and the hard-working people who run them and are employed by them, face unprecedented difficulties. Many haulage companies and those involved in logistics have contacted me directly with their deep concerns. Through no fault of their own, the average profit margin for many of those businesses has been significantly reduced to only 2%, if not lower, and the cost of running a typical haulage business has increased by more than 22% in recent years.
Melanie Ward
I wanted to respond to the point that the hon. Gentleman made a moment ago. He said something to the effect that the people who would benefit from our Government lifting the two-child benefit cap were not grafters. Does he not agree that the people who will benefit from the two-child benefit cap being lifted are children who were living in poverty, and that the majority of the households that those children live in are, in fact, in work? They are grafters.
Robbie Moore
My firm view is that the Government should be supporting all of those individuals to drive economic growth across the country. By removing the two-child cap, the Government are saying to those families who have worked out what their household spending power will be over a long period of time, “If you want to have more than two children, the Government will step in and pay for you.” That negatively impacts hard-working families that have made those hard fiscal decisions throughout. The reality is that increasing the level of welfare spending by taxing businesses such as those across my constituency—those involved in the haulage industry and the logistics sector that will now see a hike in the price of fuel—negatively impacts those who are driving economic growth, and therefore impacts everybody.
Tom Hayes
I think the point that my hon. Friend the Member for Cowdenbeath and Kirkcaldy (Melanie Ward) was making is that, contrary to what the hon. Member said, the majority of parents of children who are disadvantaged by the two-child benefit cap are working. They are grafters; they are the hon. Member’s constituents, who are often working multiple jobs just to make ends meet in the difficult cost of living crisis that we inherited. Surely he is not calling the parents who will benefit from the lifting of the two-child benefit cap, including his constituents, workshy.
Robbie Moore
It is interesting that the hon. Gentleman has not turned up to this debate—a debate on an incredibly important issue that is impacting all of our constituents, including his—in good enough time to make a speech on the fuel duty increase, but wants to turn the debate back to a point that I answered in my response to the hon. Member for Cowdenbeath and Kirkcaldy (Melanie Ward). That point still stands. If the Government increase taxes on the hard-working businesses and individuals across the country who want to drive economic growth in order to benefit only a very few people, they are not providing opportunity for many young people and hard-working families across all our communities.
Dr Luke Evans
Back when we were in government, one of the ways we tried to solve this problem was by changing the universal credit cut-off limit from 63% to 55%, which meant that the more work people did, the more money they kept. That is exactly the way to support people back into work: making sure that they keep more of their own money. That incentivises work, rather than disincentivising it. Does my hon. Friend agree that there is an ideological difference here? We support work; the other option is just a handout.
Robbie Moore
I absolutely agree with my hon. Friend. By taxing families and individuals less, we provide them with more money in their pockets and we drive economic growth, as they have more of their own domestic spending power.
This Labour Government want to hit many businesses and individuals with three consecutive fuel duty hikes in a matter of months. If these proposals go ahead, motorists and haulage companies face being hit with the biggest tax burden in years. The road haulage industry is critical to our nation’s economic success: goods are moved around daily, and logistics are key to keeping our country moving. Everything we eat, drink, wear and consume depends on road haulage services—on companies such as Freightlink Europe. Road freight moves 81% of all goods, and 98% of all agricultural and food products are moved around the country by road haulage.
The Road Haulage Association estimates that a 5p rise in fuel duty will result in a typical motor vehicle-owning household spending an extra £100 each year and increase annual household spending by £1.9 billion, which is a whopping £7.3 billion over the rest of this Parliament. In my eyes, that is a significant additional tax burden for this Government to put on those households. At a time when the conflict in the middle east is pushing up inflation and the cost of petrol at the pump, it is beyond belief that Labour wants to push ahead with this fuel duty hike.
John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)
My hon. Friend is making an excellent speech. I want to highlight the choices that people living in rural constituencies such as mine are making. In Coldstream, the price of diesel per litre has gone up from £1.41 to £1.69 over the past few days. That is a huge increase, but because of the prospective tax rise that is coming down the line from the Labour Government, constituents tell me that they are looking at jobs and considering their alternatives, because they have to drive to get to work. A constituent who has been offered a new job that is further away, and who will have to drive further to get to it, is thinking about turning it down because once the 5p fuel duty increase comes in, he will not be able to get to his job.
Robbie Moore
My hon. Friend makes an excellent point. I will come on to the additional challenges in rural areas, but he makes a clear and concise point: if people have to travel further for a job opportunity, they are going to be taxed more by this Labour Government. That is on top of the Labour Government removing the rural services delivery grant that was providing additional support to many local authorities operating in rural communities. We clearly have a Government who are not interested in supporting our rural communities. Of course, this fuel duty hike comes on top of the increase in employer national insurance contributions and business rates. It will impact our care workers, our district nurses and our hospice sector, all of which are also impacted by the rise in employer national insurance contributions.
At a local level across the Bradford district, we face an additional tax burden: the clean air zone, which was rolled out several years ago. A taxi driver with a non-compliant vehicle who wants to travel into Bradford—an area that we all want to see grow and thrive economically—faces a daily charge of £7 to do so. A white van driver is charged £9 daily to go into Bradford, and someone operating a bus or a heavy goods vehicle is charged £50 a day to do so, as a result of the choices that Labour-run Bradford council has made.
Labour-run Bradford council has received £20 million from collecting this additional tax from our hard-working businesses over the period that the clean air zone has been in force across Bradford. It is something that I am firmly opposed to. Bradford council will say that it is going to spend this money wisely across the district, but based on a freedom of information request that I submitted to Bradford council, I can contradict that narrative. As of 2023, just £4.1 million of all highways spending was spent within the Keighley and Ilkley constituency over a six-year period. To put that in context, the spending in Bradford East, Bradford West and Bradford South was £19.2 million, £17.4 million and £13.1 million respectively. That illustrates that there is no fairness in how Bradford council spends the money it is collecting from my hard-working constituents across Keighley and Ilkley.
Robbie Moore
The right to roll out a clean air zone was given to local authorities, enabling them to make that decision, but some local authorities have refused to do so. The Mayor of Greater Manchester, Andy Burnham, decided not to roll out a clean air zone—that is an example of a Labour administration at a local level making the right decision on this issue. Labour-run Bradford council, however, decided to impose an additional tax on hard-working motorists across the Bradford district. As a result, places in my constituency such as East Morton face increased traffic congestion, road usage and speeding in the areas outside the clean air zone, where motorists try to take different roads to avoid any additional charge.
Rural communities will also be hard hit, as has been rightly pointed out by my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont). Many of those businesses are in our farming community, which has already been hit by additional cash-flow implications. One point that has not been raised in this debate so far is the increase in red diesel prices, which have spiked by 60% in the last month alone, as supplies remain tight. From the research I have done, red diesel has increased up to an average of 109p a litre in March, up from 67p a litre in February. Farming businesses are reporting being quoted a variety of prices in the past month, ranging from 100p a litre to 135p a litre. That is a significant increase from the 67p a litre we saw just last month.
Several farmers are rightly querying why red diesel prices appear to have increased much more rapidly than road diesel and petrol prices. What meetings is the Minister having with Department for Environment, Food and Rural Affairs Ministers specifically on red diesel, which is having an impact right now on the cash flow of many of our hard-working farmers? That is in addition to delinked payments dramatically dropping, the chop and change over the sustainable farming incentive, and the uncertainty that this Government are creating for many of those working within our farming community, and that is on top of fertiliser prices going up.
The Prime Minister said earlier this week that he will always support working people, but what does that say to those hard-working people across the country and across Keighley and Ilkley, such as Lesley O’Brien, who I mentioned earlier? Businesses and employers face bigger and bigger hurdles the longer this Labour Government are in power. Three consecutive rises in fuel duty is an insult to hard-working people across this country. The Prime Minister and this Government need to get a grip, back our hard-working businesses and show some empathy to those concerns consistently being raised by Opposition Members. It is disappointing, although perhaps not surprising, that we have not heard one Labour Back Bencher contribution in an incredibly important debate on fuel duty.
Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)
Without getting into a fight about who has the biggest constituency, Moray West, Nairn and Strathspey is in the top five for geographic size, and my constituents grapple on a daily basis with energy costs across the whole suite of energy measures, whether that is road fuel, heating oil, tank gas, or the electricity prices that they pay. The issue for them is that the combination of all those things is totally disproportionate. The highest prices for road fuel are paid in rural areas such as those in my constituency. The highest price for heating oil is paid there, because there are high distribution costs. The highest price for electricity, because of high standing charges, is paid in my constituency and in constituencies in north Wales and Merseyside, which is the other high standing charge area.
The combination of all that means that my constituents are paying substantially more for their energy than constituents elsewhere in the country. Successive Conservative and Labour Governments have presided over discriminatory—I do not use that word lightly—energy charging for electricity. To have that compounded by the highest fuel charges and the highest oil charges is extremely painful for those households who, like everyone else, are suffering from the cost of living crisis. They also have the coldest temperatures in the UK, and these constituencies are producing the highest amount of energy per capita. The people who are using that energy hundreds of miles away are paying less to use it. The situation is utterly disgraceful and needs to change.
This Government have had nearly two years to make changes to standing charges and electricity prices, but they have not done it. They have not made a decision on it, and decisions are taking far too long to be made. Pace is everything in this. People are suffering every single day, but it is not just the individuals who suffer. Many Members have referred in this debate to the cost to businesses in these areas, generally from high transport costs. For businesses to get around and deliver their goods, to get their goods to market and to get their supply chain to deliver to them frequently involves travelling large mileages. Public services, including our emergency services, are paying vast amounts for fuel.
On Monday, while I was experiencing a very enjoyable walk to work on a bright spring day here in London, my constituents in Aviemore were contending with a temperature that felt like minus 5°, and the Highland council and the trunk road authority had gritters out for a considerable part of the day to keep the roads safe. Those gritters travel hundreds of miles on their routes because that is what they are required to do, which means that local authorities, the NHS boards and other public or emergency services are paying out vast and unpredictable amounts for fuel when budgets have already been set. Capital projects involve built-in risk to cover future price increases that are quite considerable, so they are protected to an extent, but that does not apply when it comes to public authorities’ day-to-day operational costs. The fuel price increases include increases in heating oil prices. Many primary and secondary schools in the Highlands, and Moray and Aberdeenshire and in other parts of Scotland—and, indeed, other rural areas in the rest of the UK—pay for their heating oil, and these increases will have a very detrimental impact on them.
The hon. Member for Gordon and Buchan (Harriet Cross) made many reasonable points about the impact of the energy profits levy and the fiscal regime that governs North sea production, and about the need for us to continue to produce oil and gas for as long as is required, while still making a transition. Let me gently point out to Conservative Members that while I agree with them that the EPL needs to be changed immediately—in fact, it is beyond time for it to be changed—they have drawn away from that transition to renewables because of the pulling away from climate change targets. I know that North sea companies agree with them about the EPL, but they were utterly dismayed about that pulling away from the transition, because the oil and gas majors are the same people who are investing in renewables. We need to get that transition right to avoid the job losses that the hon. Member mentioned.
A number of Members mentioned bus fare caps. Let me, again, gently point out that in my constituency in the north of Scotland, and across the highlands and islands, a pilot is being run for a £2 cap enabling people to travel, in some cases, for hundreds of miles for £2. That is progressive, because people in, for example, Inverness in the highlands who need access to services have to travel hundreds of miles to get it. The cap is about treating people with fairness, recognising that they are at the heart of our energy production and are still paying more for their energy, and giving them some services back for that. Peak rail fares have also been withdrawn.
Unfortunately, the hon. Member for Cowdenbeath and Kirkcaldy (Melanie Ward), who mentioned heating oil support in Scotland, has left the Chamber, but I can tell the House that the Scottish Government have more than doubled the heating oil funding provided by the UK Government—although is still nowhere near enough, because the UK Government should be taking far more responsibility and putting in far more money. People will be able to apply for that support from 1 April, and it will be delivered through Advice Direct Scotland. there is a plan in place, and it is moving forward.
Red diesel used to be available to local authorities for gritting roads. Reinstating it would make a huge difference to the local authorities in the north of Scotland who have to spread grit for considerably longer than those in many other parts of the UK, and I urge the Minister to consider doing so, because it is essentially an emergency service. Our roads would not be safe in the depths of winter without being gritted, and making red diesel available to those vehicles again would not be a bad idea at all.
Finally, let me simply urge the Government to take account of what happens in rural areas—how people commute, how they get to work, and how services are delivered—and to consider that in the context of fuel duty. They have the power to fix fuel duty. Such certainty is important, especially to people who are planning and budgeting for a year ahead, and that applies to public services in particular.
John Lamont
To pick up the hon. Member’s point about fairness, he will be aware that the Institute for Fiscal Studies has highlighted that Scottish taxpayers are £710 on average worse off compared with taxpayers in England as a result of the Scottish Government’s higher rates of income tax. Does he think that is fair?
Graham Leadbitter
I have always believed that the tax we pay is part of a contract with the state, and that we should consider whether it is reasonable to pay that price for the services we get back. I would also observe that we have to look at tax in the round. Broadly speaking, council tax in Scotland is considerably lower than in the rest of the UK. The tax on the accommodation I use in London is certainly considerably dearer than that on my own property at home, which is larger, and that is pretty much the case throughout Scotland. The cost of living is generally cheaper in Scotland than it is in central London.
Graham Leadbitter
And the taxation being paid gives people back more services and better services. Things such as the removal of peak rail fares and the freeze on bus fares—the cap on bus fares has been put in place and is being tested in the north of Scotland—all really benefit people. Beyond that, however, more than half of taxpayers in Scotland do not pay more income tax than people do south of the border. That is a fact.
I urge the UK Government to consider many of these proposals. They could consider measures on bus fares and peak rail fares, but they also have the power over key taxation levers, including fuel duty. They need to make decisions quickly to give people more certainty and a little bit less risk about where things are going. Some things are not controllable, and I wish the Government did not have to consider them, because they are difficult, but the Government have levers that can make it a bit easier for people, and they should use those levers.
Greg Smith (Mid Buckinghamshire) (Con)
How absurd it is that, on an issue that affects each and every one of our constituents, whether they drive their own car or take the bus or a diesel-powered train, not one Government Back Bencher—not one—sought to catch your eye, Madam Deputy Speaker, to make a speech either to defend the Government’s plan to increase fuel duty this September, or perhaps even to have the backbone to stand up and oppose it.
Meanwhile, from the Conservative Benches, we heard the case set out clearly and with passion by the shadow Secretary of State, my right hon. Friend the Member for Basildon and Billericay (Mr Holden), in opening the debate. My hon. Friend the Member for Gordon and Buchan (Harriet Cross) rightly spoke about the volume of internal combustion engine vehicles in the United Kingdom, exploring how far this tax rise will go and how Labour simply does not understand rural life, as well as the folly and unfairness of “pay per mile” for rural communities.
My hon. Friend the Member for North Dorset (Simon Hoare) rightly identified the absurdity of the Government preferring to import oil rather than use our own resources in the North sea. On the fuel finder, he made an accurate point, which I recognise from my own constituency, about the scarcity of filling stations in rural communities. I accept that we had a bit of a trade-off with constituency sizes this afternoon, but I can think of only eight filling stations in my modest 336 square miles in Mid Buckinghamshire. It is a point well made that, in rural communities, people often have to travel great distances to fill up with fuel, and may end up burning more fuel by going to the apparently cheaper station further away.
My hon. Friend the Member for Beaconsfield (Joy Morrissey) spoke good Buckinghamshire common sense when making points about rural communities. Likewise, that case was made by my hon. Friends the Members for North West Norfolk (James Wild), for Hinckley and Bosworth (Dr Evans) and for Keighley and Ilkley (Robbie Moore). My hon. Friend the Member for Bromley and Biggin Hill (Peter Fortune) made good points about the simply ridiculous and hideous levels of taxation on motoring in our capital city under Labour Mayor Sadiq Khan.
Let us ask a very simple question. When the Chancellor talks about asking those with the broadest shoulders to pay more, does she mean the care worker filling up their car to get around to their house visits, particularly in rural communities? Does she mean the self-employed delivery driver keeping our high streets alive? Does she mean the small business owner trying to make ends meet? I very much hope that she does not, but what we see on the ground, as the reality, is that those are exactly the people who will be hit hardest by this policy of increasing fuel duty.
John Slinger (Rugby) (Lab)
Given the hon. Gentleman’s concern for the various categories of workers and businesspeople he has just set out, can he explain why his party, when in government, planned to oversee an increase in fuel duty and did not budget for the kind of freeze that he is now demanding, were it to have won?
Greg Smith
The hon. Gentleman is late to the debate—we have been around that a few times over the course of the afternoon. The record of the Conservatives in government was to freeze council tax and freeze fuel duty—indeed, we cut it when we saw Russia invade Ukraine in 2022. Conservatives stand on a proud record of keeping fuel duty down, freezing it and cutting it. It is his party that, in government, is going to increase it on hard-working people this very year.
Let us be absolutely clear: this is a tax rise, a regressive tax hitting the poorest the hardest; a deliberate, calculated and, frankly, cynical tax rise phased in carefully in the hope that people will not notice. We have a rise in September—a back to school tax. We have another in December—a Christmas shopping tax. And then, in March, we have a spring clean of people’s wallets. Three moments in the year, three hits to working people.
Dr Luke Evans
It would be remiss of me not to point out that in July the price cap will be reviewed. Does my hon. Friend agree that there is a decent chance, given what is happening in Iran, that we may well see an increase in energy bills anyway?
Greg Smith
My hon. Friend, as usual, makes a clinically accurate point, and he is absolutely right to do so.
The truth is that the headline figure does not even tell us the full story. This is not just a tax rise; it is a tax on a tax. Fuel duty is applied first and then VAT is charged on top of it. So when the Government increase fuel duty, they are also increasing the VAT paid on that tax—a tax on a tax. That means that what they present as a 5p rise is not really 5p in practice, but closer to 6p at the pump—a hidden double tax built into the system, taking more from every driver, every business and every household.
We saw that argument tested just this weekend. The Energy Secretary was asked directly about the soaring cost of fuel and his instinct was simply to point to global events, external pressures and anything other than the decisions being made here at home in Whitehall. But he was confronted by a simple, undeniable fact: a breakdown of the price of a litre of petrol showed that fuel duty alone accounts for around 38% of the cost and, once VAT is added on top, that more than half of what drivers pay at the pump is tax—more than half.
Let us be clear: this is not simply about international markets or events beyond our control. Of course global factors play a role and of course wholesale prices fluctuate, but when over half the price at the pump is made up of taxes set by this Government, Ministers cannot hide purely behind external circumstances. They cannot blame global markets and ignore their own policy choices. And they certainly cannot claim to be easing the cost of living while actively increasing the tax burden built into every litre of fuel. The consequences ripple through the entire economy. Equally, when prices go up, including at the hands of the Chancellor, crime also rises. Already we are seeing reports from our hauliers across the country of fuel thefts taking place. That is serious.
Fuel is not a luxury; it is fundamental to how the country works. It is how goods get to our supermarkets, how tradespeople get to jobs and how carers reach the most vulnerable. When the cost of fuel rises, the cost of everything else rises—shops feel it, businesses feel it, families feel it—and it is, of course, inflationary. That matters not just for household budgets, but for the public finances. Around a quarter of the United Kingdom’s national debt—some £750 billion—is index-linked, so higher inflation means higher debt interest costs. In other words, this policy risks making the Government’s own fiscal position worse even as it makes life harder for working people.
The question is: what are the Government going to do, and why are they doing this? Why impose higher costs on drivers, businesses and families at a time like this? The answer lies in a failure at the heart of this Government’s approach: they have lost control of welfare spending. Instead of taking the difficult decisions required to ensure that welfare spending is sustainable and properly targeted, they have allowed costs to rise and rise. Now, having failed to grip that challenge, they are asking working people to pick up the bill. We have already seen tax increases on jobs, family businesses, our high streets and our farmers; this is simply the next step. Drivers are being asked to pay the price for the Government’s failure.
There is a different approach. In government, the Conservatives understood the pressure that fuel costs place on households and businesses, which is why we cut—I repeat, cut—fuel duty, froze it year after year, and stepped in again when global pressures caused prices to spike. We recognise that Governments do not balance the books by making it more expensive for people to go to work or to set up or operate a business and do not hide tax rises within the price at the pump. No one can create a system where people are taxed twice—once through fuel duty and then again through VAT applied on top—and call that fair. This policy fails the basic tests; it is an unfair tax. We Conservatives will oppose this unfair tax rise, and any Member who cares about what our constituents are paying at the pump will surely vote for our motion tonight.
The Exchequer Secretary to the Treasury (Dan Tomlinson)
I thank hon. Members for their contributions throughout the debate. I thank the hon. Member for Mid Buckinghamshire (Greg Smith) in particular for his winding-up, as well as the Tory Whips for giving me the opportunity to remind the House of his support for Liz Truss as PM. My Parliamentary Private Secretary, my hon. Friend the Member for Hastings and Rye (Helena Dollimore), has just passed me the 10 reasons the hon. Gentleman set out for supporting Liz Truss for PM—I do not know whether that is something he now regrets.
I will turn to the serious matter at hand. We are debating this issue at a time of significant international uncertainty. As the House is aware, we are now in our third week of the conflict in Iran and across the middle east. As the Prime Minister has made clear, our priority will always be the national interest through protecting British nationals and supporting our allies.
This Government recognise that the conflict is not just a matter of foreign policy, and that it also has direct consequences for individuals and families here in the UK. Movements in global energy markets are likely to put upward pressure on inflation, and the longer this conflict continues, the greater the risk it poses to both economic stability and the cost of living in the UK.
That is why the Government are clear that rapid de-escalation remains the best way to protect people from further fuel price increases. We are working with our international partners to support efforts to secure key energy routes and guarantee the security of vessels passing through the strait of Hormuz. We are also supporting a co-ordinated release of collective International Energy Agency oil reserves, the release of which has helped to stabilise international oil markets.
Dr Luke Evans
The Minister is right to talk about de-escalation and look to the international side, but, as I raised in my speech, there are domestic factors at play here too. What are the Government doing to set out a timeline to make these decisions and assess their implications so that the country can plan around what may or may not be going on? We do not know how long this will go on. What points are the Government looking at to make and inform their decisions?
Dan Tomlinson
I will come on to talk about fuel duty; I was just setting out the context at the opening of my speech.
The Government’s approach is to focus squarely on the British national interest and the economic interests of British households. The Opposition have clearly taken a different approach, choosing instead at times to egg on military action, focusing more on posturing and trying to get one up on the Government than on looking after our own at home and abroad.
Mr Jonathan Brash (Hartlepool) (Lab)
My hon. Friend hits the nail precisely on the head. We are debating a possible fuel duty increase seven months ahead of it happening. The reality is that the Opposition have been caught championing an illegal war in the middle east that the public of this country do not support, and they are trying to divert it with this nonsensical argument.
Dan Tomlinson
My hon. Friend is right: the Opposition are totally on the wrong side of common-sense public opinion in this country. On the most important of tests, they have failed. He is also right to point out that the fuel duty increase is pencilled in for September, as the Chancellor set out in last year’s Budget. I think it is worth reminding the House that fuel duty right now is lower than it was in 12 of the 14 years of the Conservative Government. In 2010, 2011, 2012 and all the way up to 2022, fuel duty was higher than it is now.
In the 2025 Budget, we extended the temporary 5p per litre cut in fuel duty until the end of August this year, and we cancelled the inflation-linked increase that had been planned for 2026-27. Taken together with decisions made since the 2024 Budget, the Government’s fuel duty freeze will save the average motorist more than £90 compared with the plans that we inherited. Conservative Members, who have made contributions in this debate, stood in the July 2024 general election on spending plans that would have had fuel duty increase by 5p—[Interruption.] Yes, it is true.
Unless the Conservatives are disowning the official forecasts that were published before the general election and the manifesto on which they stood—which, by the way, did not mention plans for fuel duty—I think we are again discovering that there were further black holes in the Conservatives’ spending plans. Their plans, which were set out in the official forecast in the run-up to the general election, said that fuel duty would increase by 5p last year—by RPI last year—and then by RPI again this year. We have instead chosen to freeze fuel duty both last year and this year and to maintain the 5p cut until September of this year.
The Liberal Democrat spokesperson, the hon. Member for Westmorland and Lonsdale (Tim Farron), and other Members made very important points about the impact of fuel price increases on those in rural communities. He will be aware, as I believe it applies to his constituency and to some of the others mentioned today, of the rural fuel duty relief scheme, which does provide a reduction to motorists in those parts of the country that are more rural. As I said in a Westminster Hall debate, which some in this Chamber attended, I am always happy to receive representations on whether that scheme should be widened.
The hon. Member for Gordon and Buchan (Harriet Cross) asked about the electric vehicle excise duty change that will be introduced in the coming years, and whether it will be extended. No, it will not. The plan is as set out at the Budget last year. Government Members think that it is fair that all vehicles that contribute to the wear and tear on our roads should also contribute towards the repair costs and to the public finances, and they will do so at a lower rate of 3p rather than 6p, which was the average amount paid by those who pay fuel duty.
Harriet Cross
Just for clarification, my point was that that is a pay-per-mile scheme and that the pay-per-mile basis would not be extended to petrol and diesel cars. Is the charge per mile on EVs a gateway for that extending to petrol and diesel vehicles?
Dan Tomlinson
The EVED charge is on electric cars because they do not pay fuel duty. Petrol cars do pay fuel duty, which, because it is on a litre of petrol, is a charge that is determined by how much someone drives.
The hon. Member for Brighton Pavilion (Siân Berry) made some good points about public transport. I congratulate her on getting through the speech after the very large number of interventions that she had to respond to—and she responded to them well. I point out that this Government are introducing the first rail fares freeze in 30 years and that we are investing £38 million to roll out 319 new zero emission buses across England—lots of good things.
As ever, decisions on taxation will be taken at the appropriate time, based on the best evidence and with careful regard to the public finances. The Government will continue to take the right decisions, protecting the public finances and supporting families with the cost of living.
The previous Government left us with the worst living standards stagnation in memory. A Reform Government would crash the economy just like Liz Truss did, with wild unfunded promises. The Greens would push up energy bills by blocking clean power. This Government reject the chaos offered by Opposition parties. We have an economic plan that is the right one for Britain. Our plan means that we are more prepared for this shock than otherwise, with borrowing falling by 1% of GDP last year, our power supply now less reliant on the gas rollercoaster, living standards rising, inflation falling, and the big and right decision to take £117 off annual energy bills in April yet to come. It is the right plan, and this Government will stick to it for the good of the British people and this great country that we all serve.
Question put (Standing Order No. 31(2)), That the original words stand part of the Question.
Madam Deputy Speaker (Caroline Nokes)
I will now announce the results of today’s deferred Divisions.
On the draft Employment Rights Act 2025 (Investigatory Powers) (Consequential Amendments) Regulations 2026, the Ayes were 368 and the Noes were 107, so the Ayes have it.
On the draft Higher Education (Fee Limits and Fee Limit Condition) (England) (Amendment) Regulations 2026, the Ayes were 277 and the Noes were 98, so the Ayes have it.
[The Division lists are published at the end of today’s debates.]
Student Loans
(1 day, 4 hours ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Madam Deputy Speaker (Caroline Nokes)
I inform the House that the Speaker has selected the amendment in the name of the Prime Minister. I call the shadow Secretary of State.
Laura Trott (Sevenoaks) (Con)
I beg to move,
That this House calls on the Government to set the interest rate on Plan 2 student loans at a level which ensures that balances will never rise faster than RPI inflation; further calls on the Government to stop the freeze on repayment thresholds; and also calls on the Government to create more apprenticeships for 18-21 year olds, funded by controlling the number of places on university courses where the benefits are significantly outweighed by the cost to graduates and taxpayers.
In June 2023, the then shadow Education Secretary, the right hon. Member for Houghton and Sunderland South (Bridget Phillipson), proclaimed, “Graduates, you will pay less under Labour”. Well, it turns out that that was not true; under Labour, graduates are paying more. So far, under this Government tuition fees have gone up twice. This is a long way from the abolition of tuition fees offered up by a fresh-faced candidate for the Labour leadership just a few years ago—I wonder what happened to him.
It is no wonder that students feel misled by this Government. Not content with hiking tuition fees when they said they would not, this Government also froze the thresholds for repayments, making loans even more expensive for graduates. As with everything this Chancellor touches, she makes it worse. Her choice to freeze the repayment thresholds has left young people paying more and sooner. What did the Chancellor say when challenged about the threshold freeze in January? She said that the student loan system is “fair and reasonable”. To be clear, this was the stance—that the student loan system and the threshold freeze were “fair and reasonable”—of the Labour Government as recently as January. Tell that to the graduate forced to pay an extra £24,000 because of the Chancellor’s changes. The Chancellor is wrong: it is not fair or reasonable.
Mr Jonathan Brash (Hartlepool) (Lab)
Given that plan 2 tuition fees were introduced by the Conservatives in 2012, that they froze the repayment thresholds in 2016 and that they abolished the maintenance grants, was that fair then?
Laura Trott
The hon. Gentleman is missing the fact that Labour has made it worse. Even now, the Chancellor has changed her tune—no surprise given the track record of this Government. She now says that the system is “broken”, but young people are apparently not at the “front of the queue”. I did not see that on the front of the Labour manifesto. We on the Opposition Benches think that young people should be at the front of the queue, because thanks to Labour, Britain’s youth unemployment rate has topped the eurozone for the first time ever. Graduates coming out of university cannot get jobs. Graduates in work are seeing their student debt mounting up.
Dr Neil Hudson (Epping Forest) (Con)
I have been contacted by many students in Epping Forest who are deeply concerned about their future debt and by many graduates who are worried about ballooning debt on these plan 2 loans. Does my right hon. Friend agree that the Labour Government have an opportunity to step in and relieve the pressure on young people and adopt the Conservative plans to scrap real interest rates on these plan 2 loans?
Laura Trott
My hon. Friend is absolutely right. We have a chance today to create a new deal for young people. I hope that some Government Members vote for it.
Helena Dollimore (Hastings and Rye) (Lab/Co-op)
I must declare an interest as someone in the first year group to have a plan 2 student loan under the broken system introduced by the Conservatives and the Liberal Democrats that we have today. Will the right hon. Member apologise to my generation for £9,000 tuition fees, for the broken system she created and for failing to introduce the Renters’ Rights Act 2025 that this Government have acted to introduce?
Laura Trott
If the hon. Lady thinks the system is broken, I invite her to vote for our motion.
Every metric for young people has got worse since this Government came in. It is crystal clear that for young people, as for the rest of the country, Labour is not working.
Graham Stuart (Beverley and Holderness) (Con)
My right hon. Friend will have noted, as I have, that the hon. Member for Hastings and Rye (Helena Dollimore), the hon. Member for Hartlepool (Mr Brash) and other Labour Members wish to talk about the past. Our constituents, and graduates who are paying these outrageous sums, want to talk about the future. At the general election, they listened to Labour’s promises on lowering costs for graduates, but the Government are doing exactly the opposite. By deflecting and talking about the past rather than accepting responsibility for the government that they are delivering, Labour Members are letting down all those young people, whose aspirations should be respected.
Laura Trott
My right hon. Friend is quite right: not only did Labour mislead the public, but it then made things worse. Now, Labour Members will not vote to fix it. That is Labour all over.
We need a plan to fix the problem, but it is not enough to fiddle with one part of the problem. We need comprehensive change, and that is exactly what we Conservatives have come up with: a new deal for young people. The plan, which could be implemented today, would reverse the threshold freeze, make interest rates for plan 2 loans inflation-only, stop dead-end degrees, and boost apprenticeships so that young people have real choice when they leave school, not a future weighed down by debt.
Danny Beales (Uxbridge and South Ruislip) (Lab)
The right hon. Lady talks about a comprehensive plan and giving people choices, but this is not a comprehensive plan for student loan reform; it is a plan written on the back of a fag packet. It basically revolves around restricting university access, which is always the go-to solution for the Conservatives. In truth, it will mean that people like me—I was the first person in my family to go to university—will not get to go to university. People who go to Brunel University in my constituency will face restrictions in course levels. That is not a widening of opportunity and choice, but a restriction of them.
Laura Trott
No, the plan would massively widen choice. At the moment, the number of young people who want to start apprenticeships is much smaller than the number of apprenticeships available—we need to change that and the system. It is not good enough for the Government to table an amendment to our motion stating that they will make the system fairer and financially sustainable, when they are making it less fair and less financially sustainable.
At the moment, the system is punishing aspiration, and that is demoralising for young people. They leave university having done everything that was asked of them. They work hard and get a promotion, and then the interest on their loan goes up. They pay back far more than they ever borrowed. A typical plan 2 graduate needs to earn £66,000 a year just to keep pace with the interest. Young people should not be punished for doing the right thing.
Helena Dollimore
The right hon. Lady talks about making the system fair. Will she comment on what her party did in government? The Conservatives abolished the maintenance grant, which means that low-income students have bigger debts and have to pay back more. This Labour Government have acted to bring back the maintenance grants that her party took away.
Laura Trott
The Chancellor said that the system was fair and reasonable—what a joke! The Government do not recognise the scale of the problem, but we do, and we have come up with a plan to fix it. What is their plan? It does not exist.
Dr Andrew Murrison (South West Wiltshire) (Con)
Vacancies for graduates have gone down precipitously this year compared with the same time last year. That should worry those of us who are interested in the future. How can we rebalance the offer to young people so that they are not sold a pup—as they have been by consecutive Governments over many years—in relation to what a degree will mean for their future career prospects? How can we ensure that our incredibly valuable further education sector is supported—probably at the expense of some of our lesser universities?
Laura Trott
My right hon. Friend is absolutely right: there is nothing progressive about letting a young person take a university degree that has negative returns for them. That is not fair or right, and we should fix it.
The problem is not just the loans, but a system that funnels young people into university courses that do not get them jobs and do not allow them to repay their loans. The Institute for Fiscal Studies says that 30% of university degrees have negative returns for those who study them. It is not just that they do not help, but that they have negative returns. It is worse for those students to go to university—that is not progressive.
Some 75% of the value of loans for creative arts courses is not paid back. Creative arts is an engine of the UK economy, but too many courses just do not deliver jobs in the industry that they purport to serve. It is a mis-selling scandal where brochures promise a glittering career, but the courses deliver nothing but debt and a dead end. That is not right. Of course, creative arts courses that actually lead to jobs should continue, but those who are selling a lie do not have any place being taxpayer funded.
The consequences of this broken system are already becoming clear. According to the Centre for Social Justice, more than 700,000 graduates are currently out of work and claiming benefits. That should concern every Member of this House.
Dr Luke Evans (Hinckley and Bosworth) (Con)
Is my right hon. friend also concerned by the fact that, last year, the Office for National Statistics said that 257,000 people left the UK, up from an expected 77,000? Three quarters of those people were under the age of 35. That shows that young people are fleeing this country to look elsewhere for work. Does she share my concern that that is the case?
Laura Trott
My hon. Friend is, as ever, absolutely right. Opportunity should be created for young people here, not in other countries, and that is what we want to create.
Graham Stringer (Blackley and Middleton South) (Lab)
It is a long time since I went to university, but there was a belief then that the least important things we got out of it were degrees and job prospects. There was a value in education itself. The right hon. Lady seems to think that the only reason to go to university is mercenary.
Laura Trott
It seems like the hon. Gentleman was at university only yesterday. If we are asking young people to take on a mountain of debt, it is important for them to know that they will get a job and have prospects afterwards. I do not think that is an unreasonable proposition, and it is one that I will argue for.
Alicia Kearns (Rutland and Stamford) (Con)
I was of the Tony Blair generation. We were told that unless we went to university, we were a failure, and that everyone should be able to go to university. That was fundamentally wrong; it led to a two-tier system where those who did not go to university were asking why not. I remember young people at my sixth form asking, “Am I not as bright? Do I not have the same prospects?” They should have been encouraged and supported. For example, my brother went into carpentry while studying philosophy at Birmingham. He could have started his career at a much earlier point. By rebalancing, we are giving the right recognition to the skills and training needed earlier, rather than pushing people into unnecessary debt traps.
Laura Trott
My hon. Friend is spot on. It is not well known that apprenticeship degrees are more oversubscribed than Oxford and Cambridge. These are things that young people want to do, and that is why we are trying to expand them. Instead of celebrating the expansion of low-value degrees, the Government should ask whether it is right to continue pushing young people down a path that leaves them with debt but no clear prospects.
Madam Deputy Speaker (Caroline Nokes)
I call John Slinger. [Hon. Members: “Hear, Hear!”]
John Slinger (Rugby) (Lab)
I am grateful to hon. Members for giving me such support. The right hon. Lady makes the point that creative arts subjects are perhaps not providing young people with job prospects. Would she not concede that we need people with creative arts skills and experience in our society and economy? The sector contributes £124 billion to our economy. What we need is what this Government are doing: investing in the creative arts sector. We need people who are skilled and trained in that sector so that they can do those jobs. She is offering only a litany of woe.
Laura Trott
I do not know whether the hon. Gentleman was listening when I covered that point. The whole point is that those degrees do not lead to jobs in the creative arts industry. It is a mis-selling scandal. They promise a glittering career in the creative arts and do not actually deliver it. I think that is a problem, and I am sad that the hon. Gentleman does not think that.
What are students receiving in return for these enormous fees?
Laura Trott
I will not. When the hon. Gentleman tried to intervene on me recently, he accused me of jumping on a bandwagon about rape gangs, so he will forgive me for not taking another intervention from him.
Too often, students are receiving minimal face-to-face teaching, limited supervision and a university experience that falls far short of what was promised. This is not a fair system and it is not a sustainable one either.
Robin Swann (South Antrim) (UUP)
The right hon. Lady says that the system is unfair. Does she agree that charging interest rates during maternity and paternity leave is also unfair? It disadvantages people in the workplace, especially women, who have worked hard to get into progressive careers through university education, and they are penalised at that point.
Laura Trott
I am glad that the hon. Gentleman raises that point. I totally agree with him that it is something that needs to be looked into and fixed.
As I have mentioned, we know that 10 times as many young people want an apprenticeship at 18 as there are places available. The demand is there, but the places are not. To me, it makes complete sense to move from funding dead-end courses at universities to giving young people the opportunity to do an apprenticeship that will get them into a job, and they will emerge from that apprenticeship with no debt. We want fundamental change to the system so that at 18, young people have a choice between a high-quality university place, an apprenticeship or going into work. That is a Conservative choice.
What is Labour’s response to that proposal? Last weekend, the Government announced that they will compensate for some of the mess that they created in the form of youth unemployment when they hiked up employer national insurance contributions, but they are robbing Peter to pay Paul—exactly the sort of economic thinking that we have come to expect. They are punishing employers with a jobs tax, which one of the Cabinet finally admitted this week has caused a huge spike in unemployment, and they are giving back £3,000, but only to those who have been on universal credit for six months. Fiddling with a system that needs fundamental reform and clearing up the mess of the Chancellor’s Budget is almost a full-time job for this Government.
The Conservatives are the only party putting forward a serious plan to help young people, whether by abolishing stamp duty for first-time buyers or through our new deal.
Laurence Turner (Birmingham Northfield) (Lab)
The motion in the right hon. Lady’s name states that
“balances will never rise faster than RPI inflation”.
She was a senior Treasury Minister. Does she share my regret at the decision to suspend routine methodological improvements to the retail prices index, which led to the gap between the RPI and the lower consumer prices index rates more than doubling?
Laura Trott
As ever, the hon. Gentleman raises a very interesting point, and I look forward to his bringing it up with the Chancellor at questions.
David Reed (Exmouth and Exeter East) (Con)
I say to Labour Members that we all want to get this issue sorted out. When I spoke to the Chancellor during the spring statement, she said that the way that she was going to control student loan interest rates was by controlling inflation, but we all know what is happening in the middle east at the moment. Does my right hon. Friend agree that that policy is wishful thinking and that we need to think about the issue properly in order to change the system?
Laura Trott
Exactly. The Chancellor gave it all away when she said that young people are at the back of the queue—that tells us all that we need to know about this Government.
The Government amendment is the usual mishmash of nothingness, and I suspect many Labour Members are disappointed. The amendment welcomes
“the Government’s commitment to make the system fairer and financially sustainable”,
even though the only thing that the Government have done so far, which is the threshold freeze, has made the system less fair and less sustainable for young people. But don’t worry, there is more. Labour Members are today going to welcome a “target”—not any action lines, but a target—even though it is a target that the Government are currently missing, as the share and volume of under-25s starting apprenticeships in the last academic year have fallen. What a mess!
We need a different approach. The Conservatives believe that the system needs fundamental change. We believe that students should not be mis-sold degrees that promise the earth and deliver nothing but debt, that the freeze on thresholds is wrong, that students on plan 2 loans should only pay interest at inflation, and that young people deserve a new deal. That is what we are asking the Government to vote for today, so that young people will be put not to the back of the queue but to the front of it.
The Minister for School Standards (Georgia Gould)
I beg to move
an amendment, to leave out from “House” to the end of the Question and add:
“recognises that the Government inherited the current broken student loans system, including Plan 2, which was devised by previous administrations; welcomes the Government’s commitment to make the system fairer and financially sustainable; further welcomes the support the Government is providing to young people through the Youth Guarantee; supports the Government’s target for two thirds of young people to achieve higher level skills by the age of 25, including reversing the decline in apprenticeships under the previous Government; and further supports the reintroduction of maintenance grants, which had been scrapped under the previous Government, to help ensure that background is not a barrier to opportunity for young people.”
I welcome the Opposition’s focus today on opportunities for young people, student loans and apprenticeships. I am pleased that the House has the opportunity to scrutinise this broken system devised by the Conservatives, who tripled tuition fees, introduced plan 2 loans and presided over a decade that saw a 40% drop in young people starting apprenticeships.
David Reed
We have heard the argument repeatedly that it was the Conservatives and the coalition Government that brought in these changes. I am someone with a plan 2 loan. I was in the generation that Blair told to go to university, and at no point did anyone in that Blair Government talk about how the jobs market would take on so many graduates or, most importantly, who would pay for those people to go to university. Does the Minister agree that the 50% of school leavers who went to university should be paid for by the 50% that did not?
Georgia Gould
I think it is really relevant to make sure that the public know who created this system—and not only created it, but froze those loans 10 times over the last 12 years—[Interruption.] I know that it is inconvenient for the Conservatives to be reminded of these truths, but we have lived through them.
Simon Hoare (North Dorset) (Con)
I must be suffering from some sort of political amnesia, because I was absolutely convinced that it was a Labour Government that introduced tuition fees in the first place. Maybe the Minister will correct me.
Georgia Gould
I was talking about plan 2—[Interruption.] The debate today that has been called by the Opposition is about plan 2 loans—a system that was created in 2012 by the Conservatives.
Alex Sobel (Leeds Central and Headingley) (Lab/Co-op)
I have read the motion and the amendment. Students today are on a new loan—the plan 5 loan—and Conservative Members have completely forgotten current students. The Government amendment talks about the system in the round. Can my hon. Friend reassure me that the Government are going to look at the system in the round and not just at plan 2, so that all students and graduates have a fairer system?
Georgia Gould
I thank my hon. Friend for his advocacy on this issue. I know that he represents a number of students, and this is something that he has raised continually. We have heard the concerns about student finance, and it is something that we will be looking at. I am really happy to take that conversation forward.
Dr Murrison
My constituents are not interested in the past, particularly the distant past; they are interested in the future. They have heard what the Conservatives would do, but we have yet to hear from the Government of the day what they will do. Will the Minister enlighten us?
Georgia Gould
I think that the past is really relevant. I was a council leader during the last Government and I saw the cuts to local youth services, to early years support and to all our public services. We lived through that time when young people really were at the back of the queue, and we are rebuilding from that through investment in tackling child poverty, in youth services and in schools, and through the historic investment in special educational needs and disabilities provision. Those choices that we are making really matter, and are relevant to the discussion we are having.
In terms of what we are actually doing, we are increasing the threshold to £29,385 this year, which will help to support people this year after the threshold was frozen for four years by the previous Government.
Helena Dollimore
The Opposition talk about amnesia. Does my hon. Friend agree that it is they who have collective amnesia about the system they created? My generation certainly do not have amnesia about the debt repayments we made when Liz Truss crashed the economy and sent interest rates soaring—that is what the Conservatives presided over. We do not have collective amnesia about them abolishing maintenance grants for the lowest income students. It is this Government who are acting for my generation with the Renters’ Rights Act 2025—
Madam Deputy Speaker (Caroline Nokes)
Order. I just remind Members that interventions need to be shorter than that.
Georgia Gould
I would be delighted to take the right hon. Member’s incredibly short intervention.
Sir Desmond Swayne
The Minister’s hon. Friend, the hon. Member for Leeds Central and Headingley (Alex Sobel), asked a perfectly reasonable question about looking at the thing in the round, and her answer was that she would take the conversation forward. I think we need more than that.
Georgia Gould
We have acknowledged the issues and the unfairness in the system. The Prime Minister, the Chancellor and the Secretary of State for Education have acknowledged that, and we have said that we will look at it.
I will make progress. Under the last Government, the number of young people not in education, employment or training rose by 250,000. Today, nearly 1 million young people are not in education, employment or training. That is the legacy of the Conservatives, but this Government are turning that around. We are renewing the post-16 education landscape and celebrating routes into vocational education not by restricting university, but by opening up new high-quality vocational routes. We are introducing new V-levels and new foundation apprenticeships and supporting students to get excellent university education across the country.
The Opposition talk a lot about higher education and suggest that too many young people go to university. It is interesting that they can never tell us who should no longer go or which courses they should not study.
Georgia Gould
Did the right hon. Member tell me who should not go to university? I can tell the Conservatives that when they close the drawbridge, it is pupils from disadvantaged backgrounds who will end up not at university. That is the consequence. We are opening up access to apprenticeships and vocational routes not by closing down university routes, but by opening up other routes.
Dr Luke Evans
The Opposition have made the argument that 30% of courses leave people with a negative bank balance. That is the problem that we are trying to solve. We are not denigrating anyone for wanting to choose; this is about ensuring that the quality of the course means that people have a positive life outcome, not a negative one. Does the Minister agree with that principle?
Georgia Gould
We are absolutely committed to driving up the quality of all university courses, and we are acting on that.
Conservative Members have attacked arts and creative courses as the areas where they would like to see a reduction. We have just seen the British talent at the Brits and the Oscars. This is one of our highest-growth industries. We saw this in our schools when there was a reduction in education in the arts, and we are seeing it now as the Conservatives attack those courses in universities.
Graham Stuart
Young people in my constituency are looking for a bit of hope. How should they interpret the Minister’s answer to her hon. Friend, the hon. Member for Leeds Central and Headingley (Alex Sobel), and the fact that the Chancellor has said that young people are at the back of the queue? From that very recent mood music, it does not sound as if there is much to hope for from this Government.
Georgia Gould
I have spent the last few months travelling around the country talking to young people about the investment that Labour is putting in to support young people with special educational needs and to support schools and youth clubs. That is what the Labour party is doing in power, and there is huge hope that comes from that. Those are the areas where we need to prioritise investment.
The chance to study in higher education for those who want to and who have the ability to changes lives. We are determined to support students who want to go to university to fulfil their aspirations. We must not lose sight of the value that student loans provide in enabling that and levelling the playing field at the point of access. They remove the up-front financial barriers to study and enable students to repay when they are earning.
Ruth Cadbury (Brentford and Isleworth) (Lab)
The Minister is making an excellent and powerful speech on the motion. One aspect of the broken student loans system is the maternity penalty. When someone is on maternity leave, the interest on a student loan continues to accrue, despite income dropping below the repayment threshold. That means that graduates with student loans who take maternity leave face a longer repayment period and a greater total loan amount. Will the Minister take that concern back? Will the Government have a look at this perceived inequality?
Georgia Gould
I thank my hon. Friend for making that point. As she knows, increasing security for women on maternity leave is a really important part of this Government’s agenda, and that is why we are taking forward the Employment Rights Act 2025. It is important to note that in the system, if income goes below a threshold and someone is out of work generally, they will not have to pay. That is very different from a commercial loan, but I will absolutely take her point back.
The student loan system delivers tuition fee funding—some £10.7 billion in 2024-25—to our world-class higher education sector, a sector that remains by any objective metric one of our nation’s greatest exports and a global beacon of intellectual excellence. It is important that we remember what is at stake here. From pioneering laboratories developing quantum computing and agritech to those at the forefront of advanced manufacturing and genomics, our universities are the primary engines of the research that will define the 21st century, and the impact of our universities goes beyond their pivotal contribution to the economy and the careers of individual learners. By exposing students to diverse perspectives and expanding their social horizons, these institutions help our young people to build the networks, resilience and life skills that define a person long after they have graduated.
Rosie Wrighting (Kettering) (Lab)
I have a creative arts degree. Not only did it give me the opportunity to meet people, importantly, it enabled me to access the fashion industry as somebody growing up outside of London. Does the Minister share my concern that removing those degrees would create London-centric creative industries?
Georgia Gould
I thank my hon. Friend for that powerful point. Her creative arts degree was of huge benefit in getting her to this place.
Dr Murrison
Does the Minister think that the creative industries are the exclusive province of universities? If that is what she thinks, can I invite her to visit Trowbridge college in my constituency—an excellent further education college—and see what it is doing with multimedia to give kids the skills they need, as part of the growth in the economy that the Government are sorely lacking?
Georgia Gould
Of course I recognise the critical role that FE colleges play in supporting children into the creative industries. That is why this Government are backing FE colleges after the previous Government failed to do so. However, we do not believe that closing down routes to university is the best way to support our creative industries. We can have both, and we can have opportunities for both.
Laurence Turner
Is it not also the case that kids from working-class backgrounds were increasingly shut out of traditional apprenticeship routes under the previous Government because of the artificial entrance requirements, which employers said were blocking them from hiring the best? Employers said that those requirements should be scrapped, but the Department for Education blocked that under its previous management.
Georgia Gould
We saw a 40% reduction in young people’s apprenticeships over a decade. That was the legacy of the Conservative party.
While the foundational principles of our higher education funding and student finance system might be solid, they are straining after more than a decade of neglect and mismanagement, on top of the structural flaws baked into the system by the Conservatives. First, a legacy of seven years of frozen tuition fees has contributed in no small part to a significant and growing number of English higher education providers facing financial challenges. Analysis published last autumn by the Office for Students indicates that without mitigating action, some 124 providers—45% of those included in the OfS financial sustainability report—could face a deficit in 2025-26.
Tim Roca (Macclesfield) (Lab)
The Minister is making an important point. The economics of higher education are actually quite complicated; there is a great deal of cross-subsidy, with the humanities and the arts effectively supporting science, medicine and engineering courses and so on. Does the Minister agree that we should be worried that the Opposition parties’ proposals would put jobs and the viability of universities at risk?
Georgia Gould
My hon. Friend makes an important contribution to this debate.
The Government have taken the tough, immediate action that is required, including by making the difficult decision to increase tuition fees by forecast inflation, balancing the need to give the sector stability with fairness to students and taxpayers. We are also asking more of the sector: we expect higher education providers to demonstrate that they deliver the very best outcomes, both for those students and for the country, in return for the increased investment we are asking students to make. To achieve this, this Government will link future fees increases to university quality, as I have said. This will protect taxpayers’ investment in higher education and incentivise high-quality provision for students without taking away opportunities.
Edward Argar (Melton and Syston) (Con)
The Minister is typically generous with her time and courteous in the number of interventions she accepts. May I gently take her back to lines 3 to 4 of the text of the Prime Minister’s amendment on student loans, which state that this House
“welcomes the Government’s commitment to make the system fairer and financially sustainable”.
To avoid this sounding like jam tomorrow and to reassure young people—I have a lot of respect for the Minister, and I will be generous—can she give one or two concrete announcements today of specific measures that she is bringing forward that will achieve that commitment?
Georgia Gould
We are lifting the threshold, which will make a difference this year for students. We have already announced that, and we have said that we will continue to look at this matter as we look at a wide range of issues. We accept that the system created by the Conservatives is not fair.
More broadly, this Government are resetting the contract for young people across the landscape. Beyond our new deal for young people who do not go to university, we will support more young people into work and training through a £2.5 billion investment in the youth guarantee and growth and skills levy over the next three years and—this is incredibly concrete—we will support almost a million young people and deliver almost 500,000 opportunities to earn and learn.
Andrew Pakes (Peterborough) (Lab/Co-op)
I welcome this week’s announcement of the new deal for young people beyond university. One of the challenges in a seat like Peterborough is that not enough young people get to either apprenticeships or university. Does the Minister agree that one of the challenges we face is that we spend so much time in this place and in the media debating university routes as the path to success, but we do not spend half as much time as we need to discussing apprenticeships? The youth guarantee starts to put that right.
Georgia Gould
My hon. Friend makes an incredibly important point. We need to open up access to apprenticeships. That is why the Government are making this investment, and it is why we have set that ambitious target for young people to go to university and to access apprenticeships.
Robin Swann
On that point, does the Minister agree that there is another way? The Open University also allows people to earn and learn at the same time. The situation is not as simple as university or apprenticeship. There is a middle way and, as a former graduate of the Open University, I encourage the Government to support it.
Georgia Gould
We are committed to opening up those routes to lifelong learning, and we are setting out plans on that. I welcome that intervention.
Dr Murrison
With hindsight, does the Minister regret Tony Blair’s announcement in the late 1990s that more than 50% of school leavers should go to university? Would it not have been better to have said that all young people leaving school should either go to university or into high-quality apprenticeships or training?
Georgia Gould
Opposition Members were accusing me of talking about the past, but I think I was nine years old when that was going on. I do not regret the real focus on opening up access to university, because that opened it up to disadvantaged pupils who might never have had that opportunity. Today, we recognise that we need both those routes. There has not been enough investment or focus on vocational pathways. We absolutely agree with that, and we are putting that right. It is our ambition to have a more sustainable, more specialised and more efficient sector that better aligns with the needs of the economy.
Mr Gagan Mohindra (South West Hertfordshire) (Con)
The Minister is being generous with her time, and I thank her on behalf of Opposition Members. Does she believe that there is an oversupply of courses in higher education? She has spoken about trying to evolve and reform the model, and the concern among Opposition Members is that there seems to be pressure on a lot of children to go to university, even though they will not get a graduate bonus associated with that. A lot of us question the financial viability of HE. What are her views on that?
Georgia Gould
We want young people to have a choice: to go to university, to study, to take up an apprenticeship or to earn and learn. We want that range of routes to be available and for young people to have high-quality careers education, so that they know what the opportunities are in their local communities.
We want higher education providers to go further to give their students the best course and employment outcomes, ensuring that the sector remains globally competitive. The Government are committed to ensuring that higher education is open to all who have the ability and the desire to pursue it. In the 2028-29 academic year, we will be reintroducing targeted, means-tested maintenance grants of up to £1,000 a year, increasing the cash in students’ pockets without increasing their debt. To help students from the most disadvantaged backgrounds, we are already delivering on a commitment to future-proof maintenance loans by increasing them in line with forecast inflation every academic year to try to ensure that support keeps pace with financial pressures. In the academic year 2026-27, care leavers will become automatically eligible to receive the maximum rate of maintenance loans, which will provide vital extra support for one of the most vulnerable groups in society.
Rebecca Smith (South West Devon) (Con)
I welcome support for people from the most vulnerable groups who are heading to university, but will the Minister acknowledge that by enabling those groups to take the maximum amount of support, the Government are also enabling them to have the maximum amount of debt at the end of their university careers? A frequent problem throughout all this has been the fact that either the people in the middle who do not quite get the support that they need or those at the far end of the system who do need support are saddled with the most debt, because they will not have the parental assistance that would help them to leverage against the loan repayments for the rest of their careers.
Georgia Gould
I think it important to make it clear—some people watching the debate will be worried about this—that these are not normal loans, in that young people who are not earning, or are earning below the threshold, do not have to pay anything. In the long term, if they have not earned enough by the end of their careers, they do not have to pay the whole amount, and they do not have to pass that on to future generations.
Dr Ben Spencer (Runnymede and Weybridge) (Con)
I thank the Minister for giving way: she has been very generous with her time. I think there is a point of principle in this debate, and I should like to hear the Minister’s thoughts on it. Does she believe that there is any degree offered by a university in which it is not fair to invest taxpayers’ money? If the quality is not good enough, surely it is not fair for the individual to be indebted. Will the Minister concede that there probably are some courses, across the country, that it is not fair for the taxpayer to subsidise?
Georgia Gould
I have made it very clear that we want to increase the quality of courses, and that is one of the conditions that we attached to increasing the fees in a fair way, but we want to do that by ensuring that those courses are of high enough quality, rather than scrapping the opportunity for young people to go on them.
Looking further ahead, I can tell the House that the Prime Minister’s ambition is to see two thirds of young people in higher-level learning by the age of 25. With the lifelong learning entitlement, which will be launched in January 2027—a policy that the last Administration failed, year after year, to deliver—we are transforming higher education from a “one-shot” opportunity into a flexible and responsive system with learners at its centre. As was mentioned earlier, the LLE will allow learners to fund individual modules and reskill throughout their careers, at colleges and universities alike.
We now have a responsibility to ensure that the benefits of higher education are maintained for future generations, and to clean up a student loan system in which interest rates have been allowed to spiral and students are confused about what is the right path for them. We absolutely recognise that there are failings in the system, but it is not a system that we built; it was a system that the Conservatives created. We know that student loan repayments are a concern for graduates, which is why we increased the plan 2 repayment threshold last year and why we are increasing it again next month, to £29,385. Borrowers who earn below that amount annually will not be required to make any repayments at all. This threshold is higher than the median graduate salary three years after graduation.
Graduates generally go on to benefit from higher earnings, and it remains reasonable for those who gain the largest financial benefits from their degrees to contribute more towards the cost of their studies than those who have not gone to university, or graduates earning lower salaries. Lower earners will still benefit from the unique protections that student loans offer. Any unpaid loan balance, including interest accrued, will still be cancelled at the end of the loan term at no detriment to the individual, outstanding debt is never passed on to a borrower’s family, and having an outstanding student loan is not a barrier to accessing a mortgage. Student loan balances do not appear on borrower credit records, although regular student loan repayments will be considered, alongside other living costs, as part of the affordability check for mortgage applications.
I want to say how seriously the Government take the cost of living challenges that young people face. Too often this generation have found their challenges ignored. We are working hard to tackle these issues by extending Government-funded childcare, reducing energy bills, freezing rail fares, rolling out free breakfast clubs, building new homes and introducing the Renters’ Rights Act 2025.
Before Conservative Members once again line up to criticise the decisions that we have made, I would like to take a moment to remind them of their track record on this matter. Plan 2 student loans were designed and introduced in 2012 by the Conservative-Liberal Democrat coalition, with a repayment threshold of £21,000 per year and interest rates of up to 3% above inflation. Those are the very interest rates that the Conservatives and Liberal Democrats are now calling to be reduced. Having said that they would increase the plan 2 repayment threshold to reflect earnings, they froze it for four years. The Conservatives then froze it in 2016 and in 2017, and again from 2021 to 2024. In total, there was a decade of freezes by the opposition parties. It is their mismanagement that now necessitates a further freeze to the threshold. I do not remember any of this outrage from those Members when they created and built this system.
As we have heard, the Opposition’s solution is to cut courses and cut opportunities. We will not make reckless and unfunded changes to student loans. Student finance and higher education funding is a complex, interconnected system. We are considering a range of options to make the system fairer, but we must be fiscally responsible and consider carefully how change would be funded. Politics is about choices.
Tessa Munt (Wells and Mendip Hills) (LD)
Would the Minister consider doing something about the cost of accommodation in university towns and cities? Where I come from in north Somerset there is no university, and at the moment people do not really have the option to go anywhere except a city, which is incredibly expensive. Would she give some consideration to reducing those costs on ordinary working families?
Georgia Gould
I thank the hon. Member for that comment, and that is why we are supporting maintenance grants to help students with the cost of living.
I will conclude by saying that our approach to further reform of the system will be deliberate, evidenced and fiscally responsible. We are here not to tear down the house, but to repair the roof that was left to leak.
Madam Deputy Speaker (Caroline Nokes)
I call the Liberal Democrat spokesperson.
Ian Sollom (St Neots and Mid Cambridgeshire) (LD)
I am grateful to the Opposition for this debate. In the recent Westminster Hall debate on this topic, we heard powerful testimony about the reality that graduates face in making repayments every month and watching their balance grow, with their plans deferred and lives constrained. I am sure we will hear more of that today, and those stories deserve to be heard and to receive a clear response, not a political runaround.
Parts of the motion are not wrong. The plan 2 threshold should be unfrozen, and while we may disagree on the specific change proposed, the interest structure does need reform, as the Liberal Democrats have said clearly. The motion also calls for more apprenticeships for 18 to 21-year-olds, and we welcome such investment in principle. We would go further by doubling degree apprenticeships in priority sectors and introducing skills co-operatives specifically to help small businesses to pool resources to take on apprentices they could not otherwise afford.
However, the question is whether the motion as a whole represents a serious plan, and I am afraid that it does not. Specifically, it calls for
“controlling the number of places on university courses where the benefits are significantly outweighed by the cost to graduates and taxpayers.”
Let us be clear about what
“controlling the number of places”
means. It means cutting. The courses they have in mind are arts, humanities and creative subjects.
The argument rests on a definition that sounds objective but is not: which courses have benefits that are significantly outweighed by their costs? The proxy appears effectively to be graduate salaries. Graduate salaries are a poor measure of what society gains from a degree. Nursing, teaching, social work and creative arts all underperform on salary data while delivering enormous public value, so what logic are the Conservatives applying? Even on salary terms, cutting arts places would damage science, technology, engineering and maths, not protect it, as one Labour Member mentioned. Arts courses are relatively cheap to deliver and cross-subsidise expensive laboratory provision. The Institute for Fiscal Studies explicitly found that reducing arts funding may, perversely, reduce funding for STEM.
Alex McIntyre (Gloucester) (Lab)
The hon. Gentleman is making a very important point. The Conservatives talk about cutting public funding for courses such as creative arts, but that will not stop the wealthiest students from accessing those courses. Does he agree with me that all that will happen is that people from more deprived parts of our country will not be able to access them, and that there will be one rule for them and another rule for everyone else?
Ian Sollom
The history of access to university demonstrates that point well.
Graham Stuart
I am trying to follow the mental perambulations of the left. The argument seems to be that people from working-class backgrounds can go on courses that lead them to have negative outcomes—poor earnings—and that the very course they are on, which does them little good, with so much promised and so little delivered, actually has the opportunity to cross-subsidise other people doing other courses. Both the hon. Gentleman and the hon. Member for Gloucester (Alex McIntyre) seem to think that is a good thing. Can they not see that, in reality, it is not?
Ian Sollom
I thank the right hon. Gentleman for his intervention, because that is one part of the argument I am making. There is a very important point about that, which is that it could equally be an argument for making the loan system fairer in its repayment terms to reflect that.
There is a deeper problem, too. The graduate earnings premium has declined in Britain, but not because we have too many graduates; it is because we have too few skilled jobs. That is a demand-side failure and a Conservative legacy. Our peers in OECD countries have expanded graduate numbers while maintaining the graduate premium, because they built the industries and invested in the regions that generate high-skilled employment. Cutting student numbers accepts our economic underperformance as permanent. It is, as I have said before, a counsel of despair dressed up as policy.
Then there are the creative industries: over £100 billion a year to the British economy; one of our most successful global exports; built on a pipeline of arts graduates. The answer is not to stop training the people on whom the whole pipeline depends. Ultimately, the value of an education cannot be read entirely from a graduate’s salary. The capacity for critical thinking, empathy and cultural participation are public goods, hidden in plain sight, that show up nowhere in write-off rates. A party that asks only “What does it pay?” has already decided something important about what it values.
Dr Ben Spencer
On the broader point of principle about the value of certain subjects, I intervened on the Minister and she failed to answer, so I will ask the hon. Gentleman the same question. Does he think that there are some subjects offered by some universities for which the value is quite poor and that it is unfair for the taxpayer to subsidise them? Does he think that in principle it is possible that those subjects exist?
Ian Sollom
The point is to allow the market and the regulation of that market to decide. [Interruption.] I will make some progress.
Madam Deputy Speaker (Caroline Nokes)
Order. To be helpful, the hon. Member might reflect on the fact that the microphone is in front of him; it makes it much harder for Hansard and for the viewing public to pick up his words if he faces the back of the Chamber.
Ian Sollom
Thank you, Madam Deputy Speaker.
I will turn to the threshold and the interest rate—areas on which we do substantially agree with the Conservative motion’s diagnosis, if not its proposed remedy. In the system as it stands, the interest rate matters financially only for those who repay in full, which most graduates do not. That is by design to share the costs between the graduate and the state. It means that the largest benefit of the Conservatives’ proposal would flow to the highest earners—those who repay completely. As analysis from the Institute for Fiscal Studies has shown, it would be regressive in its distribution, which is why more thought is required on interest structure.
On the threshold, the picture is more straightforward. Before the election, the Education Secretary promised that graduates would pay less under Labour, as the shadow Minister said, and, in their first Budget, the Government left the threshold rising. Then, in their second Budget, the Government froze the threshold for three years from 2027.
Ministers have cited a £5.9 billion figure as the yield of this change, but we should be clear about what that figure is: it is the discounted present value of extra repayments across nearly 30 years, with the bulk sitting in the 2030s, 2040s and 2050s. The annual cash impact during this Parliament is relatively small, and the change barely moves the needle on the Chancellor’s own fiscal rules. Graduates will bear a real and immediate burden in their payslip for the remainder of their loan for a cash-flow improvement that is modest in this Parliament and does nothing at all for the Chancellor’s balanced Budget rule. Of all the choices in November’s Budget, why did they make this one?
I note that the Government’s amendment today welcomes a commitment to making the system fairer, and such commitments should be welcomed. However, graduates are waiting for action. Let me therefore set out what the Liberal Democrats would do. First, we would unfreeze the plan 2 threshold immediately and tie it to earnings, as was originally promised. Secondly, we would restore meaningful maintenance grants. Students from the poorest families can borrow £1,284 less today in real terms than in 2020-21. The £1,000 grant reaches about 10% of students, restricted to specific subjects. I think we can do better on maintenance policy: grants must be available regardless of subject, and the parental income thresholds that have been frozen since 2008 must be urgently uprated.
Thirdly, we would establish a royal commission on graduate finance, including plans 2, 3 and 5—plans 3 and 5 have terms that are, in several respects, even harsher. All those plans should be in scope. It should also have independent oversight of key parameters. That is not to delay, but to look seriously at fairer interest structures, total repayment caps and progressive repayment rates, and, critically, to build the cross-party settlement that is the only real protection against the next Government squeezing graduates again.
The system has been treated as a fiscal convenience rather than a social contract by the previous Government, and now by this one. Graduates deserve better.
Rosie Wrighting (Kettering) (Lab)
Eighteen months ago, my constituents in Kettering chose to elect a 26-year-old as their MP. I believe they did so because they wanted a Labour Government, but also because young people in my constituency, and their parents and grandparents, wanted me to speak of my own experience of how tough it has been for my generation.
One of the tasks we navigate as MPs is how best to use our privileged position in this building to influence change.
As often one of the only young people in the Chamber, and almost always the only young woman—[Interruption.] Okay, depending on what we define as young. [Interruption.] Okay, let me say as one of the only women in their 20s in this Chamber, I try to share the perspective of a younger person. I often felt that that was missing in debates when I watched politics as I was growing up. I shall share that perspective in this debate using my own experience, and in doing so I hope to highlight the generational inequalities that have turned into deep-felt frustration—a frustration that made me join a political party, that made me campaign for a change in Government and that drives me in this place every single day.
I declare the fact that I have a plan 2 student loan close to £90,000. Before getting elected to this place, I was working full time for years, just watching my student loan grow. In Kettering, I grew up in a single-parent household. My mum, who is a youth worker, raised me by herself. At school, like so many others, I struggled to work out what I wanted to do and what I wanted my career path to look like. What I knew more than anything else was that I wanted to work hard enough to give myself a better life. It was so clearly communicated to me at school that that route to a better life was going to university. On reflection, I wish someone had spoken to me about apprenticeships and other options.
In the desire that many young people have to build themselves a better life, I and people around me did the things that we were told to do: we worked hard, we went to uni, and we got a degree. There is a lot said about what Gen Z expect from life, but ordinary hope and ordinary aspiration, despite what social media tells us, is not to live in Dubai, or to buy avocados and an iced matcha every day; it is to live in a home that we are not worried we will be kicked out of.
Graham Stuart
The hon. Lady is giving a powerful speech. On behalf of her generation, is she disappointed that, having promised to reduce the costs for graduates repaying student loans, the Government are making it worse? Is she disappointed that, when challenged over this broken system, the Chancellor of the Exchequer said that the hon. Lady and people like her are at the back of the queue?
Rosie Wrighting
There are many levers that this Government can pull to make life better for graduates. I understand that, given the economic situation, some of those levers are easier to pull than others. I am glad that measures such as the Renters’ Rights Act 2026 are coming forward and making a difference for my generation every single day. I have voiced my view that the system is not fair and that I would like my Government to look at it, and I think that that has been heard.
Let me return to what I was saying. We want to be able to live in a home that we are not worried we will get kicked out of, and even one day not to have to live with strangers or parents. We want to be able to make the choice to have a child if that is right, and to decide to go on holiday without maxing out our credit cards. I do not think that that is asking too much. That is hope and aspiration. I want to live in a country where it is reasonable for ordinary young people to want those things and, more importantly, to think that they are achievable.
Of all the damage that the Conservatives did, one of the worst things for me was the damage to hope. I started university in 2016. My tuition fees were £9,000 a year, but my maintenance loan was £12,000 a year. I am now paying back more not because my education cost more, but because I came from a low-income family and needed that support to live.
Danny Beales
My hon. Friend is making a powerful speech. This place is much better for her presence, speaking up for people in her situation. It sounds like we had a similar background, but I was fortunate enough to be on a plan 1 system and, under a Labour Government, benefited not only from an educational maintenance allowance to stay on at sixth form, but from grants as well as loans. It sounds like she was not able to benefit from that because of the Conservative party. Does she agree that the restoring of maintenance grants and the uplifting of maintenance loans to match the cost of living will benefit people who come from backgrounds such as ours?
Rosie Wrighting
I do not think it has been talked about enough in this debate, or in the debate more widely, just how much is added on for students who have to take out a large maintenance loan because they come from a low-income family. I thank my hon. Friend for raising that.
When maintenance grants were scrapped by the Conservatives, that cost did not disappear.
Rebecca Smith
The hon. Lady is giving an excellent speech, but there is a whole cohort of plan 1 students who experienced the exact situation that she is describing. In 1997, Tony Blair said that he would not introduce tuition fees. In 1998, he did, and the Labour party then also scrapped maintenance grants. I was 16 in 1997 and was suddenly faced with needing to pay fees and get a loan in order to go to university, and had no family support to afford it. It is important that we recognise that it was the Labour Government who did that in 1998, having said that they would not. We can give just as many examples of decisions that the previous Labour Government made as we can of those made by the previous Government.
Rosie Wrighting
I was born in 1997, so the hon. Lady will forgive me if I cannot recollect that. I do not think that graduates are arguing that we should not pay. There is an understanding that graduates should pay for their degrees; it is the scale and fairness within the system that I want to highlight.
When maintenance grants were scrapped, the cost did not disappear; it was simply shifted. It was shifted on to students and turned into debt, and the burden was put on those from the lowest-income families. The very policy that enabled working-class kids to go to university gave us the highest debt as soon as we left. That is not fairness, and that is not opportunity. It is generational inequality designed into a system that disproportionately impacts people who do not have a savings account waiting for them when they turn 18, who do not have the money for a house deposit, and who cannot ask for help for childcare.
That is why I welcome this Government taking steps to strengthen maintenance support, including through the return of maintenance grants. If the Conservatives truly cared about those students, I would have expected them to welcome that.
Munira Wilson (Twickenham) (LD)
I too welcome the reintroduction of maintenance grants, which, let us be clear, were scrapped by George Osborne when he was left to his own devices in 2015. However, does the hon. Lady accept that £1,000 a year for certain selected subjects will not even touch the sides and suggests that some poor students deserve support but not others? Does she think that that is the right way forward?
Rosie Wrighting
I appreciate that it is a start. I welcome our introduction of £1,000, but I do think there is more to do. I also acknowledge that we are in a tough economic environment and this is what the Government have chosen to prioritise.
It is not by accident that my generation have it so hard. Make no mistake: these decisions were taken by the Conservative party when they were in government. They asked my generation to do more with less, to bear a heavier burden, and then left us behind. The Tories calling this debate today, pretending that they have the answers to fix the system that they broke, is insulting to young people across this country.
Graham Stuart
Would the hon. Lady not find it rather worse if we were not reflecting on our time in power and the fact that we were thrown out and were not trying to come forward with constructive proposals to make things better? The important thing is to listen to people like the hon. Lady and our constituents, reflect and come forward with proposals. That is what we are doing. We are trying to look forward, not play some history game.
Rosie Wrighting
The previous Conservative Member who intervened asked me about 1997, so there is some looking back going on. I would welcome the Conservatives reflecting on their time in power, but unfortunately that is not what I have seen today and it is not the tone of the conversation that I hear coming from the party.
The Tories are calling on the Government to change the plan 2 repayment system, when they designed plan 2 student loans; to end repayment thresholds, when they froze them; and to create more apprenticeships, when they left one in eight young people not earning or learning. When we hear the Conservative party now proposing to cut interest rates on student loans, we have to ask: where was this concern when they were in government? Where was this concern for the thousands of young people—my peers, my friends, people around me—facing high student loan payments today?
The reality is that what Opposition Front Benchers are proposing would disproportionately benefit the highest earners—those most likely to pay off their loans in full—do little for the majority of graduates, and do almost nothing for those from low-income backgrounds, who are less likely ever to clear their debts. It is the same Conservative party.
I feel strongly that we now have a chance to say something to young people about their future, because after years of broken promises what we see is frustration, and something more dangerous than that: a loss of belief that working hard will mean people will get on. When that belief goes, opportunity goes with it. The real legacy of the last 14 years is not just high debt but diminished hope. I genuinely believe that it is only Labour that offers the chance to restore fairness between generations—not headline-grabbing tweets—and we are starting to do that by strengthening support for renters, delivering the youth guarantee, expanding childcare and taking steps to ensure that maintenance support works for students, not against them.
It is only Labour that can do something bigger and restore to an entire generation the belief that if you work hard, whether at school, at work, at university or through an apprenticeship, you can build a better life. That is a real life, with a secure home, the ability to start a family and confidence that efforts will be rewarded with opportunity. When my mum encouraged me to pursue education, she believed that she was giving me a better life. That is what young people deserve today: not just to be able to hope for a better future, but to have that within their reach.
Several hon. Members rose—
Madam Deputy Speaker (Caroline Nokes)
Order. There will be an immediate five-minute time limit.
Simon Hoare (North Dorset) (Con)
When I woke up this morning and sprang out of bed thinking about my upcoming 57th birthday, I was feeling quite young and sprightly, but having listened to the speech of the hon. Member for Kettering (Rosie Wrighting) I feel particularly ancient and amazed that I have managed to get to my feet to give this speech. The hon. Lady gave a compelling and interesting speech, which gave those of us of an earlier vintage when it comes to university experience much to think about. The House should be grateful to her for what she had to say.
The Government’s prognosis is slightly odd. It seems to be, “It’s a terrible system—it’s broken and it’s not working. We will have a little think about it. I’m not quite sure what we’re going to do or when we’re going to do it. You’re at the back of the queue, but we’re not going to tell you how long the queue is.” It like one of those call centre things where we are told, “Your call is important to us—please wait,” and we are waiting and waiting in the queue, but we do not know for how long. Such policy issues require long-term, settled solutions. It cries out to me as something that would really benefit from cross-party working, which would give some solidity and sense to long-term policy making.
I welcome the motion tabled by my right hon. Friend the Leader of the Opposition, because it starts to address a pressing issue in our inboxes that is of concern to our constituents. Should we go back to the idea of a graduate tax? I do not know. It is clear that all Governments and all parties should view money spent on education in the university sector and elsewhere not as expenditure but as an investment, from which the state and society should have an expectation of a return.
It is crucial that we are sensitive on the point about controlling the number of places available. We do not want to reduce the evaluation of education to a utilitarian exercise, but clearly one has to look at value for money. Education is more than just the end of the process: it is an enriching, personal development, friend-making process providing us with all the keys to life’s doors as we face them.
When I went up to university way back in 1987—I do not suppose that the mother of the hon. Member for Kettering had even thought about her then—one in eight did so. That was not a sustainable figure if we wanted to see a growing economy. I had gone to an ordinary state school in south Wales and was the first in my family to go to university. Is 50% of our young a sustainable figure when clearly the job market is changing?
I welcome whatever anybody wishes to do to support vocational and technical education and apprenticeships. There are other ways. I say this—I suppose I must declare an interest—as someone whose eldest daughter is applying to university at the moment, but it is often my fellow sharp-elbowed middle-class parents who push their children towards university and fail to recognise the importance, value and use of apprenticeships and other forms of getting on in life. There needs to be a societal step change. We have to think seriously about that and particularly about supporting our FE colleges. Many of my young constituents attend Yeovil college, just over the border in Somerset. It is a first-class college with great ties to local businesses such as Leonardo, and it provides a good start in life for many young people in North Dorset.
I echo the point made by the hon. Member for Kettering about the benefit of stability that a settled future—putting down roots, starting a family and so on—can bring. We should encourage our young to think like that, but also to understand the wide range of educational opportunities that exist for them. We cannot ignore this any longer. Too many of our university institutions are just about hanging on in there financially, many are tottering on the brink, and we have a model that we cannot sustain, the utility of which is proving even harder to demonstrate to our constituents. I say to the Minister that doing nothing and putting this at the back of the queue is not a sustainable solution.
John Slinger
The hon. Gentleman keeps referring to “the back of the queue”, but my right hon. Friend the Chancellor of the Exchequer did not say “back of the queue”. She actually said, after her Mais lecture:
“we want to make improvements. But is it front of the queue? No, it’s not.”
May I just say—[Laughter.] Right hon. and hon. Members can chunter from a sedentary position, but Conservative Members have repeatedly said “back of the queue”. That is not what the Chancellor of the Exchequer said. Does the hon. Gentleman accept that point?
Simon Hoare
What I do accept is that the hon. Gentleman is swiftly gaining a reputation in this place as the only Labour Member who would defend a policy of the slaughter of the firstborn. He will defend anything. I seem to remember that he was one of the only Labour Members who stood up and defended Lord Mandelson’s appointment to be ambassador to Washington.
Simon Hoare
No, I will not give way; one can be a useful idiot only so often in an afternoon. I say to the Minister: whether it is at the front of the queue, the back of the queue or the middle of the queue, this is an issue that cannot be put aside any longer.
Alistair Strathern (Hitchin) (Lab)
Will the hon. Gentleman give way on that point?
Simon Hoare
I am just about to give up and I will not get an extra minute. I like the hon. Gentleman very much and in ordinary circumstances I would, but I will not.
We need some urgency on this matter, and I urge some cross-party working to make sure that all our constituents, whether urban or rural, and whether first, second, third or fourth-generation university students, get the very best deal and start in life that they can as they begin their working lives.
Matt Rodda (Reading Central) (Lab)
It is a pleasure to follow the hon. Member for North Dorset (Simon Hoare). Like him I am a father—I have two children who have graduated recently. I also worked in higher education for a time.
I speak in support of the amendment in the name of the Prime Minister and the Secretary of State. I will discuss three aspects of this important issue: first and foremost, the legacy left by the last Government, which we heard a little bit about earlier; secondly, the measures that are being taken by the current Government to address that; and thirdly, what more might be done to help.
Turning to the legacy of the last Government, we should be quite simple and straightforward about this: the last Government left a terrible mess in higher education. Today, the Conservative party is trying to quite simply rewrite history when it comes to student loans. It was the last Government, supported by the Liberal Democrats, who designed the plan 2 student loans, and the last Government who froze the thresholds for 10 years. They are now the ones complaining about the very system that they devised, when actually, they should be apologising for the mess they left behind. Sadly, we face the ridiculous situation where they are campaigning to resolve the very problem that they created. It is all a little bit rich.
In contrast, the current Government are trying to clear up that mess and to build a better future for young people. I thank the Secretary of State and the Minister for their work to invest in children and young people, whether by investing in Best Start, with four new centres in Reading and many more across the country, or in our schools. It was a pleasure to welcome the Secretary of State and the Prime Minister to a breakfast club recently. We are also investing in school buildings and teachers’ pay, which I remind Opposition Members is an important area of policy, given the mess they left teacher recruitment and retention in when they left office. The Government are also updating the school curriculum and consulting on modernising special educational needs and disabilities provision. These are all important steps forward and examples of real investment in children and young people.
As part of that, I know that the Minister and her colleagues are trying to address some of the issues around student finance, and I welcome the reintroduction of maintenance loans in particular. There have been some thoughtful comments about their power and importance to many people of lower means in encouraging them to get on with studying at university.
The Government are doing wider work to tackle the cost of living, and it is important to see the support for maintenance loans in that context. The freeze on rail fares will help students and young people, as will the move to cut energy prices. We have also heard about the work to support renters. Indeed, the work to build more houses will help young people buy their own homes. The Government are helping our young people in many ways. There remains more to be done, as has been said, and I ask the Minister to continue to look into the effects of the plan 2 scheme. Given my area is in the south-east of England, I would like to highlight the challenges faced by young people living in higher-cost areas.
I know that the Minister cares deeply about this issue, and it was a great pleasure to have her in Reading recently talking to families about special educational needs. She does care and she is looking into this issue, so I hope that we will hear more about it. We have had a terrible inheritance, but action has been taken, and I look forward to hearing more.
Peter Fortune (Bromley and Biggin Hill) (Con)
A particularly pressing issue of concern is youth unemployment, which has skyrocketed to record levels on Labour’s watch, with the unemployment rate for 16 to 24-year-olds at nearly 16%. Failing the youth of this country is tantamount to abandoning our future. It is because of the political choices made by this Government that young people are struggling to secure employment. We have the lowest graduate recruitment levels on record and 700,000 graduates on benefits. To make matters worse, far too many of those who can find employment are then stuck in an endless cycle of student debt, while taxpayers have to pick up the tab for those who will never be able to fully repay the balance and write off their loans.
I have been contacted by many graduates in Bromley and Biggin Hill who are deeply concerned about the freeze on student loan repayment thresholds. They see it as an unfair decision that heaps additional financial pressure on graduates, who are already struggling with the rising cost of living. In a sense, it changes the rules for graduates after the fact. For many, what was meant to be an investment in education and the future workforce now creates a sense of permanent debt, rather than a manageable contribution based on the ability to pay. This cannot go on, or we will risk undermining trust in the student finance system altogether.
The Conservatives have a plan: a clear new deal for young people—a step-by-step plan to fix what the Government are making worse. It is a plan that I fully support and that would be of huge benefit to young people in Bromley and Biggin Hill. Under our plan to abolish real interest rates on plan 2 student loans, we will ensure that student loan balances never rise faster than RPI inflation. For example, a doctor at Princess Royal university hospital in Bromley in 2029 with £80,000 of student debt would save £58,000 in lifetime repayments and clear their loan sooner. A graduate in Bromley with £40,000 of student debt and on a salary of £50,000 would save £26,000 in lifetime repayments and would clear their loan five years faster than under the current system. It is only the Conservatives who will end the unfair interest rises, fund 100,000 more apprenticeships and encourage young people into work with a £5,000 first job bonus. We have a plan to restore aspiration for young people; the Government are failing them.
Adam Thompson (Erewash) (Lab)
I draw the House’s attention to my entry in the Register of Members’ Financial Interests, and in particular to my role as the chair of the all-party parliamentary university group and to my membership of the University and College Union.
I must note my shock and awe at the Conservatives’ decision to hold an Opposition day debate on the current state of student loans. It is a system that they created in government, that they subsequently broke, and that has left a generation of students and graduates utterly and comprehensively beaten. I remember well when they—with the support of the Liberal Democrats—tripled student fees in 2012. At the time, I was a student and the president of a sports club at my university. We saw a huge downturn in involvement with extracurricular activities that year, because of the additional pressure put on new students by the fee increase. Indeed, I remember very well that a friend who worked in the events team at our student union referred to October 2012 as “the death of fun”.
I accept that the sector needed intervention, and I believe that the architect of the policy, now the Lord Willetts, took difficult decisions that he felt were needed to make the university sector sustainable. I do not believe, however, that he had factored into his plan the Tories’ subsequent freeze in fee increases and repayment thresholds, or their later abolition of maintenance grants. Although the initial increase was a blow to students, the following decade of failed Tory policy has left our university sector in tatters. It has left our institutions facing years of staff dissatisfaction and industrial action, and it has created a whole generation saddled with unbelievable student debt. The Tories created, and then compounded, a system that looks like a graduate tax, smells like a graduate tax, and yet provides the uniquely deep personal pressure that sits astride hundreds of thousands of pounds of apparent debt, crushing millions of students who have been to university in the past 14 years. The Tories enacted almost irreparable damage on the university sector, and did immeasurable harm to a whole generation’s experience of university. The death of fun indeed!
I am amazed, then, at the decision to table this Opposition day motion. In choosing to tinker around the edges of the policy cesspit that they created over many years, the Tories exhibit the most unbelievable brass neck. There is not a hint of an apology for the damage that they did, nor a modicum of understanding of the work that this Government are doing to dig us out of the mess they left us in. The Government are taking the tough but fair decisions necessary to protect taxpayers and students now and for the future.
Under the system, lower-earning graduates will always be protected, with any outstanding loans and interest continuing to be written off after 30 years. I believe it is right that those who can repay their loans do so, and that graduates earning the highest salaries contribute more towards their student loan repayments, but the Government must also repair the damage that was left to us by the Tories. That is why I strongly support the Government’s plan to restore maintenance grants and increase maintenance loans in line with inflation, as I believe should always have been the case. These measures ultimately support low-income students to access, and participate and excel in, higher education. When I was teaching degree-level apprenticeships in electromechanical engineering, I saw what widening participation measures achieved in practice: it allowed access to education for people who did not otherwise have it. I saw the profound good that those measures achieved.
Universities UK still supports the income-contingent loan repayment system, which has facilitated a huge advance in access to university over the past two decades. It notes that more students from disadvantaged backgrounds have been able to enter university, and that the number of pupils who received free school meals and went on to university doubled from 2005-06 to 2023-24. Successive reviews of the higher education finance system have concluded that it is the fairest way of funding higher education. It was Labour policy, made when we were last in government, that achieved those significant improvements.
Although I acknowledge that the Government have a difficult time ahead in solving the Tory mess, I am deeply supportive of the Prime Minister’s huge new target for universities and apprenticeships: that by the age of 25, two thirds of young people should be studying for a degree or taking up a gold-standard apprenticeship. Labour is taking action to ensure that young people are either earning or learning, with 200,000 job and apprenticeship opportunities over the next three years. I also strongly support the £2.5 billion investment that forms the Government’s youth guarantee. We must use it to expand employment support, offer grants to employers who hire young people, and provide a jobs guarantee to create subsidised work placements for long-term unemployed 18-to-24 year olds.
Dr Luke Evans (Hinckley and Bosworth) (Con)
I have said this in the House before, but I will say it again: this is a Prime Minister who promised change and then changed his promise. On this subject, we only have to look at his 10-point plan from 2020. He said:
“My promise to you is that I will maintain our radical values and work tirelessly to get Labour in to power—so that we can advance the interests of the people our party was created to serve. Based on the moral case for socialism, here is where I stand.”
In point 2, he said:
“Support the abolition of tuition fees and invest in lifelong learning.”
He was right that Labour won a landslide election, but, strangely enough, that promise has gone.
Dr Evans
Exactly. It was not in the manifesto, and the Prime Minister made a promise. He made a promise when he stood to be Labour leader, and it was not there. Worse still, what did he do in his first Budget? He increased student fees from £9,250 to £9,535. And last year, he froze the thresholds. That is important, because he promised one thing and then changed his promise.
When it comes to student loans, we have heard a lot of tittle-tattle on both sides of the House, but all parties—including the Liberal Democrats, wherever they happen to be—have a responsibility. In 1998, it was Tony Blair who brought forward tuition fees. He then increased them in 2004. Then there was an increase in the coalition years, which the Liberal Democrats stood on an election manifesto not to do. And here we are now, having just been over what the Labour Government said they were going to do and now have done.
Does it really matter? Yes, there was an issue hidden in the plan 2 student loan, but it has come to fruition because of what we have seen across the globe. I do not think anyone was raising those concerns back then, but the Government have to deal with things that come up. That is what we are looking for today. That is what students outside this place will be listening for. Two years in, what is the solution? At the end of the day, it is the middle earners who are being squeezed. It is unfair, because no matter how hard they work, their debt is going up. Principally, regardless of our political position, I think we all agree that is unfair.
The question is how we solve it. When the Chancellor was asked that question, she said:
“So, yes, we want to fix it. Yes, we want to make improvements. But is it front of the queue? No, it’s not... Politics is about priorities. I’m not denying there is a problem. I’m not blind to that, but what I do say is there has to be some patience.”
Tell that to the hon. Member for Kettering (Rosie Wrighting) or the people from Hinckley and Bosworth whose debt, no matter what they do or how hard they earn, is going up.
Chris Coghlan (Dorking and Horley) (LD)
A constituent of mine, who aspires to be a GP, like the hon. Member, left university £44,000 in debt. She is actually paying more in interest than on her loan repayments. Does the hon. Member agree that the system deters graduates from following the very careers that we so desperately need them to follow in this country?
Dr Evans
The hon. Member is absolutely right. I expect his constituent will be shocked to hear that this is not a priority for the Government. It is unfair, which is why the Opposition at least tried to put up a solution. I was expecting the Government to turn around and say why it does not work, and perhaps offer us something different. That is what the public and his constituent want to hear, and certainly what mine do.
The Chancellor went on to say:
“If you say to me, ‘you shouldn’t have done child poverty and you should have reformed the student loan system,’ I just strongly disagree with that.”
Actually, that is very honest. I give her credit for that, but look at the wider context and what that means for younger people. As we have heard, unemployment in the UK is at its highest since 2021, and since 2015 for those aged 16 to 24. UK youth unemployment, for the first time ever, is above the European average. Let that sink in. As I said to my right hon. Friend the Member for Sevenoaks (Laura Trott), 257,000 people left the UK last year when it was expected to be 77,000, and three quarters of them were under the age of 35. Those people will not be recorded among the number of young people who are not in employment, education or training because NEET numbers are not calculated to include such cases. So not only do we have youth employment going up, but herds of young people are moving elsewhere. That is a tragedy for our economy and for those young people, because they are having to look elsewhere to find work, the lifestyle they want and their place in the world. To me, that is really sad.
What is the Government’s solution? They have already increased taxes on businesses, introduced more red tape and seen youth unemployment go up, and they have said to businesses, “Do you know what we are going to do? We are going to give you £3,000 to rehire the person who lost their job.” They have created a hole and they are now trying to fill it themselves, but they are only filling it halfway.
The Conservatives have set out a solution in the document that we have brought forward. Agreed, it does not fully cover the entire student loan system, and I agree with my hon. Friends that the whole approach needs to be carefully looked at, but at least the Conservatives are offering solutions and have time to develop them. The Government are having meetings and talking, but I see no solutions, and that is a shame.
Alex McIntyre (Gloucester) (Lab)
I declare an interest as I am a former student with a plan 2 loan. I became a student during the first year that plan 2 loans were introduced. I remind hon. Members that I had a very tough Saturday job when I was growing up, in case anyone is shocked that I am indeed young enough to be a plan 2 student.
Frankly, I am shocked at the brass neck of Conservative Members. When I was at school, I remember having conversations with other working-class kids like me who were thinking about going to university—I was the first in my family—who were being put off because the Conservatives had put up the fees from £3,000 to £9,000. There was no consideration then for what young people were going through. There was no plan for young people, and certainly not for young people like me, who grew up in communities like the ones that I grew up in, with parents who never had the opportunities that all the Conservative Members at that time had got for free.
Dr Luke Evans
As a doctor, I was lucky enough to have funding to go towards my education, but I am always surprised to hear people saying that we should put more funding into students on the back of the porters and the receptionists who never went to university. It is those people’s taxes that are supporting those students—that 50% helped to get me where I am. What does the hon. Gentleman say to people like those in his community? They are the ones who are being left behind by paying their taxes for other people to have their time at university.
Alex McIntyre
The hon. Gentleman will be pleased that I am coming to exactly that point later in my speech.
Of course there are challenges with this system. There were challenges with it back when it was introduced in 2012. We pointed out the fact that there are huge generational inequalities: there are hon. Members present in the Chamber who did not pay tuition fees at all and had lower house prices when they graduated, so they could afford to buy a house. Those challenges continue, and part of the reason that I got into politics was to deal with those intergenerational inequalities. We all talk about broken promises, but what happened to the promise about levelling up? In my mind, levelling up was about creating more opportunities for young people in places like mine in Gloucester, but those opportunities were never delivered by the Conservatives.
I want what is best for young people and for the university sector in my constituency. I am delighted to be able to take this opportunity to welcome the brand new university campus that the University of Gloucestershire has opened in the city centre, taking over the Debenhams building and creating a new campus for students, with a public library, so that young people in Gloucester can see what that opportunity looks like going forward.
We need to ensure that we are creating opportunities for all young people, because despite the move towards more people going to university, only a third of people in Gloucestershire will go to university, and in the most deprived parts of my constituency, that number is fewer than one in five. That is why I am proud that the Government are introducing maintenance grants, and why I am backing the new target of two thirds of young people going to university or doing gold-standard apprenticeships, because university might not be the best route for everybody. Generations of young people in my community were left behind by the Conservatives, who had no plan in Government for young people in my constituency.
Graham Stuart
The hon. Gentleman is making an impassioned speech and we hear where he is coming from, but over the 14 years of Conservative Government, 800 jobs were created every day and unemployment was brought down to near record lows. Since his party has come to power, with the mission that he is describing, what has happened? Unemployment is up by 25% and youth unemployment has now eclipsed even that of Europe. The Government are not delivering. I hope in the next part of his speech, he is going to talk about what the Government need to do now in order to make things better for young people, because at the moment every indicator is going the wrong way, including the cost of student loans.
Alex McIntyre
I am always happy to be educated by privately educated Oxbridge graduates who did not pay a penny for their student fees. The right hon. Gentleman will find that employment levels have actually gone up. The number of people in employment has gone up under this Government—[Interruption.] Well, that’s the stat. If he wants to check, he is more than welcome to.
I welcome the youth guarantee that the Government have talked about this week, introducing more apprenticeships and opportunities for young people and tackling the people in my constituency who have been furthest from employment. My hon. Friend the Member for Kettering (Rosie Wrighting) made a fantastic speech about some of the other things we are doing for young people. It is not just about education; it is about renters’ rights and expanding free childcare.
Dr Spencer
I am not privately educated, and nor did I go to Oxbridge. I am where I am today because I went to a state grammar school. The hon. Gentleman is making an impassioned speech about breaking down barriers to social opportunity. Would he agree that grammar schools are a key part of that?
Alex McIntyre
Gloucester has a number of grammar schools and they are doing very well for the students there. I went to a grammar school—[Hon. Members: “Oh!] I went to a state school, and my parents worked really hard to get me there. If Members want to talk about my background, where I came from and how I got to this place, I am very happy to do that. It was quite different from the background of a lot of people on the Conservative Benches.
I am proud to stand here, as the son of a train conductor, talking about opportunities for young people in my constituency who have been left behind for generations, written off and, quite frankly, talked down to by the Conservatives, who talk about making sure that the arts are only for the wealthiest who can afford to go to university and not be spread out, as if education is not actually a benefit to everyone in society and should only be in the purview of those who can afford to pay for it. It is disgraceful, it is taking us back generations and, quite frankly, I am sick to death of hearing about it.
Politics is the language of priorities. As I have said, there are undoubtedly challenges with this system, but the Conservatives left behind so many messes after 14 failed years in government that we cannot fix them all in the first five years of a Labour Government. We are going to need at least a decade. We said that in the manifesto. We talked about a decade of national renewal, and we are committed to that because we cannot afford to fix all the messes that you left behind straight away because you left the economy in a mess as well—[Interruption.] Sorry, Madam Deputy Speaker. They left the economy in a mess—you had nothing to do with it.
I would say to the Minister, as a parent and as someone who is on plan 2 and has spoken to lots of my residents, that if there is money available and if there is an opportunity, we need to look at the expansion of free childcare. We are talking about priorities and how we can support young people at the moment, and the 30 hours of funded childcare is very welcome, but it does not cover the cost of childcare for people who are working full time throughout the year, not just in term time. That is preventing young people from starting their families and getting on, and this could be a really good opportunity if there was money available. This is about priorities and about how we can support young people. I welcome what the Government are doing, but if I were to give them a gentle nudge in any direction, I would encourage them to look again at what we can do to expand the offering of free childcare.
I am not going to take lectures from the Conservatives on young people. They had no plan for young people during their 14 years. They did not care about young people like me when they were in government. Quite frankly, they wrote me off and I had to fight my way to get here today—[Interruption.] Yes, I did go to a grammar school and I am proud of that. I did quite well for myself, but my parents sacrificed a lot for me to get here, so I am not going to take lectures from the Conservatives on that. This Government are fixing the mess that they left behind. Of course there are challenges in the system, but I welcome the measures that the Government have taken so far, and long may that continue.
Dr Neil Shastri-Hurst (Solihull West and Shirley) (Con)
Education is one of the few forces of life that allows a person not only to imagine a different future but to reach it. It is more than a qualification. It is more than a certificate. It is more than even a career. It is the moment where circumstance loosens its grip and possibility takes hold. A good education does not simply serve the individual; it strengthens families and it uplifts communities. It is the most powerful engine of social mobility we possess, and it is the surest path by which talent can rise, irrespective of where it begins. However, if we are to be true to that belief, we must confront a most uncomfortable question. What does it say about us as a nation if the very ladder we offer is weighed down by a burden that grows faster than the lives it is meant to lift?
Today, far too many graduates look not at opportunity, but at a balance that rises year after year, and not simply with the cost of living but more than that. This is a system in which interest is not just keeping pace with inflation, but outstripping it, and where the cost of learning risks becoming a source of anxiety that follows people into their working lives, their families and their futures.
This is not just an economic issue, but a moral one. Education should open doors, not cast longer shadows. The reforms that the Conservatives support are a simple settlement, yet they are profound in their principle. They would ensure that student loan interest rises only with inflation, not above it, moving from RPI plus 3% to RPI alone, and preventing the trap of pushing low to middle earners to pay more than the threshold.
Mr Luke Charters (York Outer) (Lab)
I wonder whether the hon. Gentleman has read the IFS report evaluating his party’s proposal. It states that the proposal would do zilch, nada, zero when it comes to monthly repayments, and the IFS shows that lower and middle earners would not benefit at all. It is a plan for higher earners, isn’t it?
Dr Shastri-Hurst
If the hon. Member does not want to tackle the problem of the inadequacy and inequality between a high earner on £150,000 who will pay off their debt of around £46,000 over an 11-year period, and a lower or middle-income earner on £50,000 who will pay off their debt of around £80,000 over a much longer period of time, then I am afraid the public watching this debate will have serious questions about the Government’s resolve in tackling this issue.
Dr Shastri-Hurst
I will make a little progress.
The changes that the Conservatives propose would not remove responsibility for the student or change the process by which graduates repay, but they would fundamentally restore a sense of fairness. This is not about numbers on a balance sheet; frankly, it is about a young person deciding whether it is worth taking the risk of going to university. It is about a graduate wondering why their debt grows despite doing everything right, and it is fundamentally about trust that if people work hard, play by the rules and invest in their future, the system will be fair in return.
We return to the timeless understanding that education is in the interests of us all, not just because of what it gives to an individual, but because of what it gives to society as a whole. I think of the words of Benjamin Franklin, who said:
“An investment in knowledge pays the best interest.”
Kevin Bonavia (Stevenage) (Lab)
This Opposition debate brings to mind the old proverb that the best time to plant a tree is 20 years ago, and the second-best time is today. During this debate, we have heard from Opposition Members who were part of the Government who planted that tree and proceeded to do absolutely nothing while it grew wildly out of control, until today apparently. I will come on to their motion. Whether those Opposition Members are Conservatives, Liberal Democrats—whose leader was a Minister in the coalition Government—or Reform, which is starting to look the part of a 2019 Tory tribute act, it is down to them, because they planted that tree.
That irony is not lost on me, and graduates in Stevenage and across this country understand that context all too well. Graduates face interest rates that begin accumulating from their first day of study. They see their loan balances rising even as they make repayments year after year, and they tell us time and again that the situation feels hopeless. They shape real decisions about work, housing and family life. They affect the very people powering our economy, raising the next generation and driving the growth that this Government are creating. Some Opposition Members have the audacity to look at this misshapen, neglected tree and ask why it offers so little shade to the graduates standing beneath it.
This Labour Government have taken on the task of fixing 14 years of mistakes and failures with the commitment and energy that is required. As Full Fact’s manifesto tracker has confirmed, two thirds of our pledges are either already delivered or on track—far more than can be said for the previous Government. One of the key missions in the manifesto on which I stood was to remove barriers to opportunity for our young people. Millions of our young people did everything we asked of them—they studied, they trained and they invested in their futures. They kept their part of the bargain, and they deserve a Labour Government who support them, rather than a Government who quietly undermine their ambitions, as happened for so many years.
Wendy Morton (Aldridge-Brownhills) (Con)
I am probably one of the very few people in this House who benefited from not going to university—I did Open University later, so luckily I did not have a student loan, and I am probably a little on the old side as well. However, there is something fundamentally unfair about the Government’s policy. Does the hon. Gentleman not accept that the young people who he talks about so passionately are being penalised by his party? He has talked about track records, so can he explain why youth unemployment is going up under this Labour Government?
Kevin Bonavia
I thank the hon. Lady for her intervention. [Hon. Members: “Right honourable.”] Yes, right honourable —I remember her time as Chief Whip. Like her, I did not have the burdens that people who went to university after me had to face, so I am very conscious of my responsibility to those generations and the generations to come. I am glad that the right hon. Lady has raised the issue of young people, because this Government recognise the extra pressures that young people face. That is why we are taking measures to help those who are feeling the pressures of the cost of living, whether on transport, childcare, or so many other things. We are helping our younger people and looking at how we support our students into the future—we are bringing back the maintenance grants that I benefited from all those years ago.
Graham Stuart
The hon. Gentleman said that the Government are helping young people, and mentioned transport. Bus fares have gone up by 50%, from £2 to £3; for somebody who travels every day to work and back, that is £500 a year out of taxed income. That is not helping. Fuel duty is going to go up in September—that is not helping. The cost of heating oil is going through the roof, and there is going to be nothing for anyone who goes to work—that is not helping either. Can the hon. Gentleman start to look at the reality of what is happening? It is not good for young people, and unemployment among young people is going up, not down.
Kevin Bonavia
I respectfully disagree with the right hon. Gentleman. He took me to task on transport; I come from a constituency where we desperately need more bus services. That is why we now have the Bus Services Act 2025, which I believe he would probably have voted against. We are making a difference for young people, and indeed all people who need to use those services.
The greatest responsibility we owe to the generations that will come after us is providing them with opportunities and lifting them up, not holding them back. We need to look at the tough issues and find answers to them. What the Opposition have tabled today is a motion that suggests that they can fix their own broken plan 2 loan system by
“controlling the number of places on university courses where the benefits are significantly outweighed by the cost to graduates and taxpayers.”
How on earth are they going to find out what those courses are? The shadow Secretary of State, the right hon. Member for Sevenoaks (Laura Trott), plucked some of them from the air—“Oh, we’re not sure about some of these creative arts courses.” How is she going to evaluate that? Are we going to have a commission? Is the party of the free market going to control the market? How is it going to do that?
Several hon. Members rose—
Kevin Bonavia
I am afraid that I will not give way, because I want to explore this a bit further.
The Opposition really have not thought this motion through at all. Are they going to have a commission saying, “We have worked out that this degree is going to produce this value”? How is that going to affect the economy at a time when we perhaps need more creative degrees? How is this all going to work? There will be more bureaucracy and more costs, and the price is going to be paid by our young people who cannot choose their own futures. That is what would happen if this really misguided motion were implemented. This plan is not even half-baked—it is as oven-ready as Boris Johnson’s pathetic Brexit deal, which this Government are trying to fix.
We cannot change the moment when the tree was planted by Opposition parties, but we can tend that tree now. I have full faith that this Labour Government will do just that.
Royal Assent
Madam Deputy Speaker (Judith Cummins)
I have to notify the House, in accordance with the Royal Assent Act 1967, that His Majesty has signified his Royal Assent to the following Acts:
Supply and Appropriation (Anticipation and Adjustments) Act 2026
Finance Act 2026
House of Lords (Hereditary Peers) Act 2026
Universal Credit (Removal of Two Child Limit) Act 2026
Industry and Exports (Financial Assistance) Act 2026.
Student Loans
(1 day, 4 hours ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
18:59 - The House divided: - Ayes: 88 / Noes: 266 - Question accordingly negatived.
Joe Robertson (Isle of Wight East) (Con)
Labour is failing young people. Youth unemployment is up since Labour took office—it is now higher than in the eurozone. There are more people not in education, employment or training since Labour took office—now nearly 1 million. There is a midlife crisis in our economy, too. More than 2 million people aged between 50 and 64 are on out-of-work benefits. The deal for young people is bad, and it has been made worse by this Chancellor.
Too many young people are coming out of university with excessive debt, and they do not know what the future terms of their borrowing will be. If a private provider were to provide loans in this way, where someone did not know when they signed up what the interest rates, repayment deal or income threshold would be, that provider would be unable to enforce it—it would be unlawful. When it comes to this Government and the Chancellor freezing the threshold, for some reason those on the Government Benches think that is okay.
We have heard from Government Members who said that they joined the Labour party to fight for a better deal. We heard from the hon. Member for Kettering (Rosie Wrighting), who said that she is here to fight for her generation—generation Z. Is she not bitterly disappointed at the limp response from her Government now that they have power and can do something about intergenerational justice as she sees it? Instead, Labour Members come into this House to defend their Government increasing debt for students and freezing the earnings threshold at which those young people have to start repaying.
Mr Charters
I am on plan 2, and I had a targeted maintenance grant. I will ask the hon. Member a simple question: does he think it is a fairer system to have targeted maintenance grants in it—yes or no?
Joe Robertson
Let me ask the hon. Member a question, because his party is in government, he has power and he can change things. Does he think the system is fair? No, he does not, because he has already told this House that it is not. Is he not bitterly disappointed that his own Government have not got a plan to change it? If he does not like the system that existed before July 2024, why are his Government not changing it?
The Opposition have brought forward a plan, which we are debating today. It would mean that those on plan 2 student loans will not end up paying more and more above RPI, so the Government will not be making money out of them having a loan. That is a meaningful change. The Government can go further because they are in power. I hope that our party, by the time of the next election, will be able to offer more, but we have already announced that we would abolish stamp duty, helping young people. We have already announced that we would scrap bad courses that offer no real additional employment prospects for people who do them, other than leaving them saddled with debt.
It would seem that most Labour Members have history degrees, given the amount of time they have spent speaking about the last decade, but we are talking about the system that exists now. When I went to university, I accepted the principle that young people who went to university did not contribute enough to the education that they received. Under the Blair Government, undergraduates were asked to contribute more. Clearly there is a benefit for society in having an educated and graduate workforce to take up jobs as teachers and doctors, for instance, but there is also a great benefit for those who take up those jobs, because of the higher earnings involved. That is a principle I supported. It is a principle most people supported, and I still support it. However, we have plainly reached a tipping point for too many students. The personal debt is so high that they have no real prospect of ever paying it back. Some have degrees that give them no real opportunity ever to earn more than they would have earned had they been in a good apprenticeship—a good apprenticeship that the last Government gave them the opportunity to enter into.
Vikki Slade (Mid Dorset and North Poole) (LD)
My son is studying for a degree in musical theatre performance, and is due to graduate in a few weeks’ time. That may be something that the hon. Member thinks has no value. My son will probably spend a certain amount of time working tables and trying to make a living while he progresses in his career. He would not be able to be of use to people as a future teacher, a future councillor, a future communications officer or, perhaps, a future politician without that degree. Is the hon. Member suggesting that his degree has no value?
Joe Robertson
I am sure that the hon. Lady’s son’s degree is an excellent degree and that, hopefully, he will gain an excellent job, but that is not the case for every student. Too many students in this country are saddled with tens of thousands of pounds of debt. They do not know their repayment terms because they change, and some of them have degrees that will give them no additional prospect of a job to allow them to repay their debt. I hope that most of us can agree on that principle. It is therefore perfectly legitimate to ask this question: should we be putting an end to some of these institutions and courses when they are doing nothing for the young people involved?
This is not a deregulated market. In order to be able to offer a degree, an institution has to be licensed. There is no groundbreaking idea behind saying that certain courses are not of degree quality, and that the public should not be subsidising those courses. Governments already make decisions about that. It is the Conservative party that is proposing—for some reason the Labour Government do not want to do it—that young people who are sold a future that simply does not exist should not be saddled with debt, and the taxpayer should not subsidise them.
Madam Deputy Speaker (Judith Cummins)
Order. I am now imposing an immediate four-minute time limit.
Danny Beales (Uxbridge and South Ruislip) (Lab)
I welcome the opportunity to discuss the student loans system. I took out a student loan under the plan 1 system. I am, fortunately, not young enough to have benefited from a plan 2, or, now, a plan 5 loan. However, despite having graduated with about £40,000 of student debt, I did consider myself fortunate—fortunate that I went to university under a Labour Government who had widened participation in higher education and created a fees, grants and loans system that enabled me to go to university and pay my living costs, which my single-parent family would not have been able to do without the grants that were, unfortunately, then cut by the Conservatives. I was happy to contribute towards my university education on the basis that most people at my school would not go to university, but a system that was one of contribution and fairness has become an aggressive system, and I believe it is time to review the plan 2, and now plan 5, loans systems.
I have heard from many of my constituents about the system as it is operating, including those at Brunel University. Recently, a teacher told me about the challenges of repaying her loan and how she is considering going part-time as a result of high interest rates. There are clearly a number of options that could be taken, such as changing the RPI basis to a CPI basis, capping lifetime interest costs and uprating the thresholds once again. Suggestions have also been made by the Good Growth Foundation.
It is important that, rather than going for any one of those changes, we properly analyse the options and the distributional impacts—work which the Conservative party clearly did not do given the half-baked proposals before us. It is quite baffling that the Conservatives moved this motion. Having been the architects of this regressive student loans system, having maintained the system for a decade, having continually frozen the repayment thresholds, and having trebled the fees when in coalition with the Lib Dems and cut maintenance grants for the poorest, they now pretend to be the party of students.
However, the mask has slipped in the last section of the Conservatives’ motion. They plan to pay for their minor change by reducing the number of people going to university. When they say that fewer young people should go to uni, they almost never mean that they should not, or that their children should not, and they do not mean that the universities in their constituencies should close. They are talking about other people, including those at universities such as Brunel in my constituency. They look down on the arts or “ology” courses that they feel have less benefit, and to be frank, that is elitism.
Alex McIntyre
My hon. Friend is making an excellent point about how, when the Opposition say they are going to cut funding for certain courses, they really mean that those courses will be available for wealthier students who can afford to pay for them without a Government subsidy. Does he agree that that will lead to a decrease in students from working-class backgrounds being able to access arts degrees?
Madam Deputy Speaker
Order. Members are being very generous with their time, but I remind them that I will be starting the Front-Bench speeches at about 6.40 pm, and we still have four more Back Benchers left to speak.
Danny Beales
I completely agree that everyone who would and could benefit from a university education should be able to go. We do not widen opportunities by cutting them.
John Burn-Murdoch’s analysis in the Financial Times has shown that other developed countries have increased participation in higher education and not seen the impact on graduate wages that we have seen. That is not inevitable as part of wider higher education participation. We have seen it because of the stagnation in the economy and of productivity caused by the last Conservative Government, not because of higher education participation.
There is a range of cost of living pressures on younger people. Yes, there are student loan costs, but there are also rising housing costs, the stagnation of wages more generally, childcare costs and renting costs, many of which need urgent action. I hear from young people in my constituency about the impact of starting a family or getting on the housing ladder. There was a generational compact that if people worked hard and got on, they would do better than their parents’ generation, but things we had come to take for granted were broken under the 14 years of Conservative Government.
Action was needed, and I am pleased that this Government are reforming and scrapping the broken leasehold system, capping ground rents and taking action on service charges. They have introduced the Renters Rights Act, which the Conservative party opposed. They are taking action on childcare with the 30 hours free childcare, and bringing down inflation and interest rates. I welcome the fact that the Chancellor and the Minister with responsibility for higher education have acknowledged that action is needed on student loans and are actively reviewing the student loans system. I hope that the Treasury Committee’s full inquiry, which is under way, will be fully and promptly responded to by the Government.
Let us be clear: the proposals before us would not solve the student loans system. They are a gimmick that would close participation and close doors of opportunity, which is exactly the opposite of what people and young people in this country need.
Graham Stuart (Beverley and Holderness) (Con)
It is a pleasure to participate in this debate. Graduates were promised a fair deal, and we have heard all the promises that were made from when the current Prime Minister stood to be Leader of the Opposition to the announcements that were made afterwards. People were told to work hard, go to university and have a shot at a better life, and that their efforts would pay off. On those principles, Labour Members entirely agree with those of us in the Opposition.
The Education Secretary knows that those things should be in place, because in 2023 she wrote that graduates will pay less under a Labour Government. She, the actual Education Secretary, said that graduates would pay less under a Labour Government. Now in office, she says:
“We are where we are.”
The Chancellor knows it, too. In January, she said the student loan system was fair and reasonable—in January, this year. Yesterday, suddenly, she admitted it was broken, but, importantly, not a priority.
And the Leader of the Opposition knows it. Last month, she said the current system created an unfair debt trap for graduates. But what is the difference? The difference is that the Leader of the Opposition has a plan—a plan to cut interest rates that no one would accept on a normal loan. The moment a graduate throws their cap in the air, unfortunately the Labour party sees a target to tax. We Conservatives see a dream to back—dreams like Sammi’s. Sammi, from Keyingham in my constituency, is one of the first in her family to go to university. She borrowed £40,000. She works in the medical field and makes a payment every month, but she now owes £46,000 because of interest rates that no one would accept on a normal loan. Graduates such as Sammi need to earn £66,000 before they even start to reduce their loans. By refusing to cap interest at the rate of inflation to help people like Sammi, as the Conservatives are proposing today, the Chancellor, who admits that the system is broken, is making them pay more for longer.
For too many, the degree that was meant to help them get on is now holding them back. That is why, in a tough situation, we are making tough proposals about finding courses that are not adding value. They exist. We have had Liberal Democrat and Labour Members suggesting that there is not a single course at a single institution in this country that should not be put under question. That is not the right attitude.
Under our plans, interest rates on plan 2 student loans will be capped at inflation, saving graduates tens of thousands of pounds. A doctor from Hedon, graduating in 2029 with £80,000 of student debt, will save £58,000 in lifetime repayments. An engineer from Roos with £40,000 of student debt earning £50,000 would clear their loan five years faster. So, when these young people enter the workforce or start a business of their own, they will have the space to build a future of their own: saving for a home, starting a family, creating something of value—fairness, a future, freedom.
People like Sammi are the risk-takers, the innovators and the builders of what is to come and they are being let down by this Government. That is the choice before this House tonight: vote for our plan to make effort pay again or do nothing, because it turns out that graduates are at the back of the queue. Colleagues on the Government Benches know the right thing to do. Deep down, the Education Secretary knows it and the Chancellor knows it. What they need now is the courage to do something about it.
Peter Prinsley (Bury St Edmunds and Stowmarket) (Lab)
Student finance is complicated. With thanks to my hon. Friend the Member for Glasgow South (Gordon McKee), who has been in and out of his seat all afternoon, I was able to produce a biscuit explainer today, which is available on all good social media channels.
Reforming the student finance system is not straightforward. It is a complex challenge—it is made much more difficult by the need to stabilise the economy, which is something that I obviously strongly support—but we must be clear that the task is harder because of the economic mess left behind by our predecessors: years of short-termism and under-investment that have constrained what can now be done.
Yet even within those constraints, the direction proposed by the Opposition is a bit flawed. The suggestion to scrap degrees, particularly in the arts and cultural sectors, is culturally dismissive, plainly disrespectful and insulting. It reflects a narrow view of value and ignores the real contribution of the creative industries to our economy and our national life.
Turning to the system itself, student finance is not neutral. It perpetuates an inequality. Those from less well-off backgrounds must take on larger maintenance loans simply to afford the cost of living, graduating with significantly higher debts than their peers. That undermines social mobility. Instead of higher education acting as a ladder of opportunity, the system has reinforced disadvantage. Those who start with less, leave with more to repay.
In reality, we all know that what we have is a form of a graduate tax—long-term, income-contingent and unavoidable for many—but without the clarity or fairness such a system should have. So we do need reform, but not through the Opposition’s plan; we must make a better plan. The Labour party is and will remain the party of working people, grounded in the principles of fairness, which means confronting systems that entrench inequality and replacing them with ones that expand opportunity. If we are serious about fairness, we must act—and act we will, for we will use the levers of the state to ensure fairness.
Dr Ben Spencer (Runnymede and Weybridge) (Con)
I am going to talk about hope and fairness, to which many Members across the House have referred in their speeches. It is important that everyone has hope for the future, but particularly the next generation.
There are many challenges facing younger people at the moment, from youth unemployment, with the graduate jobs market unfortunately in decline, to the uncertain world we live in. The people who will inherit this world from us are concerned about conflict in the middle east, the position of our defence, and the direction in which our country and society are going. It is younger people who have borne the brunt of the decisions made during covid, and it is younger people who will have to deal with and find solutions for the changing demographics in our society, particularly the ageing population. It is important now more than ever that the next generation—the younger generation—has hope for the future, and we Conservatives have a plan to bring that back. The key to that plan is fairness.
Our motion today goes to the heart of fairness. It is fair to say that the repayment system for the people paying back plan 2 loans, with the thresholds and the interest at 3% above RPI, has essentially turned into some form of Ponzi scheme. The Conservatives have a plan to start resolving that. As has been said, it would not be possible to get these loans on a commercial basis; they are fundamentally unfair, and we have a plan to go about fixing it.
When we talk about education more generally, we talk about the fact that all different types of education have intrinsic value. There is no hierarchy between people who go to university or further education, people who do apprenticeships and people who go straight into work. It is about providing the right education for the individual person. Whether someone has gone to university or done an apprenticeship—whatever route they have gone down—it does not make them a better or worse person. The key is that it is the right plan for them. It is only fair that we reverse some of the historic biases against apprenticeships in particular, and that is why I am so pleased that apprenticeships and vocational training are central to the motion that we will be voting on later.
Fairness means fairness both to the taxpayer and to the people taking the courses. I intervened on both the Minister and the Liberal Democrat spokesperson, the hon. Member for St Neots and Mid Cambridgeshire (Ian Sollom), to ask whether they would at least concede that there are some courses—particular courses at institutions across the country—that are really not worth it because they are not value for money and will not help the student.
Ian Sollom
I thank the hon. Gentleman for giving way; I did not cover myself in glory when I responded to his point earlier, and I would like to take another bite of the cherry. The point I was trying to make was that simply basing it on salary value is not the only way to assess value. The right way to do it is through the regulator, the OfS, and to take that as just one element of many. The OfS should drive that. Would the hon. Gentleman make salary value the primary driver for all courses? [Interruption.]
Dr Spencer
I think that my right hon. Friend the Member for East Hampshire (Damian Hinds), sitting behind me, will give a more extensive answer to that question in a moment. There are lots of ways to measure degrees. An example that I often give is the degree in David Beckham studies, which I think existed. I am a big fan of David Beckham, by the way, but I am not sure how many degrees in David Beckham studies we need, or how it would benefit the economy or the individual. Critically, I am not sure that taxpayers should be subsidising that. All our constituents are contributing to this system, and it is only fair that we ensure that there is value for money for taxpayers, as well as for the people taking the courses, and that there is a broader contribution.
It is absolutely right that, as part of this motion, we look at fairness in the system, particularly to make sure that degrees, which are regulated, give the value that they are purported to give, and that we do not have fake degrees or degrees with a disproportionate difference between the offering—what people think they are going to get—and the outcomes. When people are starting on a degree course, it is important for them to know where they can expect to be in five or 10 years’ time and what their status in society will be, so that they can make informed choices given the substantial cost, in terms of both time and money, of their investment.
On that basis, I wholeheartedly support the motion and look forward to voting for it later tonight. I hope Labour Members do so as well, because this motion brings back a bit more hope and a bit more fairness to the system.
Damian Hinds (East Hampshire) (Con)
It is an honour to be the final Back-Bench speaker in this debate. I do not feel like I am at the back of the queue; I am just not at the front.
It is good to see some Liberal Democrats with us today. We know that student finance is a particularly important subject for debate in the Liberal Democrat party. In fairness, though, the Vince Cable plan, sometimes also known as plan 2, is not only about the Liberal Democrats. The Conservatives were also in government at that time, in coalition with the Liberal Democrats. We shared responsibility. The whole thing was largely based on the Browne report, which had been commissioned by the previous Government under the other Brown, who somehow managed not to mention it during the course of the 2010 general election. To be fair, the existence of a real interest rate in both the Browne plan and the Cable plan was intended to make the system more progressive. None the less, it has become clear over time that that system needs to change. It has also become clear that, with all the pressures on young people and graduates at the present time, including unemployment, now is not the time to squeeze them further on the repayment threshold.
In the short time available, I will talk primarily about apprenticeships and degrees. In particular, I want to focus on the necessity of concentrating on quality apprenticeships.
Damian Hinds
I will, but I will start by telling my hon. Friend about the lack of quality in some previous apprenticeships. I draw the House’s attention to the 2012 National Audit Office report on adult apprenticeships. I have time for only a couple of very short excerpts. The number of apprenticeships had increased dramatically in the three years up to 2012. The vast majority of apprentices were over 25. One in five apprenticeships lasted fewer than six months. Only one third of apprenticeships were at an advanced level, compared with something like 60% in France. In a separate study, there was the amazing discovery that, at that time, one in five apprentices—and this was to rise even further—did not even know that they were on an apprenticeship, so poor, thin and flaky were those courses.
So, yes, Madam Deputy Speaker, we reformed the system. First, in 2012 we introduced the minimum length of one year. We then had the substantial package of reforms in 2017 to make sure that there would be 20% of time off the job and to introduce the apprenticeship levy. It included the move from frameworks, which were sort of tick-box standards in many cases, to proper standards that would be designated and designed by employers and would have a proper end-point assessment to guarantee that that person had learned those occupational standards. And yes, of course the number of people on apprenticeships then fell.
The Government amendment says that they want to reverse the decline in apprenticeships under the previous Government. The reality is that the number of apprenticeships first grew like crazy under the previous Government as a result of the Apprenticeships, Skills, Children and Learning Act 2009, and then it came back down following our reforms to make the apprenticeships higher quality and more exacting.
In 2010, the 280,000 figure was still lower than the 340,000 that we achieved in government. Now it looks like the Government are set on restarting that rollercoaster by reducing the standard of apprenticeships.
Alistair Strathern
I will not claim that the apprenticeship system that the previous Government inherited was perfect, but he is right that at its best it was about getting hard-to-reach young people into skilled jobs that they would not otherwise be able to reach. Countless young people and employers in my constituency, as well as the fantastic charity Amazing Apprenticeships, constantly cite standards as a barrier, not an enabler.
Damian Hinds
I am grateful to the hon. Gentleman for his intervention, but we need quality apprenticeships. That is why I regret the fact that the independent Institute for Apprenticeships is being dissolved to be replaced by Skills England, which is not independent, does not have guaranteed business involvement in setting standards, and has now been moved from the DFE to the Department for Work and Pensions.
I regret that the Government are watering down end-point assessments, and I regret most of all that the new minimum length of an apprenticeship is eight months, down from 12 months. By the way, a 12-month apprenticeship is already short by international standards, and it is now being reduced even further to eight months. Try telling a German captain of industry that an apprenticeship can be done in eight months. There is nothing wrong with eight-month training courses, just do not call them apprenticeships. Call them something else so that we maintain the standard, brand and integrity of an apprenticeship.
The Government say, “We are doing all these things. We are reducing the standards and making it easier to access the cash and pass the course, and we believe that we may be able to grow the numbers.” I should actually apologise to Labour Members, because I think it insults their intelligence when they are given a piece of paper and asked to read something that says: “We believe that with our plan the number of apprenticeships will grow.” Of course it is going to grow—it could not fail to grow. The point is that it is not a like-for-like increase in the number of apprenticeships.
Madam Deputy Speaker, I know I am out of time. I had a load more to say—perhaps another day. Thank you for calling me.
Neil O'Brien (Harborough, Oadby and Wigston) (Con)
In January, the Chancellor was saying that the student loans system was “fair and reasonable”. She now admits —as of yesterday—that it is broken. In one sense, we have won this debate even before it started. The Government say that they are looking at these issues, but they would not be looking at them if it were not for the Opposition raising them, and I do not find the promise to “look at these issues” very reassuring, given their track record.
In the run-up to the last election, the Education Secretary promised: “Graduates, you will pay less under Labour”. Unbelievably, that is still up on her website. Instead, Labour has increased fees so that graduates are paying more, not less. On top of that, the Chancellor has cut the repayment threshold in real terms so that graduates are paying a further £250 a year. Actions speak louder than words.
To get elected as Labour leader, the Prime Minister promised to abolish tuition fees. Instead, he has increased them. He used to say, “We need to end the scandal of spiralling student debt,” but now he is letting it spiral. When the Minister says, “We will look at it,” we are not reassured. I thought the best speech of the afternoon was from the hon. Member for Gloucester (Alex McIntyre), who said in plain terms that he would not prioritise fixing this problem and would spend the money on something else. That kind of blunt honesty is better than the line from the Chancellor, who says “Graduates, your call is very important to us. Please continue to hold, and eventually perhaps we will do something about it.”
This system was set up with the best of intentions, but I have been arguing against it for as long as I have been in this House. The above-inflation interest rates have long been recognised as a problem. That is why our 2022 reforms abolished real-terms interest rates for all future students, but now we need to go back and end these unfair challenges for past students too.
There are lots of different ways to explain how unfair the current system is. Those on plan 2 are paying back far more than they ever borrowed. The typical plan 2 graduate needs to earn £66,000 a year just to keep track with the interest. The total volume of money owed by plan 2 students is increasing every year, even though no new loans are being taken out and they are paying back billions every year. Between the lower and upper interest rate threshold, for every additional £100 a graduate earns, they repay an extra £9, but their debt also accrues an additional £7.20 in interest. In fact, a plan 2 graduate who has £69,000 or more of debt—a doctor or someone like that—sees their debt increase faster as their earnings and repayments increase, because the interest effect outweighs the repayment effect. It is a totally perverse system.
Adam Thompson
The hon. Member talks about the effect of interest over time. Given that the loans are eventually written off under the current system, can he tell me what threshold a salary would have to be at for the proposed changes in interest to make any realistic difference over the course of a graduate’s entire life?
Neil O’Brien
Yes, and I am grateful for that question. Under our proposed reforms, four fifths—80%—of plan 2 graduates would benefit and pay less over their lifetime. The hon. Gentleman can look up all this stuff on the IFS website if he wants to check.
There are so many personal stories here. The other day, one doctor was recounting how she graduated with £75,000 of debt, has worked hard for years and has paid off every year, but she now owes £90,000.
Neil O’Brien
Perhaps the hon. Gentleman will tell me why he thinks that is fair.
Mr Charters
The hon. Gentleman referenced the IFS report. He will know that it has costed his proposals and that for the plan 2 cohort there would be a capital cost of £30 billion to £40 billion—I believe that could be a gaping hole. It is a seriously uncosted policy, is it not?
Neil O’Brien
If the hon. Gentleman reads to the end of the IFS report, he will see that it costs our proposal in single-digit billions, and we have explained exactly how we will pay for it—I will come to that in a moment—so there is no gaping hole whatsoever. No wonder so many despair, with more broken promises from the Government and ever-rising debt, and no promise of action at any particular time.
How we would pay for our proposal—this goes to the hon. Gentleman’s question—is equally important. Since the last Government created the longitudinal education outcomes dataset, we have had much better data on which degrees do—or do not—provide economic value for students and taxpayers. Economic value is not the only value put on higher education, or any kind of education, but rather than simply pushing more young people towards courses that the Government’s own data show us do not benefit them—they do not help them, and they leave them feeling like they have been mis-sold and betrayed, with a lot of debt and nothing much to show for it—we need to have a rethink. The current approach is not working.
Since the election, youth unemployment has risen to levels significantly above the eurozone’s for the first time in a generation. That is mainly as a result of the Government’s decision to target lower-paid people for tax increases and to increase regulation, but it is not helped by the Government’s unbalanced approach to skills, based on an endless expansion of university courses whether they are any good or not.
Neil O’Brien
Just one moment.
Analysis by the IFS found that total returns on going to university will be negative for about 30% of both men and women—and that is based on the cohort from the noughties. The problem now is probably even bigger because the graduate premium has declined further. As a result, many graduates now earn so little that they will never fully repay their student loans, leaving the taxpayer to cover about £8 billion in losses every year. That is why we would restore the number controls that existed for 70 years and use that to reduce the number of people who are on courses that are not good value for the taxpayer and not helping the young people, either.
To listen to Labour Members, anyone would think that there was not a single bad course, that every single course is totally brilliant and that there is no prospect of ever reducing spending on any single course. That is a fantasy world. We do not say about any other type of public service that every single instance of it is completely brilliant and there is no scope for improvement. We would use the savings from our proposal not just to abolish real interest rates on plan 2 loans but to double the number of apprenticeships for 18 to 21-year-olds so that quality apprenticeships are a real choice at age 18.
Why would we do that? Recent data shows that five years after finishing a course in 2018, the average level 4 apprentice was earning £32,000; by contrast, the average graduate was earning just £26,500 and the lower quartile of graduates were earning £19,000 or less. In many cases, a high-quality apprenticeship can be a better option than a low-value university course. That is why we would make that change.
Alex McIntyre
Labour Members have asked Conservative Members repeatedly if they can name a course or an institution that they would cut. The hon. Member for Runnymede and Weybridge (Dr Spencer) had to make up a course in David Beckham studies—as far as I understand, that never existed—to make the point. Does the hon. Gentleman have a real course in mind, or are his made up as well?
Neil O’Brien
We have already talked about that. If the hon. Gentleman wants a full list, he can go on my Substack and see a whole bunch of different institutions with low returns. He can also do better than that: he can look on the DFE’s website and see that many courses lead to low earnings. [Interruption.] It is not my purpose here to single out individual courses.
We have talked quite a lot about creative arts. The Institute for Fiscal Studies says that only 4.5% of those degrees represent a positive return to taxpayers. Some people will look at a statistic like that, say that it is only worth it for taxpayers 4% of the time and say, “That is not a problem. Let’s carry on shovelling money into something that is only working 4% of the time.” Other people would say, “We have to make choices, and we could use that money, which the Government continue to shovel into low-value courses, to fund more high-quality apprenticeships and cut repayments for betrayed plan 2 voters.”
Let me be clear: the current system is unfair. The Government admit it is unfair. Like so many other things, they say they will look at it. This is a Prime Minister who we can always rely on to do the right thing once we have dragged him by the nose to do it. As the former Deputy Prime Minister says, time is running out for this Labour Government, and it is time for them to stop moaning, grow a pair and fix this problem that they have moaned about.
The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
Let me begin by stating the obvious: the issues with plan 2 loans are a legacy of the previous Government. Plan 2 borrowers in England are undergraduate students who began their courses between 2012 and 2023. The loans were designed, implemented and operated by the previous coalition and Conservative Governments. When we were elected, we immediately recognised the pressure. We uplifted the plan 2 repayment threshold in 2025 to £28,470 and will increase it again to £29,385 next month, ensuring that it is higher than average graduate salaries three years after a course has finished. Before we came into Government, for most of the time that plan 2 loans have existed, the repayment threshold has been frozen—for 10 years during the Tory Government.
This is a system that we would never have designed. We have heard plenty today about its flaws, the worry it causes and the pressure on graduates. We have had, as we often do on Opposition days, a spirited debate. I will begin my comments on some of the contributions that we have heard by thanking my hon. Friends the Members for Reading Central (Matt Rodda), for Erewash (Adam Thompson), for Stevenage (Kevin Bonavia), for Uxbridge and South Ruislip (Danny Beales), for Bury St Edmunds and Stowmarket (Peter Prinsley), and in particular my hon. Friend the Member for Gloucester (Alex McIntyre) for an especially powerful contribution.
I single out my hon. Friend the Member for Kettering (Rosie Wrighting), who continues to be a champion in this place for young people not only in her constituency but up and down this country. When I came to this place, my maiden speech was about generational inequality. Based on her description, I think that I have timed out in my ability to call myself a young person, so I am delighted that we have my hon. Friend here holding that torch and continuing to fight and to make the case for young people.
Turning to the shadow Secretary of State, the right hon. Member for Sevenoaks (Laura Trott), we have had some serious chutzpah from the Tories today, opening with the fact that this Labour Government have increased fees—fees increased for sustainability purposes but certainly not trebled, as the Conservative party did. She spoke of the threshold freeze being unfair. April’s increase is our second in two years—as many as they managed in 12 years post introducing the plan 2 scheme.
The shadow Secretary of State labelled the motion a new deal for young people, but why on earth is a new deal required? It is because the Conservatives trebled fees, scrapped maintenance grants, oversaw a 40% cut to youth apprenticeships, and drove the number of NEETs up by a quarter of a million in their last three years in government. By contrast, under this Government, young people are getting a new deal, with a new target of two thirds of young people in an apprenticeship or at university, our youth guarantee and our jobs guarantee, because we understand that young people need support to thrive, especially after 14 years of the Conservative party.
We then heard about the range of options that the Conservatives want to secure for young people, that it is a Conservative choice to be able to earn and learn through apprenticeships or to go to university, but that was not the choice that young people had. They hammered apprenticeships for young people, and that is one of the reasons why we face the challenges in the system that we do today.
We heard from the Liberal Democrat spokesperson, the hon. Member for St Neots and Mid Cambridgeshire (Ian Sollom), in what I thought was a very considered contribution. I always think that it is incredibly brave for a Liberal Democrat to speak in any debate about fees, loans and so on.
Andrew Western
I will not because I am short on time—I am sorry.
While I do think that a Liberal Democrat should be wary, the hon. Member for St Neots and Mid Cambridgeshire made an important point in his defence of degree courses with which I agree.
The hon. Members for North Dorset (Simon Hoare) and for Hinckley and Bosworth (Dr Evans) attacked the Government for acknowledging the problems of the system and for saying that we recognise that work is needed, there is much to do, but we will look at it. When we say there is much to do, there are messes left all over the place. What exactly are we talking about? We are talking about a legacy of starved further education funding. The Conservatives oversaw a 40% drop in youth apprenticeships. They drove up child poverty, ravaged Sure Start, scrapped Building Schools for the Future, broke the SEND system—and that is just their legacy for children and young people, before I even get to the fact that they left the NHS on its knees. Their damage, the mess they left, has a long tail, and we must never forget that that damage cannot be fixed overnight.
Dr Luke Evans
Given that the Minister has just listed a great big set of problems facing students, what does he say to students when the Chancellor has said that they are not at the front of the queue?
Andrew Western
What I say is that students, like everybody else, benefit from an improved NHS and from a range of interventions that this Government are making, but we cannot change everything overnight.
The hon. Member for Bromley and Biggin Hill (Peter Fortune) commented that young people not in employment has rocketed under this Government, which is an interesting take given that the number of NEETs is 14,000 lower now than it was at this point last year, but it increased by 250,000 in the Conservatives’ final few years in office.
We then heard from the hon. Member for Solihull West and Shirley (Dr Shastri-Hurst). I simply reiterate the comments made in the intervention from my hon. Friend the Member for York Outer (Mr Charters) about the rubbishing of the Conservatives’ proposal already done by the Institute for Fiscal Studies.
The hon. Member for Isle of Wight East (Joe Robertson) mentioned youth unemployment figures, and I absolutely agree that these are a concern. We are not complacent on this issue, so he will welcome the youth guarantee, the jobs guarantee, the increase to apprenticeship funding, the shift to more apprenticeships for young people, the revised target of two thirds of young people either in an apprenticeship or at university, and the update to our approach to encourage technical learning while earning. He will also be pleased to know that, unlike him, I do have a history degree, so I have no problem looking at the Conservatives’ record of the past 10 years. I absolutely appreciate that they do not want to be held to account for the mess they left, but sadly they devastated this system, and it falls to us to resolve the problems they left.
We then heard from the hon. Member for Runnymede and Weybridge (Dr Spencer), who said that all forms of education have intrinsic value, which leaves me somewhat confused given the Conservatives have made a compelling argument today for scrapping a number of degree courses and they ran down the number of apprenticeships available to young people.
I want to briefly come to the contribution of the right hon. Member for East Hampshire (Damian Hinds), because he is always considered in this area and, indeed, I consider him an expert on this subject. I cannot pretend to be familiar with the Brown and Cable plans, but it is important to pick up a point he made around the vast majority of apprenticeships being taken by people over 25. I believe that that is a problem in the system. That is why we are creating foundation apprenticeships and that is why—[Interruption.] I am not suggesting—[Interruption.]
Madam Deputy Speaker (Judith Cummins)
Order. I want to hear what the Minister has to say.
Andrew Western
Thank you, Madam Deputy Speaker. I did not attribute a time period to the hon. Gentleman’s comments. I am simply stating that it is a fixed intention of this Government to seek to address that and to ensure that more young people under the age of 25 can access apprenticeships.
Yet again in these Opposition day debates, we see a Conservative party that continues to run away from its record and that brings forward overnight solutions that, in this case, have already been discredited. It is not fit to govern and would never solve this problem for young people.
Question put (Standing Order No. 31(2)), That the original words stand part of the Question.
Business without Debate
Petitions
Dr Danny Chambers (Winchester) (LD)
Today I present a petition on behalf of over 500 of my constituents who call on the Government to urgently review the removal of school transport for children attending Henry Beaufort school in Winchester. Under the current changes, children as young as 11 are expected to walk up to three miles—that takes over an hour—on dangerous roads to get to school. I have walked the route with parents, and it is unacceptable.
The petition states:
“The petitioners therefore request that the House of Commons urges the Government to work with Hampshire County Council to ensure that the school bus service from Kings Worthy to Henry Beaufort School is continued.”
Following is the full text of the petition:
[The petition of residents of the constituency of Winchester,
Declares that the school bus from Kings Worthy to Henry Beaufort School is due to be withdrawn in April 2026; further declares that this would force children as young as eleven to walk over an hour on dangerous roads to get to school, which would be particularly dangerous in the winter months, or cost parents who will have to start work later or pay for expensive taxis; and further declares that the plans would mean more congestion, worse air quality and higher costs for parents.
The petitioners therefore request that the House of Commons urges the Government to work with Hampshire County Council to ensure that the school bus service from Kings Worthy to Henry Beaufort School is continued.
And the petitioners remain, etc.]
[P003170]
Helena Dollimore (Hastings and Rye) (Lab/Co-op)
I present this petition on behalf of the 9,915 people who have supported my campaign calling on the water companies to end the use of plastic beads in wastewater treatment. A few months ago, I had no idea that plastic beads were used in wastewater treatment, and then 300 million of them washed up on our coastline at Camber Sands and along the Sussex coast, causing an environmental catastrophe. I have since been working with the Sussex Wildlife Trust because the use of plastic beads in wastewater treatment is an outdated technology and better, modern methods exist. Why are the water companies still using them, especially in coastal areas where they can do so much damage?
The petition states:
The petition of residents of the United Kingdom,
Declares that the use of plastic “biobeads” in wastewater treatment should be phased out.
The petitioners therefore request that the House of Commons ask the Government to work with the water companies and the Environment Agency to end the use of plastic “biobeads” in wastewater treatment.
And the petitioners remain, etc.
[P003173]
Flooding: Rural Communities
(1 day, 4 hours ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Alicia Kearns (Rutland and Stamford) (Con)
Thank you, Madam Deputy Speaker, for granting this debate. Water has no respect for property. It has no regard for a family’s memories or for a business’s survival. It rises where it will, and for too many in our communities across Rutland, Harborough and the South Kesteven villages, it rises again and again. In Whissendine, the White Lion pub flooded four times in 2024 alone. The water was so deep in the village that people water-skied, although of course I cannot condone that. The pub’s damage was so severe and so repeated that the insurers, the very people paid to be there when it matters most, walked away. Yolanda and Chris Stevenson, who have spent years running the pub, were left to face the consequences alone. A home, a livelihood and a community hub were all under threat.
Sometimes the barriers to getting things done leave me quite bereft. In Whissendine, the simple installation of a depth gauge would make a big difference to preventing cars from driving through when the roads are flooded and yet, for the life of me, I cannot get anyone to fund it or agree to it. In Langham, the same homes have flooded every single year since 2024, and properties that barely saw a drop of water in the years before now face a deluge, which often comes through their doors as lorries drive belligerently through our flooded streets when they should know better. However, no one stops them because the council repeatedly fails to put up signs shutting the road. I believe that residents should be empowered to put up signs themselves, in co-ordination with local flood response leads. Residents are spending thousands of pounds on flood defences, and not because they want to but because they have to.
In Tallington, a storm left the sewage system and residents without working toilets or showers. Thankfully, by supporting Philip Sagar and Tallington parish council, we have secured and completed works on the culvert under the railway, which was incredibly difficult to negotiate, and more is planned. We also have Thurnby brook, which flooded in 2024 and 2025 following the storms, and the impact is still felt today. There is the beautiful Braceborough, which suffered horrendously.
There is Greatford, where I was left at 9 o’clock at night ringing the circus—the real circus; it was Pinder’s circus from Rutland, which was in Hungary at the time—and begging it to help me find portaloos for the village. When Storm Henk struck, the village did not flood; it was engulfed. Some people had to be rescued by boats, and people spent nights in rescue centres. When the waters finally receded, a third of all homes had been severely damaged, and many people could not return home for well over a year.
These residents can easily be statistics, but we all know that each of them is a family with their own story. These are the same communities that are about to have a 1,300-acre solar plant imposed on flood plains right next to their homes. Flooding is not unique to my patch, and I am not trying to claim a monopoly on hardship, but I am here to advocate for solutions.
Alicia Kearns
I will gently say to Members that, as much as I love to have an audience for my Adjournment debate, we must recognise that I need to get through everything. I will give way quickly to my hon. Friend the Member for Bridgwater (Sir Ashley Fox) and then to the hon. Member for Strangford (Jim Shannon).
Sir Ashley Fox (Bridgwater) (Con)
Constituents of mine in Moorland and Fordgate live under the constant threat of flooding. This winter they have been very grateful to the frontline workers from the internal drainage board, the council and the Environment Agency for helping them out. Will my hon. Friend join me in paying tribute to those frontline workers?
Alicia Kearns
I will happily pay tribute. In fact, that gives me a great opportunity to mention Ben Thornely, who is our local Environment Agency officer. It does not matter when I call him or whether it is an emergency or proactively trying to make our communities safer, he always takes the call, and he has been out to see our communities whenever I ask. There are people in the system who work incredibly hard, and this is a great opportunity to thank them.
Every year I hold flooding summits across the three counties I serve, and every year the story is the same.
Jim Shannon (Strangford) (DUP)
I commend the hon. Lady; she is an assiduous MP and constituency worker, and we all recognise her efforts in this Chamber. Does she agree that the smaller numbers of people living in rural areas can sometimes skew the cost-benefit analysis? The Department must take each request based not on how many people live in an area and are affected, but on the bigger schemes to help the householders. I gently say that it should also enable farmland to carry out agricultural purposes that are essential for food security for this great United Kingdom of Great Britain and Northern Ireland.
Alicia Kearns
The hon. Gentleman is at risk of stealing my sandwiches, but I will get there shortly. He is right, particularly when it comes to farmers; too often they are overlooked and they need support.
The issues that I hear about at my flooding summits are that local authorities are too often silent when asked for help, and that riparian owners are not taking their duties as seriously as they should—dredging goes undone and drains go uncleared—and when people from Rutland ask the Government for support, we are told that we do not qualify. The reason for that is a simple number: 50. To access the flooding recovery framework, 50 houses must flood. Below that line, there is no support; above that line, here comes the cavalry.
For Leicestershire and Lincolnshire, which I also serve, 50 flooded houses is sadly an achievable and often exceeded threshold, but because Rutland is the smallest county—we have just 41,000 residents—we almost never hit 50 flooded homes, thankfully. We must remember the 30 houses that were badly damaged in Greatford in Lincolnshire, which I serve. If it had been the only village in Lincolnshire to flood, it would have had no support, despite people having to be evacuated by boat and being besieged. There is something deeply wrong with a framework so rigid that those in need of help do not or might not receive support.
I raised this objection in the last Parliament, and my Government then listened. The Conservative Government made sure that in 2024, for the first time ever, Rutland could access the flood recovery grant. I ask the Government to make those changes permanent ahead of the next big floods this year. Surely support should be based on the percentage of the population affected or just those who are the most affected, and accessing this funding would make an enormous difference.
I also ask the Minister to ensure that she provides support for farmers. In the village of Tixover in my community, for example, farmers have had to spend up to £80,000 this year buying food for their sheep, which would otherwise just graze off the grass, because they cannot access their land because it is so flooded.
We talk about flood risk in terms of physical damage, infrastructure and recovery time, but there is a financial dimension to this issue that is devastating households. That is the insurance market. For families in flood-risk areas, insurance premiums are eye-watering where they are available at all, so families have to cover the risk themselves; they hope that this year, the storm will pass, the river will hold or the drain will cope, but it never quite does. A family living in fear of flooding is living in fear, not just of water, but of the bill that comes in the post. Flood Re was a vital reinsurance scheme established by the last Government, but homes built since 2009 are not covered, and that scheme’s remit will end in 2030, leaving people stuck. I would be grateful if the Minister could give us an update on the Government’s thinking on this matter.
George Freeman (Mid Norfolk) (Con)
I congratulate my hon. Friend on securing this debate. On the point of insurance, I have just come from chairing a meeting with Aviva—a great Norfolk insurer, the biggest insurer of houses in the country. It made the point to me that this is the tip of a major iceberg of uninsureability, unmortgageability and then unsaleability, and that the Treasury should be looking at this as a major problem on the balance sheet of this country. It is a Horizon Post Office-sized scandal in its scale, risking serious economic damage to our economy. Does my hon. Friend agree that that elevates this issue to one of national importance?
Alicia Kearns
I was not aware of just how drastic insurers see the situation, but it does not surprise me, based on what I see in my communities. I know that my hon. Friend has worked consistently on the issue of flooding, so I take him at his word that we need to be looking at that problem more seriously.
Turning to dredging, the Environment Agency consistently argues that we should not be dredging its man-made assets, but that position is not supported by landowners and farmers, who are the custodians of our land and understand it. It can restore natural water flow, support better drainage and remove debris. It should be an option, as should removing vegetation from EA assets.
Matt Rodda (Reading Central) (Lab)
The hon. Lady is making an excellent speech. Does she agree that in many cases this is about removing vegetation, but it might also be about removing debris, such as old shopping trollies and other things that could block a much-loved waterway and cause flooding and further accumulation of debris? That is part of the problem. Does she also agree that landowners have a responsibility? There is great variation in the way they manage their land next to rivers.
Alicia Kearns
The hon. Gentleman is absolutely right—riparian ownership is a repeated issue in my community. It is also devastating to hear that he has things like shopping trollies in his waterways; we are very fortunate, in that we have so many local groups who go out and drag anything like that out of our waterways, although it is very rare. We need action to get those issues resolved.
Steve Barclay (North East Cambridgeshire) (Con)
I also commend my hon. Friend for raising this hugely important topic, and she is right to highlight the importance of local voices. Local voices know best where the flood risks are. They are most at risk and have real skin in the game, but they often feel that bodies such as Natural England and some parts of the Environment Agency are not responding. There are also the internal drainage boards, particularly in the east of England—in Norfolk, Cambridgeshire and Lincolnshire. Does my hon. Friend agree that we need to see more from the current Government about how they are going to work proactively with the drainage boards, particularly on some of the capital funding requirements that they face?
Alicia Kearns
I am in quite an unenviable position, in that only some of my constituency is covered by an internal drainage board, but that capital is absolutely fundamental. I am sure the Minister has heard my right hon. Friend’s intervention and will be able to reflect that in her speech—I was going to ask about that issue, but I no longer need to do that, so I am grateful to my right hon. Friend.
I want to touch briefly on flood alleviation schemes. We need strategies to store water better, because we are moving from droughts to floods and back to droughts. Water resilience and water security should be treated with equal importance to food security.
Turning to planning and development, the Government plan significantly—and, in my view, disproportionately—to increase the number of homes built in rural areas. All the cities around me have seen significant reductions in how many houses they have to build, while each of my areas has seen an increase in what is expected of over 100%, despite our consistently over-delivering on the targets previously set. Planning and development have to be done responsibly, and I fear that so much of the building is going to be on floodplains, or on the outskirts of small villages whose drainage has only just kept up with modern-day life and modern times. Those villages will find their infrastructure overrun by these additional housing pressures.
Helen Morgan (North Shropshire) (LD)
The hon. Member is making an excellent speech and has taken a huge number of interventions, for which I thank her. When it comes to development, flood management strategies are not taking into account the run-off that additional development will cause; for example, the upper Severn catchment management scheme is looking at opportunities to store water, but not at risks from additional development. We know that the drainage arrangements that are put in place, such as attenuation ponds, are often not maintained into the future. Does the hon. Member agree that we need a better plan for making sure that when development happens, the run-off does not affect the existing residents?
Alicia Kearns
Run-off has unfortunately been a real problem. I have only three towns in my constituency. They are not substantial, but Oakham in particular has seen a real issue with run-off, and that is all from new properties. It needs to be dealt with, and it speaks to the need for incentives and sticks. New fiduciary financial liabilities would make clear to developers that if they build new homes and in the short term—between the following five to 15 years—there is a significant increase in flooding that was not previously occurring, they should be liable for action to build additional flood prevention aids or to upgrade the flood defences or drains they originally built. That brings me to the planning process, where it would be sensible if water companies became statutory consultees.
Turning to local councils, a couple of years ago we Conservatives had to force the first ever special meeting in the history of Rutland county council, because the council was not responding on flooding and was insisting that those who had to move out of their homes would have to pay council tax on both their original property and the one they were renting. The council’s long overdue section 19 flooding report has finally been published, but it had little about what the council would do to protect us in the future. Instead, it focused on telling us all what the problems are. First, we already knew that, and secondly, it took the council pretty much 18 months from the first flood to report, and we had already had a second flood in the meantime. We all know our communities and we know what the issues are.
A statutory limit on how long section 19 reports can take is necessary, but councils should also have to go beyond just setting out the problem and lay out the solutions that are needed. Will the Government do that, and will they mandate that those who have had to move out of their homes due to flooding should be protected from the cost of covering council tax on two properties? Frankly, I am tired of having that fight with my local councils every time we have significant flooding.
I will touch on some of the flooding heroes in our communities. Phil Britton and the entire Greatford parish council and flood warden team rebuilt and recovered in the most extraordinary way. They have gone on to be determined to help other communities to protect themselves better. It is so beautiful to see them wanting to share their expertise and plans with others. Richard Besant, chair of Langham parish council, has advocated and pushed relentlessly on behalf of his village. I mentioned Philip Sagar, the chair of Tallington parish council, who has been a persistent and principled voice for residents who have been facing avoidable misery. I also touched on Yolanda and Chris Stevenson, who fought not only for their own pub in Whissendine, but for the entire community when others frankly would have given up and hidden in a hole.
Those are just some of the people who have held our communities together, and they are remarkable, and I am so proud to represent them. There are more who I wish I could name who have stepped up. It should not be left to those who care passionately to improve our flood defences or respond in an emergency. It should not be councillors, such as Kiloran Heckels or Karen Payne, who find themselves out in the dark trying to get to the bottom of things. In Whitwell, we literally had people putting on scuba gear, diving down to the bottom of the water—that is how deep it was—to try to get things out of the drains to get the water moving. It also should not be left to farmers, who are often our first responders and flood wardens, to stand in the breach because the authorities simply have not responded.
Let me be clear about what I am asking. I am disappointed that our communities have been excluded from the flood funds that were announced overnight, and I would be grateful if the Government revisited that decision. I cannot believe that we are not some of the worst affected communities in the country, not least from the conversations I have had with the Environment Agency. The Government should do more to support local flood resilience groups because, as we discussed earlier, our communities know what is best for them. We know where the flooding has happened, for how long and when there are new patterns.
On insurance, the Flood Re scheme must be updated. Can section 19 reports please have far more of a focus on action and a time limit? We need to end double council tax for victims of flooding and challenge the existing orthodoxy on dredging that is letting our communities down. On developers, we need financial liabilities to ensure that developers who build new homes tackle flooding pre-emptively or are held to account when they have not done so sufficiently. We need water companies to become statutory consultees in the planning process. Finally, as I have touched on, I want the Government to review the flooding recovery framework and in particular the 50-house threshold. As it stands, it systematically excludes my communities that are incredibly vulnerable.
In conclusion, the heavy rains will come again, and I fear they will come far too soon, and our communities cannot face this challenge alone. I have touched on some of the villages that have suffered flooding, but we have had it in Whitwell, Whissendine, Careby, including Careby’s beautiful church, Creeton, Edenham, Braceborough, Ashwell, Stretton, Glooston, Lyddington, Stonton Wyvill, Langham, Tugby, Tallington, Greatford and Barleythorpe Brooke. Those are all in the last two years, and there are far more who have suffered.
Rural communities deserve protection and recovery should not depend on population density and protections for those who can afford the premium. I suspect that these are principles that command support throughout the Chamber, regardless of political alliance, but principles unmatched by policy are just words, and I believe that we in our villages deserve much more than words. This really is one of our foremost concerns and priorities.
I am grateful to the Minister for listening to the points that I have raised, and she is very welcome to come to my next flooding summit. I will bring three counties together if necessary, which may be a shock to their systems, but we would do it if she were willing to come and have those discussions. I look forward very much to hearing her response this evening.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)
It is a pleasure to respond to the debate. I thank the hon. Member for Rutland and Stamford (Alicia Kearns) for initiating it, and for giving me an opportunity to outline the steps that the Government are taking to reduce flood risk and strengthen resilience in rural communities.
We began 2026 with record levels of rainfall in some parts of the country. Following Storm Chandra, I visited Somerset on 10 February with a Conservative Member, and witnessed the devastating impacts of flooding at first hand when one of the farmers took me in his tractor to see what had happened. What I saw could be described as flooding, but his farmland was basically under a lake. We had a good and helpful conversation about it, and I was particularly struck by what he said about the extra things that he did to support his community, in the way that the hon. Lady described. The farmers were there, helping people to go to the shops or to pick up their post. They were providing that additional service because they care about the communities of which they are part.
Sir Ashley Fox
I was grateful for the Minister’s visit to Somerset, but does she accept that when the Environment Agency announces that it is withdrawing from main river maintenance and will stop dredging the River Parrett, that is exactly the sort of action that contributes to the devastating flooding that she witnessed?
Emma Hardy
I will not make this about Somerset, I promise, but we had a very good conversation with the Environment Agency, the internal drainage boards and members of the council during that visit. We talked about the use of temporary pumps when a threshold is met, and discussed whether the threshold needs to be re-evaluated. Some really positive work is being done, with people looking into what has happened and what needs to be done. I hope that we shall be able to say a bit more about that in the coming weeks, but it was a very useful conversation. There was a willingness around the table to think about how we could get it right in an area that is very difficult and challenging to deal with because it is so flat, and relies so much on the use of pumps to move water around. The question of maintenance was discussed as well.
I want to acknowledge the vital work of local authorities, emergency services, members of the internal drainage boards, the voluntary community, the faith sector, and others who responded to the floods in Somerset, Dorset and other locations. The good news is that 24,500 properties were protected by the Environment Agency, but that, of course, is little consolation for the people whose properties were flooded. I also want to express my personal sympathies to all those who have been affected.
On Monday we held our sixth meeting of floods resilience taskforce, which is a fantastic group that brings everyone together. It includes the internal drainage boards, but also the Association of British Insurers, Flood Re and the flood action groups, which bring lived experience of flooding to the conversations. We bring everyone together for the flood action groups, and then there are task groups who go off and do work between the big meetings, such as looking at the experience of people from the point at which their properties have been flooded to the point at which they return to their properties. One of the questions that I want to ask is, “Where are the pain points along the way, and where are the difficulties?”
Once this is all set up and official, I should like all Members to feed in their experiences so we can identify the difficult points. I had a great conversation with Aviva last Thursday when I went to visit a house that had been improved through Build Back Better. Those people had had a wonderful experience, following the devastating thing that had happened, but we know that that is not universal.
George Freeman
The Minister has mentioned Aviva, one of Norfolk’s great companies and the biggest insurer of houses in the country. Has she seen its recent report, in which it calculates that about 4.78 million houses are at serious risk of flooding over the next 10 years? I congratulate he on securing the funding in the autumn, which I think was going to protect 60,000 houses, but does she agree that the Treasury should be thinking very deeply about the scale of this challenge in the context of national resilience?
Emma Hardy
The hon. Member prompts me to mention the biggest ever, greatest, most fantastic and largest investment in flood defences that this Government have just announced. On a more serious note, yes, Aviva did talk to me about that report, as he would imagine. We had a conversation about it and, without straying too much out of my remit and into planning, I believe that such conversations are ongoing with the Ministry of Housing, Communities and Local Government.
Steve Barclay
The Minister invited hon. Members to present pain points, so perhaps I can share one from my time in her Department. Natural England’s gold-plating of some of its statutory objectives often seemed at odds with the ministerial steers that were given. Does she feel she has sufficient control over the direction of Natural England in delivering the sort of actions that I am sure she discussed at the taskforce?
Emma Hardy
I would not want to advise the right hon. Gentleman, but I think hearts and minds is always a good way to win things in the Department. I do feel confident. There is a conversation about dredging, and the question of whether it is appropriate often comes up. When I have conversations with those from the Environment Agency, their response to me is, “It depends.” It depends on the river, it depends on where the flooding is, and it depends whether we want to move something quickly. Certainly, from everything they have told me, there is not a set policy against something; they just want to do what is best in the area. Of course, if hon. Members have examples that they want me to follow up, I am happy to hear them.
Dr Ben Spencer (Runnymede and Weybridge) (Con)
We are still waiting for delivery of the River Thames scheme in my area. While that is happening, we would be very grateful for some dredging, because at the moment there is no River Thames flood alleviation scheme. Will the Minister take this opportunity to reconfirm the Government’s commitment to delivering the River Thames scheme, which affects my constituency but also the neighbouring constituency of Spelthorne?
Emma Hardy
Actually, I had a conversation about the hon. Gentleman earlier on. In my meeting with him, we spoke about the local response to the flooding, and about how we can bring things together when it does not meet the level of the local resilience forum. I acknowledge that he had really interesting ideas about how recovery can operate at a local level, so I might invite him to send those in to me when we look at those pain points.
Earlier today, from 5.30 to 6.30 pm—I am losing track of time—the Environment Agency had a drop-in session in the House. It invited all Members to go in and have conversations about what is happening with their schemes this year. There is a record amount of money, which is fantastic news, so this is a massive build year. There is so much capital spend and so many things being built this year. Quite a bit of money is also going into the development of future projects. I apologise that I do not have the hon. Gentleman’s scheme in front of me, but he should ask the Environment Agency where it is with the scheme. No projects have been cancelled; they are either in development or are being built, so it is probably best to have that conversation with the EA.
I will get back to the questions that the hon. Member for Rutland and Stamford asked.
Matt Rodda
The Minister is making an excellent speech, but perhaps she would like to say a little bit about the importance of measures further upstream to protect my residents, and indeed those of the hon. Member for Runnymede and Weybridge (Dr Spencer), in the River Thames catchment. It is obviously a huge catchment, and there are significant tributaries such as the Kennet, the Loddon and many others. In the past, she has referred to her interest in rewilding to manage the flood waters as they come down through the Thames, and in particular considering vegetation near rivers and various other measures to try to slow the flow of water.
Emma Hardy
It would not be a flooding debate without my hon. Friend’s contributions. I know how much he cares about both restoring nature and doing what he can to alleviate flooding. The new formula, which kicks in on 1 April, puts greater emphasis on natural flood management and how we can increase the number of nature-based solutions to flooding, where appropriate. That is absolutely something that I want to achieve, because not only is it more affordable and good for nature, but it can help alleviate flooding. That is of course part of the wider picture, and I thank him.
Amanda Hack (North West Leicestershire) (Lab)
As in the constituency of the hon. Member for Rutland and Stamford (Alicia Kearns), one of the impacts in Leicestershire has been the sheer volume of water, and the villages in rural parts of Leicestershire have just felt left behind when it comes to money. I am grateful that Diseworth was selected this time round, but I would be really grateful to hear the Minister’s view about the impact on rural communities and how work can be done to make sure that rural communities do not feel left behind by flood works.
Emma Hardy
That is absolutely at the forefront of my mind. Having been to see some of the farmers this year and before the election, and having had those conversations, I am actively looking at what would be a good solution to support our rural communities, bearing in mind the comment that although there may be fewer properties, that does not lessen the impact.
For the constituency of the hon. Member for Rutland and Stamford, the EA is developing a new hydraulic model and hydrology for the catchment to provide further information and a foundation for future flood risk management in the area. It would probably be helpful if the EA reached out to have a conversation with her to explain that in detail.
Just yesterday, we announced a £1.4 billion investment in flooding in 2026-27, which will help to protect tens of thousands of homes and businesses, and funding for more than 600 flood schemes across the country, including upgraded barriers, embankments and natural flood management projects that slow the flow, of which I am a huge fan. It includes £5.5 million for the lower risk debris screens project that will increase flood resilience in the hon. Member’s constituency and other Members’ constituencies, as part of wider investment across the east midlands. More than £260 million will be spent managing, maintaining and repairing EA assets, including those damaged by Storm Goretti and Storm Chandra, ensuring that vital protections remain strong when communities need them most. The investment forms part of the largest flood defence programme in English history, with at least £10.5 billion invested between 2024 and 2036 to protect homes, businesses and critical infrastructure in every corner of the country from the growing threat of flooding.
I am very happy to take away the question on how quickly section 19 reports are done. I am always mindful of how hard-working our local councillors are. They need to do something well and in a timely way, and there can be a tension between the two, but is important that section 19 reports are completed as quickly as possible, so that we can really understand what has happened and hopefully do something to mitigate it in future.
On the point the hon. Lady made about council tax, I will have to take that to the Ministry of Housing, Communities and Local Government.
Alicia Kearns
The Minister has been very generous with interventions. We are about to run out the clock. There were a few more questions and I would be very grateful if she would write to me on them. I know how diligently she fulfils her brief and I am really grateful to her for that, but it would be great to have answers to all the wider points I raised as well.
Emma Hardy
I am very happy to do that. Apologies; I normally listen out for the coughing that comes—[Interruption.] And there we have it!
In conclusion, the Government are committed to strengthening resilience to flooding. That not only keeps people safe, but supports economic growth in our rural and local communities across the country. By protecting businesses, reducing disruption and safeguarding jobs, these measures contribute to stability and growth in the face of increasing climate change and flood risk. The Government’s record investment in flood defences will benefit communities across the country.
Question put and agreed to.