Commons Chamber

Wednesday 21st May 2025

(began 5 months ago)

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None Portrait Q8. What steps he has taken to strengthen the Union between Great Britain and Northern Ireland. (904188)
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The honourable gentleman is right to point out that in the event of
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Kemi Badenoch Portrait Rt Hon Kemi Badenoch MP (North West Essex, Conservative)
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Mr Speaker it is only because of the measures we have taken that the economy is improving. Growth at the highest rate in the G7, four interest-rate cuts, three trade deals because countries want to trade with this country. Because of the decisions that we made. All of those decisions opposed by the party opposite. They have learned absolutely nothing and they are going absolutely nowhere.

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This is the Prime Minister says

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This is the Prime Minister says he is taking measures. The jobs tax is killing jobs. Inflation is up, as this confidence is down. Everyone is this confidence is down. Everyone is worried. He promised to cut bills but now we see they are rising but now we see they are rising because of his policies. He promised not to raise taxes on working people but is jobs tax means people are losing their jobs. Every week he comes in with the new company that says they are shedding jobs, that is on his watch.

He promised to protect pensioners is winter fuel cut has driven thousands into hardship. His driven thousands into hardship. His MPs hate this, you can't see that they all look sick just hearing what they all look sick just hearing what

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I expect better I expect better from I expect better from whips I expect better from whips and I expect better from whips and I have got my eye on you.

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Mr Speaker,

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Order. Which one wants to leave
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Keir Starmer Portrait Rt Hon Sir Keir Starmer MP, The Prime Minister (Holborn and St Pancras, Labour)
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Can I begin by congratulating everyone selected to represent the everyone selected to represent the British and lines. It is a incredible achievement. We will be cheering them on. It is important we cheering them on. It is important we do protect those with severe disabilities or lifelong conditions disabilities or lifelong conditions who cannot work, pay them a premium and stop those reassessments, which is part of the reform we are is part of the reform we are bringing about.

We also need to get bringing about. We also need to get back to face-to-face assessments by trained assessors and health professionals, which was only one in 10 assessments under the last government. government. This Prime Minister keeps telling his backbenchers that he has deported 24,000 people from this country since he came into power. But he will not say who these people are. It is my guess that they are people who came on work visas, students and they are simply over stayers.

But I am willing to be proven wrong if he can answer one simple question, how many of these people that are deported are veiled asylum seekers that have come on

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small boats or on the back of lorries, answer the question? I am proud that we have removed

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I am proud that we have removed over 24,000 people. The highest record for nearly 10 years. We have record for nearly 10 years. We have taken other measures to get back control of our borders, including the Borders bill which gives law enforcement enhanced powers, enforcement enhanced powers, including terrorism -like powers. What did his party do? What did he
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Luke Charters Portrait Mr Luke Charters MP (York Outer, Labour)
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Thank you Mrs be covered up I beg to move that leave be given to bringing a bill to require the Secretary of State to publish an assessment of the effectiveness of current regulation of the debt collection and civil enforcement sectors. And to report to Parliament on the potential merits of statutory regulation on those sectors and for connected purposes. Today I introduce the Regulation of Bailiffs (Assessment and Report) Bill. We are in this place to speak up when others cannot.

To put right what is clearly wrong. This bill, to get a grip on rogue bailiffs, does exactly that. Today I want to share some truly heartbreaking stories. Stories of vulnerable people left absolutely petrified in their own homes. Disabled people terrified, it is time that despicable practices in the enforcement sector come to an end. For the thousands across the country who have suffered serious injustices at the hands of coldhearted rogue bailiffs, those who have brought shame to their own industry.

I came into politics to fight for social justice and that is why I am proud to be a Labour MP. But nothing has fuel that fight more than hearing from those crushed by the worst elements of the enforcement sector. Their pain, their stories, have imprinted themselves on them with lasting force. And I'm determined to change the law. Let me first thank Sophie Morris in the gallery today. I also want to give credit to the enforcement conduct board, known as the ECB, who voluntarily regulate 95% of the sector.

In my view they should oversee this regulation. At present they issue guidelines to the enforcement sector, but that is the issue of course will stop these guidelines lack legal authority. The statue of Marlborough, passed in 1267, during the reign of Henry III, is one of England's oldest pieces of legislation still partly enforced today. It shows that even at 750 years ago, people were thinking about the need for fair debt collection. Yet here we are today faced with the same challenges.

As a former regulator at the FCA, understand the importance of setting clear standards. The last changes around enforcement law were made around a decade ago. This introduced a three stage process and stronger protections for vulnerable people. Despite these changes, aggressive practices and inconsistent standards still exist. That is why the independent ECB was created in 2022, to voluntarily oversee the sector. According to Citizens Advice, one in three people who have had contact with a bailiff have had experience of behaviour that breaks MoJ expectations was to even amongst the bailiffs that are regulated, 1% of visits were deemed too aggressive by the ECB.

By the way, that would equate to hundreds if not thousands of visits each year. That is why we need a fair and proportionate debt collection system. Mr Speaker, I want to tell you about Michael's story. He is an inspirational chap who I welcomed to Parliament last week. Michael's story began with a horrific motorbike accident that completely upended his life. He sustained injuries that made him unable to walk or stand. After a lengthy spell in hospital, getting by on sick pay alone, he lost his job.

During this time, he received a letter demanding a full year of council tax to be paid at once. And the punitive rule that is triggered when someone misses just one payment and I'm grateful for Martin Lewis for campaigning on that and I welcome the government's consultation. Back to Michael's story, bailiffs were sent to collect the council tax. He was at home, bedridden, and unable to move. The bailiffs visited repeatedly. He could not hear their knocks or get out of bed.

Despite this, they unfairly added extra charges to his debt for their visit. He was left without carpets, with a broken bed and broken boiler. On top of this he was preparing to become a dad. What should have been a proud and exciting moment of his life became one of immense stress and fear. Fear that the bailiffs, given that they have nothing else left to take, might seize his baby daughter's toys, or her changing table, or even her cot.

As a father, I could sense the deeply personal pain hide that fear. The heartbreak of possibly failing her in the one way he still felt he could provide. Michael went from being a homeowner with a near- perfect credit score to nearly losing everything. I'm pleased to say that he is back on his feet, although he is still paying the debt off, he is hoping to clear it soon. He is doing well, I took it out onto the terrace last week in the sunshine.

We reflected on just how unfair bailiff practices had added to his hardship. I also met Adam recently. Adam got into debt falling behind on council tax and card repayments after losing an agency job and struggling to find new work. His experience, like many others, began with letters and ended with visits to his home. As is often the case with rogue bailiffs, the visits were aggressive and intimidating. One forced his foot into the door threatens to come in. And of course as breaks virtually every rule in the book.

Adam told me that it was like someone was trying to burn down the door. He immediately told the bailiff that he had a disability, and was classed as vulnerable. The bailiff said, that he did not care and will take away Adam's belongings regardless. The bailiff saying he The enforcement system is broken and punishes those already suffering. It is not just about one bailiff at one moment, it is about the sort of society we want to be.

Adam had government funded equipment for his disability, especially adapted device, the bailiff said he did not care and would take it anyway. Adam contacted step change, the advisers had helped him come with a payment plan, which the bailiffs wrongfully refused. Became genuinely terrified to be at home on his own. Adam has made progress with his debt. I welcome him to Parliament last week. Both of their cases are littered with dozens of examples of unregulated rogue bailiff activity. The ECB do a good job but there are many bailiffs not in their perimeter.

Statutory regulation would enable the ECB to be even more firm and drive up standards. It is time for the government to fix their regulation of the enforcement sector. I do not want anyone in this country to have to worry about losing their disability equipment or their children's toys. No one, no one ever should have to face the same hardship. 14 years of Conservative government saw only a few but welcome tweaks to the law. That has to change.

The Labour Party is built on principles of social justice, equality and fairness. That is why now we need to bring bailiff regulation onto a statutory footing. Changing the lives of millions in the process. For Michael and for Adam, in honour of all they and countless others have endured, letters bringing statutory regulation of the debt and civil enforcement sectors once and for all.

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That the honourable member have

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That the honourable member have leave to bring in the bill. The question is the honourable member question is the honourable member have leave to bring in the bill. As many as are of that opinion, say, "Aye." Of the contrary, "No." The

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"Aye." Of the contrary, "No." The ayes have it. Who will prepare to bring in? Adam, David Burton-Sampson,

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Adam, David Burton-Sampson, Amanda Martin, Alison Hume, Euan Stainbank, Doctor Allison Gardner,

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Regulation Regulation of Regulation of Bailiffs

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(Assessment and Report) Bill. Second Reading what day? Friday,
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Andrew Griffith Portrait Andrew Griffith MP (Arundel and South Downs, Conservative)
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State. Allow me to paint a picture, a small business owner navigates the early morning darkness to the High early morning darkness to the High Street shop, they twist the keys and lift the shutters, turn on the lights, the card machine, the heater, shop music, they open the door in time for the first customer of the day. Putting to the back of their mind how to meet the rising costs placed upon them by this government. The taxes they have to pay before they open that door, the unreformed business rates with many more than doubling.

How will they pay the jobs tax on their staff? How will they ever keep their business intact when they seek to pass it to their children after they have gone? Not one single person around the Cabinet table truly understands these pressures. Yet this Labour government has crossed the road to start a fight with Britain's businesses. When it comes to business, this government has broken every one of its promises. Members on the benches opposite looked In the eye and told them they would be on their side.

It took barely 100 days for this government to revert to type. The Autumn Budget the Chancellor sceptre 25 billion jobs tax on business, meaning employers would have to pay an additional £900 a year for an employee on the median wage, according to the IFS. Only a few later, the Business Secretary tabled the now 300 page trade union dictated Employment Rights Bill, drowning employers in red tape. The CEO of British Retail Consortium said that businesses are left with little choice but to increase prices, as we have seen today, or to reduce investment.

The CEO of UK Hospitality said these measures will simply force businesses to cut jobs, freeze recruitment, cancel planned investment, reduce reading hours

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and, in the worst case scenario for many, close their doors for good. The honourable gentleman is so

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The honourable gentleman is so popular. I'm interested in how is starting this debate because it chimes with what I'm hearing in my chimes with what I'm hearing in my constituency where venues like pubs constituency where venues like pubs and restaurants and cafe's are such a vital part of the effort to regenerate our high streets and local community spaces but they are seeing margins/because of the cost of labour and increasing business rates. Does he agree with me that Labour's job tax and ending of business rates relief is putting the business rates relief is putting the regeneration of our town centres and community spaces at risk?

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How tragic is it that from God's -- Gosport to Gloucester and everywhere in between, businesses on our high streets are closing. This government does not care, if they do understand that they do not care. understand that they do not care. People are putting their livelihoods on the line to create risk as a business owner.

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To that point, isn't it a shame that for the first time ever since that for the first time ever since records began in 2012, the number of new businesses registered at Companies House has fallen. Isn't that a damning indictment of the risk taking behaviour we need to

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risk taking behaviour we need to grow the economy not taking place because of what this government is doing? He makes an incredibly important

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He makes an incredibly important point. Any government, I believe all of us come here in this House to try of us come here in this House to try and do our best and try and grow an economy. At any government faced with that terrible metric about the failure rate and the formation rate failure rate and the formation rate of businesses would be acting immediately with haste, reversing so many of the measures because it is many of the measures because it is the choices this government have made that have delivered precisely the outcome the honourable member talks about.



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Pubs are the lifeblood of communities, particularly in constituencies like mine. You can perhaps make an argument for individual tax rises, but it is the combination of three in particular therefore hitting pubs badly, the increase in minimum wage, the government is good at increasing prices for everyone else but themselves, removal of the business rates relief for hospitality and leisure and the National Insurance Contributions for employers, the reduction in the threshold from £9200-£5000, particularly impacting £9200-£5000, particularly impacting those who employ part-time.

Is that the reason why so many pubs are

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closing around the country? He makes the right point about

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He makes the right point about the triple while me and the cumulative effect of changes #triple whammy. And in hospitality and retail it is manifested most, which retail it is manifested most, which had the great virtue of giving so many young people their first step many young people their first step on the ladder of opportunity. Their first experience of work. Without those sorts of businesses, it will be harder for young people. It is one reason why it is of such great concern to see the number of people employed on payrolls under this government has already fallen by government has already fallen by 100,000, faster rate of decline in the first quarter of this year.

The the first quarter of this year. The government is perfectly positioned government is perfectly positioned to achieve the unbroken track record of Labour government in modern history of leaving office with unemployment higher than when it

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started. Would he agree that another

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Would he agree that another factor that is going to undermine job creation employment under this job creation employment under this government is the approach they have government is the approach they have taken to international wealth coming into this country? At a time when other countries like the US are other countries like the US are granting golden visas, we are closing the door with these ideologically driven non-Dom reforms which will not even raise any money. which will not even raise any money.

If the government wants to increase job opportunities, they should take the chance that the next budget to

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the chance that the next budget to reverse this foolhardy policy. Is exactly right. He will correct me if I am wrong, as I understand me if I am wrong, as I understand it, one millionaire is leaving our wonderful country every 45 minutes. wonderful country every 45 minutes. That speaks to nothing as to a generation of young people who are yet to have their opportunity. How yet to have their opportunity. How tragic it would be to think that young people see greater opportunity, notwithstanding their birthright as having been born in this wonderful country, see greater opportunity in other parts of the world than the opportunities in their communities, in the heart of their families.

It has to be said that this government's combination of actions are sending a very clear and very regrettable message to those who seek to create wealth. That message is, do not bother. Do not even try. This socialist government does not want you to succeed. There could be no better example of that than the vindictive family business and family farm death tax which will carve up successful businesses as and when they are handed down to the next generation. Why do we think this vindictive policy could be the case? One of the more benign interpretations, to be charitable, is simply the dearth of experience in their Labour cabinet of business.

It has to be said it is world-class in its understanding from trade unions. Perhaps that is why the Secretary of State who has not seen it fit to be here today is currently undertaking the most expensive work experience placement in history at the taxpayers expense, at British Steel in Scunthorpe. Not just that this government does not understand the mechanics of business, they do not understand on value principle of business. Running or investing in a business, at its core, is a profound act of human courage.

The triumph of optimism over inertia. The mindset of solving problems yourself rather than waiting for permission from others. Embracing risk, knowing there is no guarantee as, no bailouts, no one is coming to rescue you. When enterprise succeeds, they create the wealth that funds our public services. Any time a Minister , this government is doing so at record velocity, they are only able to do so because a founder, entrepreneur or businessman or woman took that leap. It should be the government's job to get out of the way, to help the business builders, not the blockers.

At this Labour government understand non-office. Instead of leaving business to get on and flourish, they have erected a blockade of neuropathy and taxes they promised would never come. They have declared war on employers across this land from the ramparts of Westminster.

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... Has plummeted since Labour came to power -- business came to power -- business confidence. They have lost faith in this government, they promised their plans were fully costed and fully funded in advance and there would not be increased business taxes, and within 90 days they went back on

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within 90 days they went back on that. How can business ever trust this government again? My honourable friend who is a distinguished and successful businessmen knows exactly that. The importance of the intangible quality of confidence that the government of confidence that the government has your back, that you will not wake up in the morning and be hit with a £25 million jobs tax, of with a £25 million jobs tax, of which not one word, one syllable, was in the Labour manifesto.

We toured the studios, jousting with them, warning and having met with a them, warning and having met with a repeated barrage of denials. About repeated barrage of denials. About repeated barrage of denials. About If you have to explain the inability to balance the public finances, but to do so with taxes on business. We can move on from tax, that is one of the many marriages that business face that is sapping confidence and producing some of the very worrying statistics we are seeing.

We could statistics we are seeing. We could move on to the unemployment rights bill. It is an egregious example of red tape and state intervention and overreach. Members opposite are normally uncharacteristically quiet because they are aided and abetted to the tune of £31 million by the trade unions. It tackles the hands of employers in pubs, bars, garden centres, grocery stores, butchers, hairdressers, businesses rooted deep in our communities, with little clarity and no lead-in time. Seasonal work could be made impossible under this bill.

For sure, compliance costs were rockets, long delays for Employment Tribunals Act, already approaching 18 months for a hearing in an employment tribunal in many parts of the country. And a cost that even the government's own estimates, a headwind on business on top of every other measure of £5 billion unwanted each year.

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I thank the Minister for giving

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I thank the Minister for giving way. You talk about the risk of seasonal jobs being lost as a consequence of the Employment Rights Bill. In Bognor Regis and Littlehampton, this is a serious risk which a number of businesses have highlighted to me. Would you say that the Minister should be say that the Minister should be withdrawing that measure? The very least doing a proper impact assessment on the results of the bill?

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bill? The term "You close but is not used in the chamber because it refers to me.

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refers to me. No one will believe that you would implement such terrible measures without the level of impact assessment that has been conducted. assessment that has been conducted. More importantly, not just the honourable Member for Bognor Regis honourable Member for Bognor Regis and Littlehampton, representing those important seasonal industries, but the voice of employers across the country. This point has been made, we will no longer have the ability to have seasonal and flexible work to deliver the economy that we need.



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I'm grateful. Not only is it the cost implying, and the red tape, but it is a poor piece of legislation. The government's own regulatory Independent Commission looked at Independent Commission looked at this and turned round and said that eight 8/23 criteria were not fit for eight 8/23 criteria were not fit for purpose. Does he not agree this legislation should be reworked if it is going to come forward because it

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is going to come forward because it is a poor piece of legislation being put forward in the first place? My honourable friend makes the right point. If the benches opposite right point. If the benches opposite were honest enough to admit this, it is a rushed piece of legislation. It was introduced because of an was introduced because of an arbitrary promise to do so in 100 arbitrary promise to do so in 100 days. It was introduced at half of its current length meaning 50% of the words that are in this bill, the the words that are in this bill, the red tape that our businesses are going to have to implement and wrestle with for years to come did not even benefit the scrutiny of this place.

Many of the bill's powers are un-fleshed out, and clarified. We are wreaking great havoc and uncertainty on business. If the government is determined to proceed, far better to shelve the bill, to listen, to learn, to come back and we can use the proper mechanisms of this House to do the jobs for all of our constituents so we don't see the unintended consequences in damage that I don't

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believe anybody would want. Can I ask my honourable Friend in the spirit of listening and the spirit of listening and learning, I have been speaking to businesses this week in my constituency. The chambers of commerce have signalled the trade steel is a new start for British business because it is reducing red tape, giving certainty to tape, giving certainty to businesses, and allowing them to trade do well in my constituency and elsewhere. Do you think they are wrong?

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Mr Griffiths, do you think they are wrong? We have a long afternoon,

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are wrong? We have a long afternoon, even longer for me in the chair. One has to celebrate small

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One has to celebrate small mercies, and I'm delighted to the conversion to the cause of free conversion to the cause of free trade from the member opposite. Free trade is what has lifted millions of people in the world out of poverty. people in the world out of poverty. It has made the great country. It has made the great country that we has made the great country that we are today. The business that has formed such a clear view that the honourable member talked about has clearly had the advantage of a great deal more detail than this House has.

So perhaps he would share the name of that business and we will be very happy to hear about the actual detail of the trade agreement that has been reached. But perhaps, in having that conversation with his local business, he would like to engage in a discussion about the views that that business has on the Employment Rights Bill? Despite many opportunities that I and others have put to ministers on the benches opposite to name a single business that is in favour of all of the measures in the Employment Rights

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Bill, answer still comes there none. Since the inception of our negotiations to join the common negotiations to join the common market, the European Union has market, the European Union has attached enormous importance to fishing. We have just handed away the enormous leverage of an annual the enormous leverage of an annual negotiation every year, for what?

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Absolutely nothing. Thank you Madam Deputy Speaker. I

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Thank you Madam Deputy Speaker. I hesitate to stray into the matter of hesitate to stray into the matter of fishing, I suspect we will debate that many times in the future. I do note that the other governments note that the other governments benches next to us today tabled a motion which has not been selected for debate but will nevertheless for debate but will nevertheless seek to shackle further our small businesses by having us revert across a much broader range of topics than the past that this government has already sold earlier this week, so we become a rule taken from Brussels, and our small businesses and entrepreneurs and founders are crushed by the red tape

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that would originate there. I thank him for giving way to stop fishing is one sector but there stop fishing is one sector but there is a clause in the Employment Rights Bill which affects small businesses, Bill which affects small businesses, and I make reference to my Register of Interests as a former entrepreneur that used to employ well over 1000 people. The problem well over 1000 people. The problem is, if you impose day one employment is, if you impose day one employment rights for any higher, it is a massive disincentive to take a chance particularly in people who are more vulnerable, young people are more vulnerable, young people less well qualified.

Why would a business take that chance if they are going to be pulled up on day one

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for employment rights? Once again my honourable friend

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Once again my honourable friend demonstrates his deep and real knowledge of business. The fact that he himself in his past life has employed more than 1000 people, taking the risk, having to have that response ability shouldering the response ability shouldering the burden, moral and financial, one rather suspects it is the case that rather suspects it is the case that the entire aggregate responsibility for hiring anybody from the benches opposite. He makes the right point about who ultimately will end up...

I will give way in a minute. But who will end up on the receiving end of the hire and employment? It will be the young looking for their first opportunity, and it will be excluded and vulnerable groups who are denied employment that today chance will be taken on. But not if that chance will lead immediately to being at the back of an 18 month long queue for an employment tribunal. I will give way.

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I thank him for giving way. The point made by the audible gentleman point made by the audible gentleman was about day one rights. The day one rights was to stop unfair one rights was to stop unfair dismissal from day one full stop is it now the policy of the party opposite to allow for unfair dismissal between the first and the dismissal between the first and the second day? If he is unhappy with that being a right from day one, presumably he is not happy for that right at all?

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right at all? We have, to make those points is

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We have, to make those points is to wilfully misconstrue what is in the bill for top we have a settled and balanced position of employment and balanced position of employment rights that dates back to both before proceeding Labour government as well as the government that we were in office before the election. That strikes what will always be the That strikes what will always be the difficult balance between offering employees the chance to enter the workforce, and the ability of businesses and indeed the public sector and others to hire and run the businesses in a way that is profitable.

It does nobody any favours to seek to think that we can merely bypassing words of statute change those outcomes in a way that advantages the most honourable, the youngest employees, and I say again, this is why, the failure to learn from this point will lead to exactly the same outcome, every Labour government has left office with unemployment higher than where it starts. The minister in his response may wish to confirm that this time will be different, and perhaps lay out exactly why it will be different, but I think he has a work

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of a job to convince us and were broadly, every employer in the land that that is the case. Thank you Madam Deputy Speaker. I am grateful to the Shadow Minister. He takes a casual swipe at the business acumen of ministers business acumen of ministers opposite. I wonder if I encourage him to develop that point because him to develop that point because when I speak to businesses in my constituency, and they look at the changes that have been instituted changes that have been instituted since July last year, they are incredulous that anybody would even incredulous that anybody would even have, if they had even a passing knowledge of business that they would put such roadblocks in the way

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of wealth creation. Would you like to expand on that? Thank you to the audible judgement for making that point, and that very perceptive observation. I that very perceptive observation. I that very perceptive observation. I hate to say this, it was not a casual point. It was a considered point, that we think about how it is that this House continues to that this House continues to legislate, continues to tax in a way that reduces, as we have seen, economic growth, and does not celebrate a culture of entrepreneurialism and founders that is leading to higher unemployment with 100,000 fewer people now on payroll than a year ago, we should all look deep in our souls as to what is the endemic failure in Parliament, and in particular of this government, that is leading precisely and so quickly to those outcomes? It is sad to say, the lack sometimes of a voice for business.

Although one does not want every civil sector to be represented in this place, the compensatory mechanism for that is consultation and diligent impact assessments. This government has been conspicuous and serially criticised in legislation after legislation in the way it has casually discarded, and the Treasury maths on Sony measures simply does not add up.

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I think it goes wider than that. Both sides of this house are Both sides of this house are grappling with what to do with the DWP situation in terms of people who are long-term unemployed. If you make it more likely that companies make it more likely that companies are not going to take a risk on getting someone back to work, while increasing unemployment at the same increasing unemployment at the same time, there is again a toxic concoction of what we are creating we are trying to get people back into the job, we know it is better for the economy and better for them and their health and their family.



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Does he agree? I do indeed agree with my honourable friend. We ought to honourable friend. We ought to confront how it is that we have got here. It has happened over a period of time I acknowledge, with so many young people unable to work, get education, or be in productive education, or be in productive training. That is a headwind on the economy, a moral failure by us all. The actions that we should confront ourselves with is, what are we doing each and every day in the space to give the millions of young people give the millions of young people and the 9 million others of working age who remained stubbornly on welfare, what are we doing to give them the opportunity? And at the same time the opportunity to improve our public finances and make the maximum use of the wonderful resources and education and skills of the British people; grow our economy and be the prosperous nation that we once again deserved.

I will give way.

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I thank him for giving way. He talks about the message that government sends. Last week I was government sends. Last week I was speaking to a first-generation immigrant who was talking about the message for entrepreneurs in this message for entrepreneurs in this country. If we can't hand on more to country. If we can't hand on more to the next generation through your own hard work, she said what is the point? She's right isn't she?

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point? She's right isn't she? She is right. It is one of the chilling headwinds that anyone who chilling headwinds that anyone who wants to grow the economy, anyone who is serving in the wonderful department for business and trade or our Treasury should be confronting. We should be going back to officials and challenging exactly that, how and challenging exactly that, how can we achieve a culture vied shift can we achieve a culture vied shift

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Can I take him to what he was talking about opportunities for young people, I met with hair salons, who have been amazing employers of apprentices and given chances to young people. I was worried to hear from them that the rate they are taking on apprentices is dropping off, by 2027 there will be no apprentices left in that sector. Not just a hair and beauty saying that, others like adult social care and early years education are saying the same.

Is he is worried as I am about the lack of opportunities for our younger generation?

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Yes. Enormously worried. We have to understand it is only the private sector that creates truly sustainable jobs. We need people who work in public services but it is work in public services but it is growth and opportunities that come from the expansion of the private sector, most encapsulated by female sector, most encapsulated by female led businesses such as the health led businesses such as the health and beauty sector, often surviving off of small margins, dealing with different pieces of legislation and trying to keep high streets and trying to keep high streets and communities alive as well as performing I suspect rather a better performing I suspect rather a better service I suspect to the right honourable lady than myself.

honourable lady than myself. Nevertheless this is a vital

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industry. I think we ought to ram this home so the Minister understands and he has plenty of time before he stands has plenty of time before he stands up to think this through and providers with a sensible answer rather than something off-the-cuff. Earlier this morning, I attended an event run by one of the national clearing... Trying to create opportunities and helping others to create opportunities for young people, they have, with a raft of good ideas. At every single one of those, this point was made clearly, every single one of those good ideas will hit the roadblock of the government's employment legislation.

Where is the sense in this? If my honourable friend has not got the

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answer, perhaps the Minister no doubt well? Let us hope the Minister indeed doesn't have an answer. I am doesn't have an answer. I am somebody who always travels optimistically. Though we have sparred on the important subject of sparred on the important subject of the 300 page 120,000 word Employment Bill, it is never too late. That is undergoing scrutiny in the other undergoing scrutiny in the other House as we speak. It will be perfectly possible that the government would welcome and support the government in shelving that the government in shelving that bill, at least for a period until bill, at least for a period until the cacophony of headwinds that the member talked about earlier in terms of the tax system and other changes, of the tax system and other changes, the damage that has already been inflicted to the economy, the headwinds on costs we saw this morning, inflation 75 percent higher morning, inflation 75 percent higher than the Bank of England target rate which will mean interest rates are higher for longer.

And the failure to reform business rates. Perhaps to reform business rates. Perhaps the combination of bringing forward the combination of bringing forward To reduce business rates would be something that would be an opportunity to revisit if the government feels a burning desire to, on employment. My honourable friend is right, wouldn't it be good if we could use the ample time we have this afternoon for the Minister to consult to bring forward sensible answers that will give us all of the confidence that we are going to see

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a government properly on the side of business? I'm grateful to the shadow Minister giving way. Does he agree Minister giving way. Does he agree it is the humility of effect of the government's measures over the past 12 months, £25 million jobs tax, 12 months, £25 million jobs tax, five pounds, £5 billion burden of the Employment Rights Bill, the removal of Business Property Relief, reducing the incentive to be an entrepreneur, the cumulative effect of all of these measures will be to drive unemployment higher?

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I agree with my honourable friend. It does not matter whether I or others agree, the reality is the or others agree, the reality is the data does not lie. As of now we have 100,000 people fewer on payroll than we did 12 months ago. The data is we did 12 months ago. The data is already telling us that the cumulative, chilling effects of those measures, perhaps unintended, perhaps we learn today that the Chancellor and the Deputy Prime Chancellor and the Deputy Prime Minister are at odds, perhaps the Business Secretary is another third leg on that school, each bringing forward measures damaging to business, perhaps not adding up the sums, not seeing eye to eye to understand the lived experience of what it is like to be a business on the receiving end of one of these changes that are happening both cumulatively but all happening at the same time.

There are many businesses that, from the start of April this year, not only face payroll increase of around 10 percent, in an economy where we are not seeing that sort of level of topline growth, that hits margins directly, but also because of the failure of the government to maintain retail, hospitality and leisure, business rates relief at anything like the same level have seen their business rates double. Imagine that all hitting your

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I was startled at being described

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I was startled at being described to be on the other government venture earlier, perhaps that is a sign of what is to come. There has been negative barrage from the been negative barrage from the opposition benches. That does not surprise me because that is how we work in this place, but thinking of businesses, businesses from this year will get better, in my constituency and others, I talk about the seed potato industry, we about the seed potato industry, we have been crying out to get their have been crying out to get their best of Scottish seed potatoes to the European market.

It means a lot the European market. It means a lot to farmers. Thank you.

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to farmers. Thank you. I am enormously glad and we should be balanced, that we found should be balanced, that we found something that goes the other way. I am not sure if one can subsist entirely on a seed potato, I think it may have been tried historically and not with enormous success. But I congratulate the honourable member on the success of the sea potato industry. If only we could, if that was to be charitable, if we found an example of a government actually having the back of business and supporting them, wouldn't it be wonderful if they could extend that to other sectors of the economy, financial, retail and hospitality, manufacturing industries, as they wrestle under the cost of uncompetitive energy costs where a business in Birmingham, West Midlands, will face an industrial energy costs four times higher than that of a competitor in Birmingham Alabama.



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I am very grateful. The

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I am very grateful. The government has parroted that there government has parroted that there has been growth of 0.7 percent in the first quarter of this year. If the first quarter of this year. If you look into the figures, with the shadow Minister agree that the chunk shadow Minister agree that the chunk of that is production rising by 1.1 percent, electricity prices, gas prices and water prices being raised and they can that is economic growth?

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I think most of us would put higher energy costs into the liability rather than asset column when it comes to our economy. We are when it comes to our economy. We are debating today business, unemployment and the economy. I hope unemployment and the economy. I hope the Minister will devote an ample the Minister will devote an ample proportion of his response to what proportion of his response to what the government will do to remove the competitively high energy costs which are crushing British When it comes to business and the economy want to make sure that every region in Great Britain and Northern Ireland can have some benefit.

Northern Ireland is the UK's smallest region in relation to GDP. In relation to the numbers and population, there is a higher GDP. It is important we see that Northern Ireland see the same opportunities. Would she agree that when it comes to improving the business economy, my young people in Strangford deserve the same opportunity as Scotland, Wales or wherever else it might be?

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He is quite right. People have occasionally assumed my constituency is in Northern Ireland. All of our is in Northern Ireland. All of our young people deserve the best young people deserve the best opportunities. We know the best outcomes for young people are when outcomes for young people are when they can enter the workforce. The scarring impact that when young scarring impact that when young people graduate, if they cannot immediately find work, that scarring impact can run through the entirety of their adult life, they never catch up with their peers's earnings.

Which is why it's earnings. Which is why it's important we have a healthy labour market, and that relies upon the ability of employees who feel they can take a chance, give people opportunities and that will benefit. Just to make some progress, there are many people on the side, are many people on the side, disappointingly few on the other side. But given the paucity of business experience on that side, it is probably appropriate that there is more listening than talking on the government benches today.

Let's just imagine, as you will know from your wonderful constituency, that despite all of their headwinds that despite all of their headwinds that this government imposed on business, a business does well, they want to hand down their business once they are gone, people who took risks to create something good for their society are now at a competitive disadvantage as a result of the family business death tax, they will be forced to slice up all close up shop altogether to meet the demands for Business Property Relief or inheritance tax.

It is estimated that this measure will result in 208,000 job losses and a 2 billion net loss to the Treasury. I hope the Minister will address that directly when he sums up. Family business UK's Chief Executive says that far from stimulating economic growth, this policy will achieve exactly the opposite. He is right. To illustrate, just how ridiculously flawed this policy is, it applies to families here in the UK, but it does not apply to overseas businesses who operate here, or those who are owned by private equity or foreign corporate owners.

Labour have stolen any incentive for success from a generation of homegrown entrepreneurs. We really cannot go on like this. The gulf between those who create wealth and those who govern us has never been larger. Only one Cabinet Minister, the Scotland Secretary, has any real experience running a business. They are trying to find experience of a business on the opposite benches is like trying to find a tax the Deputy Prime Minister does not think needs to be raised.

It is no surprise that according to the Institute of Directors, over two thirds of businesses are now pessimistic about the future of the economy.

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I would argue it is worse than

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I would argue it is worse than that, there was a study out by the chartered institute of personal development that said business confidence is at the same levels as it was in the pandemic. In the pandemic they won't shut up shop, pandemic they won't shut up shop, not sure they would ever be open again. That's the level we are dealing with business confidence at the moment, 1/4 of businesses say they will lay people off. This is the reality of what is happening out the reality of what is happening out there.

This is why the government needs to listen and change course.

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needs to listen and change course. Ravaged is what our business community is like. He is right. community is like. He is right. Plummeting new depths seen only last Plummeting new depths seen only last when the entire economy was shut down due to an unknown pathogenic down due to an unknown pathogenic virus at that time. If that is the bar that the government set themselves, I would urge them to themselves, I would urge them to have a little bit more ambition.

A bit more confidence about their ability to try to grow our economy. No nation can spend its way to growth or tax its way to success. I fear we are about to have a study in why that does not work, but it has been tried before and did not work then. We cannot afford the ignorant, shortsightedness of this government to achieve growth, we need a country where everybody's spark of ambition can find ambition. Not everyone needs to run a business but for those that do, want a country that values, cherishes and honours its wealth creators.

Whether process of transforming a side hustle into a main hustle is straightforward. Where H is transformed from being accredited to a partner. In the tax system goes out of its way to reflect the risk of investing and running a business. We want regulators to think carefully before they intervene and not pounce on every perceived failure is another every perceived failure is another

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Former special forces soldiers have reached the top of Everest so congratulations to them. Isn't it congratulations to them. Isn't it the case that the HMRC, which the the case that the HMRC, which the right honourable gentleman has mentioned, reflects the government mentioned, reflects the government and the government's attitude to

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and the government's attitude to business is it is a dripping roast to be taxed to a standstill? I know so many businesses do feel

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I know so many businesses do feel like that. They feel when it is doing its legitimate job of trying to balance the books and raise money for the public purse, the way it for the public purse, the way it goes about that, the one-sided nature and the uncertainty it inflicts upon small businesses, whose biggest asset is their time, and whose greatest opportunity cost and whose greatest opportunity cost is trying to comply with the myriad of different regulations and taxes of different regulations and taxes with which they have to deal.

We want a government with a philosophy want a government with a philosophy of trust for business. To celebrate personal responsibility. One that clears the path for innovation. But that requires courage. To champion risk takers and elevate enterprise above section interest. It is very sad, as the honourable and right honourable members have raised, that investors and employers do not have faith in this government to deliver that contract between the state and those who seek to run a business. And instead of opening up investment, wonderful British businesses around the world, this government is presiding over top investors fleeing this country, taking their wealth and creativity and entrepreneurship elsewhere.

What could be more sad than that?

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I think the shadow Minister for giving way. I think business groups we see leaving the country quicker than anywhere is in the oil and gas sector. In my constituency, they are sector. In my constituency, they are sector. In my constituency, they are fleeing the country at an astounding rate, bringing investment, skills and jobs with them. We are losing out on a generation of investors and out on a generation of investors and skilled workers. What does the shadow Minister think we should do to keep the skills, investment and

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jobs in the UK? One is tempted to say we should try to remove this wretched government as quickly as possible. government as quickly as possible. Which of course is part of the Which of course is part of the But look, what we actually need is a government that listens to the points my honourable friend representing her constituents and representing her constituents and industry makes so eloquently. A government that understands the reality of the energy situation and the high cost of energy for business, rather than the pursuit of business, rather than the pursuit of a failed dogma and ideology which is not being pursued by the rest of the world, and a government that listens to enterprise and businesses, many of whom I have met, and one could do that from the perspective of trying to grow the economy.

From the perspective of trying to reduce energy costs to a competitive level. Ultimately, one could do it because one believes in the climate transition, but those special skills that deal with the harsh offshore environment need to be nurtured on the journey, rather than squandered

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and see them flee elsewhere. I'm grateful to the shadow Minister. He is making a forensic Minister. He is making a forensic case against the government. But case against the government. But could he focus on an area he will be familiar with from his prime ministerial experience? We had the banks before the Select Committee banks before the Select Committee yesterday. The in and out come of the boundary review requires the government to work very closely with government to work very closely with the regulator to make sure there is absolute clarity so investors across the country will have the opportunity to invest in the future opportunity to invest in the future of this country in equities, rather than leaving it in cash.

That requires action and direction and this is an area where there is this is an area where there is probably consensus, but it does need government to step up to the mark.

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government to step up to the mark. I thank my right honourable friend and indeed my predecessor in that role as the city minister. Where we can, and this is an important point, where we can we will support the government in its endeavours to continue the work he and I started, to try to improve investment outcomes for our economy, in terms of the level of equity investment, to mobilise pension funds but most importantly deliver good returns for our investors.

For those constituents who sent us here and want their pension to give them the best possible outcomes in life. It is really important not just that the Treasury leans into that and that we have abundant capital markets which are well regulated but not overregulated, but also that we create the right culture. Whether that is the guidance boundary, tolerance of risk, financial literacy and education in schools. This is a really big point. It is one that I hope we can continue to work collaboratively on with the government and the work of the excellent Select Committee my right honourable friend sits on.

None of that helps if wealth creators and global investors have left our country for shores elsewhere. For vindictive measures which simply vindictive measures which simply will not raise anything like the numbers. It is OK to admit sometimes when one makes a mistake. In this case Treasury ministers have made a mistake. The amount that is raised will be nothing like the amount that is expected. There have been important areas of research on that and it has found that the cost will be very significant.Raising money for the Treasury, ultimately we will I am afraid as a country lose money.

It is a truism on this side but one we had to continuously teach I regret to say the other side, that you do not make the poor richer by making the rich poorer. Like all socialists, they are attracted to superficial measures which ultimately will make all of us poorer, those of us were left behind pay more or endure less well funded public services as a result of this government shepherding the golden goose into a pen and seeing them exiled.

Madam Deputy Speaker, the Deputy Prime Minister was right in Deputy Prime Minister was right in her memo that we saw today. This government is indeed coming for your job, your business, your pension and savings. It is all very clear in black and white. Whether you are team Angela Rayner or team Rachel Reeves, it is all bad for business when it comes to decisions on the economy. When the Minister responds, perhaps he will share with us his views on whether he believes the tax measures advocated by the Deputy Prime Minister, that will once again have a chilling effect on business, are the right ways to proceed.

Stabbed by employment red tape, or shot by higher taxes, the outcome for business is the same. They duck difficult questions. While the Chancellor fiddles the rules, making it up as she goes along. Families know that the cost of living is getting worse under Labour. I should keep going. The honourable member is animated but I think I should keep going. Rather than give him the disappointment of having to listen rather than Chanda. Madam Deputy Speaker, the Conservative party has a clear vision.

From first principles and understanding business. They could listen and fully learn. This could be an exercise in understanding what a proper strategy on the side of business looks like. We back the millions of entrepreneurs and businesses that create wealth and jobs across the country. We are not afraid to talk about the need for business. To celebrate private capital, international investors and taking risks. It was the Conservatives who delivered the biggest single tax cut for business in modern history through the move to full expensing.

It was asked that/business rates when we introduced retail hospitality and relief. And during the terrible pandemic we provided billions of finance to keep businesses and the economy going. That is what leadership looks like. That is what a party on the side of business looks like. I would urge the members opposite to do a little bit less talking and a bit more listening. Think of every business owner and every employee that they looked at during the election and said the government would have their back and ask if they truly believe in their actions rather than their words that is anything like approaching the case.

With employment falling, wealth creators leaving the country, at a rate never seen before, businesses closing, investment crashing, and inflation today rising, these benches do not believe

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so and I commend this motion to the house. A substantial opening speech. The
13:41
Gareth Thomas Portrait Gareth Thomas MP, Parliamentary Under Secretary of State (Department for Business and Trade) (Harrow West, Labour )
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A substantial opening speech. The question is as on the order paper. Minister.

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Minister. Madam Deputy Speaker, even though that felt like a very long 50 that felt like a very long 50 minutes, it is always nice to see the right honourable gentleman taking centre stage for the Conservative party. As one of the authors of the Liz Truss budget, here is a constant reminder of the fiscal mess of his party opposite kindly let this government to The opposition are once again trying to make us all believe that we are living in an alternative reality.

One where the economy is shrinking and not growing. Where investment is low, not high. There is sadly only one problem with that analysis. None of it is true. Figures published last week showed the economy grew by 0.7% in the first quarter of this year. The fastest of any G7 economy. The OBR forecast for growth has been revised up for future years. The latest IMF forecast predicted the UK will get the third highest growth in the G7 over the course of this year. This government has a Plan for Change and it is working.

I give

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way. I just wanted to clarify whether inflation at 3.5% was higher or inflation at 3.5% was higher or lower than inflation at 2% where it

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was last July. I say gently to the honourable lady that the current rate of lady that the current rate of inflation is an awful lot lower than the 11% it right to under the party the 11% it right to under the party opposite. I was a bit surprised there was nothing in the shadow Secretary of State's lengthy speech on trade. Until my honourable friend on trade. Until my honourable friend Peterborough provoked him. We have secured three massive trade deals with India, the United States and with India, the United States and this week the European union.

Slashing the cost of doing business abroad, reducing border checks, cutting tariffs, cutting red tape. cutting tariffs, cutting red tape. It will support jobs for British people and create opportunities for great British businesses in our biggest global markets and in one of the world's biggest future markets. The party opposite tried to do a deal with India but could not. It has taken us just 10 months. The party opposite wanted a trade deal with the US. Indeed they had four years to do a trade deal with President Trump and could not.

We have done one in just four months. And the EU, the deal they did was the worst trade deal in history. Every opportunity they had to minimise red tape and border checks, they rejected it. The result? Businesses stopped exporting into Europe in thousands. Our deal with Europe sticks to the red line. Saving businesses thousands of pounds. Cutting the cost of food in supermarkets and helping to get great British food products from sausages, to shellfish, to seed potatoes, back to European markets.

Once upon a time the Conservative party were in favour of free trade. Once upon a time they were in favour of trade deals. Now they are against just about everything. Far be it for me to give advise to the party opposite. But when you are in opposition, you are still allowed to support measures that are obviously support measures that are obviously

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in the national interest. I'm grateful to the Minister for giving way. The key thing is we are giving way. The key thing is we are in favour of free trade. Just not at any cost. That has been the biggest problem with these deals. He said the last government did not sign them off. For good reasons. That is the point we are trying to get the point we are trying to get across from this site. There will be across from this site.

There will be people queueing up to come to the UK because they regard us as a soft touch they can get anything out of. That is what we want to stop on this That is what we want to stop on this site. He is against the trade deal site. He is against the trade deal with the US, with India and the European Union. Let me turn to European Union. Let me turn to There are claims entrepreneurs are There are claims entrepreneurs are being driven overseas.

The facts being driven overseas. The facts tell a different story. Business investment actually rose by 5.9% in investment actually rose by 5.9% in the first quarter of this year, the fastest quarterly growth in two years. In other words, business investment is higher than when the Conservative Party left office. I will give way.

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Is he a little bit worried that

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Is he a little bit worried that the unexpected growth in the first quarter of the year was businesses

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getting in ahead of tariffs? One of the ways the honourable

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One of the ways the honourable gentleman can help businesses in Scotland would be to call for the Scottish government to do what we Scottish government to do what we are doing in this country and are doing in this country and extends relief to hospitality and business rates. We are seeing investors from across the globe investors from across the globe choosing to put their money in the UK. The international investment UK. The international investment summit last year saw £63 billion committed to the UK, double the amount secured by the previous amount secured by the previous government friendly Leader of the Opposition was the Secretary of State for business and trade and that will generate 38,000 new jobs.

Crucially, leaders of these Crucially, leaders of these companies have healed the pro- business approach as a driving factor behind the decision and I

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will give way. I thank him for giving way and

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I thank him for giving way and I'm sure we all agree about the need I'm sure we all agree about the need and desire to have growth and business investment. Speaking to small and mid-size businesses in my constituency, especially in hospitality, they have been squeezed in terms of the change of rate but also lowering it down because they also lowering it down because they employ a lot of younger people and sometimes on part-time wages. I sometimes on part-time wages.

I wonder if you could make some representations to the Treasury to try to get them to consider it in future considerations.

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future considerations. I will say gently to the honourable gentleman that we are always talking to businesses. In the always talking to businesses. In the hospitality sector, and across the hospitality sector, and across the economy. I will say gently to him that the difficult decisions we had to take in the Budget were because of the mess we inherited from the party opposite and businesses and hospitality and beyond must make sure schools and hospitals and police are properly funded and I am happy to give way one more time.



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Will be minister set out to the House so much he raised in additional tax and how much the government set out in terms of additional spending at the last Budget.

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Budget. These assessments are published in the Redbrick at the time of the in the Redbrick at the time of the budget and the honourable gentleman budget and the honourable gentleman can research. -- Red Book. Coming back to the question of international investment coming into international investment coming into the country and we have business leaders in favour of our measures. One executive chairman said at the One executive chairman said at the time of the investment summit that time of the investment summit that the clear policy direction, stable regulatory frameworks and the overall attractiveness of the UK is overall attractiveness of the UK is what has led them to doubling investments over the next few years, investments over the next few years, reaching up to £24 billion.

We have seen more ringing endorsements of the government approach. In April, the CEO of Blackstone praised our progrowth agenda and said investment in Britain is undervalued. He said he had no confidence in the UK economy than he did one year ago. Meanwhile, the chief executive of JP Morgan has told the financial -- 'Financial Times' has said there is much to like about the new progrowth agenda. Forthcoming industrial and trade strategies are further steps to support businesses and accelerate growth in the sectors of the economy with most potential.

There has not been a strategy to help small business for more than a decade and the party opposite cut support to small businesses to get into new small businesses to get into new

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markets and cut support to help businesses adopt new technologies and failed to tackle the scandal of late payments for big business. I thank the Minister for giving

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I thank the Minister for giving

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I thank the Minister for giving way. In the first quarter, we had unexpected growth of 0.7%. The UK Treasury's April 2025 Survey of Treasury's April 2025 Survey of Independent Forecasts is that the entire growth of the year is 0.8% entire growth of the year is 0.8% and so does that mean he looks forward to 0.8% for the rest of the

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forward to 0.8% for the rest of the year? His policy is not working. He is wrong. The OECD says we

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He is wrong. The OECD says we will have the second fastest growing economy in the G7. Coming back to small businesses, since taking office, we have looked to hardwire this small business into everything this small business into everything we do. We have announced robust measures to tackle late payments and measures to tackle late payments and large companies will have to include performance and annual reports and performance and annual reports and that is a massive incentive to pay suppliers more quickly.

We've launched a new fair payment code overseen by the Small-Business Commission and intend to go further with a strong package of payments including stricter maximum terms and strengthened as for the Small Business Commissioner.

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Perhaps they were wrong but are

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Perhaps they were wrong but are the Bank of England wrong? They have a forecast of 0.75% and the APR has a forecast of 0.75% and the APR has a forecast of 0.1%. His growth

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a forecast of 0.1%. His growth policies are not working, are they? With due respect, I think he has

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With due respect, I think he has got to track these things over a period of time because the Bank of period of time because the Bank of England have revised the measures up for the year. As I said earlier, we have taken some difficult decisions have taken some difficult decisions in the budget to fill the black hole in the budget to fill the black hole of £22 billion left by the last government and tackle record any government and tackle record any chest waiting lists and -- NHS waiting lists and invest in school.

We've been making headway to deliver We've been making headway to deliver on the manifesto pledge to reform on the manifesto pledge to reform business rates and one reason the party opposite lost the confidence of the business community as they is to reform business rates time after time and never did so. We are developing these for retail and leisure properties. We are scrapping the immunity for low income dropping from the party opposite and cracking down organised gangs who target retailers.

This has left staff and store owners feeling this and it will change now. We are also looking to free up precious capital for businesses to expand including start-up loans for people want to set up a new shop or business we can mix with the support is there to help them and that is why we have lodged call for evidence as part of the work on the business strategy. This is having a tangible impact and the newest statistics from the ONS revealed that we have an increase of 2.8% compared to the first quarter last year.



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He talks about talking to businesses and I would urge him to do more listening to businesses. He do more listening to businesses. He was asked the question about how much additional tax was raised and much additional tax was raised and how much additional spending and I did not hear an answer. Can he give did not hear an answer. Can he give the House an answer? If he does not know, will he agree to write to me?

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know, will he agree to write to me? I understand the honourable lady supports the investment that the tax supports the investment that the tax changes are delivering. Every penny of it she supports. I wish the party of it she supports. I wish the party opposite would set out their plans to raise similar amounts of money if to raise similar amounts of money if they do not like the spending plans. I was reflect on the newest I was reflect on the newest statistics which show the number of businesses up in this quarter by businesses up in this quarter by 2.8% and despite what the honourable members have claimed, business closures are actually down by 4.4%.

The latest Institute of Directors Business Confidence Index shows a rise in business confidence with a stepping up of investment plans for stepping up of investment plans for

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the second month in a row. I am grateful to the Minister for giving way and that important giving way and that important statistic is employment and in his constituency in the last year, constituency in the last year, unemployment has risen by 31%. That unemployment has risen by 31%. That is a staggering increase and in my constituency it is 10%. This is the real impact and perhaps you will real impact and perhaps you will come onto supporting people into work.

We have seen unemployment go up around the country by 10% and up around the country by 10% and that is a concern for people as they work and look after families. The committee numbers show an extra committee numbers show an extra 200,000 jobs in the economy since the general election and so I encourage the honourable gentleman encourage the honourable gentleman to look at a wider range of to look at a wider range of statistics. The shadow Secretary of statistics. The shadow Secretary of State turned to the Make Work Pay agenda and these reforms are a big increase in job security for working people and raising the national minimum wage and national living wages so that 3 million eligible workers receive a pay rise and this is about ending the exploitative zero hour contracts and putting an end to unscrupulous fire...



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I thank the Minister for giving way and I can hear what he says about job security. Surely if businesses are not going to be given businesses are not going to be given jobs because of the rise, as my honourable friend has laid out, that would mean that there are more would mean that there are more people in work, I see figures already show.

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already show. With due respect, it is not one or the other. A pro-worker economy or the other. A pro-worker economy is also a pro-business economy and the sentiment has been echoed by experts such as Simon Deacon who is experts such as Simon Deacon who is professor of law at University of Cambridge and he says strengthening Cambridge and he says strengthening employment law has had a good effect on employment and he said that far on employment and he said that far from being harmful to growth, these laws contribute positively to laws contribute positively to productivity and right now it is worth noting that optimism among business leaders is rising with improved expectations for investment and hiring and costs with employment up by 200,000 since we took office and we have wage growth consistently outpacing inflation and these indicators suggest the labour market remains robust and responsive and not being held back.

Let there be no doubt that this government is delivering on its plan for change with investment and reform to deliver growth and put more money in people's pockets and rebuild Britain and realise a decade of national renewal. We are the party of entrepreneurs and wealth creation and the party of workers and the party for economic growth and the party of social justice. The party opposite have no ideas, no imagination, a dismal record and they do not have the courage to face up to it.

We are delivering for British workers, businesses, and I urge the House to reject emotion before us.

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I have to say that I share the bemusement of my right honourable friend and I thought to myself that friend and I thought to myself that based on recent opinion polls, perhaps he was reflecting on the fact the Liberal Democrats are now more likely to form the next government banned the Conservatives.
13:59
Sarah Olney Portrait Sarah Olney MP (Richmond Park, Liberal Democrat)
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government banned the Conservatives. The stones being thrown from the very fragile glasshouse of the Conservative Party are astonishing, even the appalling mismanagement of The dismal record they left behind which is a picture of low growth, high interest rates, a record fall in living standards and for years Conservative Party to people for granted and this was reflected in mortgage payments, the hike in energy bills and the prices they have paid for the weekly shop and under the last administration public services were left stumbling and the pitiful negotiations so our redtape introduced, causing untold damages to businesses around the country.

The Labour Government has inherited a mess and we know the cause of that if the legacy of reckless economic mismanagement left behind by the previous government but that cannot be allowed as cover for measures which damage business or course suffering for the vulnerable in suffering for the vulnerable in suffering for the vulnerable in

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The national insurance will damage business prospects and prospects for growth. People endured prospects for growth. People endured years of Conservative mismanagement which is why this government should do far more to grow the economy, create jobs and improve living create jobs and improve living standards. We know the government has had tough decisions to make. But instead of hiking national instead of hiking national insurance, cutting disability insurance, cutting disability And squeezing departmental budgets even more, they should show more ambition in growing the economy, the best way to raise revenue and boost best way to raise revenue and boost living standards.

That is why we have urged ministers to ignore the naysayers in the Conservative party and the Reform Party and negotiate a new, bespoke UK and EU customs new, bespoke UK and EU customs union. When it comes to taxation the government should raise revenue more government should raise revenue more fairly. Such as asking social media giant and online gambling firms to pay their fair share. That is the right way to boost public services right way to boost public services and repair finances, not with shortsighted cuts to make things

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shortsighted cuts to make things worse for people. I give way. I thank my honourable friend. She is right that there is no doubt this government has a very difficult job clearing up the mess left by the last Conservative government. But there have been far too many erroneous decisions and policy

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Business that has been running for 28 years is now facing difficulties... And intervention cannot have examples. It is short and to the point. What is the question?

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point. What is the question? Excuse me. Does my honourable friend agree with me that we need a friend agree with me that we need a fundamental overrule of -- overhaul fundamental overrule of -- overhaul of the business system so small businesses in rural areas can survive and succeed?

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survive and succeed? I thank my honourable friend for that intervention. She is exactly right. There are so many things right. There are so many things currently holding small businesses back. The Conservatives failed to reform business rates and we are looking to the Labour government to looking to the Labour government to bring forward measures that can make things easier for people to set up businesses in their local communities. Stripping support for many of the poorest pensioners while many of the poorest pensioners while energy bills are still skyhigh was the wrong thing to do.

I and my Liberal Democrat colleagues listened to our constituents and heard from to our constituents and heard from countless pensioners affected. We have had warning calls from sector representatives including Age UK and representatives including Age UK and Disability Rights UK and many pensioners themselves regarding the damage these cuts have done, putting some of them in the position of having to choose between heating and eating. In December last year the government admitted the changes to the Winter Fuel Payments will result in an additional 100,000 pensioners being pushed into poverty.

I give way.

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She is talking about the effect of the winter fuel cut by this government. Does she agree these government. Does she agree these were not just cruel and unpleasant for elderly people who have suffered as a result but also economically illiterate because the increased illiterate because the increased cost to the NHS is posed by individuals who become sick as a

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result of being cold? I'm grateful to the honourable lady for her intervention. I have engage the Minister directly on this point and shown example of how these cuts have impacted pensioners in my constituency directly, very harshly. The Liberal Democrats voted against removing the Winter Fuel Payment to removing the Winter Fuel Payment to prevent millions of the most vulnerable from losing out on vital support. After the Prime Minister's support. After the Prime Minister's comments today, we continue to call comments today, we continue to call on the government to reverse this cut in full and ask for them to guarantee the current cut will not be in place by next winter, ensuring be in place by next winter, ensuring all pensioners who need support will get it and I asked the Minister for full details of the proposed changes full details of the proposed changes as soon as he is able.

It is not just in the cuts we hope to see a change of direction. While the last government did so much damage to High Street businesses, the Labour government's national insurance jobs tax has only made things harder for them and their workers. The change to employer National Insurance contributions announced in the Autumn Budget were an unfair tax which will hit small businesses, social care providers and GPs. They are the beating heart of the economy, the centre of local communities and they create the jobs we all rely on.

Raising the Employment Allowance will shield Employment Allowance will shield only the very smallest employers. Thousands of local businesses will still feel the damaging impact of the changes. Liberal Democrats voted against the changes at every opportunity and I again urge the government to scrap these measures. Even more damaging for small businesses is the broken trading relationship with Europe. The Conservatives botched a Brexit deal and has been a disaster for the country especially for small businesses, held back by reams of red tape and barriers to trade, costing the economy billions in lost exports.

The dismal picture of the financial impact of this terrible Brexit trade deal is becoming increasingly clear. While the Conservative Party's motion today noted more than 200,000 businesses have closed since Labour took have closed since Labour took office, it was under their administration in 2020 up to 2024 the country started to see the rate of small business closures outpacing the rate of new businesses starting. Since 2019, there has been an average closure rate of more than 12% outstripping the opening rate. A recent survey of 10,000 UK businesses found 33% currently trade in enterprises experiencing extra costs directly related to changes in export regulations due to the transition period.

Small businesses have been particularly badly affected with 20,000 small companies stopping all exports to the EU. A recent study found good exports have fallen by 6.4% since the trade deal came into effect in 2021. I welcome the actions taken by the government at the summit. Particularly the impact on the seed potato trade. But I urge the to recognise they should only be a first step to negotiating a new customs union which would ease the pressure felt by so many businesses and boost the economy.

More broadly we will continue to call on the government to introduce vital reforms to the business rate system will stop these are harmful for the economy because they tax capital investment in structures and equipment rather than taxing profit or a fixed stock of land. We would abolish the broken business rates system and replace it with a Commercial Landowner Levy. We need a fundamental overhaul not just tinkering around the edges and sticking plasters. We are disappointed that again serious reform of the system has been kicked down the road.

We need fundamental reform of business rates if we want to boost small businesses and high streets and stop penalising productive investment. We acknowledge the government inherited a dire economic landscape. Compounded by the challenges posed by an aggressive Russia and an unreliable US Administration. But this is no excuse for the mistakes the government is making. People are still struggling with the cost-of- living crisis. Just a small businesses struggle with the cost of doing business. Energy prices are soaring. Food costs are going up and mortgage bills remain skyhigh.

The government must take bold action to boost the economy. We urge ministers to U-turn on the Winter Fuel Payment cut, scrap the jobs tax and row back on removing support for disabled people. Many of them need the support to stay in work.

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I thank my honourable friend. She talks about U-turns. Would she also agree the government should also

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reverse the family farm tax? I thank my honourable friend for making that point from her constituency which is more rural constituency which is more rural than mine I admit. She is right about the family farm tax. That is something we would also like to see something we would also like to see the government, as my honourable friend says, urgently U-turn on as friend says, urgently U-turn on as it is creating such difficulty in it is creating such difficulty in Instead we call for bolder, more ambitious and fairer measures to replace business rates with a new replace business rates with a new fare system to boot High Street and town centres.

Negotiate a customs union with the EU to cut red tape for small businesses and boost the economy as a whole. Thank you.

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economy as a whole. Thank you. We now have the pleasure of Chris Witts.

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Thank you, Madam Deputy Speaker. I think you are far too kind. Can I start by joining others in congratulating the veterans Minister in his epic adventure to the peak of Mount Everest? Anecdotally before I
14:11
Chris Vince Portrait Chris Vince MP (Harlow, Labour )
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get into the politics, I often see the Minister in the gym and he talks about his routine which I have to about his routine which I have to say is considerably more fun than say is considerably more fun than mine. It is also a pleasure to speak so early in the debate as I often get compared to the Member for Strangford so I thank you for Strangford so I thank you for calling me. It is a privilege to talk in this debate and as members across the House will know, I will across the House will know, I will take any opportunity to talk about my town of Harlow and the greater my town of Harlow and the greater constituency.

As I told the Prime Minister yesterday, Harlow is home Minister yesterday, Harlow is home to some great businesses. It is ironic for me as a vegetarian that the first business to contact me the first business to contact me after my election was actually a after my election was actually a bacon company. They raised legitimate concerns about the increased costs of imports and increased costs of imports and exports to the EU. I'm hopeful from what the Prime Minister said that what the Prime Minister said that the deal we negotiated will help this business and others in Harlow to continue thriving and trading with our EU neighbours.

I give way.

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Could he tell us whether this company or indeed any other business

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company or indeed any other business in Harlow believes the Employment Rights Bill will enable them to employ more people? I thank the Member for his

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I thank the Member for his question and honestly they have not contacted me about the Employment contacted me about the Employment Rights Bill. I have to be honest with him that they are primarily concerned about the issues with tariffs and the increased tariffs tariffs and the increased tariffs after leaving the EU. I do not want to come as some members would seek to come as some members would seek to do, reopen that debate. I think the deal that has been negotiated by the Prime Minister will hopefully help to deal with that issue but help to deal with that issue but also make sure that we can maintain sovereignty which so many people who voted Leave clearly want.

I also want to recognise other businesses want to recognise other businesses want to recognise other businesses in the Harlow. What is brilliant when you are first elected as an MP is you get to see many hidden treasures of your constituency that perhaps you would not get the perhaps you would not get the opportunity to do before being elected. In one of my earlier visits I visited a company that make components for Boeing aircraft which travelled the globe. It is the only business as I understand in the UK that produces the boxes where all the electrics go into a 747 which I think is pretty awesome.

I also paid tribute to a copy company, and where I do my Christmas shopping, and a fantastic environmentally friendly charity which I am visiting next week, Eco-. The Minister of course would criticise me and rightly so if I did not mention how wonderful the One issue I would raise with the Minister which has been fed back from my local area and I'm sure his as well is the increased issue of retail crime. I hope he will take that very seriously as I am sure at the Minister is nodding and I look forward to hearing him talk about that in his roundup.

Harlow is a great town. I have always said it may not be the oldest Newtown or the newest Newtown and it may not be the most successful economically. But it is absolutely the new town with the biggest heart. This morning as a member of the APPG on new towns I looked at data about all of the towns in this country and the challenges many face and I have to say for me the challenges Harlow face, based on the metrics they use, did not come as a big surprise to me.

And I think in particular with relation to growth, this was about housing and productivity. For me, the solution is to increasing Harlow 's productivity and that of the country come down to 3 key areas. First I want to talk about skills. I pay tribute to the fantastic work as I have done a number of times in this chamber, the work of Harlow College. Many years they have supported the next generation to give them the skills they need, not only for today but for the jobs of tomorrow.

Equally I want to talk about the importance of transport links. I will do a bit of a pitch for Harlow later if you would not mind, Minister. Ideally located between London and an international airport so a lot of potential there. And the other thing is about transactions and generating, stimulating the economy with the transactions we make. I welcome the £20 million of government investment into Harlow town centre. But I do want more for my town, Minister. I appreciate the Member for Salisbury and Wiltshire is not in his place at the moment but I have told him I will mention this and I know he has got a German debate later on this issue.

-- Debate later on this issue but I will continue to lobby for Harlow to be part of the agency which will mean 3,000 new high-tech jobs for Harlow, providing the next generation with not only an opportunity to aspire but really achieve in high-tech jobs of the For For the For the first For the first time For the first time in For the first time in a For the first time in a long For the first time in a long time there is hope on the horizon and this government will have a great future on the world stage and I only ask is that they ensure Harlow is a part of that future.
14:16
Gagan Mohindra Portrait Mr Gagan Mohindra MP (South West Hertfordshire, Conservative)
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It is a pleasure to follow on and it is my old stomping ground and I am surprised because I know it is a world-class area for business. Also looking at my constituency, in my area, we seem the business of pace since July the business of pace These are high street historically and the only cause if the volatility in the high street is something that whichever side of the House you are on is a poor legacy.

Small businesses that I speak to feel abandoned by the government and are facing high energy bills and rent. Part of that is not the responsibility of government and things like on street parking and I things like on street parking and I continue to have dialogue to make sure they can survive during these difficult times. On an international basis, we must recognise that a lot of wealth creators are leaving the country. I read a book many years ago and did not think at the time that it would be such an influence on my life until after I read it and, as many of you know, it was not something I thought I would dream of let alone be here.

All of us come with life experience and part of that, the overriding memory, if government do not support wealth creators, they will find a way to creators, they will find a way to leave and we have had 9.5 million millionaires leave the UK and that is the highest amount... I am happy to.

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Just to help members, friends you are intervening, you have to be standing and making a sound, standing and making a sound, otherwise the member is not aware otherwise the member is not aware and otherwise you have to sit down again and stand up again. I thank the honourable member for way and I the honourable member for way and I wonder if you have a source for data wonder if you have a source for data on the so-called Exodus and saffron that has a great interest in that has a great interest in propagating these type of figures.



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propagating these type of figures. The honourable member will know the difference was better than I the difference was better than I actually work for the 'Financial Times'. I am someone that comes from a small business growing and they have experience. My unlimited social circle, but I speak to people that I circle, but I speak to people that I regard as employees and people that will hopefully inspire the next will hopefully inspire the next generation, a lot of them are shorts and that causes me concern because parties come and go but we rely on these businesses to grow, succeed, expand.

I am a second generation Indian and when my parents came across at the 1970s, they had the aspiration and hope that if they were willing to work hard and be in the right place, integrate industry, the right time, that the state would not intervene and I do not see that type of ambition coming forward now. I don't wish to get party political but I think that is an issue that all of us have to be concerned about because governments of all stripes will spend taxpayer money but it is worth remembering the government has no money and it is money out of pocket for people that pay tax and we must acknowledge the fact that wealth creators pay more tax than other parts of society and if they choose to leave, and we live in a global role, it means the Treasury will not have the benefit of the income to spend on things that are vital to us and our communities.

We have spoken about business confidence before as well and must recognise that there is significant volatility in aspiration and potential capital expenditure for small and large businesses. Someone mentioned earlier about confidence and as this is need certainty of

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direction of travel. I thank the honourable member for giving way. He is right that businesses need certainty and will they agree that the thing that undermined the certainty businesses had is the key of the party opposite created through the disastrous mini budget of Liz Truss?

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budget of Liz Truss? I will let him make his political point but the only point I will make is that for the first two years of my first term be dealt with a global pandemic and spent over £400 billion pandemic and spent over £400 billion worth of taxpayer money and I got elected in December 2019 with a elected in December 2019 with a majority and we were looking to the forum on the tax base and finance forum on the tax base and finance government spending but did not have that opportunity and with the that opportunity and with the majority I hope they are ambitious.

Others have spoken about reform and I think it is massively outdated I think it is massively outdated that we look at businesses based on that we look at businesses based on bricks and mortar. I would just look at online presence and that would mean the vibrancy of high streets would be lost and it would end up being the bookmakers, hairdressers, charity shops. Nothing wrong with those but the high street site support and am honoured to be an MP for our high streets with significant diversity and we have not spoken about moving away from branches on the street but we are trying to deal with that luckily by having places like the post office be banking hubs.

-- Locally. Someone mentioned HMRC and as a pitch to the Minister, from my limited experience, HMRC have got increasingly more aggressive and also not necessarily fair and things like interest rates charged on potential that and if there is no payment by an employer or a business and the interest rate that they receive for us is what HMRC is different. We should not regard businesses as a cash cow if they have done nothing wrong and I leave that with the Minister to have a that with the Minister to have a look at and I would refer HMRC to be not that type of body and ministerial oversight is something I would be willing to investigate to see if it is practical on the bill understanding we must make sure civil servants have the freedom to raise revenue and collect it.

Going back to Hertfordshire, if I may, the median wage is £451, higher than the UK average of 728 but with inflation rising and we heard overnight it is now 3.5% at the rising cost of living, people are feeling poorer and off the back of that means we are spending less on high streets and they are less likely to expand on their own homes or buy a new car or whatever else they would have done if they felt more flush with

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cash. The honourable member makes a

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The honourable member makes a great point and I was contacted by great point and I was contacted by the owner of LA Fish in my constituency and he said the rate constituency and he said the rate rise would cost him monthly and he has two choices and one is to pass has two choices and one is to pass on the cost to the consumer and we know the price has risen exponentially over the years and the exponentially over the years and the cost of living pressures continue to make it worse and so do they agree that small businesses are under risk that small businesses are under risk from the introduction of the rate rises? rises?

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Excellent point. I think for me, reducing the tax rate does perversely sometimes increase the amount of money that you receive in amount of money that you receive in the tax coffers and I say that as someone who has reduced VAT down to someone who has reduced VAT down to 15% and it allowed me the certainty to expand the business and we got another outlook, employed more people. In effect, we were able to expand but actually it was a win-win for us as a small business and we talked about the employment rates bill and it causes pneumatic concerns and the risk I would have concerns and the risk I would have taken with someone aged 60-18.

-- Causes rights concerns. Someone aged 16-18 is the same as someone in their 40s as it would be for someone on their first job. Where is someone leaving university going to work? We spoke about 100,000 less jobs and that is only going to get worse when those people who finish graduate degrees or what have you cannot get into employment and that will affect the workings of the Minister and so on this side we will be fully supportive of government if they are doing the right thing and we all want, I was listening, and I spent a lot of time in the chamber but the reality is the number of us that want the legislation to support the community and make sure people can get on with their lives without the burden of thinking about this and they want us to get on with it and so, in terms of tax rises, there was the leap from the letter from the Deputy Prime Minister to the Deputy Prime Minister to the Chancellor and I remained concerned and it is possible it is another death by 1000 cuts on small businesses.

We need certainty and support from the government to tell people to go and be ambitious because if people are going to be risk averse, there will be a structural problem for us and that structural problem for us and that means we will not create the next unicorn of the world because those people will have already left the country to generate income in a better financial climate and a different area and typically the

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Middle East are elsewhere. I thank the honourable gentleman for giving way and I was touched by for giving way and I was touched by the story of the role his father the story of the role his father played and I hope you will be present in the immigration debate this afternoon to the same point about the fatal work done in the UK and he's mentioned and ICCs mentioned the problems facing small businesses and one small business businesses and one small business has seen business rates go from 8000 to 27,000 and surely we have to stop taxing small businesses if we want

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them to grow. It generates a significant amount of money for the Treasury and there of money for the Treasury and there was resistance to the farming that without knowing for certain how they without knowing for certain how they will feel that blackhole and we also will feel that blackhole and we also have not spoken about hospices and the fact the charity sector has been affected and also there is the fuel affected and also there is the fuel allowance and these are all affecting the most vulnerable individuals or community groups or charities and there is a massive charities and there is a massive void and my worry, and it is increasingly more so, is that we are doing things with unintended consequences that will have a significant impact and the reason why we chose the debate was to make sure the government has heard loud and clear from across the House is that we will support them when they do the right thing but when they had to adjust the direction of travel, we will support that because it benefits no one if we just chuck political grenades to the benefit of communities.

I'm sure I will just communities. I'm sure I will just finish on the loss of confidence in businesses. Small businesses are closing and investors are leaving and inflation is rising and confidence is collapsing. There is a lack of direct experience on the front bench but that is neither here nor there but I would urge the Minister to listen to businesses of all shapes and sizes because that wealth of experience is what brings value in this place and I know that there are various economists and members of think tanks but speaking members of think tanks but speaking to my honourable friend who created the business employing 1000 people, that is real life experience as to how this would have influenced his business projections and ambition and my continual conversation at the moment, they are looking to shrink and be secure while expanding and being ambitious and that is not what we are about and we are globally ambitious and I wish him success in ambitious and I wish him success in
14:31
Jeevun Sandher Portrait Dr Jeevun Sandher MP (Loughborough, Labour)
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Thank you for allowing me to speak in this debate on the economy. We know a nation where every single one of us can earn a decent life is a stronger nation and that is exactly the kind of nation this government is creating. Because today to many cannot earn a decent life and the nation as weaker as a result. The task before us is to create that nation. A stronger nation. Not weaker and more divided which some in this House would like to see and which they speak to time and time again.

I will take the emotion in good faith from the opposition but also each of the points is mistaken and I will come to each of them in due course. We do live in dangerous times, Madam Deputy Speaker. 33% of us cannot earn a decent living. Because the party opposite left us with some of the highest energy, housing and childcare costs in the world. They Not growing in 14 years. The biggest squeeze since Napoleon. And their hero Margaret Thatcher, destroyed manufacturing in this country. The fastest deindustrialisation in the Western area of Europe.

No wonder people cannot get good jobs and are turning away from democracy itself. turning away from democracy itself.

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I will start over here. We are on dangerous territory here, Madam Deputy Speaker and it ill behoves me to try to defend the ill behoves me to try to defend the party to my extreme right. But does he remember the note that was left

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he remember the note that was left by the Labour Chief Secretary to the Treasury in 2010 about all the money is gone? I was a very young man then as it happens. It was rather a long time happens. It was rather a long time ago. I believe the member over here would like to intervene.

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Perhaps not any more? Busy. Tweeting away. Okay, don't worry

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Tweeting away. Okay, don't worry about it. Oh, go on. The honourable member talks about deindustrialisation. Remind me what happened to the manufacturing share happened to the manufacturing share of the economy under the last Labour

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government? Did it go up? It has been falling in this country since Margaret Thatcher came country since Margaret Thatcher came here and the lack of manufacturing jobs, and the ability for nongraduates to get a decent job in this country, that is why they are turning away from democracy itself. More than that, the fastest deindustrialisation in Western Europe. And on top of that, young people who cannot move out of their mum and dad 's home. 40% of them living at home with mum and dad.

Each of them now turning away. I give way.

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I do want to continue the point about deindustrialisation. Is it not the case that the manufacturing share of the economy dramatically fell under the last Labour government and then stayed the same under the last Conservative government?

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government? I will go on to industrialising the economy and what this Labour government is doing it right now. I will turn to the motion in hand. It will turn to the motion in hand. It doesn't add up. Each point in turn. The motion speaks to employment. Employment today is higher than it Employment today is higher than it was in the July election as is youth employment. More people are entering employment. More people are entering the labour market and less people are sick because we are getting are sick because we are getting waiting lists.

This motion speaks of businesses closing down. More than 230,000 have been created and a net 230,000 have been created and a net increase of 10,000. On business rates, a permanent 40% reduction in business rates for High Street shops. The Employment Rights Bill, shops. The Employment Rights Bill, which we are very proud of on this side of the house, I will look at the impact assessment and the package will be significantly positive for society. For example, the benefits will outweigh the cost. It goes on.

A direct and positive contribution to employment growth. Pro-worker, pro-business. Progrowth. That is the record and legacy of this Labour government. And where we differ from the party opposite, where we differ entirely and where we differ entirely and fundamentally, is we do not believe that it is simply business owners and entrepreneurs that create wealth and create growth in this country. Every worker, nurse, doctor, teacher, they create wealth in this nation. It is a joint enterprise between capital and labour to produce more.

That is where we are. Our nation, a stronger nation, is where each of us does well. That is the country we are creating. In stark contrast to what they left us opposite. To get everyone to live a decent life, we need costs to come down. First we move on to costs. Members across this House have spoken about inflation today. 33% of the increase in prices because of energy costs and why? We depend on natural gas which set the price 98% of the time. Natural gas that is 75% more expensive than wind and solar energy.

That is why we are investing in clean energy. Cheap energy. Secure for the long run. Not just the next five or 10 years. We have the next five or 10 years. We have some of the highest childcare costs in the world and that is why the Chancellor put more money into it so everyone can get the child care needed and get their bills down as well. Second, and to take the point from the member opposite, creating good jobs for nongraduates. Building 1.5 million homes which are cheap energy, warm homes and the Warm Homes Plan, good jobs for nongraduates.

Thirdly, young people. For our generation. Building homes where you can move out of mum and dad's home. That is where we create a better, stronger nation where each of us can do well. Stronger because we produce more. We have a stake in each other's well-being. Because we have a shared sense of purpose. These are some of the most dangerous times in the country for almost a century. Where 33% cannot earn enough to live. Nongraduates and the young see no prospect of a decent life for being able to earn a decent life.

They are turning away from democracy. What was despair and despondency is now becoming anger. What we are up against now is that the only answer is to tear everything down and bring in someone else and blame someone else for all of our problems. Create division and a divided nation is weaker. Division leads to anger and as we saw last summer, sometimes violence. We meet this moment with decency and determination. We meet it by creating a stronger nation where every one of us can earn a decent life.

Thank you.
14:38
Damian Hinds Portrait Rt Hon Damian Hinds MP (East Hampshire, Conservative)
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Damian Hinds. the backbone of the economy. 99.9% of businesses in East Hampshire are small or medium meant a is. Professional services. Retail. I think there were a few here before. Information and communication. And of course on agriculture. The biggest sectors for employment are in retail, healthcare and manufacturing. I have slowed down, Madam Deputy Speaker. I have heard from businesses in all of these sectors, worried about the prospect for their business, for this for their business, for this I think there are two things we always need to remember about businesses.

The first of those, in contrast to what the gentleman, who is no longer in his place, temporarily, in his place, and I know will return, contrary to what he said, it is in fact only business that can create the wealth, create the jobs, make the livelihoods, generate the tax, which in turn makes those high quality brilliant public services which we all value and on which we rely. The second thing I think we should always remember about business, and I would encourage ministers opposite always to remember this, is that in spite of accountants talking about the entity concept for the entity principle, that a business as a separate entity from the people who run it, that may be true in the counting sense but actually in a broader sense, businesses are people.

Collections of people coming together to achieve something. The joint stock company was created to share risk between different people. And the way organisations work within companies is a way of increasing efficiency, increasing productivity relative to everyone doing their own thing as a sort of sole trader. Because businesses are ultimately people. Ultimately there is no such thing as a tax on business. Taxes can only ever ultimately fall on people. There is a so-called business tax and it falls on one or more of three groups of people.

Either the customers, the employees, all the owners. When we say owner, of course I give way...

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He talks about the impact on people. A small business in my people. A small business in my constituency has recently had to constituency has recently had to reduce staff by four, a small business. A real impact because small businesses create so much for small businesses create so much for the rural economy. Does he agree with me the government should scrap the ENIC Rice and Chris -- placed the ENIC Rice and Chris -- placed the broken business rates with a fairer funding system to boost the fairer funding system to boost the rural economy and jobs in our rural

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areas? She makes very good points about small businesses, particularly rural. I will talk about national insurance contributions and business insurance contributions and business rates. I want to come back to this thing about taxes on businesses thing about taxes on businesses thing about taxes on businesses Some would say that if it is a tax of the owners, we do not mind because they are capitalist and they can afford it. We need to bear in mind the owners of businesses are a mixture of owners.

In the case of small businesses, small business owners are often sole traders. Sometimes family businesses. If it is not them it is either the customers or the employees. I'm afraid we are going to see this effect with the National Insurance Contribution rises. Ultimately that tax is going to be felt by those two groups of people and particularly by employees. A mixture of wage suppression over time. Possibly actual job losses. But the bigger effect is not going to be about job losses but jobs which are never created in the first place.



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Particularly among the youngest people and those furthest from the labour market. He is making some very good

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He is making some very good

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He is making some very good points. When the government brought in the National Insurance Contribution on employers, they used a sleight of hand and said it was not a tax on working people. Does he not a tax on working people. Does he agree that the Office for Budget Responsibility and assessing the impact concluded the overwhelming majority of the cost will be borne majority of the cost will be borne by the employees and not this

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by the employees and not this notional employer? It will and I repeat again it can only be one of those three. There will be some price increases so will be some price increases so those costs will be felt by customers, consumers. But all the indications are the big effect will be in wage suppression and employment. Which ultimately of employment. Which ultimately of course also means slower economic course also means slower economic In the same way that taxes on business ultimately landed upon people, also sometimes taxes which look like they land on people can have an effect on business and I want to talk about those.

First the family farm tax. Clearly a desperately ill-conceived measure. Which I think to be fair to Labour ministers, I think they probably didn't realise at the time quite what they were doing. Certainly their representatives, their Members of Parliament representing rural seats very quickly found out exactly what it was they were doing and the effect it would have stop there is an alternative proposal on the table which we know has been put by representatives of the sector to the Treasury. There is going to be this brilliant Treasury minister winding up and I am sure, or at least I hope, that he will find it possible to share with this House and the critique the Treasury have of the alternative proposal, the so-called clawback proposal, which would be much fairer and why they are rejecting it.

The family farm tax has had quite a lot of debate in this house. The Business Property Relief situation has had somewhat less. It is not quite the same in some ways as the family farm tax but there are a number of parallels and similarities. Business Property Relief was put in place to create A-level playing field between family-owned businesses and others. So family-owned businesses confident in investing in that business, knowing they could pass it on within the family, without incurring a tax that no other business ownership model has to pay.

Now typically... Does he want to give way? Typically these businesses will not have large amounts of net cash or liquid assets to settle the tax bill upon the demise of the owner. Of course they are not listed shares. So there is no market typically for those. You have to have a theoretical evaluation because you cannot value the shares. It is likely they will come up with a figure which is considerably higher than the amount which could be any realised -- could be realised in the event of a sale.

The net effect is that it is very likely that a substantial number of firms in this situation, and bear in mind this was created specifically to stop family firms having to be broken up, will find large numbers of them being brought up in whole or part by foreign owners or private equity, and is that really what a equity, and is that really what a equity, and is that really what a

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Labour used to agree with this. I right in saying it was a labour

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government that generated this policy in the first place in 1976? I do not have the history my

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I do not have the history my fingertips, forgive me. This has been recognised over the years and been recognised over the years and looked at in the past and I have been a Treasury Minister myself and you always get presented with various things you could do but, generally speaking, many people have found a good reason to keep something before you, it is a good something before you, it is a good idea to look at that. Overall, the government changes in the business government changes in the business taxation regime will affect a large number of sectors, particularly those which are labour-intensive and those which are labour-intensive and all of us can name hospitality, all of us can name hospitality, retail and care in our constituency and I would also mention nurseries and pubs in my constituency and there are sets of specific pressures in different sectors.

With nurseries, the issue is around the rate per child per hour that is provided and whether that is sufficient and my local nursery with three it is not sufficient to cover costs at a time when entitlements are increasing. In the hair sector, there has long been an issue around those below the VAT threshold and so on. What the new government has done is the confluence of four things that is creating the big headache. First of all, the national minimum wage growing up is a good thing.

It is good in of itself. We support people on lower wages having them rise. It is that happening at the same time as all these are the things that is causing the problem. I will not talk in detail about National Insurance contributions because others have particularly the effect on part-time employees and the government should acknowledge the gender differential that comes with that and we have had little about that. Business rates, two Labour MPs have said that they have gone down for retail and hospitality businesses and the Minister himself and somebody over there.

Try telling that to those businesses, unless he's going to tell me he has told local retailers and pubs.

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Point will make on the state of the House is the temporary rates the House is the temporary rates that were put in during COVID apply

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that were put in during COVID apply to those years and it was a reduction of 40% for the future. It is not good etiquette to use

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It is not good etiquette to use the word 'you' because it just the word 'you' because it just happened to be torn a little bit.

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happened to be torn a little bit. At a time when you are changing the relief from 75% to 40%, try telling those businesses who are facing an increase in National Insurance contributions and the other cost increases. Try to tell them that you are reducing it when clearly it is going up. I'm conscious I have gone on. I want to conscious I have gone on. I want to wind up. The fourth of the four is wind up. The fourth of the four is the employment rates bill and on the face of it, who will not like it? -- Employment Rights Bill.

The point is the effect it will have, particularly unseasonal businesses who may take on someone in Christmas or summer, hospitality, events, businesses that rely upon this. The NHS will have to deal for the first time with some of these considerations. It turns out the are considerations. It turns out the are considerable user of zero hours contracts and not as a first job but usually the second jobs will be can vary according to demand in the hospital or clinic. I will be interested because I know he is a Labour economist in both senses of the word, upper and lowercase, but in terms of temporary contracts and the shift we are seeing in companies moving from contracted, salaried employees to relying on agency workers.

And finally, the effect it will have on the job opportunities, the removal of job opportunities for those furthest from the Labour market and perhaps those out of work for a long time, ex-offenders, for whom it feels like more of a risk as an employer. Most of all, for those young people. That is the big concern with this package of measures, the effect on unemployment, especially youth unemployment, especially youth unemployment. We've heard from the government today the first in what I government today the first in what I hope is a series of U-turns over the hope is a series of U-turns over the winter fuel payment and I will ask them, please, when they look at what has happened or what will happen in small businesses and with small businesses and with unemployment statistics, please will be think again? be think again?
14:52
Yuan Yang Portrait Yuan Yang MP (Earley and Woodley, Labour)
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The honourable member for South- West Hertfordshire mentions my work before I came to the place and in my work at the 'Financial Times' I spoke to business leaders every day and I spoke to many in my constituency and that has ranged from small shopkeepers in South Reading to leaders of the pharmaceutical company which is one of the largest listed companies in the world and also in my constituency and the topics they want to discuss our three full, trade and prices, industrial strategy, infrastructure.

Those areas come up again and again and when speaking to local businesses and the Chamber of Commerce because businesses have to be forward- looking and have a vision of the future and where they will fit into it and I want to look at those areas and firstly trade because so many have thoroughly welcomed the trade deals the government has done, not just with the EU but the US and India. Small businesses in Redding and across the UK have suffered from the bungled Brexit of the previous government and they suffered from red tape and bureaucracy and small companies that is an increasingly large part of overheads and it's more difficult for small retailers.

I have heard that again and again on the doorstep from many during the election and I know from speaking to residents last weekend how much the trade deal with the EU is deeply welcome. It will decrease the inflation of food prices in the UK and give opportunities of those exporting into the EU and that is also true of the trade deals with the US and India. Secondly, on the industrial strategy, the Thames Valley is one of the largest destinations for foreign direct investment across Europe and I'm proud to say that the life sciences companies are spoken to are excited about the opportunities brought in by the industrial strategy which will be unveiled next month.

It is because in an age when countries across the world, from the US, India, Japan, are updating their industrial strategy, we cannot afford not to compete and we must decide where we fit into the supply chain and what our advantages are and how we can invest in that and I'm glad the government is doing that and that is what the multinationals in my constituency want to hear. And finally, in the Thames Valley, I'm proud my constituency is the fastest growing region in the UK outside of London and that is not because there is something in the water, although you can never tell these days with Thames Water, but it is the infrastructure because we are close to Heathrow, with the M4 are too many major cities and we have got the connection with so many ports and cities across the UK and the infrastructure is paid for and funded by the government and is not just physical infrastructure but the services, schools, hospitals that mean that families want to move to the area and build their lives and bring skills there and that is why I continue to press for the investment in the NHS that we sorely need.



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I know that the audible member was just about to conclude but I think it's notable she decided not to talk about hospitality, leisure to talk about hospitality, leisure and retail in her constituency, or private schools or other industries. private schools or other industries. Other businesses have been talking to me and are deeply worried about to me and are deeply worried about the policies of this government and I wonder if the honourable member would like to reflect on the impact

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would like to reflect on the impact to smaller businesses in the retail and hospitality space. The first business I mentioned was the smell shopkeepers, the retail businesses. -- Small shopkeepers. Depending on imports and they want to make sure customers and they want to make sure customers get a good deal and I support but very much and those are three areas that businesses speak to me about that businesses speak to me about regularly and the areas I hope we will continue to reflect on.

There is also the area of employment and I think it is the area of employment rights that the Conservative Party assured whose side they were on. They talk about the benefit to young people but it is young people in my constituency at the University of Reading who stand to benefit from the policy and are very glad for the Employment Rights Bill and they will benefit from that. I am about to draw to a close. Thank you. Young people are brought the future and also they will see a rise in their wage and immediate because of the cost of living because of the crisis we face across the country at the University of Reading employs these young people and is also a source of education for them and it can see that as an employer it is better that all employers lift standards so that they are not undercut by other employers seeking a race to the bottom.

In conclusion, I will finish, Madam Deputy Speaker, I proud to talk about businesses and the real issues on the agenda for businesses and I do not see them businesses and I do not see them reflected in the agenda I see from the Conservative Party today and I hope the government will continue to tackle living costs.
14:58
Dave Doogan Portrait Dave Doogan MP (Angus and Perthshire Glens, Scottish National Party)
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The honourable lady is not giving way.

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I hope you will continue to make progress on living standards and on

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improving many parts of our economy. It is a pleasure to speak in such an important issue and I'm glad to be here speaking up for Scottish be here speaking up for Scottish constituents and I can see one of my constituents and I can see one of my cat my Conservative -- and the House nobody turned up on the other side to speak up for their Scottish to speak up for their Scottish constituents. Over to the Quebec. Predominantly, as has been touched Predominantly, as has been touched Predominantly, as has been touched on, there is the incredibly big on, there is the incredibly big issue of jobs tax and national insurance and I do not think it is later found but I think it goes later found but I think it goes beyond that.

23 national insurance beyond that. 23 national insurance is not a tax on working people is stretching the term disingenuous to the absolute limit and it is counter-productive because the government target of around £22-23 billion has already been attributed and is more like £10 billion and if you did the right thing by hospices, it would go down further and is a massive burden for a modest gain for the Treasury and that does not take into account the consequential costs of imposing such a burden on the seasoned employers.

The impact has already been felt on care homes in Scotland with five closing ahead of this disaster for enterprise. The ONS predicted 25,000 jobs will be lost across the UK as a result. I remember when this was introduced, I spoke to one of my local pubs and I asked as a joke when I ordered my asked as a joke when I ordered my paint if the penny was off and he said it was and she had stuck on another £0.20 for the National Insurance increase.

Although that is anecdotal, it speaks to the that understanding between UK government Treasury ministers and the real Treasury ministers and the real

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We have got a calculation by the

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We have got a calculation by the Scottish government that it will cost on average £850 per job, per year in Scotland. I see no particular region except for the particular region except for the particular region except for the Wage and the tax regime, it will be broadly the same across the whole of the UK economy. Utterly unrealistic. The genesis of this of course is the UK government insisting they had no UK government insisting they had no idea there was a £22 billion black hole which there probably was, hole which there probably was, though they probably made up about 33% of that when they came into government.

But the point of the matter is it is the brazen matter is it is the brazen willingness by the Labour Party to reinvent reality. Barefaced reinvention of reality by saying they did not know there was a they did not know there was a multibillion pounds black hole in public finances. Despite being engaged on it repeatedly in debate engaged on it repeatedly in debate at the election. What were they debating if they didn't think it was Inflation jumped up again. 3.5% in April up from 2.6% in March.

Not caused by an economy firing on all cylinders. Not because of a rejuvenated consumer sector high on the output from a new government full of ideas and creativity. Not any of that. It is driven by electricity prices, gas prices and water bills which consumers can do little or nothing about and we are To pay on top of high interest rates as the bank of England tries to take on the inflation in a deeply dysfunctional economy. The government should address the actual drivers of inflation.

Take on those energy prices. Don't forget it is not that long ago that we were promised at the election a £300 reduction in energy bills. It was not maybe, not around or anything of that nature. Vote Labour and get a £300 reduction in energy bills. What has happened in less than a year? They have gone up by £281. Energy is , emptying bank accounts and driving inflation and what is Labour's response? They say that is because of reliance upon gas. Well, we were reliant upon gas before the elections.

There are two possible reasons stop they were playing fast and loose with the truth or didn't understand how energy works? I know which one I think it is but either way it does not reflect well on this Labour Party. In under a year, confidence falling, job losses and unemployment rising, costs soaring, rampant inflation. The Chancellor in speaking about growth at the beginning of the year said she is very pleased that has happened and says she has got more to do. God help the business if she has got more to do.

We have seen quite enough damage in the first nine months of this Labour government. I want to turn to Agricultural Property Relief. In the garden of Scotland that is Angus and Perthshire Glens and I take no Perthshire Glens and I take no dispute on that fact, we have some of the most productive agricultural land on these islands and as you would anticipate with some of the most productive land on these islands, we have very high performing food producers who invest heavily in the latest technology and equipment.

Who make sure there is a tremendous return on investment so they get the best yield possible to drive down prices and deliver good value food for tables across these islands and beyond. What is going to happen now? With Agricultural Property Relief? What is the signal that is sending to farms and businesses? Invest in their farms so they have to give it all away when somebody dies? We have people in the glens and it will be the same everywhere else across the United Kingdom, older farm owners now petrified of dying.

What an ignominious position for any government to put the people who produce our food into this incorrigible, and I say this in sincerity to the Minister, he should quietly with colleagues in the Treasury at the Spending Review or at some other opportunity, call it a review, call it what you like but call off the dogs from farming businesses up and down these islands. They deserve better. Not unrelated of course is Business Property Relief and we have heard some of the testimony from other members on the effect on investor confidence.

There is a really good reason why large scale family businesses are really good for economies and especially local economies. They employ local people. They headquarter locally and try as much as possible to establish an stand up supply chains locally. They sell nationally and internationally. Capital from with two within. It is excellent for the economy. Far better than the same economic output from a plc, although PLCs of course have their role. But what large scale businesses in Scotland and elsewhere are speaking to me about is again the disincentive to invest.



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I am happy to give way. Family business UKCA 55% of businesses have paused or even cancelled planned investments due to cancelled planned investments due to the plans to cap Business Property Relief. Does he agree the government Relief. Does he agree the government should delay the plans and changes and have a consultation and impact and have a consultation and impact I cannot help but agree with my honourable friend. At the very least that is what the government should do.

And to be fair, and other members have said this, it cannot be easy for the new government. Certainly does not look easy. Any new government must come in and make decisions and I am certain ATR was put under the nose of a minister by put under the nose of a minister by a civil servant in the expectation the Minister will say we are not going there. Absolutely not and they going there. Absolutely not and they have gone and done it. I'm sure that is what the civil servant said when they walked away, we never expected that and so it is with Business Property Relief.

Because the consequences, and again the cost benefit relationship between what they are doing to enterprise and business and what it accrues to the Treasury is out of all kilter. The damages well in excess of the potential and that is before behavioural changes are brought into effect. We are speaking about a potato farm in my constituency and there is massive cold storage which is a vital element of production to keep it there in good condition to make sure supermarkets are supplied as and when just in time.

I sometimes think the government thinks farmers are trotting around in tractors and chewing a bit of straw. These are businesses doing their best to keep food prices down. They are some of the lowest prices in Europe. But not investing seriously massive sums and the government has catastrophically disincentive prized the behaviour which keeps food prices down and is

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anti-inflationary. And look what is going to happen. I am grateful to the honourable member for giving way. Does he agree the changes to Agricultural Property Relief and Business Property Relief will raise relatively small amounts for the Treasury? They will have a devastating effect on those devastating effect on those businesses and the reason they are being brought in is because government ministers have no idea how small businesses and farmers operate.

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operate. I do agree. I would rather not but I do agree. That is why I am imploring the Treasury minister in imploring the Treasury minister in his place to have whatever private conversations ministers have in conversations ministers have in their departments about this being one of the ones they have got wrong. one of the ones they have got wrong. You cannot U-turn on everything and go back on everything. But honestly, Agricultural Property Relief and Agricultural Property Relief and Business Property Relief is a landmine for businesses to be pulled landmine for businesses to be pulled across by this government.

He doesn't even have to address it in summing up. Just go back and quietly summing up. Just go back and quietly look at it again and have a review and kick it into the long grass at least. I want to speak very quickly and probably will not have too many supporters in the chamber on this issue, and it is that of quantitative timing from the bank of England. I raised this a couple of times with the Chancellor. She talks about all manner of things none of which is related to this in response.

The overzealous nature of the bank of England disposing of government bonds is very costly to the Exchequer. There is no need for the rate of tightening the central bank is undertaking. It is not replicated by other central banks. Even if they went to a passive model of tightening, it would have substantial multibillion pound savings for the Exchequer at a time when the Chancellor returning from China was given -- was getting excited about the economy over five years. £600 million is the annual budget of my local health board in the Angus and Perthshire Glens so if those types of numbers are important to the Chancellor, then the total to the Chancellor, then the total quantitative tightening cost of 45 billion since the year 2022 should really be further up the red box to pay attention to.



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I was going to point out to the

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I was going to point out to the honourable member the size and he mentioned it himself but this is translating a theoretical loss into a real loss. Guaranteed by the a real loss. Guaranteed by the Treasury with taxpayer money. I think the honourable member is definitely onto something.

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definitely onto something. I thank the honourable member for his reassurance. Particularly as I was not anticipating reassurance. But this is predicted to be in the But this is predicted to be in the region of £130 billion. All borne by the taxpayer of the United Kingdom. the taxpayer of the United Kingdom. The one thing the Chancellor did say when I raised this during Treasury questions is she highly values the operational independence of the Bank operational independence of the Bank of England and so do I but that does not mean you cannot chat to them about what is patiently unnecessary about what is patiently unnecessary and very expensive to the public and very expensive to the public purse.

Just finally, I think we see a very unsavoury lurch to the right a very unsavoury lurch to the right from the Labour government on immigration and it is quite clear and I will not repeat the cause of the Prime Minister regretting some of his more florid language around immigration, and the Chancellor has provided no costings, no analysis of this dangerous policy which has been dreamt up on the back of a cigarette packet. Scotland has a declining birthrate. Many part of the rest of the UK have a declining rate.

We actively need immigration for the care sector. For hospitality. Agriculture. And for the energy sector. It is not just low skilled seasonal work that we require. We require all manner of people to come and work in the broad and diverse economy. In Scotland we have no idea why we are being dragged, actually we do know why we are being dragged down this route, but it is very damaging again for a government whose ambition is growth to choke off the component of the economy is really not consensual.

I heard the Chancellor say the other day that there is no going back on Brexit. There will be no regulatory alignment. No free movement of people. We will honour the vote of the people. Not the vote of the Scottish people, let me add. And these were her words, Brexit is water under the bridge. Well, it is not. Or insofar as it is water, it is a pool of stagnant water that is a pool of stagnant water that refuses to shift.

And I heard a Liberal Democrat earlier getting doe eyed about seed potatoes. They are very important in my economy. I remember when a Liberal Democrat would give a full throated endorsement to membership of the European Union rather than doffing their caps to a Labour government for frittering around the edges because that is what it is. It has come at tremendous cost to the Scottish fishing industry. 70% of the revenue from agriculture and fishing in the UK comes from Scotland. The Scottish industry is 50 times greater a part of the Scottish economy than it is of the UK economy.

Yet no discussion was had with the Scottish government or the sector ahead of that. Just the same as no discussion was taken in 1970 when the Scottish fishing industry was thrown under a bus at that stage as well. The Minister might say you cannot have it both ways. You cannot say you want to be back in the EU and lament the loss back in the EU and lament the loss of your fishing rights to EU boats. You can just score that one out, Madam Deputy Speaker.

Yes, of course we want to be back in the European Union with all our European nations and we would have to take some of that pain on fishing but we would get the game to go with it. Labour have foisted upon Scotland is the pain of conceding ground to European boats and none of the gain of being in the union and nothing they have agreed this week is remotely like being back in the European Union. There is an ill wind blowing through the political landscape on these islands.

The actions of this government are simply making matters
15:16
John Cooper Portrait John Cooper MP (Dumfries and Galloway, Conservative)
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As a member of the Business and Trade Committee I have traversed this land and spoken to people on the frontline of business. Britain has got talent. We are doing amazing things. Heads are going down. Costs. I reference the speech for the audible member for Loughborough and it has had a colourful speech, I was not sure if he was blaming Margaret Thatcher or gas prices for the energy bills but he should look to his own Department for Energy Security and Net Zero because much of the pressure come from carbon taxes applied by the.

This is leading to plans being shelved and it means fewer jobs, especially for young people chasing that all- important first job. The government is boasting that it is putting money in people's pockets but I say from the veracity of the claim, if you lose your job, there is no extra money in your. The government is creating a hostile environment for some sectors. Yes, there is millions or maybe billions for a steel and or maybe billions for a steel and there is also something for rail and NHS staff but not for everyone, especially in my constituency.

Farmers might survive the urban centric indifference but the active harm on things like increasing inheritance tax and the driving down inheritance tax and the driving down of agricultural property relief is a disaster. The consequences of the avaricious increase in National Insurance employer contributions is serious. There is a charity in Dumfries doing incredible work helping people into real jobs in catering despite having mental health issues. They are cutting back because the extra National Insurance contribution to put a bounty on people's heads.

I copy charity will celebrate its 10th anniversary next month. Labour is doing nothing to get them there. I spoke with the firm which has a 5-figure amount of employees and they have a strong social conscience and are trying to get people back into the world of work and that means a pay packet but also intangibles like self-esteem and dignity that work affords. The other gateway employer, proud to be the first rung on the jobs ladder for many but they are shocked at the Labour approach.

The increased bill for national insurance contributions as eye watering and now there is a thicket of rules and regulations, the Employment Rights Bill. There is the imposition of Day 1 rights and that means they are taking a chance on someone with pure employment history are perhaps an ex-offender and that will make it more risky. They are less likely to recruit and elements of the legislature in our designed instead to swell the ranks of trade unions.

We are through the looking glass with the unbalanced approach to business of this government. Black is now white.

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Has the honourable member just

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Has the honourable member just arrived in the chamber? You cannot, straight in and make an intervention. What time did the honourable member arrive? You have honourable member arrive? You have been here for 25 minutes. We will check the records. Continue.

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check the records. Continue. I thank the honourable member for

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I thank the honourable member for way. He's talking about the feedback way. He's talking about the feedback on the Business Trade Committee and I wonder if people realise there was feedback about the uncertainty of the previous government and how that the previous government and how that made it difficult to create an environment that is supportive for business.

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business. She is a campaigner on that

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She is a campaigner on that committee and unquestionably mistakes were made and we have been mistakes were made and we have been through this and we know that what the government has been in place for 10 months and they are have been inflated rises, jobs slipping away. inflated rises, jobs slipping away. Trade deals are bad, except for when they are good and the DEFRA Secretary of State criticised the New Zealand deal for hitting farmers while his deal protects farmers both I will tell you that this deal could I will tell you that this deal could be really good into farmers who are -- put the boot into farmers who are facing issues with the price of imports and exports.



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When is a trade deal not a trade deal? It seems that what has been agreed with the US is a tariff deal but with the EU it is an arrangement. For beef farmers in his part of the UK, what do they think the deal will mean for them?

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These are frittering around the edges, I see Sirs, and the prices are rising because of a drop in are rising because of a drop in stock. -- As he says. The idea of
15:22
Ashley Fox Portrait Sir Ashley Fox MP (Bridgwater, Conservative)
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stock. -- As he says. The idea of sending beef to America is unlikely and it is more likely to come here. Again, back through the looking glass, and up is down when the Employment Rights Bill heads but it is coated as opposed to productivity. Let's not pretend this is government money but it is hard pressed businesses having to find the cash again. Labour is not working and, terrifyingly, neither

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constituents. This government was selected on a

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This government was selected on a promise to go for growth. They said they had a costed program and they wanted to spend money on things and wanted to spend money on things and it could be paid for by increasing growth. Despite the promises, almost growth. Despite the promises, almost every single action they have taken since entering office has been to since entering office has been to stay for growth, not to improve it. Many businesses before the election backed the new government and backed the new government and believed promises on tax, stability, believed promises on tax, stability, growth.

Many of those businesses have now lost confidence in the have now lost confidence in the government and who can blame them? government and who can blame them? The impact of hikes to national The impact of hikes to national insurance and the business rates, combined with the redtape of the Employment Rights Bill and the removal of Business Property Relief has totally undermined business. I had the pleasure of serving on the Employment Rights Bill Committee to go through the regulations line by line.

This is 300 pages of additional regulations and costs on businesses. It is a payoff to the trade unions for their support given to the Labour Party before the election and that is why it was introduced within 100 days. introduced within 100 days. Ethically, unfinished. That is why -- it was basically unfinished and that is why there were so many amendments at committee. This bill was written by trade unions and explains why the government shows no willingness to compromise on its most damaging parts.

The Deputy Prime Minister is using the bill to burnish her credentials with the left of her party, the same reason of why she and her team briefed the press yesterday and why she wants more tax rises. It is all to be ready for a tilt at the top job. That is why one part of the government are not listening to businesses when they see how badly they will be impacted by the legislation but there is another significant contingent, those who do not understand business at all.

Very few members opposite have experience in small businesses and practically nobody in the Cabinet has any experience of business at all. And who is going to be hit the hardest by the cumulative effect of the punitive attack on business? Not be Amazon or Tesco, or Shell. It will be the people on the margins, those looking for a job in the local family-run as this. The real impact will be -- family-run business. The real impact will be on those looking for work because everything the government has done is an attack on jobs.

Ask yourself why small business, as an employer, would take a risk taking on an additional member of staff in this environment. They would be taxed more for it and opened up to litigation from day one if they fail to follow the complicated legal processes in dismissing them. Day 1 rates will have a disproportionate effect on those people we most want to help into work, young people without qualifications, those who have taken long-term sick leave, those with disabilities who need reasonable adjustments, former criminals.

Right now, a small business gives someone a chance, they can let them go easily if it does not work out for the employee or the business. Why would they take that risk now? It is deeply regrettable that unemployment is already on the rise. We always know that every Labour Government leaves unemployment higher than when it started. It is regrettable business confidence is at an all- business confidence is at an all- time low after only 10 months of the government being an office.

It is all caused by this government's disastrous business policies and I urge the Minister, it is not too urge the Minister, it is not too late to change course but if the government does not do so, they will government does not do so, they will create a whole new generation of people who are locked out of the job market altogether.
15:27
Neil O'Brien Portrait Neil O'Brien MP (Harborough, Oadby and Wigston, Conservative)
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The outlook for business and the economy is not good, to be honest. Today, we learnt inflation has shot up to 3.5%, a surprise increase in inflation and the Chancellor said she was disappointed by this but, of course, it is entirely the result of her own policies and she was warned that if you increase taxation and borrowing to record levels that you will have an inflationary impact and people are PNV price with higher inflation and that is alarming because you have unemployment up and stagnant growth with the IMF revising the forecast for this year and next.

Business confidence is down to levels last seen during the pandemic read the entire role the economy was brought to a halt as the businesses are clearly very anxious and I have spoken to businesses in my own constituency and when business suffers, ultimately it is living standards that suffer and the Minister that we have produced loads of good work when he was in a think tank for the Resolution Foundation and he used to produce lots of trucks on disposable income but now the government has come in and in the first Budget we saw that the measures meant to reduce the cost of disposable income and the post forecast was lower than the pre- forecast and this is one of the worst forecasts for living standards in decades.

The growth is a tiny fraction of what we have been expecting suspecting 45. The outlook is bad and is not difficult to explain how we got here. We have taken, the government had taken the tax burden to an all-time high and they have increased National Insurance and cut APR and BPR and it is interesting to see how that plays out across the rural economy. People think of the farm tax as being something that hits farmers but in terms of local businesses, there are a whole group of people, suppliers of tractors, insurers, vets, the whole rural economy is being dragged down and I have spoken to my Welsh colleagues about the issues with investment as a result of the unfair tax and as has been noted by various members, it has been floated many times and when I was at the Treasury we had the option for the family farm tax at the Member for Hampshire said the same thing and this terrible idea has been produced many times and there has been a mugging on great George Street with naive and innocent young ministers coming into be mugged by civil servants who have had their way on that and, indeed, on the winter fuel payment, we all had that piece of paper in front of us and we chose not to do it and the government are now trying to U-turn on let's see what happens.

We had the national insurance

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He knows as I do, that had the last Conservative government seen last Conservative government seen growth even close to what we had in the mid-2000's, that everyone in this country would be better off. this country would be better off. However, what we saw was stagnation.

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However, what we saw was stagnation. One of the things that happened

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One of the things that happened was a global pandemic that brought the whole economy to a halt. But memories are short. And more importantly... I will add to that importantly... I will add to that why take the next one. Every single thing this government is doing is bad, I will take the next one.

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bad, I will take the next one. Perhaps the honourable member has not had a chance to see the piece of not had a chance to see the piece of work produced by the former Shadow Chancellor that sets out the relative recovery rates of different world economies in the developed world economies in the developed world since the pandemic and shows that the United Kingdom is right at the bottom of the pile, thanks to the bottom of the pile, thanks to the mess left to us by Liz Truss,

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crashing the UK economy. Labour members were not in the

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Labour members were not in the House at the time, it is before their time so they will not remember their time so they will not remember that, both the deficit that we inherited in 2010 was twice the size of the one that the party opposite of the one that the party opposite have inherited on the structural deficit was twice as big then. Indeed, we went into the global Indeed, we went into the global recession, the financial crisis with the largest structural deficit in the largest structural deficit in our entire peacetime history, that is the record of the last Labour government.

We talk about cleaning government. We talk about cleaning up the mess and I am going to use a Generation X meant for -- metaphor here. We had a recess version -- recession, and cleaning up the mess, recession, and cleaning up the mess, it was like one of those enormous brontosaurus co-ops in the film drastic Park and we had to make difficult decisions during the coalition years to clean up that coalition years to clean up that mess. Let me continue, they talked mess.

Let me continue, they talked about, the House grows at this prospect, the government have increased.

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He talks about the mess that the coalition as it then was, government coalition as it then was, government inherited in 2010, does he recall that unemployment was running at 10% that unemployment was running at 10% when inherited and although the when inherited and although the coalition and then the Conservative government was successful in government was successful in rebuilding the nation finances, as painful as those decisions were, at the same time, that government was able to create 800 jobs every single day from 2010 to 2024.



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day from 2010 to 2024. Unemployment had doubled and one of the achievements of the government was to halve it again. I have to say, the first time I met have to say, the first time I met Nick Clegg I was accompanied by a gentleman wearing a chicken suit, gentleman wearing a chicken suit, this is the kind of serious economic analysis... He was not a chicken when it came to it, when we were making decisions to make of that mess, they did make difficult decisions along with us to try and decisions along with us to try and do that.

So, I have talked about increasing national insurance and I will come to that in more detail. One of the most striking things in my constituency has been the effect of the doubling of business rates for hospitality, leisure, and retail. By the ending of the relief we put in place, and that is really visible, the effect of that, visible, the effect of that, particularly in the high streets. It is visible. It is compounded by local decisions, such as parking charges.

Nonetheless, the end of those reliefs and the huge increase in national insurance has been bad for our local high streets and it has been bad for pubs. I was talking to a pub landlady who owns several pubs in the area and she said, they were hoping that the new government would be lifting morale and boost and a feelgood factor, but there is now feel bad factor and the area, I drive past several pubs that have recently closed because of the end of these reliefs, the high energy costs, and the number of tax measures that the government have put in place.

Pubs are huge centres of immunity life and when you lose them you lose some community life and it is particularly true in rural areas. We have heard the increases in tax and we have had increases in energy costs as a result of everything that the secretary of state is doing, we were promised a free Japan reduction in bills and instead we have had a £281 increase in bills, only going up as the government does all kinds of ill- advised things to hit their target of trying to decarbonise electricity by the end of Parliament, something which will increase the costs of going green compared to...

And we have had a massive increase, one of the bright spots of the last 30 years has been a relatively liberal labour market. And we saw this moment where every single business group, all of the big businesses in this country came together for the first time, they've never done this before, to criticise the Employment Rights Bill. And I heard opposite earlier on, one member said it was all right because a professor in Cambridge said it was all fine, so on the one hand, every single business in the UK is saying it is a disaster but on the other hand, some professor thinks it's fine, so I thought that really spoke to the contemporary Labour Party, they are facing this approach to managing the economy rather than the views of the people who create jobs and drive the economy forwards.

It is a serious thing and it is a major economic thing and it is a major economic detriment. It is true that, this changes some have been rolled back on, so more those that have a lot to give to the economy. There are lots of reasons why we have got this picture of economic underperformance and gloom. And I would not mind so much if all the tax increases had been against the backdrop where the government was getting our debt and deficit under control, but actually, and perhaps the Minister can correct me if his knowledge of fiscal facts is better, I can't remember a fiscal event the government presented a budget where at the end of the forecast period, net debt was still rising, but there has been lots of fiscal events where debt has gone up, such as the war in Ukraine, but they have all shown a path to falling debt.

This is the first time I have seen a chart of 7.3 I think, that shows even at the end of the forecast, debt is still rising without end and I can't remember a budget I could. So we have this confluence of a sprawling, stagnating economy and rising unemployment and increase in tax and yet, debt as a result of all that going up, storing major problems for the future. I want to go in more detail in a couple of points. The first is, national insurance increase.

Of course Labour promised there would be no tax increase on working people, so I was stunned, draw on the floor when in fact, the biggest tax increase that they put through was squarely a tax not just on working people but on low income working people. It is laserguided, like laserguided heat signal missile targeting those low income workers, particularly women who graphed hard and do not get paid a lot. It is incredible to me that a Labour government should have chosen as their big tax increase, to have lowered the threshold for national insurance and increased the rate and it hammers those on the lowest incomes.

And why was this chosen? It was chosen for all of the wrong reasons was chosen because the party opposite hoped they could see, this is not a tax on workers, it is a tax on businesses. Everyone can see through that and the problem is that because we created the office for responsibility, he they immediately have the OBR pop up and say will be passed through to peoples wages. And so, they say that of that, someone on £13,000. Is going to be losing £500.

That is a lot to lose if you are on 13,000. Someone on only 9,000 a and they are the peak losers by the way, people using nine -- earning £9000 p.m. They will lose income as a result of this is a result of the huge tax increase and it is amazing that Labour Party members are not up in arms about the fact they have just on one of the biggest tax increases and they have targeted it on low income workers. The Labour Party, credible -- incredible.

And on the other side, what has happened to public services? Of course, they are all hit by this increase and they were promised in the autumn budget, we were promised that they would be looked after but that is not what has happened in practice. First we found out that lots of bits of the NHS would not be compensated. Primary care would not be compensated. GPs, opticians, dentists, they would have to do so could this increase in tax and in social care, we found out that they were also not going to be protected.

They were going to have to suck it up and intriguingly, I pointed this out at the time, there was a difference between the budget document and the OBR EF oh which the Minister will remember I am sure, because in the OBR EF oh, there was a different number how much it would be and it mentioned that social care would be included, sometimes one of the joys, of having the OBR there as you can see the handwriting and the last-minute changes so you can see they were thinking seriously about exempting social care from this big increase in tax but they chose not to the last minute.

And that was the wrong decision.

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I welcome the gentleman's conversion to the cause of social conversion to the cause of social care. Can you point me to in the record where, between the reporting 2011 and today, he mentioned that

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while his party were in government. The member was probably not here

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The member was probably not here at the time but I was a social care at the time but I was a social care Minister, I am quite passionate about it and one of the things we about it and one of the things we delivered amongst the other things that we did deliver on that front was the professionalisation of the profession and the investment into skills and technology. One of the things we chose to do was diary ties things we chose to do was diary ties in the pandemic, money going to the frontline rather than the protection frontline rather than the protection of people's property income.

I am of people's property income. I am not a social democrat but occasionally you have to make tough choices and our choice was rather choices and our choice was rather than to protect property income, to protect the frontline of social care and to put the money into that. Let me talk about some other public services that have been affected by the national insurance increase. Obviously in education there are lots of examples of that. Firstly, the nurseries lost out and nurseries are screaming right now, they are in real difficulty.

Lots of them will close, lots of them will be unable to deliver their places parents have been promised and if this does meet they will hear a tale of this because they are caught by both the large increase in national insurance which hits our workforce and the increase in the national living wage. I am not anti the national living wage, I believe fair pay for fairway but you have to be conscious of what you are doing with that at the same time, with tax, because what you cannot do is have a big increase in the national living wage and also one of those people with a massive tax increase.

That is a disaster. Nurseries lost out, schools are losing out, schools were promised to be fully compensated and yet we now know, it is not saying this, the Association of School and College leaders and the Federation of School trust, they have discovered that schools are losing out by up to 35%, that is how much they have been shortchanged by the governor. Government delivery obfuscated the funding and they don't even attempt to compensate school how much they are losing and schools are potentially going to sack about 13,000 teachers will stop I have been meeting with schools over recent weeks and they are currently sacking teachers.

One of the best trusts in the country, a record for turning around London schools, they are sacking people. Synergy, sacking people. It has been talked about, the obvious way schools will have to sack people because of the shortchanging of our schools over national insurance. That is pretty poor. They were promised one thing and it has not been delivered and then our universities are the same. This is I have to say, a masterclass in under joint of government. First, the government broke its promise on things, they say graduates will pay less than the increased tuition fees instead.

Broken promise of A1. Then universities did not get the money because it was entirely wiped out by the increase in the national insurance rate. Universities did not get the money. And then as 1/3, with industrial action looming across the sector because they had taken away the money they put in, the government made it easier to strike through the Employment Rights Bill. And then having taken away the money they put in and made it easier to strike, it is rumoured that the Office for Students are about bringing a mechanism to make it easier for students to sue universities if there are strikes in universities.

This is left-hand, A masterclass in totally chaotic government. The same is true in other areas of public transport service. Local government, according to Local Government Association, have been shortchanged by £1.8 billion. An enormous hit, they promised they would be compensated but have not been. But the worst example is that charity and voluntary sector. As the Minister knows, 7000 charities and voluntary sector organisations have written to the Chancellor asking her to change her mind and reverse the massive increase in National Insurance on these small vulnerable organisations.

When I talk to charities and voluntary organisations in my constituency, they tell me some pretty disturbing things about what they are having to dig their staff because of the big increases was the I pay tribute to these organisations like Helping Hands, and like Rainbows. We will recently at a local hospice, their job is not made easier by this enormous tax increase. I really think if the Minister wants a good measure for his next Budget he will reverse that.

Hugely important and the right thing to do. Public services have been shortchanged, and low income workers have been the hardest hit. A bad combination. I want to touch on one thing at a date that has been much explored in recent days. It is a stealth tax increase that is gone unrecognised because, by linking up the UK ETS with the EU ETS, the government has increased tax. Prices in the UK ETS have been driven up not just by the deal announced the other day by the prospect of a deal, the prospect of connecting up those two different markets.

So two different things have become muddled in the discussion, one is about trading and the other is about actual ETS as a tax. In January, UK allowances were trading at about £36 a tonne for December 2025 delivery. An EU allowances were about £25, so 36 bus 25. As of today, the UK ETS is 54 and the use ETS is only 4 pounds above this. We have seen a convergence with the UK carbon price shooting up to join the EU one.

The increase in price, although it had been picking up, on the prospect of this connection to the EU scheme, has gone shooting up on the announcement of the deal. A further 10% up since Mondays reset announcement. That is increasing the cost to businesses and ultimately that will be passed through to the wider economy and the rest of us. Looking at the EU ETS price movement so far, it looks as if the UK Treasury will accrue £1.2 billion extra as result of these increased ETS costs which will outweigh the supposed benefits from the sea down.

Not that that is necessarily a tax paid by firms in the UK, it is paid by importers in the EU. The wider cost of this stealth tax is potentially more than that. I mentioned the potential Exchequer increase being about £1.2 billion. But the overall cost can be £2 million or so. That is an immediate result of the deal announced on Monday. It was effectively a kind of stealth tax. It has given us a higher carbon price immediately. I thought it was ironic insofar as the EU's own competitiveness report, to have EU can become more competitive.

They have been quite critical of the EU ETS and they said the EU had one of the highest carbon prices in the world in a higher volatile price. The government was saying what a wonderful thing it was to be part of this, even as the EU was saying that it was problematic scheme. Let me

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of... I thank him for giving way. He

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I thank him for giving way. He has spoken out for 23 minutes, where has spoken out for 23 minutes, where he has criticised on many fronts the decisions that this Labour government has made to fix the government has made to fix the foundations of our economy and clear up the mess that his government left. Would you mind spending haps 30 seconds on what decisions his 30 seconds on what decisions his party would make to put police back on our street to fix our broken

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on our street to fix our broken services and put money in people's pockets? I had not realised I'd spoken for

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I had not realised I'd spoken for so long. Even I at 23 minutes had so long. Even I at 23 minutes had probably had enough of Brian at this point, never mind the rest of you poor souls. The honourable lady poor souls. The honourable lady talks about policing, in the last Parliament we added 30,000 extra Parliament we added 30,000 extra police officers to our street. I was not going to raise this, but I see not going to raise this, but I see TV footage of prisoners released from jail by this government popping open the champagne corks.

I'm not going to whiten this out into a debate about criminal justice as well as everything else, but it will certainly be more enjoyable for us on the site to have that debate than it would for the current government. But as I say, we have a pretty bleak picture really of inflation up, and implement up, growth is stagnant and being revised down by national bodies like the IMF. Business confidence at the worst level since the global pandemic, as an outlook for living standards which is absolutely miserable.

Something has to change and I hope the government are having a rethink on the economy as well as on subjects like migration. The Prime Minister that used to be madly in favour of it and used to be madly in favour of it and sign letters. I don't the policy has changed hugely but at least the rhetoric has changed. An winter fuel, let's see how far the policy fuel, let's see how far the policy changes. You need a change in economic policy that is focused more on growth.

Until you do that you won't get anywhere. The Minister won't get anywhere. The Minister will remember the Economist you said once used start thinking about economic growth it is difficult to economic growth it is difficult to give anything else. I'm sure he's give anything else. I'm sure he's thinking about economic growth. We need to move from thinking to the changing of policy, in a more growth orientated direction if we are to get unemployment down, and give people in this country a chance of having better living standards and a better future.
15:53
Jerome Mayhew Portrait Jerome Mayhew MP (Broadland and Fakenham, Conservative)
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Thank you Madam Deputy Speaker. What a great speech to follow on from. I have an ambition to reach 25 minutes, so here we go. I should start however by making reference to my Register of Interests. I was chatting to a member opposite, I'm not sure which one I should make reference because I'm a background in entrepreneurialism and I ran an SME and created something called an employee relationship trust having employed well over 1000 people. I'm director of the pre- that will have some relevance to my comments.

It has been very interesting that there are likely interesting and quite wonderful debate on all sides I have certainly enjoyed it so far. It has been really interesting about what it is revealed about the members opposite and members on the site. We have had no less than three academic economists speaking on the Labour benches. And we have had businesspeople with real-life experience of the economy talking on the opposition benches. You think, well, shall economists know lots about the economy.

You would have thought so, but if you look at how the government has responded since July 4, with their obvious surprise that business confidence has actually gone through the floor, you begin to see how out of touch academic economists can be. When faced with the fact the real economy. Because it is undoubtedly the case that business confidence has collapsed. The BDO optimism index has now sunk and this is the latest figure 2 and this is the latest figure 291.36%.

What it really means is it is the lowest since the entire world economy was shut down by COVID. You can choose any one of a number of indices, and both business confidence and also consumer confidence has gone down massively as a result of labour's election. It begs the question, why is it that there has been such surprise on the government benches that their actions have been so ill received by people who actually drive the economy? One of the reasons is because the country as a whole, and businesses in particular, were actively misled by Labour in the run-up to the general election.

Because we were all told that Labour had no plans for tax rises, and those which had already been announced. We were told that their plans were fully funded and fully costed, and did not require tax rises above those which are set out in the manifesto. On that point I will give way.

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I thank the honourable Member for giving way. As someone who has come from a business background, who was working in a large international business before coming to business before coming to Parliament, I wonder if he agrees with me that the previous Conservative government misled

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Conservative government misled businesses when they promised them a Brexit that is going to remove red tape and actually created barriers? I'm grateful for the

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I'm grateful for the intervention. I joined this House in intervention. I joined this House in 2019, so the original Brexit debate had hyperbole on both sides. We had had hyperbole on both sides. We had Projects Fear saying we would need an immediate fiscal event as soon as an immediate fiscal event as soon as we had a referendum, that didn't take place. We have actually had growth continue since the referendum growth continue since the referendum back in 2016. That growth in the United Kingdom has outpaced that of United Kingdom has outpaced that of Germany, France, and Italy, and for that matter, Japan.

There was a lot of arguments both one-way and the other about the likely consequences of Brexit. My takeaway has been overwhelmingly that it has not made that much difference to the world economy, to Britain's relationship to the world. There have been frictions, undoubtedly, there have been some trade frictions which are particularly acute for SME import, export. I recognise that. But overall, change has continued and we have outperformed our big European

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neighbours. He suggesting there was no damage

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He suggesting there was no damage

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He suggesting there was no damage done to businesses that I have been sharing roundtables with industry representatives, people who run significant businesses, and every

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single business recognises the impact of Brexit as a principal drag on their profitability, on their growth. I'm grateful for that

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I'm grateful for that intervention. As I say, we had a huge change to how our country was huge change to how our country was governed. Dictated to us by the governed. Dictated to us by the people, because we are a democracy was one of the reasons I entered Parliament, having personally voted Parliament, having personally voted remaining 2016, I was so outraged as a Democrat, the failure of the Parliament between 2016 and 2019 to affect the will of the people is clearly expressed in a referendum, that pushed me over from being an that pushed me over from being an that pushed me over from being an activist into being a politician.

To affect the will of the people. Since then, there have been pros and cons. There are a lot of pros, but over the last five years, I have seen for myself how important some of our Brexit free have been. If there was a plebiscite now as to whether to leave or rejoin the European Union, I would without hesitation vote to leave. Because I have seen some of the benefits in my area, the Common Agricultural Policy was a disastrous both economic and social policy.

A huge negative impact on the environment of farms in the countryside and right across the country. Replays because our Brexit Freedoms Bill the environmental land scheme, the ELMs land management scheme. That wholly beneficial policy change, imperfect though it was, and it was part of an innovative iterative process to learn from farmers, that would have been impossible without Brexit. Some of the trade deals that we have done, impossible without Brexit. Some of the Riyadh regulations which have been improved just a little bit, in all those DLs that we have enjoyed so much of the last years.

Many of them could not have been achieved without Brexit. None of them are going to reach the front pages of the newspapers, but iteratively, over years, they have the opportunity to make our economy and our society stronger. It is one of the main reasons why I was so disappointed by the government's capitulation to the European Union on dynamic alignment just a couple of days ago. Because what it takes is disadvantages of non-membership of the European Union, we become rule takers.

And yet none of the benefits of dynamic diversions of our regulatory system, to allow us to bend our rules most accurately to reflect the opportunity to own economy. And so, that was an interesting divergence by now going to come back to the main argument in my speech which is that government misled. Labour misled the people in the run-up to the general election. They said it would be fully funded and fully costed, but this is the will be no taxes on working people, and expressly said in the manifesto that there would be no increased tax and National Insurance.

What is reality? They chose a fig leaf, as the other member for Angus and Perthshire Glens might have said. This fabricated £20 billion black hole in the economy. The black hole by the way that the OBR failed to find. The honourable member formally employed by the financial Times newspaper might recall that they They use that not to raise £22 billion, that would be sufficiently unambitious, but to raise £40 billion of tax and another £32 billion of debt.

And they have done it by focusing the tax on jobs, national insurance contributions, focused on the young, focus primarily on the part-time, focused on women and in particular, the Employment Rights Bill putting on another 5 billion on taxation on the government's own impact assessment. And then they increased to High Street business rates, that is inexplicable in a period where we have such a strain on businesses. Not to mention Agricultural Property Relief, what is the result? 200,000 businesses have closed, a 20 year high.

A high only been by the previous Labour government. January 2025, up 10.7%, the highest since the financial crisis when Labour was last in power. Unemployment, up 10% to 4.5%. The Bank of England forecast that it will go up further. Youth unemployment, up 11%. It feeds into this world one narrative that Labour always leaves government with unemployment higher than when they arrived. The government has to stop and think again. They have been out of power for 14 years, they made some profound rookie mistakes, but do not let people, don't let our businesses and those employed, pay the price for that.

Look again and seek to recover the economic reputation.
16:03
Blake Stephenson Portrait Blake Stephenson MP (Mid Bedfordshire, Conservative)
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Thank you. Under close supervision, I have been told to keep this speech quite short, so no 25 minutes from me I'm afraid. Hard-working British people are losing their jobs and, is it any wonder when every pollen -- policy this government announces seems to make it harder for British people to do the right thing, and grow our economy. A tax on job creation. Billions of pounds in extra costs through the Employment Rights Bill. A family business tax, pushing entrepreneurs and job creators elsewhere.

You cannot grow an economy through sheer force alone, you need to give the people that built the businesses that employ the workers who power the economy the best possible environment to thrive. We have seen what happens to hard- working people under this government in my constituency. Constituents who were part of the 120 air proud manufacturing history at a plant in Luton now find themselves out of work just a few months after the policies of this government. Hard- working publicans are now very sadly closing their doors because higher costs and crippling regulatory burdens being applied from this government.

And not many memos have spoken about pubs but they are a central part to many of our communities and pubs in my community have been closing their doors. That means fewer opportunities for younger people to get their first job in rural areas which is exactly my experience growing up. That means less money for our local farmers and producers in the supply chain, damaging our rural economy. And it means the heart of two rural communities in my case, in my constituency, being ripped out.

And this is happening up and down the country with UK hospitality confirming that 70% of hospitality businesses expect to reduce employment and one in seven are planning to close at least one site. Worse of all, this government economic policies, I know members on this side have spoken passionately not just today, but in previous months about the importance of the charitable and hospice sector. Hospices and charities who have relied on the British public and their own ending goodwill and generosity to keep going through tough years over the pandemic, but who can no longer reliant goodwill of their government.

The only jobs that seem to be safe from labour's tax hikes are in the rapidly established quangos running our energy and country, and government announces review after review into who are spending all of the government's money. I said I would keep it short so I will wind up so that we can move on. The tax rises that we all know are coming to pay for the expanding state and to pay the debt that the government is running up will strangle any growth that the government currently plans to nurture.

The government's plan for growth are a mirage. Huge government spending will only private investment. The national wealth fund investment won't create any wealth, I know we have not spoken about the national wealth in today but the national wealth fund will not create any wealth. So far, been average investment since July 2024 has cost nearly £1.5 million per job created. It is a sad state of affairs. This government talks of its plans for growth but fails to back the people who grow the economy.

We can see from economic history that the larger the government, the smaller the economic growth. The government is putting big government over job creators and entrepreneurs, confidence is being entrepreneurs, confidence is being undermined and that is resulting in rising unemployment, especially for young people. It is time for something to change. The government needs to urgently change course to support the aspiration, hardware, and risk-taking we all need to and risk-taking we all need to create the jobs that working people throughout Britain deserve.

throughout Britain deserve.
16:07
Gareth Davies Portrait Gareth Davies MP (Grantham and Bourne, Conservative)
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Thank you. I am very grateful to be closing this debate on behalf of His Majesty's official opposition. Let me start by thanking all of those who contributed from all sides of the House, particularly those behind me who have highlighted so clearly today, the devastating impact that job losses and disclosures have on families, communities, and our national economy. I should also thank those on the opposition, sorry, on the government benches, not too long to go.

It is amazing, isn't it, that just three mems of Parliament for the government were brave enough to speak and I pay tribute to the Member for Harlow, Loughborough, and Woodley who is not in her place as yet. So proud of their economic performance, only 1% of the Parliamentary Labour Party actually bothered to show up to this debate on the economy, but then again, 1% is pretty high for the Labour Party. The truth is, that since last July we all know a story.

We all know a story of someone who is struggling, struggling to figure out how they are going to pay their new tax bills, struggling to figure out how to find a new job, struggling to pay their energy bill is that just keep on rising despite being told they would be going down. Many of my honourable right honourable friend have made very good contributions, both in terms of intervention and speeches today, I cannot mention them all, but in particular, my right honourable friend for East Hampshire highlighted that businesses are people, it is something I mentioned in my maiden speech, my dad set up a business, he took a risk and made it work and made it happen despite it being very difficult to do that and he is right, when we in this place tax businesses, we are taxing people, it is something we understand and they don't.

My honourable friend speaks with great authority in this place, not least because he has employed so many people, driven so much growth, and is a proud colleague of mine and he highlighted at the beginning, the potent combination of taxation on businesses, not just one, it is a combination of taxation that is sitting in particular, retail businesses but also the red tape that is being implement it. My honourable friend spoke about his farmers, my right honourable friend highlighted the impact of the threshold increase which is not always talked about.

There was a two pronged attack on businesses and people in that, it was the rate change and the threshold change and he spoke about hospitality businesses in his constituency, as to my honourable friend, talking about his pubs and south-west Hertfordshire, who spoke about personal experience of retail businesses, not just his own personal experience in his previous career but also in his constituency. And my honourable friend pointed out that if Ministers opposite spend a bit more time listening and a little less time talking, the economy would not be perhaps in as bad a state as it is.

This time last year, the premise and the Chancellor were talking at people telling anyone who would listen that the growth lever is the very first lever we will reach four in government. But the only economic lever they did manage to Paul was the handbrake, otherwise known as the tax lever. The first Labour budget was the second tax- raising fiscal event in the last 50 years. It took the tax burden to the highest level on record. As my honourable friend in an excellent speech pointed out.

And on growth, forecasts have been downgraded across-the-board by the OBR, the BOE, the IMF, by this point, labour's economic performance has been panned by just about every letter in the alphabet. Members opposite can crow all they want about both data from the first quarter of this year but it does not change the fact that growth was higher under the Conservatives during the same quarter of 2024. Debates around growth figures are not purely academic, as much as the Labour academics would have you believe.

They have real world consequences. For workers and businesses up and down this country will stop most obviously, when it comes to employment. We know, no Labour government has ever left office with lower unemployment than it inherited, as my honourable friend pointed out. And this is perhaps because in the last 60 years, every Labour government has left office with a higher tax burden than when it started. As my honourable friend, the Shadow Secretary of State highlighted right at the beginning, the ONS now says there are in fact, 100 and for thousand fewer payroll employees in our country than there were since last July when Labour entered office.

We have had significant falls in employment by this measure in seven of the last nine months. Let's put that into context. This follows 42 months of near unbroken payroll growth under the Conservatives as we exited the pandemic. In that time, we saw 2.2 million workers added to payrolls leaving payroll employment 1.4 million higher than it was pre- million higher than it was pre- pandemic. That is the difference a Labour government makes. It sends job recovery into reverse. Hiring expectations for the next three months are at a record low.

Unemployment is going up and up with the Bank of England now forecasting 5% unemployment by 2027. And of course, it is the most heavily taxed sectors that we see, the very greatest damage. Earlier this month, 250 jobs were cut by harbour energy in the North Sea after Labour raised the tax on the sector to some 78%. In retail and hospitality, small businesses who are hardest-hit by the national insurance increases and business rates relief cut, Labour Ministers talk about difficult decisions but they are not the ones who are having to reduce opening hours, close on weekends, freeze pay, and make redundancies of family members, of mums and dads who just want to get up and go to work.

Just to survive. And in too many cases, we are seeing local businesses close down for good. The country is witnessing the fastest growth of corporate closure since Labour were last in office. And the great irony of the Chancellor's much lauded economics is that it has created insecurity and business uncertainty. Entrepreneurship is being suppressed and jobs are being sacrificed on the altar of labour's centre many. They have brass neck to go about claiming that this is all in order of restoring stability.

And public finances. When the independent national and of economic social research has predicted that the true size of the Chancellor's blackhole is £60 billion. Let's talk about black holes. The genius is opposite to pensioners Walter -- winter fuel payments away for the winter but now that summer is appearing they are talking about restoring it. They are taking pensioners for fools. What is next? Lower fuel duty for cyclists? The damage is already done. And who is to say Labour won't be back in the winter to cut fuel payments again? Just in time for Christmas.

Especially as Downing Street can't guarantee today that the proposed changes will be ready by then. Let's changes will be ready by then. Let's In Labour's fiscal funfair the only ride is a merry-go-round. Round and round the vicious cycle goes to the point that we are no longer asking if Labour's next budget will bring in more tax rises, but which taxes they will hike. We are not asking if the next budget will downgrade growth forecasts, but by how much.

We are not asking if the next budget will support jobs, rather, how much higher unemployment can really go under Labour. As we found out this morning, the Deputy Prime Minister has put in her own first draft, a brief to the press, for the Chancellor's next budget. Raising taxes on pensioners, it will hurt growth. Raising taxes on retail investment, that is anti-growth. And raising taxes on incomes, that is definitely anti-growth. When in a hole, stop digging. You simply cannot tax your way to jobs and growth, but Labour seem utterly determined to learn the very hard way.

Our motion today calls on the government to learn from its own government to learn from its own mistakes and urgently change course. On behalf of millions of British workers and businesses across this country, I commend this motion to the house.
16:17
Torsten Bell Portrait Torsten Bell MP, The Parliamentary Secretary, HM Treasury (Swansea West, Labour)
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I call the Minister. This is hopefully one thing that all members on both front benches agree on which is it is the economy stupid. It is a growing economy that raises living standards will stop it is a growing economy that sustains public services and eases public finances. And most importantly it is a growing economy that proves the people that tomorrow can be better than today. So can I welcome the party opposite for calling today's debate. It is an important topic that is deserving of our time and I thank all the honourable members for their contributions today even if I can't thank them all for the duration of their contributions.

50 minutes to deliver one speech is Britain's productivity crisis right there. Given that it is, he is still talking, the proximity crisis is still running on full stop given how important this topic is, it is a surprise to memos on both sides that this is the one and only time the Conservative party has wanted to talk about the economy any year since the election. It is the first Opposition Day on the economy. Initially I thought that can't be true. And I am a new minister, I have got a lot to learn to ask the office to check.

They can't have got through a whole year with no Opposition Day of the economy. They did check and what they found out is that this ten-month with not one debate on the economy. Private schools, oh yes, they want a debate on that, but investment, growth, jobs, the economy, not one debate. It is no surprise they don't want to talk about the economy because their economic legacy was one of an entirely unprecedented failure as my honourable friend said. Stagnation not seen in living memory.

The lowest business investment in the G7. Wages which used to grow at a consistent 2% a year flat lining for their entire period in office will stop the worst Parliament on record for living standards. Public finances trashed, as debt soared. It is no surprise they have nothing to say about the past. Leader of the Opposition, it is true, she said we had no Plan for Growth. It is staggering still that they have nothing to say about the future. I said I would give way so will come to you in one second.

It is not just my view it is George Osborne. He says the Tory party has no credible economic plan. I always enjoy listening to the honourable member for Grantham I listened extra carefully just now. There is still

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no plan, credible or otherwise. Thank you for giving a full stop I was observing and enjoying the way I was observing and enjoying the way that he is said there were literally three members from the Labour Party in the chamber, extraordinary. They are so wonderfully proud of their are so wonderfully proud of their record, if they are so wonderful proud of higher unemployment, higher inflation and slower growth, why are

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inflation and slower growth, why are none of them here? Because these backbenchers

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Because these backbenchers support their Frontbench, and all they would have said is everything they would have said is everything I'm about to say about the record of this government about which we are proud. I will come on to the labour market. The honourable Lady raised the question of employment and changes to National Insurance will changes to National Insurance will stop several members of said there is a direct relationship between changes in National Insurance and changes in vacancies within the labour market.

I want to introduce some facts. Here are some facts. Vacancies in Britain have been Vacancies in Britain have been falling for 34 months. There has been a Labour government for 10 months. And has been Inessa insurance change for one month. That is the facts. You can't let the party opposite escape from their disastrous record by reinventing history.

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I'm grateful. In Swansea West,

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I'm grateful. In Swansea West, one of the facts you will find is the unemployment rate has gone up by the unemployment rate has gone up by 4% in the last year. What does he say to his constituents when he

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say to his constituents when he confronts them, when they are losing their jobs because uncommon rate has gone up? I thank the member for his

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I thank the member for his question. The fact I say that is most important to my constituents is most important to my constituents is that wages today at the end of their period in office, wages were stuck the same level they were when the the same level they were when the Conservative party came to power in 2010. 14 wasted years for my constituents. Directly on the constituents. Directly on the question of unemployment, I would not be using claimant count than not be using claimant count than ever because the data is not as robust as it could be.

But on unemployment, several members have talked about increases in the talked about increases in the unemployed rate in recent months. Why has it gone up? Not because a product has come down, because inactivity shot up on their watch inactivity shot up on their watch and has started to decline. That is what is going on with the numbers. I will make some progress. Why do the party opposite want to talk about the disastrous record or the labour market? Because they left the only economy in the G7 whose employment rate still have not returned to pre-pandemic levels they left us to put 8 million people out of work due to long-term sickness.

1 million young people not in education employment and training. More than one in eight of all young people left on the scrapheap at the party opposite. Turning to the labour market today, 200,000 jobs have been created since his government took office. Pay has outstripped prices, the strongest real pay growth we have seen for years. Let me pause on this question of wages because for many people, for many people, what people get paid is the economy. Here is a fact so staggering that it tells you all you need to know about the failure of the last government and the progress being made under this one.

Wages in the first 10 months of this government have grown faster than under the first 10 years of Tory government since 2010. That is what a country turning a corner looks like. It is not boom and bust because wages for workers need to be rising in Britain once again. We also need to turn the corner on an economy that is far too unequal. It is what our Employment Rights Bill

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will do. This is generous with his time.

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This is generous with his time. He say what a wonderful outlook is for wages. Why is it that the OBR's forecast for real household disposable incomes is lower than the disposable incomes is lower than the 1950s, lower than the 60s, lower than the 70s, love in the 80s, 90s, lower than the naughties and lower than the 2010s, why is that?

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than the 2010s, why is that? It was growing quite fast at the end of quarter 420 24. Look at the OBR they say the legacy of the last government has shown productivity government has shown productivity and growth in this economy has been too slow. Our job is to turn around their record as our real actual

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their record as our real actual wages start to rise. Thank you Madam Deputy Speaker. I

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Thank you Madam Deputy Speaker. I thank the Minister for giving Wayne. He is making an excellent speech contrasting the 14 years after failure on their side with the quick start on ours. You want say more about the benefits of the three trade deals because he has been quoting statistics since Labour was elected. Perhaps he wants to look forwards to potential benefits to growth and investment from these three trade deals?

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What is great about my honourable friend is that he has a forecasting friend is that he has a forecasting ability significant above many economic forecasts. Exactly predicted where I shall be telling predicted where I shall be telling shortly. I want to dwell also on the economy. 3 million workers have economy. 3 million workers have benefited from a higher minimum wage last month. It is worth £1400 to last month. It is worth £1400 to full-time workers. Just today, the Trussell trust provided an update on the painful symbol of modern Britain the painful symbol of modern Britain that is food banks.

Far too many food parcels were provided in the food parcels were provided in the last 12 months, 2.9 million. At has gone up by half in over five years gone up by half in over five years and that is a disgrace. But it is down 8% of the past year and we need to keep it falling. Several honourable members have raised the question of tax. The right honourable Member for East Hampshire honourable Member for East Hampshire and the Shadow Minister sound opposed to all taxes, and the core opposed to all taxes, and the core of their argument is that the higher tax level of the problem.

Neither of them mentioned that the increase in taxes under the last Tory Parliament is significantly higher than any change introduced under this government. And it is true, the right honourable Member Hertsmere specifically raised the question of non-doms but also ask about HMRC whether they were behaving more aggressively. He favoured direct control of HMRC by government control of HMRC by government ministers. The Exchequer now chairs HMRC and I'm sure would have heard this point. But on the idea that HMRC has become more aggressive, and my first jobs in government has been involved emerging what was then the Inland Revenue and the customs department.

I have promise you no one is as aggressive as the customs department was in the olden days. This government detected a difficult but fair choices on tax in the last Autumn Budget.

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Thank you. A moment ago, he told

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Thank you. A moment ago, he told the House that real household disposable incomes were rising under this government. Does he not accept this government. Does he not accept that the OBR, when critiquing the budget last October, found that budget last October, found that during the forecast period, real household disposable incomes will household disposable incomes will fall as a result of the budget proposals?

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proposals? What the office for to be that he says is disposable incomes will grow at twice the rate under this parliament is in the last one. He has just given me another excuse to repeat my favourite fact which is, forget what anybody is forecasting. forget what anybody is forecasting. In the real world, wages have risen more in the first 10 months of this government than the entire 10 years government than the entire 10 years of the party opposite. We are of the party opposite.

We are sticking to our promises not to raise working people's rates of income tax, insurance, or VAT. But we are maintaining an internationally competitive tax system the lowest rate of corporation tax in the G7. No one on this side of the house is pretending that these were easy decisions. They were the right and responsible ones. Each and every decision has been opposed by the parties opposite. It is no surprise to hear the SNP joining with the Conservatives as

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they do almost everything. The Minister is making great play

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The Minister is making great play about the way that his government since the election have increased wages across the United Kingdom. We concede that 91% of earners and concede that 91% of earners and workers in Scotland were already earning more than the living wage level his government have just

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recently set? Talk where I I will and that is why I am

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I will and that is why I am celebrating wage rises happening. If he does not want to celebrate this he does not want to celebrate this that says a lot about the S&P was the we are used to that liberal Democrats fantasy economics. But the Conservatives used to believe in Conservatives used to believe in sound public finances. They used to understand it is only on that basis that the bank of England could sustain because interest rates. As they have done on four occasions they have done on four occasions since the general election.

The shadow Secretary of State in his very long speech claimed that these choices were not pro-business choices were not pro-business choices. I tell them, these are pro-business choices because it is pro-business to deliver functioning public services. It is pro-business when the party opposite left shops up and down the country paying a retail tax. Forced to employ their own security guards because the Tories took the police off the beat. It is pro-business when employers everywhere face a health tax under the party opposite because the NHS was not functioning and their staff off sick.

As I said earlier, growth is key. Of course the shadow Secretary of State is such a champion of the British economy when he predicted there would not be any. Back in December he claimed with glee Britain would start 2025 recession. But the British business... I will quote him, "Could we be in recession? Yes we could. " He talks the economy down, he knows exactly what he did. British business have proved him wrong. No recession, the fastest growth in the G7.

While the economy is beginning to turn a corner, the government recognises are big challenges ahead. There is no shortcut if we want to get the economy growing again. We have to start investing once again. That is what we have raised public investment by £130 billion over this parliament compared to the deep cuts planned by the party opposite. In my day job it is why Britain's pension funds are looking to invest more in productive assets and to invest more in the UK.

That is why we are improving infrastructure projects for windfarms, reservoirs, previously blocked for years. When firms decide to invest they have to actually be able to build something because the is why this is the party Turning to trade, the Prime Minister has secured trade deals, every single one opposed by the party opposite will stop opposing our whiskey industry exporting, opposing lowered food prices in the shops, isn't it clear that they say they support free trade in principle but there is no actual existing trade deal they would ever support.

They used to be the party of Robert Peel and they are just the party of plonkers. We are under no illusion about the challenges ahead. We all know on both sides of this House, the deep cost of living squeeze that has left far too many British families suffering. We are getting on with the job. Stability in the public finances, investing at home, trade agreements abroad, interest rates down, wages up, after a long decade and 1/2 of stagnation, Britain is growing at the fastest rate in the G7.

We have heard a lot from the members opposite today, not a single word of apology has crossed their lips for the mess they left. No humility for the unprecedented economic damage they inflicted. No apology to businesses and no apology to workers. And no, not even a sign to workers. And no, not even a sign of an alternative plan to drive growth and investment in our economy. The British public learnt a very long time ago, when Tories govern, Britain loses. govern, Britain loses.
16:32
16:48
16:48
Chris Philp Portrait Rt Hon Chris Philp MP (Croydon South, Conservative)
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now time to deliver what the public wants. That is why we have tabled an Immigration and Visas Bill presenting a serious credible plan to fix immigration issues. Madam Deputy Speaker, according to IPSOS last week, 67% of the British public think immigration is too high. The British public is right. There are British public is right. There are now around 11 million foreign-born people in the UK. For too long, immigration numbers have been far too high. Immigration at this level has serious consequences.

48% of social housing in London has a head of household not born in the UK. In the last 10 years, migration has absorbed around about 50% of new housing supply. And some nationalities are exceptionally dependent on social housing. For example, 72% of Somalis live in social housing compared to only 16% of the population more generally. I will give way.

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I am grateful to the honourable gentleman for giving way. I think you may have revealed something early on in his speech. He told us early on in his speech. He told us that now is the time for a serious and credible plan. He therefore and credible plan. He therefore admitting that in the 14 years his party was in government there wasn't

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one serious or credible plan? I will talk bits in a moment about the record of the last about the record of the last government but I have already said that for decades, under successive governments, including the last one, governments, including the last one, the previous ones as well, immigration has been far too high. That is the failure by governments over a period of decades, and it is over a period of decades, and it is now time to listen to the British people and put this right.

Because high levels of immigration, especially when there is not proper integration, undermines social integration, undermines social cohesion. A nationstate, a society, cohesion. A nationstate, a society, can't function when you have social fractures will stop it can't function properly. Society can't function properly when you have fractures in social cohesion. In advancing the case that we do have a problem with social cohesion and a lack of integration, I will present some evidence. In support of that. The most recent census revealed that 1 million of our fellow citizens don't speak English at all or properly.

In one part of East London, 73% of children do not speak English as their first language. And some nationalities have extremely low rates of economic activity, or very high rates of economic inactivity. For example, amongst people born in the Middle East and North Africa, economic inactivity rates are 40%, that is double the rate for people born in the UK. Amongst people born in South and East Asia, economic inactivity rate is 50% higher than it is for people born in the UK.

By contrast, among those born in Australia or New Zealand, the economic inactivity rate is only half the level amongst the UK born population. I'm afraid to say when it comes to crime and offending, there are some immigrant groups where levels of criminality are very high. Example, Afghans are 30 times more likely to commit sex offences than average. People of Congolese origin are 12 times more likely to commit violence, and Algerians are 18 times more likely to commit theft.

These figures illustrate that we do have a problem with integration. That is why we need to get these numbers dramatically down, until such time as we can address these issues. Let me now turn to the economy. Let me turn now to the economy. It has long turn now to the economy. It has long been thought that net migration is an unalloyed economic good. That is one reason why successive governments allowed immigration to get so high and stay too high.

Both governments over many years, decades in fact. Recent analysis has shown this is simply not true. OBR analysis last year showed for the first time that low-wage migration actually cost the Exchequer money. There is not a net contribution, there is a net draw on the Exchequer. It costs other taxpayers money and low-wage levels. And in particular where there are large numbers of dependents. And it has reduced per capita GDP which affects the level of affluence enjoyed by the population here.

It is one of the reasons why productivity in our economy has flatlined for so long. Because businesses have reached for mass low skilled migration instead of investing in technology, investing in automation, or simply becoming more productive. It is one of the recent Apple activity has flatlined. That has all happened while 9 million of our fellow citizens of working age remain economically inactive. Many of those of course have caring responsibilities, some genuinely can't work, and others are studying. But many of those 9 million, likely over half of them, could, and in my view, should, be in the workforce instead of large numbers of low-wage low skilled migrants being imported.

So it is time for a different approach. We need to end the era of mass low skilled migration, and instead focus on small numbers of very high skilled workers who should be welcomed. We need to invest more in technology. And we need to get more UK residents of working age into work, including by investing in training and including by reforming the welfare system. I think somebody

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wanted to intervene over there. I thank the member for giving way. When he is finished denigrating every community that has made the homes in this country, will he homes in this country, will he reflect for a moment at the massive reflect for a moment at the massive contribution made in education, in health, transport and many other industries by people that have come to this country? When he goes to a to this country? When he goes to a hospital, does he criticise those people that have come from another country and are working in hospitals, looking after us and the health service, or is the only interested in denigrating people because they were born speaking a because they were born speaking a different language and they look different to him?

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I don't think it was listening carefully. I expressly said that highly skilled migrants do make a contribution and should be welcomed. But I was talking about those issues with social housing, with economic with social housing, with economic inactivity, with criminality, I was reading out facts. I was reading out published data by the sensors, by

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published data by the sensors, by the ONS. These are facts, he may not like them but they are facts nonetheless. I thank my right honourable friend for giving way. The honourable gentleman, the member for Burnley, said from a sedentary position that my right honourable friend was race-baiting. My right honourable friend was simply reading out official statistics. In contribution to an important debate about the future of our country. Does my right honourable friend think that your judgement should stand up, put his views on the record, the Tellers constituents what he thinks about their

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legitimate concerns? I think you should do that because the British public have expressed very clear views on this. expressed very clear views on this. And if we can't in this House of all places, layout the facts, published places, layout the facts, published data, as a way of having an honest debate about this issue, that I don't know where we have got to. It is that kind of shouting down, saying it is somehow beyond the pale to discuss these facts, it is precisely how we ended up in this precisely how we ended up in this mess in the first place.

Let me come on to some of the steps taken late in the time of the last government. in the time of the last government. Steps they took, yes they were too Steps they took, yes they were too late, that's right. Taken late in the time of the last government, which took effect in April Taken which took effect in April Taken late in the time of the last government, which took effect in April 2023, and in April 2024. Those steps included preventing social steps included preventing social care workers and students bringing dependents, and increasing various salary threshold.

The official forecasts published by bodies like the ONS and the OBR show that net the ONS and the OBR show that net migration, thanks to those measures, is forecast to reduce by 500,000 compared to the peak. Those measures are already having an effect. If you compare visas issued in the second half of last year compared to the second half of 2022, you will see a reduction in social care visas of 76%. Reduction in student visas of 21%, a reduction in student - dependent pieces of 89%, and a reduction in skilled worker visas many of whom are not in fact skilled, by 45%.

But the truth is, we need to go further. And the government White Paper published last Monday does not go far enough. On that Laura Kuhn spoke program the Sunday before last, the Home Secretary said it would only have an impact of 50,000 on net migration. The numbers are cupping the white paper said 100,000. Whichever number you take, that is only between 1/10 and 1/5 of the impact of the measures taken by the last government. It simply does not go far enough.

A question I've got for the Immigration Minister, she's welcome to intervene if she would like to or answer in her speech. The last government set out a plan to increase the salary threshold for families is up to £38,000 that was due to take effect on 1 April this year, just seven or eight weeks ago. The last government suspended that measure which will obviously have the effect of increasing immigration. Will the government implement that increase in the threshold as set out by the last government? As I said, the measures in the white paper go nowhere near far enough.

We have set out a detailed plan.

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Does he share my concerns not only were the measures inadequate only were the measures inadequate but they are potentially opening a big new route for inward migration? The weekend the Paymaster General The weekend the Paymaster General suggested that the youth mobility or youth experienced scheme of EU was parable to the one we had with parable to the one we had with Uruguay. That is 500 visas a year. We read in the papers today that the Youri is asking for hundreds of Youri is asking for hundreds of thousands of youth visas.

It's as concerned as I am actually BA

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concerned as I am actually BA backdoor for new route, very substantial migration? Yes I do agree with my honourable

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Yes I do agree with my honourable friend. This could create an enormous new loophole. There are potentially around 60 million people potentially around 60 million people in the UK eligible for this visa route. We have no idea at all where route. We have no idea at all where a cap may be. The Leader of the Opposition asked the prime list a Opposition asked the prime list a couple of days ago what numerical cap might be. Prime minister character regularly did not answer character regularly did not answer the question.

There are no answers on the question whether people coming over on the scheme could claim benefits, no answer as to the question whether they could bring dependents, and some European countries grant citizenship to illegal immigrants to three years after getting asylum, they would be eligible to come as well. So it seems to me this route could create

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an enormous loophole in our asylum I think it is important that the honourable gentleman clarify honourable gentleman clarify something to aid this debate, and I have read his notion carefully. The vast majority of the motion in front of the House today, is about illegal of the House today, is about illegal migration. And repeatedly, it feels migration. And repeatedly, it feels like the issue of Illegal Migration Bill and Illegal Migration Bill is being conflated as the same issue. That does not help the debate and I wonder whether he could clarify if

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that is his intention. I tend to talk about, I have been talking about legal so far and in a moment I will talk about Illegal moment I will talk about Illegal Migration Bill's but since he has raised the question of the bill that we table, one of the measures and that speaks directly to the question that speaks directly to the question of legal migration. The numbers have of legal migration. The numbers have been far too high for decades, the only way this House, this democratically elected House can get a handle on this, is if we have an a handle on this, is if we have an annual binding vote in parliament to set a cap on the level of legal set a cap on the level of legal migration so that when the -- cap is reached, the government would simply , never again would we see a situation where migration of offender being far higher-than- expected.

This House would decide, this democratically elected House would decide, it would be transparent, it would be open, and the level would be set at a number following than anything we have seen in recent history. And yet when we put this to a vote last Monday, as an amendment to the border bill, the party opposite voted against this measure that would give Parliament the power at last, to limit inward migration. I: the government to think again and to support our bill which provides Parliament with those which provides Parliament with those powers.

Let me turn out to the question of illegal migrations since the member opposite has invited to do so. And it would be churlish not to respond to an invitation of ICANN, the main sector of illegal, small boats crossing the channel, is there is no reason at all for anyone at all, no matter their circumstances, to cross into the UK by small boat from France, because France is a safe country. France has a well functioning asylum system, there is no war in France, no one is being persecuted in France.

You do not need to get into a dinghy to flee from Calais. Not a single one of those people coming across need to do so for reasons of fleeing persecution. They should claim asylum in France. The government record on this area is lamentable. They came to office last July, cancelling the reminder scheme before it even -- reminder scheme before it even started. It is grossly misleading, describes the scheme as being in force, the reminder scheme was never enforced, did not start, it was not due to start until 24 July so this amendment is deeply misleading.

The government, the new government last July, set out their alternative plan. Their alternative plan was to quote, smash the gangs. How's that going? Well, since the election, about 37,000 people have illegally crossed the channel, that is a 30% increase on the same period 12 months prior, and this year so far, 2025, has been the worst year ever, the worst in history for illegal Channel crossings and today, as we speak in this House today, it is going to be the worst day this year for Channel crossings, an observer in Dover has so far counted today 820 illegal immigrants arriving in Dover making this the worst day of the air so far.

The plan to smash the gangs is in tatters, it is not working, and that is why far from closing down asylum hotels as the government promised to do, they are opening them up, there are a thousand more asylum hotels have -- that there were one year before.

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I wonder if he would take a moment to reflect and remember the moment to reflect and remember the woman and small child who lost their

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woman and small child who lost their lives today in an incident in French territorial waters. Yes, of course I would. A number of people have tragically lost their of people have tragically lost their lives crossing the channel and that is precisely why we need to stop is precisely why we need to stop these crossings entirely, as these crossings entirely, as Australia did 10 years ago. If we can stop crossings entirely, lives will not be put needlessly at risk

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and we can avoid tragedy. Thank you. I have to say, I am disgusted by the narrative coming disgusted by the narrative coming from the party in opposition who are continuing even in opposition, to use their Opposition Day debate to scapegoat migrants for their own 14 years of failure to deliver proper public services, tackle inequality, public services, tackle inequality, tackle poverty in this country, that have led to many of the problems he listed. Now that he has moved on to tackling small boats, will you not acknowledge that without providing safe and regulated routes for people to claim asylum, they are pushed into the hands of people smugglers.

Does he is not acknowledge the most rational thing to do would be to

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provide those safe and managed routes? I don't accept that. Firstly, everything a person getting on a boat is able to claim asylum in France. They do not need to get into France. They do not need to get into one of those books to claim asylum in the UK. Secondly, unless every single person that wants to come single person that wants to come into the UK is given a safe and legal routes, those people who are not given a place on what would presumably be a capped scheme would nevertheless try to cross by small boat.

The idea that this is a boat. The idea that this is a solution is manifestly absurd. There are of course, safe and legal routes, some that have been set up specifically like the Ukrainian scheme, like the British nationals scheme, like the British nationals overseas scheme, like the UK resettlement scheme, which saw 25,000 people from Syria resettled here. Like the Iraq schemes in relation to Afghanistan, like the refugee family reunion route, there refugee family reunion route, there are plenty of safe and legal routes and as I say, unless every single and as I say, unless every single person that wants to come here is given a safe and legal routes, there will still be illegal crossings which are unnecessary because France are safe and people are able to claim asylum there.

I will make some progress. The government amendment makes reference to the border bill and the obvious truth is that the border bill is not going to make a great deal of difference. It creates a border security commander. I have every respect for Martin Hewitt but the border security commander has no powers. All they have in this bill are functions and the functions include things like preparing an annual report and publishing a strategic priority document. With all due respect to the immigration Minister, I do not think the people smugglers will be concerned by an annual report or a strategic priority document.

The so-called anti-counterterror powers in this bill amount to things like confiscating mobile phones and using slightly enhanced surveillance tactics on the criminal gangs. The truth is, it is a tiny step in the right direction but the truth is it will make no difference because as the agency said, law-enforcement alone will not fix this problem. Because if you dismantle one gang, another will pop up in its place. That is what the National crime agency assessed one year or two years ago. We know what works in Australia, who had a bigger problem than us about 10 years ago, around about 50,000 people were crossing to Australia.

They set up operation sovereign Borders which entails a removals deterrent. And in a matter of a few months, and only a few thousand people being removed, the illegal maritime crossings to Australia stopped entirely, they went to 0 because the deterrent effect meant people in Indonesia did not even attempt the crossing in the first place. And because those crossings were stopped, hundreds and hundreds of lives were saved. It is clear to me that we do need a removals deterrent, in order to prevent these crossings.



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I went to visit Rwanda and I was

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I went to visit Rwanda and I was impressed by the facilities built for migrants due to go, does he agree with me that had the scheme agree with me that had the scheme not been cancelled, that the people who had gone there would be being cared for and setting up new and successful lives and we would not

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successful lives and we would not have people dying in the channel? I agree and I commend my honourable friend for having gone honourable friend for having gone there to look at the facilities. Had that scheme been started as intended, the deterrent effect would by now have stop these crossings. by now have stop these crossings. And in fact, the UNHCR sent people And in fact, the UNHCR sent people to reminder so it is clearly good enough for them and other countries enough for them and other countries including Germany are now looking at removals deterrence and so it is clear the government should restart a proper removals deterrent and I a proper removals deterrent and I urge them urgently to do so.

We have presented a bill to this House which contains serious and credible contains serious and credible measures. To limit legal migration and to take action against illegal and to make sure people with no right to be here are removed, including foreign national offenders. And one of the most important measures is to repeal the Human Rights Act in relation to immigration matters. Because over the years, UK judges in the immigration tribunal have adopted ever more expansive definitions of ECHR articles to allow dangerous foreign criminals to remain in this country.

There are in fact, thousands of examples of the definitions of these articles, not just article 8, but article 3 as well, being stretched and stretched over the years, beyond any definition of common sense, certainly beyond anything contemplated by the framers of the , that is why the Human Rights Act has to be repealed so Parliament decides what the rules are, not judges applying expansive interpretations. I will give one example. There was a Zimbabwean paedophile, and a judge using article 3, not article 8, said that he could not be sent back to Zimbabwe in case he faced his hostility.

What about the rights of children in the United Kingdom to be protected from paedophiles like that? What about the rights of British citizens to be protected from foreign national is? We need to repeal the Human Rights Act in relation to immigration matters. That is white is in our bill and I call on the government to support it. It is time to deliver what the British public want. This side of the House has developed a credible and detailed bill to do that, I call

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on the government if they are serious to support it. The question is as on the Order Paper.

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Paper. I note that this motion begins by regretting the fact that we are 20 regretting the fact that we are 20 weeks into this year, and more than 12,000 people across the channel by small boat and let me start on a note of consensus, I agree with him, numbers are too high and I agree numbers are too high and I agree that they must come down and I am going to come onto the action that we are taking to achieve this aim.

we are taking to achieve this aim. Let me address what we would call the shadow Home Secretary's brass the shadow Home Secretary's brass neck. What he did not say in his speech was that in the last 20 weeks speech was that in the last 20 weeks when he was immigration Minister, it was not 12,000 people who crossed the channel, it was 13,000. It was the channel, it was 13,000. It was not to the -- 230 small boats that not to the -- 230 small boats that made the crossing, during his last 20 weeks in charge, it was almost 500.

Where was this motion of regret then? And where were his expressions of outrage? Let me tell you just how bad it was in his last 20 weeks in charge will stop from the end of April 2021 up to the middle of September. More people cross the channel by small boats in those 20 weeks than the previous 14 months put together. All the way back to the start of the crossings in 2018. 173 weeks worth of crossings, and he managed to get them exceeding that total in his last 20 weeks in charge.

That was not his only claim to fame during his period in office because he was the Minister in charge when net migration started to run completely out of control. In the 19 months that he was in charge, net migration rose... When I have finished my sentence. Net migration when he was in charge and the Home Office, net migration rose from 170,000 to 470,000. A 300,000

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increase in less than two years. I think the honourable lady should correct the record, I never had ministerial responsibility for legal migration, I would be grateful

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legal migration, I would be grateful if you would withdraw that. Collective responsibility

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Collective responsibility apparently used to matter to the party opposite but I think if we actually remember some of the history, we will know that that was history, we will know that that was history, we will know that that was actually true because I want you and everyone else in the House, to cast all of your minds back to the sum of all of your minds back to the sum of 2022 and the 20 weeks. Between when Chris Pincher had his night at the Chris Pincher had his night at the Carlton club, all the way to 20 weeks later when Jeremy Hunt had to have an emergency budget.

The Conservative government descended into utter chaos with three different prime Ministers and for different prime Ministers and for different secretaries who took turns in office. What was happening to small boats in the channel during that particular 20 weeks? Arrivals? Not 12,000 arrivals, not 13,000, 30 not 12,000 arrivals, not 13,000, 30,000 arrivals. In the space of 20 weeks. Not to intrude on 20 boats, not 500 boats, 670 votes. And why did that happen? Because they were all too busy fighting amongst themselves and crashing the economy to bother about protecting our borders.

And let's not forget the role that the shadow Home Secretary actually played in that little bit actually played in that little bit In the space of 20 weeks he went from tech minister to no minister, to Chief Secretary to the Treasury, to Paymaster General, two police minister, but none of this was his most important role. We should remember.

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Order. The Minister will be heard.

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heard. 20 week period that featured in

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20 week period that featured in the party opposite motion. I am talking about what happened in the talking about what happened in the 20 weeks. Just to go back over it, the shadow home secretary went from the shadow home secretary went from tech minister to not having a job, to Chief Secretary, to Paymaster to Chief Secretary, to Paymaster General, to police minister, they General, to police minister, they brought a chaos to government that they brought to the immigration they brought to the immigration system.

They have control of it for 14 years. We should all remember 14 years. We should all remember that, that the shadow home secretary that, that the shadow home secretary was once credited with being the economic guru behind Liz Truss's premiership. This is the man who helped Liz Truss write her

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catastrophic mini-Budget, to throw the country off a cliff. And scuppered her own premiership. Point of order.

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Point of order. Thank you Madam Deputy Speaker.

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Thank you Madam Deputy Speaker. History lesson of who was which minister in which government is all available on the internet. How does it relate to the matter in
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Angela Eagle Portrait Dame Angela Eagle MP, The Minister of State, Home Department (Wallasey, Labour)
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the sentence, no I'm not giving way. the sentence, no I'm not giving way. I think it is perfectly reasonable to point out the record of the party opposite and they come and try and opposite and they come and try and give us lectures about immigration policy and what should be done with migration policy now when we are migration policy now when we are clearing up their mess. This government inherited a system in total chaos from the party opposite. Partially that was from the chaos Partially that was from the chaos that I have just talked about in those 20 weeks between the Chris Pincher visit to the Carlton club Pincher visit to the Carlton club and the Budget that had to clean up and the Budget that had to clean up Liz Truss's mess.

We had three prime ministers and four Home Secretary. Can the party opposite seriously pretends to the British people that pretends to the British people that while they were busy doing all that they had a coherent migration policy? No. I don't think so. I'm happy to give way to the honourable happy to give way to the honourable gentleman because he stood up and I got to the end of a sentence.

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Now I know I look forward to be able to formally intervene in the able to formally intervene in the future. When it comes to clarity on policy I would be grateful for help on the current prime ministers on the current prime ministers clarity was in 2020 he wrote a letter defending migrants right and letter defending migrants right and making a positive case for immigration. Yet in his recent speech he talked about crafting an island of strangers. Could she island of strangers.

Could she provide clarity on which the two it is he believes it comes to immigration policy?

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immigration policy? It is important that we all remember when we are talking about migration policy, net migration, immigration being legal or illegal, we are talking about human beings. we are talking about human beings. And we should treat them as human beings and that all human beings have human rights. We should not actually perpetrate narratives that actually perpetrate narratives that dehumanise. And too often, let me dehumanise. And too often, let me finish the sentence. Too often, the party opposite, or some of the parties opposite not all of them, actually perpetrate a narrative that is increasingly dangerous.

Let us not dehumanise fellow human beings. I give way.

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I recognise how it is very important that we use template language. But my honourable friend language. But my honourable friend was very clear, he set out two was very clear, he set out two factual statements of what the Prime Minister said with an interval between. I think she must between. I think she must acknowledge that the public mood has changed significantly in very recent changed significantly in very recent times. And the purpose of this times. And the purpose of this debate today is to scrutinise the government's record in its 10 months government's record in its 10 months in office, and to see how effective those interventions have been.

I those interventions have been. I think it is perfectly legitimate to be asked about the characterisation that her prior minister has made very recently about this matter.

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very recently about this matter. I don't think that the two quotes are incompatible with each other. We are incompatible with each other. We have to have, and our White Paper sets out the route forward to that stop we have to have net migration coming down compared to the legacy that we inherited from the party opposite which was to quadruple it in four short years. It is important also to remember that when we are talking about legal migration and net migration, we have to have integration, we have to have capacity to absorb the people that we allow into our country.

And crucially when it comes to small boats we have to have the capacity to decide who comes into our country so I don't see that either of those two statements from the Prime Minister is incompatible. I'm happy to give way.

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Can I commend her for her words in terms of saying we are talking about people. Recently in a debate about people. Recently in a debate in this place I referenced Lord in this place I referenced Lord Balfe Dubs. I said he had said it was outrageous and he said the prime ministers words were regrettable. ministers words were regrettable. What I would like to hear, does she realise that words matter when we talk about people? We can have different views on migration policy we are talking about people so I we are talking about people so I commend the words she used now.

I would encourage other members of government to use likewise.

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I think it is very important to remember that we thrive, like we remember that we thrive, like we were having a history, with a tolerant multicultural society now. tolerant multicultural society now. Where we strive to understand each other and get on with each other, rather than divide and seek to cause rather than divide and seek to cause resentment which some people have political narratives that do that and that is regrettable.

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and that is regrettable. I thank her for giving way. This is clearly a very emotive debate on all sides of the house. It is probably a good time to acknowledge that, in the NHS, you are more likely to be treated by an immigrant working for the NHS and you are to be waiting behind an immigrant for treatment. So despite the rhetoric that has been promoted by many politicians over the last few years, especially those that champion Brexit, we should probably acknowledge that the NHS wasn't being crippled by immigration, it was being sustained by it.

Quite I think it is important that all of us acknowledge first of all the humanity of people who come to our country to work, and also the contribution that they make. We also have to have rules, so we have to decide ourselves who comes to our country and why, and we have to explain those rules to the electorate. That is what I will go on to try and do. Inherited a system in total chaos from the party opposite.

They allowed criminal gangs to take hold across the channel which saw numbers arriving rocket from 300 in 2018 up to over 30,000 in a few years. They crashed the asylum system, the 70% drop in monthly decision-making, and an 80% drop in asylum interviews. There was a 34% drop in returns compared to the last Labour government, and they spent £700 million sending four volunteers to Rwanda. Their handling of legal immigration was no better for top net migration quadrupled in the space of just four years to nearly 1 million.

That is their record. Those records tell a wretched story of a system spiralling out of control, of an entire criminal industry building up along our borders with terrible consequences, of ruthless smugglers sending desperate people on dangerous and sometimes deadly journeys, and making a fortune in the process. The basic rules not being enforced. And of the collapse of trust and confidence in the ability of the state to perform one of its most fundamental functions to keep our borders safe and secure.

So bad was their record that the public simply stop believing anything they said. And who can blame them? For all the talk about stopping the boats and stopping the, all of this boats and stopping the, all of this crisis, the crisis carried on. Grotesquely expensive gimmicks and strong words made little impact against sophisticated smuggling networks. The task of ending this

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chaos. Government... She knows I have long believed

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She knows I have long believed that this government is harbouring its own admission for a Rwanda scheme and this seems to be in scheme and this seems to be in Albania for top that now seems to have been rejected by the Iranian government was she have any further government was she have any further plans to introduce some sort of substitute Rwanda on behalf of the government?

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government? When we came to office we ended the Rwanda scheme. The Rwandan scheme was about deporting people. scheme was about deporting people. And processing their asylum in another country, and never letting another country, and never letting another country, and never letting them back here. It doesn't, it

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didn't work. The honourable... Order. I want to hear what the

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Order. I want to hear what the Minister has got to say, and certainly all of our constituents want to hear what the Minister has got to say.

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got to say. The party opposite which are conveniently called an early election so the Rwanda scheme would never start, after spending years even perpetrating the idea of a Rwandan scheme would stop the boats, they know as well as I do that over 84,000 people crossed the channel in small boats in the years that the
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