Commons Chamber

Wednesday 28th October 2026

(began 11 hours, 9 minutes ago)

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John Healey Portrait Rt Hon John Healey MP, The Chancellor of the Exchequer (Rawmarsh and Conisbrough, Labour)
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Madam Deputy Speaker, thank you. This is a Budget for the working people of Britain. For British businesses, big and small, delivered at a time when global uncertainties and pressures are swirling worldwide and hitting people here at home. A Budget built on fiscal discipline, which matches immediate action today with clear direction for the future. First, by giving Britain some breathing space on the cost of living and the cost of business. Second, by backing the enterprise of British business to unleash innovation and growth in every postcode. And third, by tackling the big challenges on energy, on national security, on public service procurement and transformation, and on housing.

In this Budget, I will set out the new approach. This administration is taking, led by the vision of our new Prime Minister, demonstrated in our first 100 days, demonstrated in our first 100 days. Carried through today's Budget, the ten year plan for Britain and the Spending Review next year to steer us through the global economic storms. Today to chart a new course for Britain in the years ahead to give people fresh hope for Britain's future. Madam Deputy Speaker, it's an honour to stand here as the Chancellor of the Exchequer to deliver my first. And I had hope that I might be the most closely watched member of the government this week until the Prime Minister went on Gogglebox.

But at the outset. But at the outset of this Budget statement, I want to pay tribute to my predecessor, my right hon. Friend. The Member for Leeds West and Pudsey. Britain's first ever female Chancellor after 800 years. She brought fiscal discipline to this country. She took. She took the decisions required to boost investment, cut

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NHS waiting lists. Order. Colleagues who are

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Order. Colleagues who are chuntering will need a lot of stamina. We've got many hours to go, so let's keep the chamber calm,

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Chancellor. She took the decisions required

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She took the decisions required to boost investment to cut NHS waiting lists, and to lift half a waiting lists, and to lift half a million children out of poverty. And I also want to thank my outstanding team of Treasury Ministers and Treasury officials and the office for Budget Responsibility for producing today's forecasts. Madam Deputy Speaker, analysts like to speak of economic headwinds, but what we face today are global economic storms, with trade tensions acting as a drag on global growth and Putin's illegal invasion of Ukraine approaching. Now the end of its fifth year. The OBR sets out that the war in the Middle East is a key driver, affecting their forecasts today.

And this government continues to work with our allies to end the conflict and restore shipping through the Strait of Hormuz. Madam Deputy Speaker, we did not want this war, and we rejected calls from the Leader of the Opposition to jump to to jump two footed into it. It's a war that has driven up costs. It's driven up costs on British families and on British businesses. Inflation, which was due to fall earlier this year to the 2% target, has now risen, driven by higher oil and gas prices. Oil is up from around $70 a barrel to well over $100, and gas prices have nearly tripled since February.

For families, this means higher prices at the pump, higher energy bills, higher mortgages. For businesses, it means higher running costs and more expensive business loans. And the impact is felt in public finances, too, driven by the conflict in the Middle East. Government borrowing costs across the G7 are reaching highs not decade forecast, the. This year. Those are the storms we face. We cannot wish them away. We must choose the course. We steer through them and. Fiscal discipline is my first commitment as Chancellor. More than ever, it underwrites every promise this government makes to the British people in the Budget.

Today I meet the fiscal rules, the stability rule. The day to day spending must be covered by tax receipts and the investment rule that government debt, defined as public sector net financial liabilities, must be falling as a percentage of GDP. This year, for the first time, I must meet these rules in the third year of the

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forecast, and I do. Yeah. My plans continue to reduce

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My plans continue to reduce government borrowing so we spend less on debt interest and more on the priorities of the British the priorities of the British people. First, the stability rule in the Budget. Today, I have chosen in the Budget. Today, I have chosen to use some of the headroom established last year to absorb the impact of the Iran war, to protect the economy and to protect family budgets. My choices in this Budget mean I have kept the Labour manifesto promise not to raise tax on working people, and I've

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rejected. And I have. Order. Mr. Bauer, you're sitting services, recognising that families and businesses need this breathing space. Madam Deputy Speaker, the space. Madam Deputy Speaker, the OBR confirms today that headroom against the stability rule is £15 against the stability rule is £15 billion in 20 2930, before rising to £22 billion in 2030 31. That is what a buffer is for. Use it when you need it, rebuild it when you can. And so despite the global challenges, this Budget puts us on track to eliminate the current Budget deficit and get Britain's finances back into the black within three years.

Madam Deputy Speaker, as a Labour government last year we cut borrowing to its lowest level in six years, from 5.1 to 4.4% of GDP. I continue that work today. In today's forecast, borrowing falls to 4.2% this year, 3.4 next year, 2.9 in 2829, 2.1 in 2930, and 1.8 in 20 3031 and 3132. Our debt as a percentage of GDP is 83.2% this year, 83.8 next year and in 2020 829 before falling to 83.1% in 2930, 82.3 in 3031 and 81.7 in 3132. It is because of our labour decisions.

 It is because of our labour plans that the International Monetary Fund has said that the UK, and I quote, now stands out as a country where. Stands out as a country where I quote action to reduce debt and deficit has been taken decisively. They project our UK deficit will be the lowest in the G7 by 2029. Madam Deputy Speaker, the last time the IMF called the UK stand out was when Liz Truss crashed the economy. Her new book, crashed the economy. Her new book, a new book. The new book, says she could have taken the British people to Mars, but in reality, what she achieved in government, with help from the shadow Chancellor, was blowing a big black hole in the Budget.

That is the difference between Labour and government and a conservative government before us. Madam Deputy Speaker. During this year of global economic shocks, forecasters predicted that the UK economy would slow down. Those predictions of gloom are about as accurate as the predictions of who would be the Chancellor. But, Madam would be the Chancellor. But, Madam Deputy Speaker. Britain is defying expectations. In the first half of this year, our economy was the fastest growing in the G7, alongside the US. This. That is testament to the British people, the innovators, the business leaders and the workers on the front line.

And it's testament to the labour decisions taken over the last two years. Government, government investment up. Business investment up. Productivity up, real wages up more since the election than in the first ten years of the previous conservative government. I will never be complacent, but these are signs of resilience in the UK economy. Madam Deputy Speaker, three months ago, the Bank of England upgraded their forecasts for UK growth this year. Two weeks ago the IMF did the same. And today the OBR has upgraded its forecast 2 to 1.2% this year, followed by 1% next year, 1.81.6, 1.6% in 2028, 1.8% in 2029, 1.7% in 2030, and 1.6% in 2031.

Yes, there are real challenges ahead, but Britain has beaten the forecasts this year. And with the action I'm taking today, I believe Britain can beat the forecasts again. Madam Deputy Speaker, despite the resilience of our economy, I know that people are under pressure. Too many people feel this country isn't working well for them, and in particular, households and businesses face challenges from rising energy costs due directly to the conflict in the Middle East. In the face of that, what matters is how we respond as a government. And my choice in the Budget today is to give families and businesses some breathing space now, and to begin

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the radical reform of energy to reduce bills in the future. Yeah.

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Yeah. Last week, my right hon. Friend the Energy Secretary opposed. Approved.

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Approved. OK. All right. The long wait. Doctor Luke Evans, you will have to write yourself a prescription just to calm down.

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Chancellor Madam Deputy Speaker.

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Chancellor Madam Deputy Speaker. At least they're still awake. My right hon. Friend the energy secretary. She approved the jackdaw gas.

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Field. Boosting our energy security. This will protect hundreds of jobs. And adding an estimated £2.9 billion to the UK economy. A billion to the UK economy. A pragmatic, common sense decision. And alongside that, I launched a new energy wealth fund for the UK. Today I'm setting a new course on energy to get UK energy costs down in line with Europe. From this point, our Labour government priority is first and foremost cheaper energy with clean power. Key to achieving this. This is possible because of the progress we've made towards clean power over the last two years, and this government remains unshakeably committed to net zero by 2050.

This will demand deep reform of our energy system and starting at the Budget today, carried through the ten year plan into the months and years ahead. Madam Deputy Speaker, for many years, under Conservative Government's policy, costs were simply loaded onto household bills through levies. Today, I am putting an end to that. We will introduce a new cost control framework to drive down all aspects of energy bills, and I will scrap the upcoming Gas shippers obligation, a levy to fund hydrogen projects, and instead back those projects directly from government. And I am making further big bills and making further big changes to bring bills down in the long term.

First, on clean power generation, this government will only buy and build new projects when they lower bills and when they can connect to the grid. Second, we will further break the grip of international gas prices on our bills by moving more of our old renewables onto fixed price contracts. And thirdly, we will build cheaper, faster grid connections through GB grid and reform the complex web of institutions that govern the system. This is how we deliver radical change Britain needs on energy. It will not happen overnight. And so I am taking immediate action to give families and businesses breathing

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space in the here and now. The. In the first week of this new

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In the first week of this new government, we took VAT off electricity for 29 million households. Today I'm extending households. Today I'm extending that VAT cut through the winter and spring to July, taking £50 off the spring to July, taking £50 off the annual price cap and for business. Our new British Industrial Competitiveness Scheme will take 25% off electricity bills for 10,000 firms at the heart of British industry. It will go live in April, and I confirm that we'll make back to back dated payments for energy costs this year to next year. Working with my right hon.

Friend the Energy Secretary will go further to make bills fairer. Gas standing charges. These standing charges cost people over £100 a year, regardless of how much gas they use. So from next year through Ofgem, we will remove standing charges from household gas bills. And we will set out similar reforms to follow for electricity bills. Madam Deputy Speaker, let me say this to families at home. I know that with the conflict in the Middle East, rising energy bills are a real worry. I know that people look to government at times like this not to solve all their problems, but to give them a bit of breathing space.

So today I'm taking one further step. This winter for 20 million households in council tax bands A to D. I'm announcing a £100 energy payment for households for. Paid directly into people's bank accounts to deal with rising energy bills. That's a £2.6 billion scheme to take the pressure off in the coldest months and see people through to the spring. The the Scottish, Welsh and Northern Ireland governments will receive their share of this funding and I call on them to do the same and give people of all nations in the UK breathing space on their energy bills this winter.

Madam Deputy Speaker. £50 off VAT. £100 off council tax for this winter. Two tax cuts for next year, fairer bills and for the long term radical reform of the energy market to produce cheaper power breathing space. Now hope for the future delivered to the British people by this Labour government. Madam Deputy Speaker, for millions of people, the cost of living and the cost of doing business are the same. The home is the office. The van is the family car. Earlier this year, the government extended the £0.05 cut to fuel duty and slashed red diesel to its lowest rate in over 20 years.

With the war in the Middle East still driving high fuel prices, I'm extending these tax cuts for motorists through the winter and spring to July, supporting households, hauliers and farmers, and for anyone who relies on their car for work, from care workers to engineers. I am increasing the higher mileage rate from 25 to £0.30 per mile from 25 to £0.35 per mile, and I'm making permanent the increase to the standard mileage rate introduced earlier this year. And in this Budget, I'm acting on other costs too, to help with the weekly shop. I'm suspending tariffs on over 100 supermarket products to keep prices down for pensioners, and delivering the new pension tax allowance so that pensioners with income of up to the value of the full new State Pension, will not pay income tax in this Parliament.

For ex mine workers. I'm guaranteeing that every penny of the pension fund surplus now goes to miners. I know the job's not done, and I will go on to ensure the full transfer of

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the guarantors fund. Yes. For carers. I'm getting rid of the cliff edge on earnings so that the cliff edge on earnings so that people don't lose their entire carer's allowance when they earn a penny over that threshold. And for penny over that threshold. And for 2.3 million of our lowest paid workers, I'm increasing both the national minimum wage and the national minimum wage and the National Living Wage by 3.9%. Madam Deputy Speaker, I know that for families, the worst thing is feeling that your kids are missing out, even on little things, because money is tight.

So today I'm announcing £15 million for organisations like Dolly Parton's Imagination Library and the Book Trust, who give books to children. And I've heard calls for pay transparency on job adverts to close the gender pay gap. And we will act soon to make sure women

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are paid and promoted fairly. Yeah. This Labour government is determined to make the economy work better for all families. And so I've listened to representations from colleagues across the House from colleagues across the House about paternity leave. And I'm making a down payment on change today. And as a mark of respect for today. And as a mark of respect for their role, I will make self-employed fathers and partners eligible for paid parental leave eligible for paid parental leave for the first time. Madam Deputy Speaker, since day one, I've said that I'll be a Chancellor who champions the small British firms that give character to our communities the bakeries, the cafes, the hair salons they make, the places that we live and work, the places we love.

And I want these businesses to invest, to recruit, to expand. And so today, I'm taking action to support our high streets. In the first week of this government, we cut 20% off business rates for pubs, clubs and music venues from April next year. And I've heard calls from members across this House and a call from one member in particular, the right hon. Member for the Member for Makerfield. And so I'm increasing the threshold for small business rate relief for retail, hospitality and leisure businesses from £12,000 to £18,000. That means 70,000 more businesses.

I'm not just cutting their rates, I'm taking them out of paying business rates altogether. That means half of our shops, restaurants and gyms pay no business rates at all. And for all other businesses in these sectors, I will freeze their rates in real terms so that none face an above inflation rise for the next two years. Madam Deputy Speaker, to pay for this support for our high streets, I am raising taxes on gambling by increasing machine games duty from 20% to 25% for higher stakes machines, whilst protecting pubs and seaside arcades. I will carve out an adult gaming centres and vape shops from business rates reliefs and extend the business rates transitional Relief supplement for another two years.

And I will strengthen the requirements for online marketplaces so that sellers cannot avoid paying VAT when they sell online. Madam Deputy Speaker For those who feel like celebrating tax cuts for our high streets, I'm providing a £10 million alcohol duty relief for around 2000 small British brewers and British cider makers. Madam Deputy Speaker, Breathing space now fresh hope for the future delivered to the British people by this Labour government. Madam Deputy Speaker, I've made my commitment to fiscal control clear, and every policy in this Budget is fully funded. I have begun by making sure that people who pay the tax they owe, when they owe it, and by closing loopholes in our tax system.

First, I'm giving HMRC funding to improve compliance and stronger powers to collect overdue tax from those who can afford to pay, but ignore repeated contact. And I'm reforming the administration of Self-assessed income tax from 2029, bringing more of these taxpayers in line with the majority so that they make smaller, more regular payments instead of facing large bills that are often harder to pay. Second, I'm changing outdated rules so that people taking profits out of their companies are taxed consistently, and I will protect the treatment of genuine commercial transactions and families passing their businesses down to the next generation.

Third, I modernising the tax treatment of investment by foreign sovereigns. This will bring UK rules more in line with other investment and other nations, while remaining still one of the world's most generous regimes in the world. And fourth, I will resolve the question of VAT for larger taxi companies, ensuring they play by the same rules no matter where they're located, while still protecting smaller local firms. Madam Deputy Speaker, Providing support for British families and businesses has meant raising some tax to meet my commitment to fiscal discipline. I've done this in a balanced way, protecting the incentives for business investment and the incentives and income from work.

I'm maintaining full expenses in corporation tax for eligible assets for other assets. I'll provide I'll provide greater upfront relief for new investment, increasing the main rate. First year allowance from 40% to 50% while reducing the main writing down allowance rate from 14% to 12% and reducing the threshold for business asset disposal relief in capital gains tax from £1 million to £500,000, meaning no change for three and four claimants. And I'm increasing the rates on tax, on income from property and savings by a further two percentage points from April 2027, with no change to tax on income from dividends and no change on tax to income from employment.

 Madam Deputy Speaker, 88% of people will pay no more tax on their savings, and I am taking a new approach today to encourage people on ordinary incomes to save and to invest. I will not go ahead with the cut to the tax free amount that people can put into a cash Isa. The limit will stay at £20,000 per year, tax free for people of all ages, and to make investment more accessible, I will work with the sector to create a new starter Isa to reward first time investors. Finally, let me turn to banks. Our world leading banks make a huge contribution to this country in the tax they pay in the jobs, industry and investment they support.

As Chancellor, I want to say directly to our banks, I celebrate and I am grateful for the role that you play. And amid and amid the global economic storms, I am looking to our banks to help fund breathing space for British families. And so banks will pay an extra 3% on the bank surcharge. This will be time limited to pay for immediate support on energy bills starting in January, ending 15 months later. I've made my choice at this Budget, asking a bit more of our banks to support ordinary people raising taxes on gambling to support good growth on every high street.

And so I challenge the Leader of the Opposition. Does she support? Does she support? Today our support for British families and British firms? And does she back the action we are taking to pay for it? Madam Deputy Speaker, the only way we keep Britain's families and Britain's finances secure for the long term is an economy that is growing strongly, and our country is one of the most innovative in the world. We have top ranking universities, vibrant start ups and deep capital markets. Just today, I can announce over £1 billion of new life sciences investment from Ed Davey from Vertex and Newark, backed by almost £70 million of government funding and support.

Over 1000 jobs. And I can announce that Rolls-Royce will develop their next generation of turbine engine technology here in the UK, in partnership with this government. A £2.5 billion investment supporting thousands of jobs across the Midlands, Bristol and the UK. Madam Deputy Speaker, I want to build on our strengths to unleash the innovation power of Britain, to drive competition and raise profits in British business, drawing a line on the cost, holding business back with stronger public control, as I have done today on energy. Proudly backing Britain's entrepreneurs to succeed and unlocking the potential of every part of this country with a new wave of devolution.

Madam Deputy Speaker, the biggest barrier to fast growth firms here in Britain is investment here in Britain. In today's Budget, I'm boosting investment through our public financial institutions. A further 20.4 billion for the National Wealth Fund and the British Business Bank over the coming years, supporting 140,000 jobs. And I'll work with pension providers, with asset managers and with the wider industry to accelerate more private investment into Britain's innovative, fast growth firms. We will prevent regulation from holding back investment by removing regulation and tariffs worth £800 million to business. We will legislate for a regulatory carve out so that innovative products like drones and medicines can be safely tested and rapidly scaled.

And I'm re-establishing the Better Regulation Executive to cut outdated regulations and admin burdens on business and on workers scrapped by the Tories, re-established by this Labour government. And I'm determined that we use public procurement to back British businesses, to buy British goods and promote British exports. So I'm expanding challenge led procurement just as I did in defence, so government can be the first customer for innovative firms. And I'm developing a new definition of UK supplier to identify the companies creating genuine wealth, genuine investment and jobs here in

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Britain. Madam Deputy Speaker. Order. Order! Mr. Cartlidge, I think

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Order! Mr. Cartlidge, I think you spoke more words than the Chancellor during this statement, Chancellor during this statement, so let's try. Lewis Atkinson. Do not leave that to them all, Chancellor.

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Madam Deputy Speaker, thank you. Nowhere is the necessary role for the state clearer than in artificial intelligence to forge a British way to seize opportunities and guard against the risks that is based on security. We are all. We are already world leaders in AI safety and security, which today's Budget backs with an extra half £1 billion. And it is based on sovereignty with our first of its kind sovereign AI unit protecting UK interests by channelling government investment into strategic British AI firms. Backed today with another £140 million. And to ensure our most sensitive data stays under British control, I am setting out a new deal for data centres in the UK.

When the NHS uses AI to treat patients. We want that data here. When our armed forces use AI to keep us safe, we want that data here. So here's the deal. And today, launching a new British data centre covenant with strict tests that data centres must meet to invest in local communities, create local jobs and protect local water supplies. In return, critical data centres will get the grid connections they need and, where necessary, be allowed to build on site generation while they wait. Built on sovereignty and security. I want to ensure that the British people can benefit from the huge potential upsides of AI.

With the new AI Challenge Prize to find innovative uses for AI in public services and the Union Learning Fund to back workers. This is how Britain leads on AI secure, safe and working for the British people. Madam Deputy Speaker, let me turn to enterprise. Britain does not lack great entrepreneurs. Too often we invent technologies the world wants here in the UK and then see the jobs and the profits go somewhere else. High growth firms make up less than 1% of small and medium sized businesses, and they generate more than half the output from the start-ups of today to the scale ups of tomorrow, to the billion pound companies of the 2030s.

I want to see them succeed and stay in Britain. So for those for those just starting out, I'm tripling the trading allowance, the amount you can earn from a new venture tax free from £1000 to £3000. I'm launching a new Young Entrepreneurs Allowance, which will cover a year of living costs for young founders while they turn their ideas into businesses. And as recommended by the Women in Tech Task Force, I am also announcing a new scale up programme to support female founders, and the British Business Bank will double its commitments to women led businesses and funds to £200 million.

We need to get the best talent into our fast growth firms. And so I am reforming skilled worker visas and non-compete clauses in contracts so that people who help build one successful company can move easily onto the next. And building on our world leading EMI scheme to. Today, I'm launching EMI two, doubling the generosity of the company's share option plan so more companies can hire and retain top talent as they grow. Madam Deputy Speaker, let me say this to the men and women building their businesses in Britain. I know starting a company takes. I know starting a company means taking a risk, often leaving a secure job and build something that there's no guarantee will work.

 And I believe that when business founders take that risk, build an exceptional company, create wealth for Britain, we should recognise that success and keep those people here to invest again. That is why today I'm announcing a Founders Relief, a brand new relief in capital gains tax, a 10% rate on lifetime gains, up to £10 million for the founders of our most successful firms. Madam Deputy Speaker, this is how we make Britain the place where the companies of the future are built. Entrepreneurs backed by this Budget investment, backed by this Budget, talent backed by this Budget, innovation, backed by this Budget, growth, backed by this Budget and delivered to the British people by this Labour government.

Madam Deputy Speaker, when I talk about unleashing Britain's innovation power, I mean in every part of Britain. That's why we reformed the Treasury's investment manual, the Green Book, so that we can invest in the potential of every town and city. That is what I do today in the West Midlands. £10 million for a new market hall in Stafford in the South West. £10 million for Bristol's Temple Quarter and £3 million to help Plymouth's young people get jobs in defence in the east of England. New access to government borrowing for the Cambridge Development Corporation Building. £10 million for Bury's indoor market.

20 million to restore Liverpool's Littlewoods
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John Healey Portrait Rt Hon John Healey MP, The Chancellor of the Exchequer (Rawmarsh and Conisbrough, Labour)
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hold the next International Investment Summit in Gateshead in Investment Summit in Gateshead in the spring. Madam Deputy Speaker, the devolved governments will receive equivalent funding for the measures in this Budget. And today I'm also investing directly in high growth industries in Scotland, growth industries in Scotland, Wales and Northern Ireland. In Wales, 2.5 million for a science Wales, 2.5 million for a science park in North Wales, 11 million for the Aberavon Bridge, 30 million for the Cardiff Parkway station in Scotland, 18 million for advanced chip design led by Edinburgh University. 6 million for Glasgow's Scottish event campus and in Northern Ireland, 7.5 million for AI and Cyber in Belfast.

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I'm sorry to interrupt the Chancellor again. Mr. Holmes, just like last year, your voice is carrying far too heavily across the carrying far too heavily across the chamber, and the member and the Member for Bridlington on the wall promised me and his young daughter promised me and his young daughter this morning on the way to work that he would behave. He has let

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Chancellor. Madam Deputy Speaker, all power

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Madam Deputy Speaker, all power to your elbow. Madam Deputy Speaker, London is the UK's economic powerhouse. But if our other great powerhouse. But if our other great cities match their counterparts in France and Germany, growth in this country would be transformed and country would be transformed and local leaders shouldn't have to come cap in hand to Whitehall to build a new tram or a new concert build a new tram or a new concert hall. And when those projects lead to growing local companies and rising local incomes, it should be those same areas who keep the proceeds.

This radical rewiring of the state is a dual mission led by the Treasury and number ten North. In today's Budget, I'm announcing new good growth funds for mayors and incubator capital for areas without mayors. I'm announcing flexible funding to invest in local economies, boosted by a further £1.5 billion of devolved loans for mayoral authorities, funds that will back projects like the new Black Country Metro Extension, led by the mayor of the West Midlands, or the Urban Regeneration in Gateshead Quayside, Gateshead Quayside, led by the mayor of the North East and in my home region, the reopening of Doncaster Airport, led by the Mayor of South Yorkshire.

Madam Deputy Speaker, this is unfinished business for me as a Treasury Minister. In the last Labour Government, I was proud to help create the regional development agencies. They delivered economic growth, local regeneration before they were axed in 2010 by the Tory Lib Dem coalition. But there is a further step. There is a further step. We never took the most radical act of devolution in a generation. The devolution of tax revenues. That is the step I take today, alongside this Budget, a roadmap for fiscal devolution. For the first time. I'm making the commitment that 100% of business rates will be retained locally by the end of the decade.

So if local leaders help businesses to start and grow, more of the rates they pay will stay in that area. From next year, 20% of business rates revenues will go to mayors. And from 2028, a share of income tax receipts will go to mayors as well. Also from 2028, mayors and other strategic authorities will have new powers to introduce an overnight visitors levy. Taken together, these are long term funding streams. They can be used to back investment into big local infrastructure, so that more of the money that is raised locally can be invested and spent locally spent on projects like the Trent Sports District, led by the mayor of the East Midlands and the Bakerloo line extension, led by the Mayor of London.

Madam Deputy Speaker, new powers to the people who know their areas best not sentimentality, but supply side economics. The biggest wave of devolution in a generation, driving good growth in every postcode delivered to the British people by this Labour government. Madam Deputy Speaker, I decided on an early Budget to give the country a bit of breathing space and to provide stability and direction in the face of speculation. We will continue continue to map out that direction for Britain through the Prime Minister's ten year plan and the spending review. Madam Deputy Speaker, The Labour Party is the party of public services.

Since 2024, we've rejected austerity. We've been rebuilding our public services with over £40 billion a year of extra day to day spending. We're making our streets and borders safer. We're fixing crumbling. We're fixing crumbling classrooms. We're extending childcare. We're. And we're restoring our NHS. We're restoring our NHS, spending 37 billion more on health this year than in the last year of the last conservative government. And today I'm accelerating our work to halve violence against women and girls and setting up a new misogyny prevention fund, partnering with the private sector. I want to pay tribute to my Cabinet colleagues and thank them for everything they're doing, prioritising within their department budgets in the face of tough fiscal constraints in today's Budget.

I'm fully funding the Defence Investment Plan, including through capital Reprioritisation across Whitehall. This honours the commitment made both by me and by the Prime Minister. And as we look ahead to the spending review, we start from a position of strength with spending at that higher base. There will be choices we have to make about priorities, priorities. As we have shown we can, and efficiencies we must deliver. As we've shown, we can. Last year, departments hit double their productivity and efficiency target, generating £16 billion of savings. Asylum costs, which tripled under the last conservative government, have been cut by £1 billion.

Under this Labour government. Strong public services, strong fiscal discipline. Two pillars of our Labour approach. But delivering the next spending review will also require a fundamental rewiring of the state. First, a digital overhaul of government in the Budget. Today I'm investing in AI for the civil service transformation to support saving a further 600 million from back office costs, and alongside my hon. Friend the Health Secretary, I'm launching a review of NHS productivity and AI so staff can spend their time with patients and not on admin. Second, streamlining the state through devolution, reducing the double running between central and local government and.

 Today's Budget provides £100 million for a local apprenticeship service to match young people, with local firms funded from savings in welfare, fraud and error. Third, with a new focus on prevention, just as we ring fence capital spending to invest in future success. So at the next spending review, I will ring fence prevention spending that brings down costs in the future with a new preventative departmental expenditure limits. Madam Deputy Speaker, when it comes to welfare, the last conservative government left a broken system, a broken system which we are changing, bringing back face to face assessments, rebalancing Universal Credit so it doesn't force people to label themselves too sick or to work.

We're reforming Motability and we're clamping down on those living abroad from accessing a UK State Pension on the cheap. But there is more to do. I refuse to write off a million young people like the last conservative government. I refuse, I refuse to see disabled people suffer the indignities of a system that has been found not fit for purpose, and I refuse to allow the burden of paying for this failing system to fall on taxpayers for decades to come. As the Prime Minister and I have both said, we will bring down the welfare bill and we will do it in a Labour way.

Madam Deputy Speaker Alan Milburn and the Timms panel will publish their final reports next month. This government will then set out our response before the end of the year, with a White Paper and legislation to follow next year. The Prime Minister has already announced that from 2030, we will adjust the triple lock so that the State Pension rises every year and keeps pace with earnings and inflation. This will save £15 billion a year by the end of the 2030s, £50 billion by the by 2050. A new settlement for older generations, a rising State Pension and a National care service that is there when older people need it.

Taking the burden off families, taking the burden off our NHS. Taken together, these reforms reject crude cuts that intensify cost of living pressures and drive up costs elsewhere in the system. Taken together, these reforms will rebuild our welfare system so that it supports people from youth into old age. This is our labour approach tackling long term challenges, improving public services, restoring hope for the future. Madam Deputy Speaker, let me come now to two more long term challenges. First, defence. The week in Kyiv started with Russia launching another brutal ballistic missile attack on the city. And this morning, the Prime Minister and I called President Zelensky to tell him about our commitments in the Budget today.

He told us, you've made my day. £10 billion of additional economic and military support based on loans in export finance guarantees, and half a

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million in urgent military funding for this winter. Yeah. The whole house, the whole

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The whole house, the whole country is united for Ukraine. And today we send a clear message to Moscow. Britain will stand with Moscow. Britain will stand with Ukraine for as long as it takes. Ukraine for as long as it takes. And in this new era of threat, the demands on our UK defence are demands on our UK defence are rising. Keeping the people safe by equipping our armed forces is the first duty of any government. I say this as Chancellor. I say this as former Defence Secretary, and I say this as a dad whose son is an Army reservist, a reservist that came back four years ago from early training to say they had no kit and they had no bullets to fire.

That's the truth. For 14 years, conservative governments hollowed out and underfunded our armed forces. And I'm proud to be part of a Labour government that has made the biggest increase in defence spending since the end of the Cold War. This year, our defence Budget is £14 billion higher than it was in the Conservatives last year of government, and at the Spending review next year, I confirm that I will set out the details of how of how we will meet our NATO commitment to spend 3.5% of GDP on defence by 2035, with a target date for 3% in 2030.

Today, I'm getting work underway to get there in a fiscally sustainable way that will include looking hard at public spending, as I have done today to fund Defence Investment Plan, but I'm also determined to use more innovative financing alongside the private sector and our international allies. So first, I'm launching today a new innovative defence finance task force to lead this work ahead of the spending review. Second, I'm now confirming that we will commence treaty negotiations on the multilateral defence mechanism or bank with Finland, Poland and the Netherlands to boost defence, investment and joint procurement across NATO allies.

Third, we will expand our defence industrial base by getting the maximum amount of private investment into defence, including through public private partnerships. And fourth, as an immediate step, I can tell the House that the National Wealth Fund and the British Business Bank will launch a new focus on defence, dual use technology and sovereign capability, deploying up to £5 billion of investment and lending over the next four years. Madam Deputy Speaker, I will ensure this record defence investment works twice, once for our national security and once for British jobs and British business places across all four nations Barrow, Rosyth, Aldershot, Aldershot, Plymouth, Glasgow and Belfast.

Reindustrialised and transformed. Security for our nation. Jobs for our people. Fresh hope for the future delivered for Britain by this Labour government. And let me now turn to housing. On Monday, the Prime Minister and I met les at the Connexions Project in Saint Martin's in the fields, just a stone's throw from this chamber. He'd spent three months sleeping on the streets. Now he has a room. He has medical help. And he has a bit of hope for the future. And he's told me now I have a chance. Now I have a chance. I want to make something of my life.

And Anne, the nurse at the project, put it this way. She said they put the team around the person and that's what we will do as a The Conservatives did promise to end. Yet when they left office, it had doubled. Ten years ago, as shadow housing secretary, I argued that rough sleeping was a shame on the nation. I said it could be solved, but only with national will. Government can fix this if it

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chooses. And this government has chosen. Yeah. We've already promised everyone

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We've already promised everyone sleeping rough a roof off the streets this winter. And today I streets this winter. And today I confirm a further £430 million to keep that offer open for the rest of this Parliament. Not just this of this Parliament. Not just this winter, but every winter. This is a moral mission for me. It's a moral mission for the Prime Minister. It mission for the Prime Minister. It is a moral mission for the Labour Party. Madam Deputy Speaker, home is the heart of all our lives. It's the foundation on which we raise our families and build our hopes.

Rough sleeping is the sharp end, a symptom of a system that feels broken to too many people. Since the 1980s, Britain has lost over 2 million council homes. Tonight, more than 170,000 children will sleep in temporary accommodation and 2 in 5 young people are trapped, paying more than a third of their income on rent while they watch their hopes of buying their own home slip away. So I'm taking action today to deal with immediate pressures and taking decisions to start to deal with the long term challenges, to get more homes built. I'm drawing the line on constant changes to building regulations, no major changes to building regulations in this Parliament except where critical for safety.

And I'm removing biodiversity requirements for more brownfield sites to get more council homes built. I'm extending cheaper borrowing for councils and making all land sold to social housing providers VAT free. And today I'm providing an additional £1.5 billion for the social and affordable housing programme, taking our total government commitment back in council housing to £40 billion. Madam Deputy Speaker, the council, the conservative, sold off our council houses. Labour is now building them back. And finally, for every young person who's working hard, saving what they can and dreaming of their first home, I'm taking action.

I'm announcing that a first time buyer, Isa, will replace the lifetime Isa. And from today, I'm dealing with the likes of penalty. So that if the home you want costs more than the limit, you will get back at least what you put in. And I'm going further. From next spring, a new scheme for first time buyers who don't have the bank of mum and dad behind them. Your first home, an equity loan scheme which I'm funding today with £4.7 billion of government backed lending. Madam Deputy Speaker, hope starts with a home. A route off our streets.

A secure home to raise your kids. The keys to your own front door. Delivered to the British people by this Labour

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Government. Madam Deputy Speaker, this is a labour Budget for the worker, the labour Budget for the worker, the sole trader, the parent at the school gate, the young person desperate to start their first job or start their first business. These are my choices, raising revenue from those who can afford revenue from those who can afford to pay no tax, rising on wages or dividends, cutting taxes for dividends, cutting taxes for millions of families and businesses. And just as the British people

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helped support our banks 20 years ago, it is our banks that will help give families breathing space today. Yeah.

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Yeah. And for our high streets, it's gaming machines and vape shops that will help provide the funding for will help provide the funding for our pubs, our shops and cafes to thrive. Breathing space now, while taking the long term action to get costs down for good. The decisions I've taken today will help steer I've taken today will help steer Britain through. And when the storms pass, what matters is where Britain is heading. A Britain reindustrialised a Britain with our return to communities. Threats deterred. Global opportunities seized in our first 100 days, this Labour government has set a course for fresh hope, good growth and support for those who need it.

We know who we are. We know who we are. We know where we're going.

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Mr. Battersea no need, no need. Chancellor.

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Chancellor. Madam Deputy Speaker, we know who we are. We know where we're going. We can see the Britain we going. We can see the Britain we want to be. It's a vision burned into every line of this Budget statement. Madam Deputy Speaker, breathing space now fresh hope for the future delivered to the British the future delivered to the British people by this Labour government. I commend this statement to the House.
13:29
Nusrat Ghani Portrait Ms Nusrat Ghani MP (Sussex Weald, Conservative)
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Of de. All. Under Standing Order Number 51. The first motion, entitled Provisional Collection of Taxes must be decided without debate. I call the Chancellor to

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move the motion formally. Formally. The question is that pursuant to

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The question is that pursuant to section five of the Provisional Collection of Taxes Act 1968, provisional statutory effect shall provisional statutory effect shall be given to the following motion Stamp duty land Tax Local Government Pension Scheme pools Government Pension Scheme pools motion number 49. Stamp duty land tax withdrawal of Group relief. tax withdrawal of Group relief. Motion number 51. Value added tax electric vehicle charging motion number 55. As many of that opinion say aye. Of the country. No. The ayes have it. The ayes have it. We now come to the motion entitled Income Tax Charge.

It is on this motion. The debate will take place today and on succeeding days. The question on this motion and on the remaining motions be put at the end of the Budget debate on Tuesday,

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the 3rd of November. I call the Chancellor to move the motion formally. Formally. The question is that income tax

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The question is that income tax is charged for the tax year 2020 728, and it is declared that it is expedient in the public interest expedient in the public interest that this resolution should have statutory effect under the provisions of the Provisional provisions of the Provisional Collection of Taxes Act, 1968. I now call the leader of the Official Opposition, the Right Honourable Kemi Badenoch.
13:30
Kemi Badenoch Portrait Rt Hon Kemi Badenoch MP (North West Essex, Conservative)
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Thank you, Madam Deputy Speaker, and I would have thanked the Chancellor for advance sight of his Chancellor for advance sight of his statement, but it was so redacted it was like reading it in the dark. There were more. There were the only the only numbers were the page numbers. Quite frankly, Madam

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Deputy Speaker, this is Labour's third Budget in office. I apologise for interrupting the

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I apologise for interrupting the official. The leader of the official opposition members are leaving. They should leave very leaving. They should leave very quietly and very quickly. Right.

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The Right Honourable Kemi Badenoch. This is Labour's third Budget in office, this time with a new Chancellor. Can I welcome the right hon. Gentleman to his place? I believe there is a term in Rugby called a hospital pass, which sums up the inheritance he received from his predecessor last year. She gave us the Budget for Benefit Street. I said it would be her last Budget. I was right, he may want to blame external events, but Labour's last two budgets weakened our economy before any wars. He has got a big job to do cleaning up her mess and this Budget fails to do it.

He is giving this Budget at a time of great economic danger. We are spending more on debt interest than on the army and schools combined. The rate of interest we pay on our debts is higher than Greece, Latvia, Slovakia, even the Socialist Republic of Vietnam. Next year, under Labour, the tax burden will be the highest in our country's history, and our benefits bill is going up by tens of billions of pounds because this government has put welfare first. We are overspent, over borrowed, over taxed and drowning in an out of control welfare system. And this is his answer.

It is simply not enough. Not good enough, not strong enough, not bold enough. Last week, the government published its resilience plan. I'm afraid three days of baked beans and a wind up radio are not going to save us. Labour's Britain has no resilience. There is no household resilience because families are struggling to make ends meet. There is no fiscal resilience because we are borrowing just to pay the interest on our debt. There is no economic resilience because businesses have been taxed so much, they are closing down and shedding jobs and there is no national resilience because we are not ready, certainly not after that speech to meet the security threats of today.

We all know why he's delayed until tomorrow. Difficult decisions he should have taken today. It is because the Prime Minister wants to keep the option of an early general election open, putting his party's interests before the country's. But there are some things in this Budget I will welcome some of the Chancellor's colleagues the Deputy Prime Minister, the Defence Secretary, the Energy Secretary. They were calling on him to increase capital gains tax. Can I thank him for ignoring them? They were wrong. Tens of thousands of wealth creators have already fled Labour's Britain, and if he listened to his colleagues bonkers ideas, many more would be heading for the departure lounge.

I am also glad that he has broken Labour's manifesto pledge on the minimum wage for young people. That pledge was wrong and breaking it is the right thing to do to help young people get jobs. Can I welcome his U-turn on ISIS? He is reversing his predecessor's raid on ISIS. Thank you. But his new tax on savers will penalise the prudent and all those people who have done the right thing. I'm glad to see that he has agreed with our campaign on the previous Chancellors fuel duty rise. Motorists will be pleased that would have inflicted real pain, especially while petrol prices are so high.

But they will go up in

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July. Why we froze fuel duty for 14 years. They can do better than that. Yes.

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Yes. I know that Labour MPs probably didn't like those bits of the Budget, but can I take a moment to Budget, but can I take a moment to say to the right hon. Gentleman, that I have been appalled to see the brutal briefing about him from his own side in this week's papers one Labour MP, one Labour MP, one Labour MP, one Labour MP, called him slow, a dud. Visibly out of his depth, said another. I can assure him that he will not be. We've all. We've all read it. Who said it? Why are they.

They're not my words. They are their words. There's. Yes, one of them did it. Another came in after. I can assure him that he will not be hearing that kind of language from this side of this House today. But with friends like that, who needs enemies? Madam Deputy Speaker, but most people in the country listening to his Budget will be thinking to themselves, is that it really is that it? The Prime Minister came in promising to reverse 40 years of neoliberalism. Instead, we got £0.04 of gherkins. Unfortunately, just like every other labour Budget, the headline story is the same.

More borrowing, more tax rises and surprise, surprise, more money on benefits. This Budget does not come close to meeting the moment. Last week, Labour MPs were asking for a Budget which did no harm. This shows how little ambition they have for this country. Let me tell them the harm has already been done, not not facing up to the tough decisions we need to take is itself an act of immense harm. Many on those benches do not understand that our national debt is now more than £100,000 for every household in this country. They do not understand why it's a problem that a quarter of all working age adults are now claiming some form of benefits.

They do not understand that if Russia launches an attack on NATO in the next three years, as the government's own intelligence suggests, we will be at war without the means to

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properly defend ourselves. Order. Dawn Butler Adam Jogee

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Order. Dawn Butler Adam Jogee and Mr. Vince, what would Baby Patrick say? Behave better than

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Patrick say? Behave better than your child. Official Leader of the Opposition. Madam Deputy Speaker. Look at

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Madam Deputy Speaker. Look at them. If war comes, do we want this lot running the country? People so unserious that they don't unserious that they don't understand that you can't have Social Security without national security? Because if you cannot defend your country, there will be nothing left to defend. To be honest, I don't I don't blame the Housing Secretary for stocking up on serving on blank. If Russia attacks with these guys in charge, we'll all need a drink. The fact is, the fact is the Defence Secretary is country. He couldn't even commit to 3% on TV the other day.

He's still not doing his job, Madam Deputy Speaker still not doing his job. The fact is there are huge problems coming down the road and this Budget is simply trying to get through today. It is the Budget forgetting by not forgetting on. I was cautiously optimistic when the right hon. Gentleman was appointed Chancellor. This is a man who once seemed to grasp the danger that Britain is now in. I thought that he was putting. Country before party. When he quit as Defence Secretary. He will remember, I said he was a man of principle. Let me remind him what he wrote in that resignation letter in June.

He said, I am certain that a date for 3% of GDP on defence in 2030 is what Britain must set. I feel I haven't finished, they've got to wait for the punchline. They're so slow. Gotta wait for the punchline. He went on to say that if that did not happen, he would be forced to make decisions which increase the risk to personnel on operations and could make our country less safe. Today is the day he should have said that date. Today. He is the man who has failed to set a plan for 3%. Today is the day that we should have got the plan.

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Order, order! I'm not sure which side is the most noisy the Defence Secretary we are. You're going to have to have a lie down in a dark room. If you

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lie down in a dark room. If you carry on like that. Right honourable Kemi Badenoch. He should have set out a plan

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He should have set out a plan for 3% today. So now he is the man who is increasing risk to personnel who is increasing risk to personnel on operations. He is the man who is making our country less safe. He has failed his own test. This is on him and no one will ever forget. If he had any decency, he would resign again today. Yes, he has funded the Defence Investment plan. That is welcome. Yes, there is more support for Ukraine. That is welcome. But he said himself in June that wasn't enough. What he's done is he's given himself a bit of breathing space, given himself a bit of breathing space until next year.

 Instead, what we have is a plan to have a plan. I bet Putin's really scared now. We know. We know that finding the money is difficult, but it can be done. On this side of the House. We have found the savings to get to 3% because we know Britain is facing very serious threats. The defence funding they have announced today relies on more borrowing. Let me explain why this will only make us weaker. The OBR confirmed today that Britain's national debt is forecast to increase again. We are borrowing just to pay the interest on that debt.

The credit card has been maxed out and he is taking out new credit cards just to pay the interest on the old ones. In three Labour budgets, they will have added more than £260 billion to the national debt. Our great grandchildren will be paying for their total lack of self-restraint. Meanwhile, the Prime Minister is fantasising about rejoining the EU. There's just one problem under Labour. Britain is now borrowing so much that we wouldn't even qualify for EU entry. The Chancellor clings to the IMF's praise of the government's deficit reduction plans. The truth is the IMF have to take at face value the idea that Labour will cut public spending massively just before the next election.

Really? Are these MPs signed up to the cuts in those plans? These are the same MPs who voted down the most modest welfare reforms in the history of this House. They are never going to cut spending. That's why this month, the IFS described their plans as a work of fiction. I tell you, who else isn't fooled by Labour's fantasy figures? The bond markets. Britain is now paying more to borrow than at any point in the last 30 years. Any point in the last 30 years. Those borrowing costs are hurting people today. Businesses are struggling to afford loans because of rising interest rates.

Five year mortgage rates are now above 6%. Rates are far higher now than they ever were under us. So the utter cheek of the Chancellor and Labour MPs to raise the mini Budget when government borrowing rates are far higher now far higher now their rates are higher than under any conservative Prime Minister. These are their interest rates. These are their borrowing costs. This is their mess. This is their mess, Madam Deputy Speaker, and they need to own it. And he knows. Madam Deputy Speaker, the Chancellor knows that next week, interest rates are expected to rise again.

Yeah, only the Labour Party would think the answer to this is to spend more money. I know, I know the the Education Secretary can't count. So she thinks this is all fantastic. Keep on. Have you got

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something more to add? Can you add. Inflation?

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Inflation? Oh oh. Order.

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Oh oh. Order. We have to showcase the best of ourselves. Our constituents are ourselves. Our constituents are watching. Oh, I, I really I really don't need any help. I miss Emily don't need any help. I miss Emily Darlington normally so polite and so well behaved today. Not a great day, not a great day.

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Thank you, Madam Deputy Speaker. They love to dish it, but they can't take it. They love to dish it. But what was that? What was that? Education Secretary? I'm sorry. Education Secretary? I'm sorry. Sorry. I'm sorry, I can't, I can't, I can't hear her, Madam Deputy Speaker, because the rest of the Speaker, because the rest of the class are making too much noise. Inflation, Madam Deputy Speaker is Inflation, Madam Deputy Speaker is eating away at our standard of living. Their friends in the Joseph Rowntree Foundation have said that this could be the worst Parliament for living standards on record.

But Labour have looked after their people. There have been plenty of pay rises for the unions.

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Yes.

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Benefits will go up. It's true. There have been plenty of pay rises There have been plenty of pay rises to their friends in the unions. Benefits will go up by inflation in

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April, but private sector wages this year are below inflation. Yeah. People in the private sector are

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People in the private sector are getting poorer. They can all feel it. Those on benefits are getting an increase, while those going out to work will not. That is not fair.

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Yeah, yeah. The problem, Madam Deputy Speaker, is that Labour are Speaker, is that Labour are addicted to spending other people's money and addicted to welfare. The money and addicted to welfare. The welfare Secretary said it himself. Every meeting I have is Labour MPs asking who can we tax to pay for asking who can we tax to pay for more benefits? Since the last Budget just 11 months ago, the equivalent of the entire city of York has signed on to disability benefits. And why wouldn't they, when sickness benefits pay more than the minimum wage, jobs have been destroyed by labour, and this government has made it easier than ever to claim.

It is honestly like their policies are designed to get people off work and on welfare. Just because just because it's called Universal Credit, doesn't mean that everyone in the universe should be on benefits. And this is not Madam Deputy Speaker. This is not just about cutting the benefits bill. This welfare burden is deeply unfair to those people who are working hard, making ends meet, those people making tough decisions about whether they can move home, whether they can afford to have children. How do you think they feel when they hear that working age welfare is now costing every taxpayer £4,000 a year?

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Wow. Yeah. Cutting welfare isn't just about

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Cutting welfare isn't just about saving money. A million young people in this country wake up with people in this country wake up with nothing to do and nowhere to go. Unemployment among 20 to 24 year olds is now higher in London than in Bulgaria, the second poorest in Bulgaria, the second poorest country in the EU. Labour are creating a lost generation, isolated and powerless over their futures. Madam Deputy Speaker, Britain is about to collapse under the weight of welfare. We have to start showing people some tough love. Deep down, the Chancellor knows that spending more money is not the answer.

He talks about giving people breathing space, but they are the ones choking the economy. £70 billion of new taxes in just two years and they've put them up again today. He said he wouldn't be putting taxes on working people. That's what the Chancellor said. But he has because they are taxing everything that they can get their hands on. They have taxed jobs, they've taxed pensions, tax cars. They've taxed the rental market today, tax savings, taxed investments, taxed homes. He asked me if I support the action that they're taking today. No, I do not support the action that they're taking today.

The Chancellor also said that this is a Budget for business that will unleash enterprise. That must be why the entrepreneurship adviser quit this week. There is nothing for business here, Madam Deputy Speaker. Nothing for business here. He wants to charge them more for what was it, Union learning fund. I mean, they don't want these random new schemes. Let me tell him. Business confidence is negative. Not just this quarter, not just the last quarter, but for seven quarters in a row. That's never happened before. And in case Labour MPs don't understand what that means, the last time business confidence was positive was when we were in charge.

He says he is helping with the cost of doing business. Businesses need cheaper energy, flexible labour markets and lower taxes. They are getting none of those. Nearly half of businesses say they cut employment because of Labour's jobs tax. There are now fewer vacancies in the economy than at any point in the last 12 years. Outside the pandemic, graduate vacancies are down almost 50% this year. They were the worst on record last year. Under Labour they were again even worse, worst on record this year. I was hoping that he would do something on plan two student loans today, but he hasn't even done that.

When was the last time any of them spoke to a graduate looking for a job? Parents are watching their children receive rejection after rejection. Companies report 140 applicants chasing every job. Unemployment has risen by a quarter of a million people since labour came in. A quarter of a million people under this lot. So let me tell them some home truths. They have made wages expensive with their jobs tax. They have made energy expensive with their net zero policies. They have made capital expensive by increasing the cost of borrowing. What happens when wages, energy and capital are expensive?

Nothing gets built. That's why the economy is grinding to a halt. Labour said they were going to build 1.5 million new homes. I remember when the housing Secretary first started and I told her that she'd been stitched up. Do you know what she's saying now? She says, now there is a slim chance, a slim chance, of building 1.5 million new homes. They're not going to build them. They're not even going to build as many as we did. Despite their lofty ambitions, they promised to secure the future of Britain's steel industry. Now taxpayers are spending £1.3 million a day propping up British Steel alone.

 They promised to create 650,000 clean energy jobs. Where are they? Where are they? 650,000. Nothing has been created except unemployment. Madam Deputy Speaker, let me tell you what's actually happened since last year's Budget for benefit street inflation up, government spending up. They can join in on that side now. They know the words. We heard them. They know the words debt, interest, mortgage rates, up, benefits, claims up, unemployment up, welfare spending up. Madam Deputy Speaker, the report card is not looking good. They are making the same mistake with banking that they made with oil and gas tax, one of Britain's flagship industries, until they pack up and leave the result, the

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country gets less money in tax. Mr. Gemmell yowling for so long

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Mr. Gemmell yowling for so long with very bad for your throat. So with very bad for your throat. So simmer down, simmer down. Right

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honourable Kemi Badenoch. I see the Minister is leaving.

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I see the Minister is leaving. Madam Speaker, I guess he couldn't handle the truth. Scott, leave. Everything. Everything in our economy is being made more expensive by Labour's taxes. Next year. Under them, Britain will have the highest tax burden in our country's history, higher than the 1970s, higher than in the Second World War, higher than in the Napoleonic world.

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She asked. She asked, whose fault is that? It's your fault. It's your fault. She's asleep at the back of the class. Education Secretary. You might want to take a look at that student, but Madam Deputy Speaker, what have we learned? What have we what have we learned? What have we learned from the OBR today? Growth next year is downgraded. Inflation next year is downgraded. Inflation up every year until 2030. Real household disposable income lower

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every year. Yeah. We have learned that his debt

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We have learned that his debt interest bill will be £14 billion higher than expected. And the debt higher than expected. And the debt will be higher in every single year compared to the previous plan. How is this giving us breathing space? is this giving us breathing space? How there is a better way that actually delivers for the people of actually delivers for the people of this country. There is a logical order to creating growth in an economy. You have to create value, prosperity and wealth first before you distribute it. That's how it works. Labour are only interested in the distribution.

They have no plan to create any value at all. This side of the House wants to see Britain richer, more prosperous, thriving, not just a little bit of breathing space. That is why conservatives are proposing tough love. We will cut spending by £70 billion, including £36 billion from welfare cuts, which are fair to taxpayers and fair to those who really need support. We would use half of that money to cut the deficit so Britain doesn't go bankrupt and borrowing rates start to come down. That's how we get cheaper mortgages and we will fund our defence properly, because keeping our country safe should be the first priority of any government.

Madam Deputy Speaker getting the public finances under control. Living within our means allows us to cut taxes, because that's what really gives people breathing space. Scrapping the carbon tax to bring down energy bills, scrapping stamp duty, abolishing inheritance tax on family homes. That's what people want. So let's cut spending, cut the deficit, fund defence, cut people's taxes. That, Madam Deputy Speaker, is the Budget the Chancellor should have delivered today. That is the Budget conservatives would have delivered, and that is going to be the choice

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at the next election. If members are exiting, they

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If members are exiting, they should do so very quietly and very should do so very quietly and very should do so very quietly and very quickly. Vicky, you naughty girl. If colleagues can be seated so we can hear the first of the backbench contributions. We come to the Treasury Select Committee Chair. De Meg Hillier.
13:57
Meg Hillier Portrait Dame Meg Hillier MP (Hackney South and Shoreditch, Labour )
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Thank you, Madam.

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Deputy Speaker. I think the Honourable right hon. Lady opposite needs to really hon. Lady opposite needs to really have a tough look at the reputation of her government. Because she talks about welfare, she talks talks about welfare, she talks about defence, and it was her government that crashed the economy. And under her government, the And under her government, the welfare spending rose 0.7% of GDP in the last parliament alone and in in the last parliament alone and in the last year of the government in which she served, it rose by £33 billion. So she knows.

We all know reform is necessary and reform is coming because under this Labour government we are reforming the Social Security safety net and ending the scandal of young people on on PIP, who are in droves being put on a benefit that they're less likely to come off than someone over the age of 55. As the Prime Minister said in Prime Minister's Questions earlier, Labour's approach is a names, not numbers approach and there is a lot of thought going in and I pay tribute to Alan Milburn for his thinking about how to reform the system as a whole.

It's easy to talk about numbers and top slicing, but that takes no account of the human beings at the heart of the benefit system. And so we need. I will

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certainly go away from. Lady Giving way, giving a typically powerful speech. But it's over. My 21 years in the House, I've normally found the person who holds her position gives her holds her position gives her somewhat less partisan critique of the Budget, recognising the fact that the primary role of all of us that the primary role of all of us as backbenchers here is to hold the executive to account the government of the day, rather than just

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playing to our party political base. Well, Madam Deputy Speaker, I take I take the reputation of my predecessor, who was who took this job very seriously and would make a point. But I think it's very difficult for me to stand up as a member of the backbenchers of this government and not to react to the party opposite that crashed the economy in 2022 and left a lot of the mess that we're dealing with now. And I am passionate about some of these issues because I spent a long time looking at public spending, looking at the waste of the government before, as indeed the Public Accounts Committee should be quite rightly challenged this challenging this government on any waste of taxpayer pounds because taxpayers work hard for their money, and they need to be sure that someone is watching the government to make sure that they're spending it as as well as they possibly can.

And we know that that is not always a simple task. But I look to welfare reform, for example, and only yesterday I was with the Secretary of State for Work and Pensions in my constituency in Hackney South and Shoreditch, meeting with scope, who's doing amazing work with disabled people, where 72% of the recent cohort were supported, supported into work, were still in work. 26 weeks later, people who'd been written off by the system but helped into work. So we can see this name but not numbers approach. And if we make sure that it's done properly through some of the devolution measures that this government proposes, we can make sure that that is replicated across the country where there are already good examples.

I welcome the decision by the Chancellor to fund the Defence Investment Plan. And again, I looked at this for a very many years as chair of the Public Accounts Committee. It's right that we stand with Ukraine and that is rightly a cross-party position, and it is right that we fund, spend the right money on defence. And it was, unfortunately, the last government that reduced under austerity, the money on defence to a ridiculously low level, leaving us exposed to the challenges of the world we face. And I would hope that we would have a cross-party consensus that we need to increase defence spending and back the Chancellor in that

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mission, I give way. Announced 5 billion more. In the Budget in in the defence

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In the Budget in in the defence research and development, which, as you know, is I forgive. Please be seated, please. You

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Please be seated, please. You will continue. Whose phone is going off? Mr. Davidson, please fix your

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off? Mr. Davidson, please fix your phone, please. Short intervention. Does the hon. Member agree with me that the government announcing 5 billion more in the Budget for defence R&D through the British Business Bank, could have profoundly positive implications for our national security and growth, as I've urged, if the government scales it further from

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here. Yeah. Well, I thank the hon. Gentleman. I count as an hon. Friend because he serves, of course, on the Treasury Select Committee and is an indefatigable in his attempt to make sure that government is make sure that government is listening about research and development in in defence and across wider sectors. And so it across wider sectors. And so it sounds like between us, the government has heard that message. Before I move on to the main thrust Before I move on to the main thrust of the Budget, I do also want to comment on the leader of the opposition's comment about plan two student loans.

As a Select Committee, we looked at this issue. It is having a very big impact on that generation of young graduates. The engine room of Britain, the people who will be funding and growing our economy in years to come, and making sure that the ageing population is supported. So we need to do everything we can. And intergenerational fairness is a big strand of our concerns. On the Treasury Select Committee. But let's be clear who was it who set up plans to student loans? It was the government opposite. And this is I talk a lot about slow politics, that governments should make decisions today that will stand the test of time in ten and 20 years time, as well as dealing with the challenges of today and the catastrophes that might occur, whether it's globally or locally next week.

But it was designed by her government, and that was a ticking time bomb left for this generation to pick up. So while I am saddened that we haven't been able to see a change to the threshold at which those repayments are made, I would hope that the Chancellor could consider that as part of his longer term plans, to make sure that that generation has one less burden upon them, and I hope that we will see some some talking about that in the weeks to come. One very important issue arose before the Chancellor rose to his feet.

Madam Deputy Speaker, it seems that some bank shares increased in value, and I am concerned and will be, with the permission of the Treasury Select Committee. Writing to the FCA, the Financial Conduct Authority, to see if there is any evidence of leaked market sensitive information that may have led to that movement, because that would be a very serious issue. And on that point, I would congratulate my right hon. Friend for his very strong clampdown on speculation and leaks ahead of East Hampshire. He has shown that that he knows, as we all do, that stability is so important and that wild speculation, he cannot completely halt that.

But. But clamping down on leaks from the Treasury itself is a very. And the system itself is a very important aspect. And despite the headwinds, that forecast has only slightly worsened. We've seen a Budget that pushes stability and we've seen some some particular changes that I would welcome. The Treasury Select Committee looked at cash ISAs and the changes that were being proposed and were proposed in last year's Budget. And as as we said then, it was not the right approach. Building society societies use cash ISAs to lend to home purchasers, and they were going to be particularly badly hit.

And most people have much less than £20,000 in a cash isa. Many never get anywhere near the 12,000. The average is between 3 and 7, depending on where you how you cut the figures. And so I think it is right that the Chancellor has done that. And I look forward to seeing the start of Isa for investors. And we as a committee, obviously will be examining these in detail. But the the the proposal had overcomplicated the system. The Isa is a trusted brand. And I think it's a good step that that that the Chancellor has made.

And on the subject of building societies and mutuals in a hidden corner of the Red book, there is the. There is the announcement that my hon. Friend the Member for Peterborough, has been appointed as the Co-ops and Mutuals champion for the government. I commend him on that position. After many years of hard work in this area and as the chair of the Co-operative Group of MPs in Parliament, I'm delighted that the government is leading in further to the progress it's already made to support co-ops and mutuals. This is important to get that growth and and involvement of people in every community up and down the country, because this is a way of people owning and having some say in the shaping of their services and their outcomes, whether it be a credit union or a co-op or a childcare co-op, the list goes on.

There are many, many opportunities there. And I welcome the lifetime Isa reform again, something the Treasury Committee spoke produced a report on the removal of the penalty payment. It seems like the only just approach to that. And we have this challenge when ISIS and these products are created, and sometimes they don't work as well as they could. So I welcome the Chancellor. Looking at that. I'm delighted to see some changes in housing in my own constituency. House prices are rocketing through the roof, rents are high and thousands of people are living in temporary accommodation, not just temporary accommodation, but those who are in housing are often severely overcrowded.

I visit people every weekend who are living with three children and one bedroom flat. That's a very typical picture and no freedom or agency over their own lives to move, because the cost of housing to buy is too high, the cost of rent is too high and we do not have enough social housing. Indeed, it's cheaper to buy back from a leaseholder who is selling their property than to build new. So the VAT reduction for housing associations is a welcome first

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step I give way. I thank the hon. Member for giving way. As a member for a part giving way. As a member for a part of the United Kingdom where government is devolved, despite notwithstanding the good intentions notwithstanding the good intentions coming from this government, sometimes the money that goes north goes into the tube. What comes out the other end is sometimes rather the other end is sometimes rather different, particularly on housing. So is that something the Treasury Select Committee could look at one

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Select Committee could look at one day to see what is delivered? Is what was within the intention of His Majesty's Government. Is that.

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It anticipates a further area of my speech because I believe very, very firmly in devolution. But there are some caveats I would have. there are some caveats I would have. I would say to that and something that we may consider. Of course, I chair a committee. I should say I do not make all the decisions for the committee alone. It's not an autocracy. And I will be discussing that with my committee members, and that's my committee members choose to make it that way. But I think with housing, I think there are with housing, I think there are also areas which would be too detailed to go into the Budget.

But I hope in the forthcoming spending review there is some discussion about system built housing in Murray Grove in Hoxton. In my constituency, there are some millennium products built by Peabody still standing, the test of time built system built offsite. So reducing the cost of construction, making it faster. But we don't have enough throughput in the factories that do this for them to survive and thrive. I think that's a real opportunity for us potentially in the UK. But look, the Chancellor has a huge challenge. We are facing very difficult fiscal circumstances, but in the wider picture we are seeing some green shoots of hope.

 According to early estimates, the economy grew 1.8% year on year in the three months to August and at the fastest pace since the country was re rebuilding from the rebounding from the pandemic in 2022. And GDP has grown at an annualised pace of two 2.7% so far in 2026, with early estimates indicating that growth continued. It will continue into the third quarter. And once we get those figures and productivity is over 1% per worker every quarter since the end of 2024. So this is a degree of hope that if we keep stability and keep focus, that we will see some

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challenges. So the I will give way to the hon. Gentleman. Hon. Member, who's making an

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Hon. Member, who's making an excellent speech. As always, given there is some underlying positivity. Is she concerned that whilst there is support for ongoing support for people with their energy bills, people with their energy bills, there is nothing for the tens of thousands of people in Cumbria and hundreds of thousands across the country who are off grid and who rely on heating oil. Do you think that the Chancellor had room actually to make sure there is a formal cap on energy bills for those people who rely on being off grid, whose bills have gone up

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threefold in the last year? Yeah. I thank the hon. Gentleman who's a good campaigner for his constituency and raises these issues repeatedly, but there has been some support from government on that issue already. And I think on that issue already. And I think that we will, as a Treasury Select Committee, be poring through the detail of what the Chancellor announced today. So he may take the plaudits I've given today. But that's only wait, wait. But but but there will be a detail we will look through because one of the aspects through because one of the aspects here is how much this cumulatively delivers for a household.

But that's been, I know the mission of the Chancellor and the Prime Minister. So, you know, on that point, we will wait to see the detail. But I think there is a limited pot of money, and it has to be targeted at those who need it most, notwithstanding the challenges his constituency face.

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And there are choices to be made. I'll take Chris Philp. Thank you. Madam Deputy Speaker

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Thank you. Madam Deputy Speaker in the House will be determined to know how this Budget is going to benefit Harlow. Would she agree benefit Harlow. Would she agree with me that the £100 payment directly being paid into the bank accounts of residents in Harlow will make a huge difference this winter. And by the way, it will help 30/39,000 households that are

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help 30/39,000 households that are in the A to D category of Council tax. The hon. Member didn't get the chance to use the word Harlow multiple times during the Budget statement. A failure, a failure on his behalf. Dame Meg Hillier.

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Madam Deputy Speaker, I thank the hon. Member for Harlow again, just off his count on how many times Harlow is mentioned in the constituency, but I in my own constituency, around 48,000 households will benefit from the households will benefit from the the Council tax rebate for the A to D Council tax band. I'm assuming the government did this, took this approach. It's a simple way of getting the money into people's pockets, but there'll be a lot of unpicking about how that works. But unpicking about how that works. But it is an instructive figure, in fact, that people think that London has streets paved with gold.

I have 1 in 2 children in my constituency living in poverty are in the top three for the deprivation index of pensioners and in a very high level of deprivation overall. And and there are there are challenges of

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the cost of living. I'll take one last intervention. I'm most grateful to the hon. Lady for giving way. She may not Lady for giving way. She may not have read the Budget book, but actually in 2027, GDP is forecast to reduce from 1.6 back in March to to reduce from 1.6 back in March to just 1%. And indeed, GDP per Capita is also forecast to reduce from 1.3% to 0.9%. So actually the numbers and the forecasts are getting worse, not better.

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getting worse, not better. Well, Madam Deputy Speaker, as the as the hon. Gentleman rightly highlights, I haven't had time in the moment since the Chancellor sat down to go through every graph in the Red book, or indeed the OBR's forecast. But what the Chancellor did lay out very clearly some of the figures at the Dispatch Box. We obviously will be raising these issues in committee, but it's easy to pick one figure where it's gone down, but sometimes it will go up in a later year and there is there is, despite the headwinds, some room for optimism here.

But let me let me be very clear. And I think the Chancellor would expect me to say nothing less. I not only chair the Treasury Select Committee, but the Liaison Committee, and as committee chairs and committees on the committee corridor, we see our role as robust scrutineers of the work of the government, of the day, of whichever party it is, and whichever party we are as a core part of what we do. So there is no way the Chancellor will have to hide when he comes in front of us on the 11th of November, but I'm sure he's robust enough to be prepared and take take on all comers, and he will be face up to

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my hon. Friend I will. I'm very. Grateful to my hon. Friend and chairman of the Treasury Select Committee for Treasury Select Committee for giving way. The trend started by my right hon. Friend for Godalming and Ash when he was Chancellor of Ash when he was Chancellor of giving £3.5 billion to the National Health Service to spend on AI and digital in order to make all departments, and particularly that Department more efficient, was sadly lacking from this Budget. Could she make any suggestions, as chairman of the Treasury Select Committee, as to how digital and AI, with spending from the government,

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could improve government's productivity? Well, I it's quite a detailed point, Mark. The hon. Gentleman raises. But what we know that AI can add about 0.2% to productivity can add about 0.2% to productivity in the economy. Overall, I haven't got direct figures for the for the for the NHS. But I know that my sister committee and led by the hon. Member for Oxford, Oxford West, will be no doubt looking at these issues and the Committee corridor, as he knows, is examining the power of AI. Both the cost, the opportunities and the opportunity to improve productivity in various guises, and it's something that we will, I'm sure, continue to have conversations on in this House and scrutinise government very robustly on.

But I think that that we. What is interesting about today's Budget is there are some measures for today, but there's clearly rooted in a longer term reforms, which is something that I welcome. We need to be thinking about the long term. And one of those is around devolution. I'm a firm believer that power should be devolved to the most appropriate level. In fact, when I was a baby councillor with the then chief of staff to the Prime Minister or the now Chief of Staff to the Prime Minister, back in 1994, I was responsible and he and I were both responsible for devolving powers to areas within pram pushing distance.

This was, I should say, for younger colleagues to. For the days of the internet perhaps dates me too much, but. But giving people say over their own spending in their own local area can be a really powerful way of engaging people with the decisions that they make. Not seeing politics as something distant and remote, but very much part of their communities. I, I'm afraid I've given way many times. There are a lot of people willing to speak, waiting to speak. Whitehall is often just too distant, not just physically and geographically, but in attitude from communities and towns up and down the country.

And I always say, don't make decisions about people without people, but but however good our civil service is, and I pay great tribute to the many civil servants I've quizzed over the years about public spending, there is still going to be a challenge if you don't have the right people around the table, and that could be you just don't know what's going on in that geography. So our mayors have a very important role. But if money is to be devolved to the mayors, there needs to be very strong local accountability. And of course, it was the last government that abolished the Audit Commission, which I think is a great sadness.

We've seen huge challenges in local government audit. The London mayor has the most the strongest accountability, with 25 London Assembly members able to challenge him in open, openly, regularly about his spending and powers to delve into the detail. But mayors don't have in other areas don't have that. And I would say to the government and to the mayors, there is very good reason to have very strong accountability. One, as a mayor, you want to prove to your constituents that you've spent money effectively, and you can be transparent about that so that they know when they can come up for re-election, that you're not frittering away their hard earned tax pounds and that you are delivering for the things that they want to see.

Secondly, if you spend that well as a mayor in your area, you can possibly prove to government that you can get more bang for the taxpayer pound than Whitehall would achieve by doing it from a distance. And sometimes there may even be times when, dare I say it, that the government of the day doesn't give quite enough money to deliver what it was promised for, and you need to have the figures to prove that you actually short changed. So in all of those circumstances, we need to see a stronger accountability process. And I hope that in the drive towards devolution, that we don't go so fast, that we don't have those checks and balances in place.

I'm very pleased about the moves on cheaper energy and clean power. But I do also say to the Chancellor that we have made he mentioned GB grid, which is a start, but there are around 400 projects needed to upgrade the grid, and I believe that GB grid covers 10 or 11 of those. So there's still a huge challenge to get the grid up to speed in order to enable the the target of meeting net zero by 2025. But. But the pledge to buy and build only when they will. When. When new technologies will lower bills and connect to the grid, I think is an important driver potentially in that area.

We may want to quiz the Chancellor, as I'm sure our sister committee, the Energy and net Zero Committee, will want to do in due course with the relevant Ministers, and I welcome the energy cost reductions for businesses. I think that is something that we've all heard from across the chamber. Businesses have been really struggling with, and the closing of the loophole on VAT for online marketplace sales is something that I've been pushing for. So I'm pleased to see that. So this is a Budget that, on the face of it, looks like it's done a good job.

But of course the devil will be in the detail. So I again put the Chancellor on warning that we will be looking through that detail over the next few weeks. We have the office for Budget Responsibility into the committee next week alongside other economists, and we will have the Chancellor himself in front of us on the 11th of November, when we've had a chance to go through all the figures in detail and challenge him on what he's promised today and what the promises are for the future. But overall, I think the the approach to support households is something that across party we must see and support in these challenging international times when a lot of the things that buffet the government are very difficult for the government to control, support for small businesses.

We all are lobbied a lot by our small businesses. Quite rightly, people invest their energy into their businesses and they need support and we need a long term vision. So part of our challenge as scrutineers across the committee corridor for government is to hold the government to account for its ten year plan, which we have yet to see for the reshaping of the state and for devolution. And I just again warn all Ministers who are sat there on the front bench, if you may feel good today after the Budget, but we will be challenging you in detail about the money that you're spending.

Whichever committee you appear in front of you.
14:19
Ed Davey Portrait Rt Hon Ed Davey MP (Kingston and Surbiton, Liberal Democrat)
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I call the leader of the Liberal >> I call the leader of the Liberal Democrats, Sir Ed Davey. >> Thank you, Madam Deputy Speaker. It's always a pleasure to follow It's always a pleasure to follow the chair of the Treasury Select Committee. I'm glad she's committed to looking at the devil in the detail about this Budget, because when one looks at some of the fine print, there's quite a few things for her committee to scrutinise. I particularly hope she will look at the very disappointing growth forecasts, because I do think this Budget will be more defined by Labour's red lines on Europe and the Conservatives Brexit red tape rather than faster growth.

And Madam Deputy Speaker, at the root of so much of what's gone wrong in our country, the cost of living crisis, higher taxes, broken public services, empty high streets, the lack of jobs and opportunity. At the root of all of that is the lack of economic growth. Our economy is being held back. British business is being held back, and it's being held back, above all by the terrible damage of the Conservatives. Brexit deal, a deal let's never forget. Backed by the leader of reform and voted for by Labour, a deal that put up pointless new barriers to trade, tied up British firms in extra costs and red tape, and pushed up prices on our supermarket shelves.

So, Madam Deputy Speaker, the

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biggest single. Order, as I said earlier on in my introductory remarks to Bernard Jenkin, we do not intervene on the front bench speeches. And the odd front bench speeches. And the odd thing is we went through this scenario this time last year. We

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did, we did. Here we are again. Order Sarah. Thank you, Madam Speaker. Always

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Thank you, Madam Speaker. Always happy to talk to the hon. Gentleman and gentleman in the tea room. But as I was saying, our economy is being held back by Brexit. And so, Madam Deputy Speaker, the biggest single thing the government could do to fix our economy is to fix our trading relationship with Europe, take us back into the single market and the customs union, giving us the growth and the money to cut people's taxes.

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Order. Mr. Gower, now moving three rows back does not mean I three rows back does not mean I cannot see you or hear you. So let's try and simmer down, Sir. David.

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David. Thank you, Madam Deputy Speaker. Unless and until a government has the courage to do just that, I'm afraid any Budget will only be tinkering around the edges because tinkering around the edges because it will not provide the growth our country so desperately needs. Now, the Prime Minister, to be fair, has rightly talked about the economic damage caused by Brexit. But in answer to my questions, he still refuses to drop Labour's red lines set down by Keir Starmer more than five years ago. Yet, Madam Speaker, the world has changed so much since then. It's long past time that Labour policy changed with the world.

So I do welcome the Prime Minister talking more openly this week about the need to move forward on Europe. But can I say to the Chancellor and to the Prime Minister, there is it is just too urgent to wait until the next Parliament. And today's Budget shows why. Madam Speaker, I remember when 2% growth was nothing special. When we were in government it was the average. But since we left the EU, it's been less than half of that less than 1% growth a year. And while today's forecast does show things starting slowly to move in the right direction, they still show growth well below 2% every year for the next five years.

What used to be average growth now feels like a pipe dream. So we need a real growth plan. With Europe at its heart. The plan only our party set out an economic plan to make Britain richer, safer and stronger. And our plan Madam Deputy Speaker would also tackle one of the great hidden tax injustices, not just of this Budget, but of every Conservative and Labour Budget. Since 2021, frozen income tax thresholds. They are a stealth tax rise, a tax rise that has dragged millions of the lowest paid into paying income tax and millions of ordinary people, nurses, teachers, police officers into the higher £0.40 band, millions paying higher taxes for the cost of government economic failure.

And I have to say to the Chancellor, this Budget, which freezes the income tax allowance of people in work while raising the personal allowance for some pensioners, is not the answer. Income tax thresholds for everyone should rise. The fairest tax cut possible, letting people keep more of what they earn, rewarding hard work, giving individuals more power in our economy. A profoundly liberal thing to do. And if we grow the economy by trading more with Europe, we can afford to do this. A real plan to turn the economy around and cut taxes fairly. Madam Deputy Speaker.

Our plan would also tackle one of the biggest headaches the Chancellor is facing in this Budget. The cost of government borrowing, because we clearly can't go on spending £1 in every 12 just on interest payments, on the national debt. That's money. That money that should be going on schools, on the hospitals or back into people's pockets. And we just can't go on with government borrowing money at interest rates over 5%. Now, some of the cost is down to global factors, as the Chancellor talked about, a lot of it is down to Donald Trump's war with Iran.

But there is no doubt that the bond markets would look more favourably on the UK if our growth prospects were better. So just as for growing the economy, the single biggest thing the government could do to cut its own borrowing costs and interest rates faced by homeowners and businesses is to take up our growth plan and join the single market and customs union here. Madam Speaker, just look at the alternative put forward by the terrible twins of British politics, the Conservatives and Reform. They are in a bidding war of unfunded fantasy promises. And we've seen what where that sort of fiscal irresponsibility ends.

Liz Truss's mini Budget that sent mortgage rates rising. And yet now we face a threat of a Tory reform government doing it all over again. The British people simply can't afford that. And that brings me back to the cost of living. Madam Deputy Speaker, why are so many bills going up again? Because Donald Trump chose to start his idiotic war with Iran that's pushed up our energy bills and hiked diesel and petrol prices to painful levels. But when that war began Monday, speaker, the Conservatives and Reform were lining up to say Britain should be backing President Trump.

Just imagine if they'd been in charge. We'd have been dragged into fighting a war that no one wants and paying for it with even

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higher bills and higher taxes. Britain needs a Government. That stands.

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Up for British. Interests. Not one that. Makes us. Ever more dependent on an

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Ever more dependent on an president. Yeah. So with Donald Trump pushing up

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So with Donald Trump pushing up petrol and diesel prices, the Chancellor's freeze on fuel duty is. But it isn't enough. So can I urge the Chancellor to look again at our emergency transport package that would actually cut prices at the pumps by 12PA litre and bring down the cost of travel by bus, train and electric vehicle to a real breathing space for families and businesses. And with energy bills forecast to rise by more than 25% in January, the Chancellor promised to break the link between gas prices and electric electricity bills can't come soon enough. But he is right to reject the siren song from conservative and reform benches, who want Britain to be even more dependent on dirty fossil fuels and their volatile prices.

 Once again, they're copying Donald Trump, and their energy plan would be a disaster for our environment, for our economy, and for everyone struggling with the cost of living. The right answer is to invest instead in clean, home grown renewable power, energy efficiency, and battery storage. So the prices we pay don't depend on Trump's latest Truth Social post, but instead come down quickly. As technology continues to slash the cost of renewable energy and slash the cost of batteries Madam Deputy Speaker in a world where Trump is deserting Ukraine, praising Putin and selling out on European security, we must move far more quickly on defence.

When the Defence Secretary says we must be ready for war within a thousand days, our armed forces can't wait years for the investment they desperately need now. Now, the Chancellor's announcement on some extra funding is welcome as far as it goes. But why hasn't he taken up our plan for defence bonds to invest £20 billion in Britain's defence over the next two years? And since he's ruled out joining Canada's defence Bank, will he now take up our plan and push for a European rearmament bank, which goes so much further than what he announced today? Instead of signing up to one country's version, surely the right answer is to bring our allies together behind a shared vision of defence investment to protect our continent from Putin.

 Madam Deputy Speaker, the defence of our country needs serious answers like these, not fantasy pledges like the Conservatives Iron Dome that they say isn't an Iron Dome except when it is. What a shambles, Madam Deputy Speaker. No wonder they left Britain's armed forces in such a mess, something for which they've not yet apologised. Now, it won't surprise the House to hear that we on these benches are delighted to hear talk of fiscal devolution, taking money and power out of a few hands in Whitehall and giving it to

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communities to make their own decisions is something we as liberals have always championed. Yes.

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Yes. But there's a right way to do devolution, Madam Deputy Speaker and a wrong way. So we will have three tests for the government's plans as they develop. First, does plans as they develop. First, does it give councils enough money to actually fulfil the responsibilities they are being given? Does it reach beyond mayors given? Does it reach beyond mayors to councils and communities everywhere? And is it fair so that those areas that are already struggling don't find themselves with even less? Done properly, this could be the start of something really big. Done badly, it is simply passing the buck.

And the same goes for welfare reform. Madam Deputy Speaker. Of course it needs to be done, but it needs to be done right? Cutting the bill by helping people into work, giving people the care and support they need so they can work. Like fixing Carer's Allowance Madam Deputy Speaker to help people juggle care with work. I'm glad the Chancellor has listened to carers on the need to scrap the unfair cliff edge of Carer's Allowance. As I said to the Prime Minister earlier, this can't wait another four years and we can't see 100% tax rate on working carers.

So I urge the Chancellor and the Prime Minister to look at our alternative plan instead, something we put forward to Liz when she did her review, and I'm hoping to bring it to the meeting that the Prime Minister has promised. But, Madam Speaker, whether on Carer's allowance or other benefits, let's reform welfare rights. So the system actually helps people into work and then rewards them for working Madam Deputy Speaker the country needs this new Chancellor and this new Prime Minister to succeed, because it's the livelihoods of everyone in our country that are at stake. So we, on these benches will work constructively whenever we can.

We will oppose the government when they get things wrong, of course, but we will also support them when they get things right, and we will push them to go further when they are too timid. And in that spirit, I have to say to the Chancellor, this Budget is far too timid. They have recognised the scale of the challenge, but like Keir Starmer before them, they still haven't risen to it. They haven't fixed the terrible damage they've done with their tax rises, from the family farm tax to the job tax. So I urge them be bolder, be bolder on energy and defence, be bolder on devolution and get it right.

Be bolder on cutting income tax, bolder on Europe and growth. Because after so many years of pain, so many years of being held back, the British people need real change and fast.
14:32
Daniel Zeichner Portrait Daniel Zeichner MP (Cambridge, Labour)
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They Daniel Zeichner. right hon. Gentleman will not always show. The Liberal Democrats are quite so bold when it comes to local decision making. It's a real local decision making. It's a real pleasure for me to support the measures announced by my right hon. Friend the Chancellor. I've known Friend the Chancellor. I've known him for many, many years, and he certainly knows Cambridge very well. And I can say that the the measures around rough sleeping will be strongly supported in the city of Cambridge, because they're the right thing to do, because it also helps tackle the problem that I've talked about before, which is what I've described as almost a pauperisation of the public realm.

Too many of our city centres, too many of our towns over the last decades, I'm afraid, have not had the investment and the care that's needed. And I think it goes some way towards explaining how we are a country which, by international and historical standards, is really well off. And yet there is a general sense of unhappiness. I think that fragmentation and privatisation of public services and public spaces frankly attributed, I think, widely to decisions made in the 1980s has come back to haunt us. And I was very, very pleased to hear the suggestions in my right hon.

 Friend's speech echoing the comments made by the Prime Minister over the last few months, saying that we really need to address these points. Very happy to. I'm interested in what the hon. Gentleman says. I mean, I've been a critic of some privatisations myself, but what he says doesn't explain why those same malaises did not apply during the Blair years. Well, I as I've said, I think it goes back over decades, and I think it needs to be reversed. And I thought the most radical measure, actually, in the right hon. My right hon. Friend's statement was about fiscal devolution.

I'm someone I think many others in the chamber will probably have argued for business rate retention over many, many years, and I will look forward to seeing how that plays out. But I represent a young city, and I'm confident and optimistic about the future. If we can give our young people the opportunities they need. So I was also very pleased to hear about the measures, particularly to support innovation and entrepreneurs. The innovate Cambridge summit last week. We were told by local people that an innovation cluster by density. In 2026, Cambridge ranked second in the world and first in Europe.

And just a few months earlier, the Oxford Cambridge Supercluster board had published research showing that the growth corridor has produced 740 university spinouts, almost 70% more than the fabled Bay area in America, and produces more scientific publications per resident than anywhere else in the world. But as we all know, all too often we manage to generate tremendous start ups, but have that problem of scale up. So I thought the points about the national wealth fund that the British investment Bank, these are things that can help us really, really use the Oxford Cambridge Growth Corridor to drive prosperity for the whole nation, not just the region.

And I very much welcome the announcement about the flexibility that will be offered to the Cambridge Development Corporation to really be innovative in a way that we use public funds to also pull in private funds. So I welcome the the optimism and the confidence that this statement brings. But I would just add one word of caution, because the success and strength of cities like Cambridge and Oxford Cambridge growth Corridor is based on the strength of our universities and colleagues will know that universities are facing acute financial pressures at the moment. Those are made more difficult, I have to say, by some of the measures being taken to address international students, the the changing attitude of Ukvi in terms of visa applications is putting pressure on.

An introduction of the international student levy will put financial pressure on. So I strongly urge my frontbench colleagues to talk to universities UK to look at alternative ways to fund maintenance grants. I fully understand and appreciate that these are long term structural issues, but it really is dangerous. Allowing universities to get so close to the financial brink and potentially undermines that success I've been talking about in terms of the Ox-cam corridor and cities like Cambridge, we should be optimistic about our future. We have the talent to succeed, and it is partly based on the fact that we attract talent from across the world, and we need to remain competitively competitive internationally.

Innovation and knowledge is something we're really good at this in this country. They should be celebrated, and there are measures in this Budget which I think will be strongly welcomed by innovators. But we do need to make sure they're not in any way undermined unintentionally, as the government seeks to address other issues.

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Sir Mel Stride. Thank you, Madam. Speaker.

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Speaker. This Budget was a world of the little things. I picked up a little things. I picked up a roadmap, a task force, a few bobs scattered around the various organisations, and even a few pence organisations, and even a few pence off a jar of gherkins. But it is a missed opportunity. It smacks of missed opportunity. It smacks of managerial incrementalism, rather than the bold and radical reforms that our economy needs if it is to meet the challenges of the future. And those challenges include intergenerational unfairness, an ageing population and heavens above. Surely the menace presented by Vladimir Putin.

It is also based on a somewhat smug, false premise that somehow this economy is going broadly in the right direction. It is not. The right hon. Gentleman the Chancellor prayed in aid the IMF and their comments about near-term growth and fiscal consolidation. But the reality is that should not be the benchmark. We should not be looking at France, which has had so much civil unrest, economic unrest, political unrest that it is heading towards potentially a bond crisis. We should be asking a fundamental question what level of growth does this economy need in order to address the challenges that I have just set out?

And the answer to that is at least to get back to the trend growth that we had before the
14:38
Mel Stride Portrait Rt Hon Sir Mel Stride MP (Central Devon, Conservative)
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global financial crisis, to at least get to around 2 to 3% growth least get to around 2 to 3% growth per year. And we are a very long way from that. The Chancellor lauded the fact that growth has been revised up for this year. He neglected to mention that, of course. From next year the position course. From next year the position is very different indeed. He made no attempt to acknowledge the mistakes that this government has made since it came to office. Huge mistakes made by his predecessor when she was Chancellor. Massive tax increases, predominantly on businesses which have had the effect of lowering investment.

 Rising and rising unemployment, reducing output. And of course, because taxes are often passed along by way of higher prices. Bearing up on the rate of inflation. And we are now in a position where, if my reading of this document from the OBR is correct, fiscal drag alone due to the inflationary effect that this government has in part induced, will result in over 200,000 average days work being destroyed. We are left, Madam Deputy Speaker, with almost the highest level of unemployment in five years. High and sticky inflation, high interest rates, massive servicing costs on our national debt, and huge levels of borrowing.

In the OBR's document today, they set out what is happening to real household disposable income across the forecast. And if my reading is correct, it is lower across every year of this forecast. Now, within this set of forecasts compared to the forecasts back in March. In other words, hard working. I will momentarily hard working people up and down this country are getting poorer as a direct result of the

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actions taken by this government. I thank. My. Right hon. Friend for.

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Giving way. I don't know if he, like me, received a card from the Joseph Rowntree Foundation yesterday, suggesting in Beverley and Holderness every family will be and Holderness every family will be at least £440 a year worse off at the end of this Parliament. But the end of this Parliament. But today, of course, on top of the points that my right hon. Friend has already made. Not only are we has already made. Not only are we going to see a disposable income so constrained, we will see debt going up in each of the next five years

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higher than previously suggested. Yeah, yeah. The right hon. Gentleman is absolutely right. Which brings me absolutely right. Which brings me to another point, which is that the Chancellor has taken a conscious decision to reduce the headline on decision to reduce the headline on the primary target from around 24 billion to £15 billion. That is a mistake. If he took the radical measures necessary to get on top of public spending, particularly the welfare bill, he could have increased the headroom that we have. And when he talks about the risks that there are ahead, that is the very reason why you have that buffer of headroom.

And if you have low headroom, then you end up paying a premium on those debt servicing costs that my right hon. Friend has just referred to. In fact, if you look at the average headroom that Chancellors have come forward with since the instigation of the OBR, it runs about 1.4% of GDP. In today's terms, that would be about £40 billion worth of headroom. We are now down to 15. So do not be surprised. Members across this House, if the Chancellor comes back at some future date and tells us that, just as was the case with his predecessor, that headroom has entirely evaporated once again because of reasons that are beyond his control.

This is a Budget. This is a Budget that is kicking the can down the road, the Chancellor, of course, was Secretary of State for defence, and then he made it very clear that his resignation from the government was nothing to do with the defenestration of the previous Prime Minister. It was a matter of principle, because he did not believe that our country was going to be adequately protected as a result of not coming up with the money to fund the 3% by 2030. He now has his hands on the levers, and he has failed to do even that on this occasion.

I will certainly give way to the hon. Gentleman.

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He will remember in the Chancellor's speech he did commit to reaching 3% of GDP by 2030. But

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can he say when the Conservatives reach 2.7% of GDP on defence. Yeah.

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We will have to look very closely at the wording that the Chancellor used, because my Chancellor used, because my recollection was that he said that the government would be committed the government would be committed to the NATO target of 3.5% by 2035. And then he said, with a target to reach 3% by the end of 2030, the target is not the same as the word commitment to reach that particular figure. So I would recommend that the hon. Gentleman that closely at that. When it comes to principles and the Chancellor. Madam Deputy Speaker, I am reminded of the late remarks on the matter of principle, said, of course I have principles, but if you don't like them, then don't worry.

I do have others, and it seems to me that that's where we are on this particular matter. The other point which the Leader of the Opposition perfectly correctly identified, is the unrealistic expectations and assumptions that are contained within the numbers the OBR has had to work with. Whilst the OBR, of course, sets out its assessment of what various interventions will mean in terms of growth and inflation and so on and so forth. It has to take at face value the spending envelope that the government comes forward with. And as we know, and this was inherited from his predecessor, that sees a very strong squeeze in spending right at the end of the forecast period.

In fact, if health was to be increased in the spending review next year by 2.7% in real terms, as it was in the last review, and the 3% target were to be met. There is a black hole of £20 billion in the figures that the Chancellor has just presented, and of the measures in the Budget just announced, we've seen the march of the puffins. We've seen £20.4 billion now placed in the National Wealth Fund. Make no mistake, this it should be very clearly understood that this is additional borrowing. It doesn't matter whether it can fall within the current definition of debt.

Public sector net financial liabilities definition, and would have laid outside the old definition of public sector net debt. The reality is, it is more money that this government is borrowing and I give

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way to the. I give. I thank my right hon. Friend for giving way. I'm talking about the sovereign wealth talking about the sovereign wealth fund. Would he comment on the fact fund. Would he comment on the fact that when we under the Tories sold off our national treasures of North off our national treasures of North Sea oil and gas compared to Norway, who put those assets into a who put those assets into a sovereign wealth fund and now have £1.7 trillion available for public services. And we don't have anything that that was an absolute catastrophic mistake for our

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country. Well. I think the hon. Gentleman should come and join us on our benches over here, because we are benches over here, because we are the party that is standing foursquare behind North Sea oil and gas extraction. And it's a very gas extraction. And it's a very important economic reason that we do that for business. It is right do that for business. It is right that and the Leader of the Opposition welcome this the national minimum wage increase, not national minimum wage increase, not going up by as much as it might otherwise have done, will help business a lowering of business rates.

For some businesses. The mileage changes with HMRC will no doubt be slightly helpful, particularly to the self-employed. But the Chancellor also came forward with a reduction of the business asset disposal relief. He's halved it, making it less of an incentive for people to go out and set up businesses. I looked at the figures in the Red book, and it seems to me there are £5 billion worth of additional taxes on businesses across this forecast, an increase of 2 billion in additional taxes across inward investment into our economy. So in conclusion, Madam Deputy Speaker, I think the lights are flashing on the UK economy.

We have huge challenges ahead. It is not good enough to simply rely on saying that we can

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be steady as we go for that, for that very, very quickly. I'm very. Grateful to.

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Grateful to. My right hon. Friend for giving way. He, like me, is a member for a very rural constituency. Was he very rural constituency. Was he shocked to hear the lack of any relief for rural areas that are being hammered by disproportionate being hammered by disproportionate energy costs? The Treasury's own figures show that the risk of rural fuel poverty is 150% higher than in fuel poverty is 150% higher than in cities, but we heard money for cities, nothing for rural areas and rural businesses who are being hammered and where we're seeing stagflation, inflation, taxes and interest rates going up.

Nothing for rural areas.

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Absolutely. My my hon. Friend is absolutely right. It was a palpable absolutely right. It was a palpable that statement for the absence of anything about farmers, you would think that the right hon. Gentleman might have at least said something might have at least said something about the farm tax, which is still hanging around the necks of our farmers up and down the country. But when you hear. I'll just conclude now. But when you hear the conclude now. But when you hear the Chancellor talk about being steady as we go, read into that complacency. When you hear him say that we need time to get things right.

Read into that. Kicking the can down the road we face as a country. Huge challenges. This Budget has been grossly complacent. It is a lost opportunity. It has failed our economy and it has

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failed the British people. Peter Kyle.

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Peter Kyle. Thank you very much, Madam Deputy Speaker. And I noticed you're wearing a Sussex tie today. It's good to be called to speak by It's good to be called to speak by somebody wearing a Sussex tie. I'm sure that as a result, you'll be breaking the internet for another year running. As you have done before. It's a pleasure to follow the right hon. Gentleman the Member for Central Devon, who so recently was forced to leave Cabinet. There may well be another grouping. There may well be another grouping in this chamber alongside the Select Committee chairs.

But it is very good to be able to speak to you today from the backbenches. The the Budget speech from the Chancellor today has made real concrete progress in the areas of the economy that I care about the most
14:49
Peter Kyle Portrait Rt Hon Peter Kyle MP (Hove and Portslade, Labour)
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and have the most impact on the people who live and work around our country. And also my constituency country. And also my constituency of Hove and Portslade. I was very animated by the areas of the speech animated by the areas of the speech that focussed on growth and innovation. Those are the areas innovation. Those are the areas that I will focus my contribution on today. The trading allowance, on today. The trading allowance, the entrepreneurship allowance, doubling the British Business Banks Women Entrepreneurs scheme. But also, crucially, the funders relief are all things that we should be extremely grateful for.

We'll have a direct impact on growth of our economy, but keep innovation here and allow it to scale here. Founders are quite unique people. They are able to commercialise innovation, to tell stories about their products, and also act with such confidence that they are. Their charisma carries a lot of weight. But sometimes that belies the amount of risk, the amount of hard work, and the amount of determination that they take on behalf of their company, their employees, and our economy as a whole. So the relief that has been offered to them is hard earned. I also I'm going to I'll give way to the right hon.

Gentleman.

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I'm grateful to the. I'm grateful. Madam Speaker. I'm grateful. Madam Speaker. I'm grateful to the hon. Member. I think I'm right in saying that his think I'm right in saying that his constituency, like mine, relies very heavily on the tourist trade. very heavily on the tourist trade. That industry is gasping for air on its knees. It doesn't need a breathing space. It needs help. There was nothing in that Budget

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There was nothing in that Budget for that industry. I'm always grateful to hear from the hon. Gentleman again. A member in the region that I represent as well, but I'm afraid he may have misheard in the noise of the chamber at the time, because the South East benefited quite considerably from the retail, hospitality and leisure, which will no longer pay 47% of those businesses in those sectors in our part of the country will no longer pay any any business tax business rates at all. I'm going to make some progress because lots of people want to speak, and I want to.

 I haven't even got on to the main points and the main argument that I want to make today. But there are real benefits. And also in my constituency of Hove and Portslade, the council tax rebate will have will impact positively on 42,000 homes. The same will be true in his constituency and those around the country as well. I want to mention one other thing that the Chancellor mentioned directly today, and that was the defence dual use investment for those companies doing dual use innovations. When he was defence secretary and I was Secretary of State at the Department for science, Innovation and Technology, and we worked together.

And it was the first time that we that those two Secretaries of State came together to work on the strategic challenges and opportunities faced within the defence industry. I am really pleased that this time later, we now see a Chancellor investing in dual use, and it will be based on the conversations and the work streams that we set up as two Secretaries of State that should be working together going forward. Madam Deputy Speaker, When Labour came to office in 2024, we inherited a growth emergency and now we have taken solid steps forward. But we are still and still must have the the mindset of a growth emergency.

It is my belief that we are on a motorway heading in the right direction, but even now we're only travelling at 30 miles an hour, and I believe the challenge is a complacency that set in in previous times where we took growth for granted from the 1997 government onwards for a decade before the financial crash. I think it is fair to say that we felt that growth was dependable, but there was a sense of inevitability about growth, so we could focus on all the social issues we wanted to tackle based on the proceeds of growth, but we didn't pay enough attention on underpinning growth and making sure it was sustainable into the very long term.

I will

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give way. I'm grateful to the right hon. Gentleman for giving way, and I agree with every word he's just agree with every word he's just said about the need to focus on growth. But the question is, how do you get it? And it seems to many on you get it? And it seems to many on this side of the House believe it's government intervention rather than reducing the taxes which create reducing the taxes which create disincentives for business. And he is alarmed, as I am, by the more is alarmed, as I am, by the more than 2.2 billion increase in taxes on business today from writing down allowances, company distributions, business asset disposal relief, as well as the probable 6 billion plus reduction in lending that will

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result from the 1.5 billion bank tax. Thank you. His speech was longer

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Thank you. His speech was longer than mine so far, but but also when when I find that I agree with every word that somebody is saying, I usually sit down and listen to a bit more of it before trying to challenge it. So let's just carry challenge it. So let's just carry on, and perhaps the rest of my speech will answer the questions that that he raises. In that period, because of the predictability and the certainty of growth, then I think the growth policy was seen like any other policy. In other words, if you had a shelf and you had all the different policies of government alongside it, growth would be one set of policies on that shelf.

I know there's a lot of analogies going around these days, and Liz Truss has blown a hole in analogy use as well as in our economy. But it's my belief now that we need to have the mindset whereby growth is the shelf itself. Because you cannot you cannot have successful social policies delivered in the way that all of us would aspire to around this House, around this chamber. Unless you have a solidly, predictably growing economy into the long term that provides the security and the prosperity for which we can invest fairly and share fairly around the country.

It is, therefore, we must be on this side of the House and also on that side of the House as animated about economic growth as we are about creating prosperity, spending it and talking and challenging the social ills that we have in our society. We must care as much about economic growth as we do about rough sleeping, social care and international development. As somebody who spent a lifetime early in my life in international development, as much as economic growth, because tackling those issues depends on economic growth itself. Now, of course, public services are incredibly important.

They are enablers of growth. You cannot have growth if people arriving late to work or they are too sick to work, or stuck on a Tory waiting list for treatment, for example, you need to have the right skills in the right places. All of these things are absolutely essential. But don't kid ourselves because the growth itself will be built on top of this by private enterprise. Now, thanks to the time that the Prime Minister decided I could have over the summer, I spent some time. I spent some time doing an essay. Now that Tony Blair brought them back into fashion.

And in that essay, which I know so many of you will have already read, which will make some of my words obsolete. But maybe I should refresh some of your minds as to what I focussed on, because I wrote the essay confined to my experiences in government as relating to economic growth, to see how we can configure government more assiduously, more dependably, to unlock the growth that our country needs. So much so, focusing on what government itself can deliver that experience comes from leading two departments as Secretary of State. And I saw in both of those departments that civil servants can deliver boldly when they have the authority and incentives align.

I'll take one example of one of the challenges that growth has. When you in order. The government. Government has to unlock growth just in the automotive sector. Just to illustrate to members from across the House that to deliver support for the automotive sector, it means that energy trade regulation, all these different areas of policy need to be aligned, and all of them are held by more than one government department. And each of those government departments has its own priorities. So whereby me, as Secretary of State in the Department for Business and Trade at times were prioritising the automotive sector, recognising how important it can be for growth?

 Bear in mind that when JLR had its suffered, its cyber attack, 0.2% was taken off of our GDP when it was up and running six and six weeks later, 0.2% was returned to our GDP. The importance of industry is still fundamental. So when the Prime Minister and the Chancellor talks about Reindustrialisation, don't underestimate its ability to deliver growth for our overall economy. But we also have another asset when it comes to the automotive sector in our country. We talk about frontier technology. I was looking for the AI Minister who was there a moment ago.

We talk about frontier technologies, looking at the AI labs, mostly in California and some in China. We have a frontier industry here in the UK. It is in the automotive sector, and it is formula one, where 11 of the 12 teams do all of their R&D, all of their development, all of the deployment of their vehicles right here in the UK. No other country in the world has this asset and it filters skills through our automotive sector. So the ability to grow that sector is huge, but it needs government to work in an aligned way.

So when you have an I discovered different departments with different priorities, having oversight and the ability to sometimes slow down the priorities when it comes to things like automotive, then we need a government and the structures and incentives in government to be much, much better aligned because we can't have all of these important sectors depending on Ministers being at a WhatsApp each other, to sort out problems. That should be a system of government that is already on the side of making choices that are pro-growth choices. And I want to say just a brief few words about defence.

Defence has been raised already in this debate, and we focus on the percentage of GDP being allocated to defence. And I'm grateful for the Chancellor and the statements that he made on this. But the defence debate cannot just be about how big a share of our economy we spend. It must be about how big an economy we have. If we achieved five years of 3% annual growth, spending, 3% of our national income on defence would then deliver almost the same amount of money as moving to 3.5% today. At today's sized economy, I'm going to continue.

That is the difference growth can make to our national security. It doesn't remove the need for difficult spending decisions today, but it does give us greater strength to sustain our defence into tomorrow. I give way thank the right hon. Member for giving way, and I do agree with him. It would be great to grow the economy to achieve the 3.5%, but with the what the Chancellor has set out today, there are in-year cuts, multi-billion pound in-year cuts this year, and we can see that, particularly in the Budget, about 0.5% next year. So there will be far less for training and operations.

As it stands at the moment, not even before we look at three plus years time, whether we achieve the growth or not. Yeah, I agree. And if if I realise when you make an intervention, you stop listening to what's being said. But I did say in the paragraph before I hand it over to him, this is not instead, I'm not proposing that we look to five years down the line after the five years of 3% growth before we start investing. Of course, we must move towards those naked NATO targets, just as the Prime Minister and the Chancellor has promised.

But it does illustrate if this is about getting cash into defence, there are more than one way of doing it immediately. Yes, increasing the percentage, but in the long term, to do so sustainably on the back of an economic economic growth of 3% and above, then you can see that it will unleash enormous amounts of resource into it, in addition to the reprioritisation that might need to happen. And of course, the difference when it comes from growth is that you also have the opportunity for other government departments budgets to grow as well, and working people right around the country will be feeling it in their pockets.

So that is why it is one of the driving social justice issues of our time. So it's my belief that government needs to become organised around growth, and that growth needs to become the organising principle of government. And in the essay that I published, I give some practical advice or practical suggestions based on my time in government for what I would do if I had the opportunity. Firstly, government needs to adopt a task force mentality when it comes to growth. The Prime Minister should back a 90 day plan to unblock investment Cabinet accountability, of course, but we have these great boards in government, experts on the Board of Trade, the non-executive board on departments, and we have the all sorts of different specialist groups who are already outside experts coming in, sitting on the boards across government.

We should pick from those boards, those people who are best placed because they're already already there, understanding of government from the work they're doing to jump into a task force based approach to looking at different government government departments, to look at the opportunities we have to act fast within departments and then identify areas that would need legislative change. And for that, we can, of course, introduce a growth bill if it were appropriate, and I believe it is, to look at to look at some of the. Well, certainly legislate to remove the barriers to growth, because certainly there are some barriers to growth that require legislation.

 And let me illustrate one point. When I was Secretary of State, I visited a fantastic organisation, a company called Ocean Infinity, down in Southampton, Southampton Ocean Infinity are building and deploying globally. A global leader in autonomous marine vehicles. They took me to one of their vehicles being built 36m wide. These are huge investments, doing extraordinary work autonomously for marine biology, for mining, drilling, looking at some other areas where going to very remote marine places on earth. And they took me one deck below an autonomous vehicle, and they showed me one room and said, what do you notice in there?

There was a washing machine and a tumble dryer in an autonomous boat. Why? Because the law requires any boat that's more than 34m long to have a washing machine and a tumble dryer for its crew. So you may laugh over there. At my suggestion of a growth bill, there are some things that need to change in the bill, in the law to unlock the stupidity that is now out there in the way that we regulate certain sectors, simply because of the passage of time. And that's what I say to all of our members here who worry deeply about the deregulatory and or the modernisation of the regulatory landscape.

There are absurdities out there that are holding businesses back. And it might be one example of 111 tumble dryer and a washing machine. You aggregate

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that across our economy and you start to see the need for real positive action. I give way. I thank you.

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Very much. For giving way. Would he back a. National security exemption.

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National security exemption. For regulations like the one he cites, where if what it is that's being developed is clearly for our being developed is clearly for our national security, then health and safety and other regulations fall away to enable us to get it into the field quickly.

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I'm very grateful for the constructive intervention. I am certainly in favour of looking at mechanisms where we where we discover absurdities in the regulatory system, and we know how long it takes to get legislation through the House, even introduced to the House, when we have so much priority that we need to be able to act in the interim period, and that is something that we should look at, and our House should give the powers where needed in those sorts of circumstances. And of course, national security is the number one priority of any government at any moment in time, and certainly should be.

I'm going to make some progress. So we also need a tax growth test outside from outside experts, from AT&T reviewing all investment, hiring, innovation, revenue incentives from HMD to judge it against a growth test. It doesn't mean that we don't still redistribute. It doesn't mean we don't still invest and we don't use tax in ways that aren't always conducive to growth. But we do need to know in aggregate form exactly how the incentive landscape and the policy landscape within H T aligns alongside the need for growth. I think we need to look very closely.

I was very pleased that the Chancellor made a lot of statements and made some good progress when it came to procurement. This is something that we should really be using far, far more effectively to champion British innovation to support British scale up companies, because in procuring that those products and services, they have access to over £400 billion worth of spending, which of course eclipses the investment we can make from innovate UK or British Business Bank, the Sovereign Wealth fund or the UK. Re. But what I couldn't understand as Secretary of State and still can't understand looking on, is that we went through a period with my encouragement of taking equity stakes in scale up companies as part of our scale up plan, all of the due diligence that goes into making those decisions.

That leads to the British Business Bank, through its independent and its thorough work from its investment committee to take an equity stake. But once you do that, you don't have any preferential access to any other part of government that should change. The Regulatory Innovation Office should be upscaled, and there should be local rewards for businesses that are growing fast. I've spoken, and I won't speak in any more detail about my frustration that this this economy and the continent of Europe has never produced $1 trillion company. Some of the wealth from those companies, that is, when it is fairly distributed amongst its workforce and the communities in which they are sited are astonishing vehicles for levelling up.

And we need to make sure that we understand the reasons why our economy seems to have some kind of glass ceiling, and it is a continental European challenge, because if Taiwan can produce $1 trillion company that produces the wealth, the power that goes alongside it, then there is nothing that Taiwan has that we don't have here in Britain. So to close, social justice and growth are intertwined. I started by saying that we are on a motorway going in the right direction, but at 30 miles an hour, but fairly distributed growth delivers security, freedom and prosperity.

So if that is what the destination looks like, why wouldn't we put our foot down and try and get there

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faster? Thank you, Madam Speaker. Jeremy Hunt. Yeah, yeah, yeah. Hon. Members, to my.

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Hon. Members, to my. Entry in the Register of Members Interests. It's a great. Pleasure to come after the right hon. Member for Hove and Portslade, who was an for Hove and Portslade, who was an excellent business and trade Secretary and a great loss to the government when he stepped down. And like him, I have been writing about economic growth. He wrote an essay, I wrote a book, and I have
15:11
Jeremy Hunt Portrait Rt Hon Sir Jeremy Hunt MP (Godalming and Ash, Conservative)
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absolute confidence. That all members were poring over every word in my book over the summer, which happened. The book, the book happens to be called Can We Be Rich Again? And in case anyone was interested and and what I what I wanted to say contribute in a brief contribution today is to say this doing a Budget since 2022 has become much harder because the invasion of Ukraine caused a spike in energy prices and inflation, which brought to an end the. Over a decade of near zero interest rates. And in that context, rule number one is not to upset the markets.

And today they are calm. And long may that last. Rule number two is to do no harm. And and frankly, after two budgets that put up taxes mainly on business by £66 billion, many businesses will be relieved that today it is just inverted commas. A 2 billion tax rise on businesses. But I am worried that the bank tax is going to lead to higher mortgage rates, which will actually make the cost of living worse for ordinary families. But my concern is on what I might call rule number three, which is never to waste a Budget.

When you are Chancellor of the Exchequer. In some ways, in the run up to a Budget, you are the most powerful person in the country because you are sitting on top of the most powerful government department and you have the full support of number ten, which needs budgets to be successful. And the OBR has just downgraded our growth next year to 1%. There are still formidable impediments to getting back to that 2 to 3% growth that we all know is so important. And today could have been the Budget which set out plans to get a million young people off welfare and into work.

We could have found out how it's going to happen, when it's going to happen, where the money is going to come from. The impact on national accounts today could have been the Budget, which showed how we are going to enshrine AI into every part of our economy, helping us to become the world's next Silicon Valley. That would have been an extraordinary, powerful opportunity for us. It could have been the Budget. There were some things mentioned about bringing down energy prices, but it could have been the Budget that showed how, over three years, we are going to get energy prices for businesses, factories, data centres down to levels in France where they are 35% less.

And it could have shown how that was going to happen, and it could have been the Budget. You know, when Ukraine is about to go into the most difficult winter, that showed how we are going to get defence spending up to 3% of GDP, and how that is going to help our technology sector and our economic growth in the process. Instead, I fear that the Chancellor and the Prime Minister have wasted the political capital that they have by putting off difficult decisions. We're told that we won't hear what's going to happen with respect to NEETs until the new year.

We're not going to find out about defence spending and the spending review until the end of next year. That's a year away. And, you know, the problem is these decisions are going to be harder in a year's time than they are today. And, you know, I think today could have been a Budget which did so much more. The Prime Minister likes talking about hope. Well, young people today are leaving school and leaving university with high levels of debt. Fewer jobs, particularly many fewer graduate jobs. And they are worried about their future. They are losing hope.

And the truth is that to give them back hope, I mean, you know, we had lots of so-called breathing space measures. They're very welcome in their own right, but they will be forgotten within a matter of months. To really give people hope, you have to be prepared to take difficult decisions. And we need to be completely honest. Reforming welfare is really difficult. It was difficult for us. It's difficult for the party opposite, particularly difficult, I understand, for a Labour Party to reform welfare, you know, controlling public spending is very, very difficult. As the Chief Secretary knows well.

And, you know, it is very difficult for any government to deal with the pressures on public spending, dealing with the the reforms that improve public sector productivity or bring down energy prices or sort out vocational education. These are very, very difficult decisions. But I feel today none the wiser as to whether those difficult decisions are actually going to be taken. And that that is my worry, because in the end, people need to have a sense of a government that is prepared to grasp nettles on all these all these different things. It's not enough. I'm afraid to say that it's OK because we're not the Tories.

We got, I think, a lot of things right. And I'm very proud of the fact that there were 4 million jobs created under 14 years of conservative rule. That's 800 jobs a day, by the way, compared to 200 fewer jobs a day since Labour came to office. But we also made mistakes. But, you know, in the end, right now, looking forward, we know there are lots of difficult decisions that need to be taken until we have a government that is prepared to grasp the nettle on those decisions, our economy will continue to be buffeted by

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international storms. Instead of being master of its own destiny. Yeah. Thank you very.

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Much, speaker. It is a great pleasure to follow the right hon. Gentleman, the the right hon. Gentleman, the Member for Godalming and Ash. And I thought he had a very thoughtful analysis there when he wasn't selling his book, of course, which selling his book, of course, which was I'm not going to accuse him of that being the primary reason, but he mentioned breathing space. And I he mentioned breathing space. And I think I don't think he was saying it wasn't important to people. I think he acknowledged that what the breathing space does is I think it gives a direction of travel.

And I think I think that is the context for the for the Budget, perhaps to
15:17
Bill Esterson Portrait Bill Esterson MP (Sefton Central, Labour)
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answer some of of what he was saying, but it was very much a Budget for energy and cutting bills. Budget for energy and cutting bills. It was very much a Budget for how some of the growth challenges that my right hon. Friend set out Putney left his place about how important left his place about how important growth growth is as well, and for very good reason. We are in the middle of the second big energy middle of the second big energy shock in a few years. And to the right hon. Gentleman's comment about his concern about mortgage rates.

I would add my concerns about the impact of inflation. If we don't tackle the cost of energy and the impact on prices more widely, that is true for consumers. It is true for businesses and for the wider economy. And so bringing down that cost of energy had to be a fundamental part of this Budget. And I think it is exactly what it was. And progress has been made and progress will continue to be made. I note in the the Red book that gas now sets the price 60% of the time of electricity. Just two and a half years ago, that figure was 98%.

So huge progress has been made. It is also the case that the opportunity is there available for people who can switch to electricity. It is up to nine times cheaper to drive an electric vehicle compared to diesel, and not all of that is due to the exceptionally high prices that we have at the moment. But these things point in the same direction that the energy transition is in our interest, ending our dependence on the uncertainty, the danger, the threat that we face from having to import oil and gas. And I know there are people who will claim later in this debate that it can all be got from the North Sea.

Well, it simply can't. There isn't enough of it. Even if we were to increase production and the announcement on jackdaw is welcome, it does increase in a relatively small amount, but a welcome amount. The amount of gas coming ashore to the UK to be used here. But as well as the challenges around costs, there are huge challenges on how we how we move on from here. Challenges are around how to build out the grid further. And those I think are. There is a start of how to address them in what was announced today in the Budget, and I'll come back to 1 or 2 of those a bit later on.

But on the point about bills, there were a range of measures and I think they are more than breathing space. The VAT cut was confirmed today by the Chancellor in his speech. The council tax cut of £100 that that will benefit 32,200 households in my constituency alone. We should be welcoming these approaches. The ending of standing charges for gas that will help the poor, some of the people in greatest fuel poverty around the country, and a welcome announcement of something similar to come on on electricity standing charges as well. And it must be right that at this time, in this scale of crisis, that the priority is to help people with their energy bills and to use the bank surcharge for a year to do so.

It's also welcome to see no more policy costs on bills. And the announcement of a longer term commitment there very, very much in that vein, too. We heard earlier in the week about the use of loans in the warm homes plan to make it easier for people to take advantage of the technologies in moving to electrification. And to the point about the the reduction in the amount of time gas sets, the price on the system, the increase in renewables on the system as the as the Red book sets out, is closing the gap in the price between electricity and gas.

And it is absolutely crucial. This is one of the things the Warm Homes plan will help with, that. It is made as attractive as possible for people to move to electricity, in transport and in home heat. The more people can take advantage of these things, the cheaper for them, the greater the opportunities for industry to. The Warm Homes Plan is a a commitment, a confidence builder for industry to invest in the installation of the technologies that are involved in it. Solar storage, heat pumps or other forms of electric heating, potentially

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Hybrid heating to something my committee will be looking at in our inquiry, which we're about to start inquiry, which we're about to start on the subject, and then we have this builds on the £150 off from this builds on the £150 off from scrapping the the ecosystem and the moving of the renewable obligation to the Exchequer, as well as the help for of £50 million for homes that rely on heating oil for their heating. On the subject of energy security, good commitments in the Red book on the expansion of renewables, but also on nuclear. And I think the statement of the need to review and reform the institutions niso Ofgem, the way the department operates, the uncertainty and confusion over where the networks fit into the picture are all absolutely essential if we are to roll out the grid faster.

If we are to make the most of the opportunities in the new technologies that are available, and indeed to move ahead with nuclear. And I noted the recommitment to the application of the findings of the Fingleton review in the Red book as well, something my committee has called for, because we do. We need to have certainty on the siting of the next large scale nuclear power stations after Sizewell C and Hinkley C, and also what comes next after Will Forster on SMR two. Good support with the British Industrial Competitiveness Scheme. 10,000 energy intensive businesses benefiting there.

And as I touched on before, the. I think I'd be very interested in my committee to be asking about this. The cost control framework and the reforms to the market. We certainly need to know more about what they are. And it does go to what the right hon. Gentleman was saying. I think more detail is needed, and certainly my committee's role will be certainly to to try and identify exactly what what is going to come next. But there is a strong link now between the new generation of electricity and cutting bills. There is the commitment to continuing to break the link between the price of gas and the price of electricity, including and especially by fixing the price for new renewable projects, which in its own term will provide protection against those volatile gas prices and the uncertainty that we all face now.

 So, Madam Deputy Speaker, I see the Budget that's been announced today as a very important next step in the commitment on energy. I see energy as a fundamental part of the growth agenda, as well as delivering as the importance of delivering energy security. The government has taken a pragmatic approach. It's also announced. I mean, we had the intervention earlier about the energy wealth fund, and it is a huge shame that the the then conservative government didn't set up the sovereign wealth fund in 1990 that Norway did, because it would be worth over £1 trillion in this country now, had they done so.

But we now have an energy wealth fund. It is part of the economic opportunity of the 21st century. We've seen success in the latest auction rounds, the commitments on nuclear, the rapid progress on those renewables and the warm homes plan. And I think in the announcement on procurement. Thank you, Madam Deputy Speaker, the announcement on procurement and more widely, there is an opportunity to really support the economy, develop jobs and growth, as well as keeping down bills. So this was a Budget for energy bills. It was a Budget for energy security, but also very much for growth through investment in energy.
15:26
John Glen Portrait Rt Hon John Glen MP (Salisbury, Conservative)
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John Glen thank you, Madam Deputy Speaker. It's a pleasure to Deputy Speaker. It's a pleasure to be able to contribute so early on in this debate. And I speak as a former Treasury Minister who sat behind four Chancellors in different scenarios In the previous government, and I acknowledge the enormous challenge that every Chancellor faces trying to reconcile so many competing pressures. But when I reflect on my experience of listening to this Budget, I'm left with a great sense that this has been a Budget of missed opportunities. 98 measures were the value of each individual measure is at a record low.

So it's a Budget that has not grasped the opportunity or taken the opportunity that is necessary for our economy, because all governments face different circumstances. And I was in the Treasury when Covid occurred. We had to take interventions of a scale that had never been seen before, and it obviously had significant scarring to the economy. This government faces different challenges in terms of the energy security, but also a fundamentally transformed context when it comes to national security risks. And I was left afterwards, as Helen Miller of the IFS says, saying there was a lack of a coherent vision.

And it is this everything has been kicked further down the road. And it leads me to conclude that we are warming up for a general election, which will be framed around the need to have more taxes to reset the economy, because for a Chancellor to come in with a new Prime Minister and make 98 measures of which all have a record low level of impact, speaks to a lack of ambition, whilst a holding position is held on the back of 66 billion of tax rises, so that more can be done on the basis of whatever comes out of the summit with the EU next week.

So that's what I'm anticipating. Now. Of course, some of these small measures will be welcome, but when they amount the effects of tariff changes to £0.40 a week, it for most people it won't be significant. And I want to look at some of the tax measures that exist. The increase on tax, on savings is not a good thing. That higher level of tax take that we see will risk incentives within the system, constraining economic activity by more than expected. That is what people are saying about this Budget. The renters tax. It has been determined that these measures collectively risk leading to a steady rise in rents, building on the additional taxes of last year.

Now, I take a close interest in financial services, having had some experience in that sector as a Minister. And I note what the chair of the Treasury Select Committee said about the rise in some share prices this morning, I think they probably anticipated a larger increase in the surcharge back up to 8%, and therefore the increase to 6% and time limited was reflected in a bump, where they felt that that wasn't as bad as it could have been. But I would note that if you look at what UK finance say about the implications of that change, we only need a very modest change of 7.4% of internationally mobile banking to leave the UK, and the tax increase will generate zero net revenue.

So this isn't some sort of insignificant industry that is wholly located in London. It's an industry that actually provides the infrastructure for the wider economy, and we will see the impact of that decision on interest rates, on savings rates. And when I was the Minister in this area, I used to have conversations with the CEOs of your banks, global banks, and they point out what the aggregate tax rate was. When you look at corporation tax surcharge, the levy, the national insurance rate, and then compare it internationally. And we are now in a situation where that is going to look really bad after what's already happened with the national insurance increases.

 But I also want to reflect on what this Budget hasn't done for small businesses in my Salisbury constituency. I've been particularly impressed by one small businessman who I've got to know over the last few years Ethan Davids. He's a very young, he's in his early 30s, and he's got 15 hospitality venues growing rapidly. And he says to me when I speak to him, the combined effect of the increase on employers, National Insurance, the effect of the Employment Rights Act and the previously above increase in inflation, increases in the National Living wage, as well as the challenges of a reliable outcome from the planning process, means that it actively discouraged him from making investments.

And I fail to see anything in this Budget that has made a significant impact on the context of which his business and the decisions he will make going forward. I'd be very

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happy to give way to the. Would you care to ask the business owner that he refers to business owner that he refers to about the potential impact of the reduction in business rates for nearly 70,000 small businesses?

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nearly 70,000 small businesses? Yes. A small measure like that will make some impact. But in the context of what we've seen context of what we've seen previously, where, as the hon. Gentleman will know in the manifesto he stood on two years ago, the implied a modest increase in taxes of about 7 billion. And actually we had 66 billion. The scale of the burden that's placed on those businesses means that they are disinclined to continue to invest. Now, I want to say a few words about defence. It's a massive part of the world in Wiltshire and in South Wiltshire.

And again, the context is changing and it's changing rapidly. And the commitment to raise the defence expenditure that given so far is, of course, welcome. But it was pretty explicit of the departing then defence secretary in June this year that he insisted on a date be given when 3% would be secured of of of GDP. A date has not been given. Today. I accept a pathway to 3.5%, and a task force to get to 3% has been announced. But that is very different. And I think we are in this country rather complacent about the nature of the risks that we face.

And it was obviously just over two years ago now, I visited the Nordics, and one of my last months as a Minister, and I was just struck in Sweden and Norway by that sense of anxiety and readiness over what Russia was capable of doing and how imminent that threat was. And so, of course, I acknowledge the progress made, but the urgency and reality of the situation that we now find ourselves in necessitates a step change in the urgency of the government's response. And I'd be

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very happy to give way. I'm grateful to member for giving way, and I respect his experience in the time in which he experience in the time in which he is delivering his speech. I would just gently ask, though, on the question of credibility on this question of credibility on this point. In April 2024, the conservative government committed to a target for defence spending. to a target for defence spending. In 2030. That target was, of course, 2.5%. A month earlier, they'd cut National Insurance and committed to National Insurance and committed to a further cut in National Insurance in the manifesto.

Could I not ask the hon. Gentleman, maybe, to reflect a little harder on the credibility of the Conservatives on this issue, given the failure to commit to 3% mere months before the government, your party, the hon. Gentleman's party, then said it should be 3% with no real means to pay for it.

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Well, of course I recognise mistakes made and choices made in previous governments, but as I was previous governments, but as I was trying to indicate, the world has materially changed since the general election, I think for most people that is pretty obvious what's happening in geopolitics, and that necessitates a suitable response from the government and indeed the Chancellor. The former defence secretary, insisted on that defence secretary, insisted on that when he left government. But what I'd like to finish by saying is this, that if you come into government and secure the massive majority that this government did, it is pretty painful for the country to see the lack of ambition in the choices made in the three budgets so far, and this downgrade from 1.6% to 1% growth next year is massive.

Yeah. And it still implies a 2.6% per year spending cut in unprotected departments from 2829 to 3132. I don't see that as politically realistic for the party opposite, and that's why I'm anticipating that the next step after the summit next month will be the call for a general election.

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Yeah, definitely. I'll call the Select Committee chair, Liam Byrne, after which there will be a speaking limit of eight minutes.

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eight minutes. Liam Byrne thank you very much, Madam Deputy Speaker. Well, I'm going to start by commending the Chancellor for what I thought was a Budget that is going to leave our country richer, fairer, stronger country richer, fairer, stronger and safer. Madam. Madam Deputy Speaker, it's been my privilege to Speaker, it's been my privilege to know the Chancellor for many years and over the course of those years that I've known the Chancellor, he
15:37
Liam Byrne Portrait Rt Hon Liam Byrne MP (Birmingham Hodge Hill and Solihull North, Labour)
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has been a modest man. But the truth is, on the basis of the numbers that he has set out for the numbers that he has set out for the House today, he has got nothing to be modest about. He has been able to tell the House today that we have delivered the joint highest growth in the G7. We've had the second biggest uplift to growth in second biggest uplift to growth in the G7. We have now got whole of economy investment that is now at economy investment that is now at the highest rate since 1990.

We have got productivity growth, which has been upgraded again and is now back in line, not just with the growth rate but with the growth achieved by our competitors. We've got a million more people in work forecast between now and the end of the forecast period. That is 550 people back in work every single day. We have got economic expansion forecast for this parliament of £200 billion. That is twice the level that was achieved under the last Parliament. We have got GDP growth that is forecast to rise by 2500 pounds over the course of this Parliament.

That is 36 times more than was achieved under the last government. But crucially, I'm not giving away. The OBR says today that GDP growth is now structural, therefore raising the potential of output growth over the course of the years to come. And of course, that is what is helping the Chancellor deliver. What is the fastest fiscal consolidation in the G20. So, Madam Deputy Speaker, I just want to use the time. I've got to make three very quick points about the virtue of predictability, about small business, which is a particular interest of our committee and around AI.

The Chancellor has been able to deliver, actually, despite the challenges of this war in the Gulf of Hormuz, he has actually managed to keep to the fiscal rules. Now, I'm old enough to remember when the fiscal rules used to change every couple of years, depending on which faction was uppermost in the Conservative Party. We used to zigzag here and there, and actually the markets had no predictability. But actually the response of the gilt markets this afternoon has been positive. They have respected the buffer that the Chancellor has been able to leave. But above all, what they have been, I think welcome of is the fact that where we have made changes to deliver real help now to the people that we come into this House to serve, we have actually stepped up and made the difficult decisions about how we're going to pay for it.

We haven't tried to borrow it on the never, never like the party opposite sought to do in the past. And that is exactly why we are retaining the confidence of the bond markets. Now for this side of the House. Of course, growth in and of itself is never enough, and that is why growth in every postcode is an important political priority for this administration. But if we want growth in every postcode, then we need enterprise in every postcode. And if we want enterprise in every postcode, then we are going to need to surge finance into every postcode.

We have got to, I think, step further and faster. Ahead of the proposals the Chancellor has laid out tonight to back those little engine rooms of growth in each of our constituencies. They are the people who work out of white vans. When I started my working career there, the people on market stalls there, the people on High Street, they are the people in every business park. They are the wealth creators in this economy. They are the visible economy which employs millions of our constituents. Now I welcome the statement from the UK Private Capital Association today, which said that the Chancellor delivered pro-investment measures today, which should make the UK a more attractive place to invest and grow a business.

That's a really important judgement. The start up coalition have said that today's Budget delivered the best news for start ups and scale ups that has come out of a government in years. Those are important credentials. Now, of course, I would like to see the Chancellor go further and I'm publishing today the analysis of our committee about where we'd like to see the Chancellor do more changing further the business rate structure, changing VAT thresholds for small business, ensuring there's real accountability to drive government procurement into the bank accounts of small business. Going further to tackle the peril of late payments, not just tackling rogue traders, but tackling rogue customers who don't pay on time.

 Getting much tougher on high street crime, tackling bogus self-employment which undercuts good and honest traders on the high street. These are all important things that will help our small businesses grow, but crucially, we have got to crack as a nation this challenge of investing in ourselves. Now the former Chancellor, who has left this place made some important changes with the mansion House accord. But the reality is our country is not short of long term savings. We have £3 trillion of long term savings. Our problem is, is that we invest the lion's share of it in other countries rather than in ourselves.

80% of the long term savings that we channel into equity investment goes abroad rather than to here. And yet the mansion House accords are proceeding so slowly. We're going to miss our target by a decade. That is not good enough. And so I would like to see the Chancellor go further and faster on repatriating pension fund investment. I think the £25 billion that's been announced today for the National Wealth Fund and the British Business Bank are incredibly important, but that now has to be used to actually make sure that we're using that money to leverage in more of our long term savings, to expand enterprise in every postcode.

We heard evidence on our committee yesterday that underlines that the enterprise rate in our country is now the highest level that it has ever been. We have doubled the entrepreneurship rate over 1999, but too few of those businesses are surviving for the long term because we're not investing in ourselves. So let's rebuild regional banking. Let's put business banking back on the high street, and let's couple that with stronger, sharper incentives for our angel investors and for our venture capitalists too. At the moment, we are making some progress, but it needs to be much faster. We're not short of long term savings.

We're not short of genius. What we've got to do is match the money to the ideas and the entrepreneurs, and a completely different scale for the years to come. My final point, Madam Deputy Speaker, is about artificial intelligence, and I think there were some very important announcements made about investing in artificial intelligence and artificial intelligence, safety and security for the future. That obviously builds on a number of initiatives that were made under the last government, in particular by former Prime Minister. But here again, we have got to grasp the fact that the way that we are going to reindustrialise our country is by marrying AI to AI, the human ingenuity, the British genius that we have in such abundance on these isles of wonder.

This is the home of the scientific revolution. This is the home of the Industrial Revolution. We have been inventing the future and making history for 3 to 400 years in this country. But if we are to re industrialise in the way the Prime Minister has set out, we've got to kind of marry artificial intelligence, that kind of traditional engineering with cyber engineering on a completely new level for the years to come. And so that is what needs to become the AI eight. But crucially, we've got to recognise that we're not going to spread artificial intelligence through our economy unless people trust artificial intelligence.

That means we're going to need new regulation to keep it safe and secure for the future. And we're going to have to make sure that there is a just transition for workers as they go through this new industrial revolution. Now, our committee will have important changes to announce about how we think there should be statutory safety legislation in the here and now, and we will have a report out before Christmas about how we think workers should be supported and reskilled for the future. We have a tremendous future ahead of us if we get this right.

But if we pretend that we can somehow leave it to the market to decide, rather than build a strategic partnership between the public and the private sector for the future, then I'm afraid we will miss the opportunity that lies ahead of us. So, Madam Deputy Speaker, this is a Budget that will be, by and large welcomed by business. There is more and further reform that is needed that I hope our committee will influence in the ten year plan and the CSR next week. But I think the Chancellor should take some pride from delivering a Budget statement today that has left our country stronger and fitter for the future.
15:45
Helen Maguire Portrait Helen Maguire MP (Epsom and Ewell, Liberal Democrat)
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Helen Maguire. However, I believe it still falls short in several areas. In Epsom and Ewell, hard working people have been stretched from all directions. One constituent shared how even though she's earning more than ever before, it just hasn't kept up with the increasing costs of everyday life. This is not a unique experience. Rising costs are making essentials feel like luxuries. Working hard simply isn't good enough. Food prices are mounting and energy bills are spiralling. The Chancellor then offers a few pennies off a jar of marmalade, which will only save households £21 a year. And whilst Paddington Bear will appreciate the cost of sandwiches going down, this marmalade relief won't help my constituents.

We need to bring costs down because no one should have to worry about the cost of energy because of the whims of Westminster or geopolitical instability. Now, I welcome the £100 cash payment for homes in council tax bands A to D, but if energy bills keep rising, this will only offset the escalation in price. Today, the government's own council tax band check had crashed as people checked to see if they were eligible. This just shows how desperate people really are. Instead of offering a one off reprieve, why not offer a sustainable solution, an essential energy guarantee that will save the average family £100 a year every year?

Epsom and Ewell is home to many hardworking businesses. Independent restaurants like bamboo baskets and family run shops like Fudge's and Sons. And when I speak to local businesses, one word repeatedly comes up again and again. Uncertainty. Only 1 in 6 small businesses are anticipating growth in the next 12 months. This is a dire assessment, and Labour's only added pressure with their previous jobs, tax and national insurance hikes, I welcome slashing the endless form filling and pointless paperwork and introduction of the founders relief, and I'm glad that the Chancellor has finally listened to the Liberal Democrat calls to support business and reward entrepreneurial ambition.

But more must be done because businesses deserve a fair deal. I welcome efforts to ease business rates, but it doesn't go far enough. Dawn, the director of word on the Street bookshop in Ashford, told me that she fears changes won't help. Her business is a micro business. It has a turnover of less than a million, a balance sheet of less than 500,000 and fewer than ten staff. But her current business rate is over 6000. To pay the. She must sell around 1300 books a year. The current system continues to punish high street businesses, and due to the high rateable value in Surrey, businesses won't benefit from the new exemption.

The government must overhaul its business rates. Now hospitality is on its knees and the government has failed to throw businesses a lifeline. Every week I'm told that the cost of doing business is suffocating. Fiona, the landlady at the Marquis of Granby, was forced to increase the pint of the price of a pint from £6.50 to £7.15 just in the last year. And now there's a rise in beer duty. Green and Bean coffee shop in Epsom told me they didn't have any hope for this Budget and quite frankly, they were right. Hospitality is not just about pubs, cafes and restaurants.

It's a vital entry point into the world of work, giving young people, including niece, a chance to gain skills, earn a wage and build a future. When hospitality businesses close, we lose jobs, local growth and the heart of our high streets. We cannot let this happen. High energy costs put real pressure on small businesses. It seems that big industry gets a discount today and the high streets get the bill. Fatima's Hair Boutique in Epsom is no exception. Hairdressing is energy intensive. She needs hot water salon machines and heating in summer. Her salon energy bills are around 390 a month and in the winter the average are staggering £600 a month.

The government has announced the electricity bills will be cut by up to 25% for over 10,000 businesses through the British Industrial Competitive Scheme. But will the Chancellor confirm whether high street businesses are included in this scheme? Small businesses need a cut in their energy bills, not a trim around the edges. Epsom and Ewell is a strong net contributor to the Exchequer and is home to major businesses like Aviva, Weights and Slitherine. But this success depends on strong rail infrastructure and I didn't hear anything about this in the Budget today. Cuts to train frequency post-COVID is having a huge impact on local business growth needs people to be able to get to work and contribute to the economy.

We must restore train services in Epsom and Ewell to at least for an hour. This investment will pay dividends back to the Treasury. Now, I've been in Parliament for just over two years, and I've seen three health secretaries come through in that time. What I haven't seen is the government deliver on fully funding the new hospital programme. Saint Helier is being held together by patchwork repairs, and now we're seeing the result of this chronic underinvestment pipework that is so old that Legionella and Pseudomonas has been found in the water in Saint Helen Hayes maternity ward.

My constituents deserve better. The government must stop dragging its feet and speed up the construction of the new specialist emergency care hospital. Now, I welcome the abolition today of the cliff edge on Carer's Allowance. But the details are less welcome. It won't take effect for four years, and it will act as a 100% tax rate for working carers. The Chancellor also didn't acknowledge the crisis in primary care. GP wait times are through the roof. Dental deserts are the default. It's not good enough. There also was no mention of funding for the National Cancer Plan. We need action to save lives and increase cancer survival rates.

Treatment must begin within 62 days of diagnosis. Now the Chancellor himself resigned as defence secretary, but in his own words, the plan fell well short of what's required for defence. This was an honourable decision, but now that he holds the purse strings, he's failed to set out a clear route for defence spending. With the urgency, the needs, with the general public being told to stockpile. It appears that Britain's kitchens are going to be better resourced than our armed forces. So while I welcome much of what has been announced today, for many of my constituents, this Budget has not been bold enough.

We need real guarantees that support constituents and businesses, because life shouldn't be this hard.
15:51
Catherine West Portrait Catherine West MP (Hornsey and Friern Barnet, Labour)
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Catherine West Madam Deputy Speaker. And it's a pleasure to follow the hon. Member for Epsom follow the hon. Member for Epsom and Ewell, and there's much to be welcomed in today's Budget speech. welcomed in today's Budget speech. For me, today's Budget speech was solid but not flashy. It was the man who has HP sauce on his man who has HP sauce on his sandwich rather than pesto alla Genovese or tapenade or olive. This is definitely a really good Budget for the everyday, supporting households, helping small business and doing all it can for our fantastic start ups.

Today's debate is obviously being given in the context where the IMF has said that the fundamentals of the UK economy are solid. Unemployment is down by 26,000 in working age population productivity productivity has improved. However, today the cost of a barrel of oil is $114, and I don't think any other Budget speeches in the last few years have had that sort of input into every single thing that we consume as a country. So the timeliness, the tone, the careful presentation and the panache which with which with which this was delivered is a real pleasure.

Madam Deputy Speaker, in my Budget last year, I reflected on Attlee's 1945 Labour government style, where Labour rebuilt the country, built the welfare state, built the NHS and built council homes up and down the country. But this year the more appropriate leadership is, of course, the Labour Prime Minister, Harold Wilson, who once said to show that as a government we are sensitive to little points which may be trivial in the context of government policy, but carry a disproportionate weight in people's minds. That is the paternity cover for the white van employees, which my hon. Friend from Hodge Hill mentioned.

That's the help that the children at Coppetts Wood Primary School are getting with their breakfast clubs. On top of the school meals provided by the Mayor of London and Barnet Council, for example, the use of empty office buildings back in the day. London Centre Point during the period of Harold Wilson, which, of course he proposed to nationalise and which finally gave its name to the homelessness charity Centrepoint, which is still going from strength to strength today. What price can we put on somebody who is brought in from the cold to be given a night away from that freezing temperature, and served by those people in our constituency who may not necessarily be working for the council, but who may be in, for example, the Museum of Homelessness in Finsbury Park in my constituency, the Muswell Hill Community Kitchen, the street kitchen on Haringey Ladder, all those volunteers doing brilliant work with those experiencing street homelessness.

They've been in touch to say how much they like the style of our Prime Minister and this solid style of our Chancellor. Now, I'm very pleased to see that 1939 billion has been earmarked to deliver 300,000 homes for 26 to 36, and I know there's a little bit of gloom around the chamber, but I think we can be positive about the fact that just six months ago, when the cost of a barrel of oil was down at $70 a barrel, things felt a bit more hopeful. So I actually think that one of the things which is implied in this Budget is the redoubling of our effort from the Foreign Secretary to use the might abroad to bring people around the table to talk about the importance and the link between conflict and our household budgets, because if we could see just that wasn't even a total cessation of violence, but that was at least people talking to each other $70 a barrel compared to 114 today.

That's the sort of thing that we can see turn around with the fundamentals of our economy being strong. I welcome the first home scheme, backed by £4.7 billion. And I also know that both Haringey and Barnet Council will be pulling out all stops to ensure that everyone has a safe, secure and affordable home and be working on those ever longer lists of homeless individuals. I also welcome the statements about assisting councils and assisting with the devolution, fiscal devolution roadmap, as it's being called, and I look forward to when Dame Louise Casey comes forward with her plan.

And I'm hoping that councils today will be pump priming their adult social care departments so that together with the NHS and with social care partnerships, we can see that National Care Service become a reality much more quickly than it needs to be. Barnet's Labour run council earned dementia friendly status and has worked with residents on an engagement and co-production charter for adult social care, working closely with unison and other trade unions. That's the sort of co-operation that we want to see. Madam Deputy Speaker, I've talked about why we need good housing, why we need good social care.

But the final piece of the puzzle is good, well paid jobs. And I'm incredibly pleased to hear that the minimum wage is set to increase once again under a Labour government for 2.3 million of our lowest paid workers. We often hear in the media from different quarters about the damage that the minimum wage or the London living wage is doing. We very rarely hear from people who have had a pay rise, who think that really helped me this week, having that pay rise. So I welcome that, particularly for people who are in entry level jobs, hoping to get on to a career ladder, but with a twist of fate in their own lives, it means that they're actually on the minimum wage or the London living wage for their entire career and retire on the minimum wage or the London living wage for those workers.

These increases are absolutely crucial. In 1967, Harold Wilson applied for Britain to join the European Economic Community. And in my constituency, where 81% of people voted to remain in the European Union, they want me to point out how important it is to the UK economy that we get closer to Europe. We know that Brexit hit 6% of our economy, made us 6% smaller, and as we all know, the importance of allowing the Prime Minister to go to Brussels next month to have as free hands as possible is really important. Let's not hold Britain back. And what about our children and young people who want to look forward to travelling abroad and having experiences where they learn a language and they meet other people in their own region, where they get to know the difficulties in Europe, where they understand what it means to defend Europe, where they really appreciate the opportunities that there are for our future prosperity for our children.

I do believe that we need to be at the heart of that European debate. Finally, today's Budget speech laid out timely, carefully presented intervention with families and small business. At its heart, I like the style of the Chancellor. It felt safe. It felt the right thing for today. And as we see, Madam Deputy Speaker, I hope an improvement in the international conflict picture, we will see an improvement due to the good fundamentals that this Labour government has produced since 2024.

 Thank you, sir.
15:59
Desmond Swayne Portrait Rt Hon Sir Desmond Swayne MP (New Forest West, Conservative)
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Desmond Swayne Madam Deputy Speaker and it's always a pleasure Speaker and it's always a pleasure to follow the Member for Hornsey. I believe that this is the cut and run Budget and indeed the the Liberal Democrats occupying here the two front benches below the gangway. They I read in the papers this morning have taken that hint as well. They're preparing for a December election. Such is the. The electioneering of this this this Budget, because because this is hamlet. Without the Prince there is

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no. Oh, of course I'll give way to the hon. Gentleman. I'm very grateful to. I'm very grateful to him for giving way. So what he's saying is the main criticism of this Budget is it's

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too popular. Oh, I will certainly I will certainly address this question. certainly address this question. It's not popular with me, but but with I have interests which are in the register, but the. But but the difficulty is that in the absence of the spending review and any clear appetite to deal with the 3 trillion debt, the burgeoning growth of debt, and, of course, our lack of productivity, this Budget lacks any credibility. Yeah, it's it's the try and not upset too many people Budget to get us through to the spring with the government unscathed. That's that's the meaning of the breathing space is breathing space for this government to get to a position where it can call an election decently, notwithstanding the fact that the Prime Minister assured the people of Makerfield and indeed has said in terms since that he has no such intention.

But that's that's the reality that we're dealing with now. The problem that we have at the centre of our economy at the moment was defined, I think, brilliantly and very candidly by the Secretary of State for Work and Pensions when he said all the meetings that he has are questions of who can we tax in order to give benefits to others. That is essentially the issue that we're having to deal with it now. The Chancellor has decided not to address that question. He has made a calculation. His calculation is that the pain for the Labour Party in addressing that issue is greater than the medium term financial damage of not addressing it.

Of course, the financial damage of not addressing it is that we'll all pay a higher mortgages and endure higher costs. But his calculation is that he can get to the spring before those particular chickens come home to roost. That is the strategy of this Budget, not to do too much, to have a few things that make it in. My hon. Friend's estimate popular, but the reality is there's going to be an election, and we're going to have to face these huge questions of the enormous costs that the the Prime Minister has pointed to in his ambitions and how that will have to be addressed.

Well, he said today that he's going to soak the banks. Now, that has implications for us all because this is this affects the cost of everything. It'll affect the cost of our mortgages. It will affect prices. And of course, it affects investment. What a signal to send to investors if you're successful. If you're doing well, we're coming for you. That's the message that investors receive. Little wonder that we are haemorrhaging wealthy taxpayers. Bloomberg, Bloomberg data. We have lost half of the billionaire wealth in terms of leaving the United Kingdom, in terms of leaving the United Kingdom or reducing its exposure here since 2024.

And we might ask ourselves why? Well, why it comes back exactly to the to the the issue raised by the Secretary of State for Work and Pensions, we've terrified them with mansion taxes and with the international reach of inheritance tax on all their assets. And of course, merely talking about the the prospect of raising capital gains tax. I'm really glad that we haven't raised capital gains tax, but they can read the runes and then, of course, speed up their exit, expedite their exit by talking about an exit tax. All these things have consequences. And enter this this milieu of burgeoning debt and surging unemployment.

The Prime Minister hurls his latest grenade talk of rejoining free movement within the EU. Nothing could be more calculated to be devastating for the prospects of our young people languishing in unemployment than to suck in European labour. So I say, let's have that election. Let's go for the election that the government is clearly building itself towards, because that at least will give the British people the opportunity to get off this road to penury. Yeah. Seema Malhotra.

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The Speaker It is a pleasure, I

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The Speaker It is a pleasure, I think, to follow the on New Forest West, but may I just start by challenging him on a couple of challenging him on a couple of points that he made. He has talked about the risks for higher mortgages. I might remind him, Madam Deputy Speaker, that there Madam Deputy Speaker, that there has been six interest rate cuts has been six interest rate cuts since 2024, and that will have supported constituents of his in terms of bringing their mortgage bills down.

And indeed, he mentioned about productivity. I might actually remind him that when he looks at the detail of the of the Budget papers, that the
16:06
Seema Malhotra Portrait Seema Malhotra MP (Feltham and Heston, Labour )
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upgraded growth forecasts from the OBR has been due to productivity OBR has been due to productivity gains from investment in AI, there. There is positive news, and I'm sorry that he has missed it so far, sorry that he has missed it so far, but he may want to spend a little bit more time looking. I do welcome bit more time looking. I do welcome today's Budget because it is much needed in this. In these tough times, to put in place the foundations, to build the base for a competitive future and prosperity for all. But Madam Deputy Speaker, I was surprised by the rather extraordinary response from the Leader of the Opposition, almost denying the impact of the Liz Truss Budget.

And perhaps it may be worth a reminder that the unfunded £45 billion in tax cuts led to the bond prices plunging, sterling falling and the Bank of England having to intervene to prevent a fight to prevent a financial stability crisis. It is important that we recognise what happened, and I think that alongside the fact that the welfare bill rose by 33 billion in the years to 2024 might actually help with some honesty about the debate first. But let me speak about today's Budget from from the point of view, three key tests, because it does need to be a Budget for stability, for growth, and one that eases the cost of living.

The Budget comes amidst unprecedented economic shock shocks with conflict in the Middle East and in Europe, which has disrupted international energy and commodity supplies. The Bank of England identified the energy shock from the Middle East as a major source of uncertainty in July 2026. So I welcome the Budget and in particular, the Chancellor's determination to combine fiscal discipline with a relentless focus on growth and tackling the cost of living. Because fiscal discipline matters. It is not simply about an accounting exercise at the Treasury, it is about credibility and about national economic security. And indeed the bond markets matter.

And if investors lose confidence in the sustainability of public finances, we have seen in 2022 what happens. But fiscal discipline and growth are not competing objectives. Ultimately, sustained economic growth, higher productivity, higher investment and more people in good employment is the surest foundation for sustainable public finances, and I am pleased that the UK economy has shown resilience for which I pay tribute to my right hon. Friend, and also to the stewardship of the former Chancellor, the right hon. Member for Leeds West, and I think it is important to not talk Britain down, because we were the joint fastest growing economy in the G7 in the first half of this year, alongside the US.

Borrowing last year fell to the lowest level for six years. The IMF has upgraded our growth to 1.3% for this year, and indeed, the IMF chief economist has said that we stand out on deficit reduction. And so I know the opposition may be disappointed by the. Some of the revisions of the forecast from the OBR. I do want to also welcome the government's commitment as a priority to get energy costs down, not just today but for the future. And I would welcome more clarity from the government as well, on whether they are reconsidering the expansion of the British Industrialisation Competitiveness Scheme, which I do believe may be something to be looking forward to looking to, and particularly in the plan, the ten year plan coming forward.

But indeed, with global headwinds from the conflict in the Middle East expanding, impacting us here and economies throughout the world, it is vital we have our own plan for growth and for tackling the cost of living on growth. I'll just briefly speak about fiscal devolution and entrepreneurship, because business and industry must be at the heart of our plans for growth. It is important that we have a plan which looks at how we are building the principles of stability, partnership and innovation, and the unleashing of potential in every corner of the economy in the UK, at the heart of our plans.

That's why I was pleased to welcome the fiscal devolution roadmap. It is bold, it is ambitious, and it is game changing and recognises that we need to deal with both the challenges of today and and address the structural challenges to achieve higher growth tomorrow. For too long, Britain has been one of the most centralised major economies in the developed world, with only 5 to 6% of total tax revenue raised locally. The OECD average is closer to 11%. But fiscal devolution means more than devolving spending decisions. It is about enabling greater responsibility and stronger incentives to expand local

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economies and tax bases. I will give way very briefly. To the hon. Lady. We've had devolution, of course, since the devolution, of course, since the Blair government, and if you look at Wales, it has become one of the poorest parts of the whole of Europe and it has had serious and real fiscal devolution. So why is real fiscal devolution. So why is it that she thinks that it's been so spectacularly painful for the residents of Wales to have such residents of Wales to have such devolution, but it will be so marvellous for people in other parts of the United Kingdom?

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I think there is an important debate about how you make sure that fiscal devolution is successful, and what are the enabling factors and what are the enabling factors around fiscal devolution, and we have seen it be successful elsewhere. And what he will elsewhere. And what he will recognise, and I will mention, is that as a London MP, I was pleased to see some of the some of the to see some of the some of the commitments today to establish a successor to the Elizabeth Line business rate, supplies, supply rate and being able to support transport infrastructure in the future as well through some of the new mechanisms.

And it is important we look at how fiscal devolution can accelerate projects that will unlock homes, create jobs and generate economic growth not just in the capital, but the impact of that across the UK. And it is important as we devolve. And this will be a question I am putting to the Treasury team as well, that we confront another economic challenge, which is coordination, because economies do not stop at administrative boundaries. There are cross-regional economic spill-overs if we don't design institutions to take account of them, ensure appropriate accountability and evaluation, and help successful innovations in one region spread to others.

What appears optimal for each region individually may not be optimal for Britain collectively. And so I do look to the Treasury team to be able to update the House on what can be learned from elsewhere, on making sure that we have coordination as well for devolution. Briefly on entrepreneurship, I was extremely pleased to see the measures and support for young entrepreneurs and also women entrepreneurs, which I have championed. Also previously in my work as chair of the APPG entrepreneurship. Entrepreneurship is oddly absent from debates about youth unemployment as well, and I. And we celebrate success when people have an IPO or attract a big investment.

But we don't talk about the preceding journey or the inequality that often characterises it. So I'm looking forward to seeing the measures the government is bringing in, having impact and encouraging entrepreneurship with young people across the country. Let me say a few words on opportunity and the cost of living, because the your first home scheme, I believe, will make a huge difference, not just to my constituents in Feltham and Heston, but also across the country. It is vital to have measures like this, the 20% equity loan scheme to help first time buyers and with a minimum deposit requirement of just 2.5% to ensure the scheme is accessible to those who have a regular income but have been unable to save for a large deposit and the measures as well.

With the council tax rebate, the VAT removed from domestic electricity bills, reforms to standing charges alongside measures like the first rail fare freeze in 30 years announced earlier this year, and the freeze in prescription charges are all important measures. So in conclusion, Madam Deputy Speaker, this is a Budget for stability, for growth, one that eases the cost of living. Designed to raise Britain's productivity and investment, to spread opportunity to every part of our country, investing to save and investing to grow fiscal credibility, empowered regions, effective coordination and investment in human potential taken together leading us to better growth, productive, inclusive and sustainable.

This is the time and the challenge we as a nation must

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rise to. Kirsty Blackman. Thank you very much, Madam Deputy Speaker. People really Deputy Speaker. People really desperately need support with the cost of living. They do not need brown sauce. They do not need brown sauce. They do not need gherkins or marmalade. They need help with the cost of living. If help with the cost of living. If you look at the documents that the Chancellor has produced today, he's Chancellor has produced today, he's less likely to hit his fiscal rules than the previous Chancellor was.

Tells you that in the back of the
16:15
Kirsty Blackman Portrait Kirsty Blackman MP (Aberdeen North, Scottish National Party)
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OBR book, the real household disposable income is going to drop in the short term, the Blue Book, if they're going to be standing up on, you know, an election platform saying, vote for us. Household disposable income, which is a disposable income, which is a fairly reasonable measure of living standards, is going to drop in the short term, and it's only going to short term, and it's only going to drop in. It's only going to rise again if gas and energy prices do what the OBR has hoped that they will do, and they will be, or has been very clear that this is not by any means set.

I mean, who would like to predict what Donald Trump is going to do next? Because I certainly wouldn't. We don't know what is going to happen with that. So the only way in which people's living standards will actually increase is if the international market for energy reduce the price of gas and oil. That's what the Chancellor is pinning his hopes on. What he's doing in this Budget is giving people £100, despite the fact that as of January, energy bills will be £1,000 higher than Labour promised that they would be in their manifesto, £1,000 higher.

We have got a situation where every single major household bill has increased over the course of this government, every single one. So we're seeing people really struggling with the cost of living. And so what is the Chancellor decide to do? The Chancellor decides to reprioritize capital debt to reprioritize capital spending. He decides to pull money from the Acorn project in the north east of Scotland, supporting hundreds of jobs for carbon capture and storage, which the Climate Change Committee said was one of the projects that is needed in order to get us to our climate change ambitions.

That is one of the things that the Chancellor has chosen to do today. The other thing that's really significant issue that the Conservatives have got a significant amount of of creation of this problem is the fact that the UK has got an incredible level of index linked debt. Now, I'm pleased that the Chancellor is moving towards reducing the percentage of index linked debt that there is. But in the OECD, there are only three countries that have higher levels of index linked debt than the UK does. That is Mexico, Israel and Chile. So moving away from that, from that legacy that's been left by the Conservatives is really helpful in today's financial climate.

However, if they don't manage to make that any slight change in this, any slight change in the inflation levels or any slight change in the oil and gas prices could mean that the Chancellor massively misses his fiscal rules. If you look at the risk section of the OBR's blue book, it very clearly sets out how easy a very small percentage change could mean that the Chancellor will miss his rules, and there's only about a 50% chance that he's going to hit the rules anyway. It's only about 52% in the in the back of the blue book.

And therefore, given the volatility of the world, I think that we should all be incredibly worried. Madam Deputy Speaker, we needed something dramatic. We needed something major in order to ensure that people can survive through this cost of living crisis. We had the child poverty strategy earlier in this parliament, the child poverty strategy, which was deeply, deeply unambitious and only restated other than the two child limit being removed, which I have fought for and entirely welcomed. Other than that, every single thing was things that have been introduced or announced already. We have got in Scotland a much better child poverty strategy and in fact the most comprehensive cost of living package in the UK.

So people with children are looking at this and thinking, this Budget does not help us young graduates who are currently living with their parents up to the age of 25, like they never have before, are looking at their student loans that they owe in England and thinking, how can we possibly be paying our student loans until we're 60, with no chance of a job to come in? Couples with children are looking at the fact that their parents could afford, for one of them to work part time, could afford to have more children, still afford to go on an annual holiday, whereas young couples now cannot afford that because they're poorer than generations before.

Folk in their 40s have got no end in sight in their mortgage, whereas their parents have paid off their mortgage by that stage because housing prices have gone absolutely
16:24
Toby Perkins Portrait Mr Toby Perkins MP (Chesterfield, Labour)
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through the roof and mortgage prices are even higher as a result of some of the decisions that have been taken. So what is the been taken. So what is the Chancellor doing? Is providing cheaper gherkins, great disabled cheaper gherkins, great disabled people who are desperate to work, subsisting currently on Universal Credit, but know that they cannot afford the fuel they need to drive afford the fuel they need to drive the car to the job. They can't do that. And what is the Chancellor that. And what is the Chancellor delivered? £100, £100 is not going to cut it.

Madam Deputy Speaker, we've got pensioners who are living in terror of their next energy bill. Pensioners who have lost trust in this government because of the winter fuel cut that was made with no warning to people because of what was done to the WASPI women. We've got a huge number of people

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who are living in absolute fear at the moment Of the next bill dropping

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Of the next bill dropping through the letterbox, and the Chancellor has completely failed to recognise this. He's living in a recognise this. He's living in a different reality to the rest of us. He's providing a little bit of He's providing a little bit of changes around the edges. He's providing a little bit of breathing space, he says. The breathing space isn't going to get people through isn't going to get people through this winter, never to the spending review or the Prime Minister's wonderful ten year plan that's supposed to be coming forward. Madam Deputy Speaker, we've made some different choices in Scotland.

 We've provided the baby box. We've provided the cost of living package that's the most comprehensive in the UK. We've provided no prescription charges. We've provided free tuition fees for university. We don't have all of the levers. We don't have the ability to do what we ask the Chancellor to do, which was to cut energy bills by at least £300, which is not even close to what the manifesto pledge was, but is getting there. We asked him to do this this winter. We asked him to make a difference so that people can get can afford to get through this winter.

We asked for the removal of VAT on various things, including petrol and diesel for the duration. We are pleased to hear the changes that have been announced in relation to fuel, particularly in relation to the mileage, which makes a massive difference. But in the gas standing charges that has been announced, it wasn't announced today. It was announced a couple of weeks ago or when Jack was announced. They talked about removing the gas standing charges. We know that that's going to put up the energy bills for those people that use the higher levels of gas. We know that people in Scotland have got significantly colder properties because it's colder in Scotland than it is here.

What is a differential change? How many people in Scotland will be losing far more in terms of the extra that they will be spending? How many disabled people who live, who spend more time in the house? How many elderly people who also spend more time at home will have to pay more on their gas bills because of the Chancellor's choices? Has he actually looked at this? Is it in any way a progressive measure, or will it continue to screw over those people who are already screwed over by the current situation? Madam Deputy Speaker, he needs to do better.

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Dear Toby Perkins. Thank you very much, Madam Deputy Speaker. This Budget will Deputy Speaker. This Budget will continue to make Britain more resilient, supporting people and businesses in the current moment businesses in the current moment and investing in the future and in an increasingly uncertain and changing world. This government is steadying the ship. This Budget will help families with the pressures they face now, and invest in the long term to bring down the cost of living and make life easier and better for working people.

However, whilst welcoming much
16:31
Richard Tice Portrait Richard Tice MP (Boston and Skegness, Reform UK)
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that's been announced today, I do need to say that whilst members of need to say that whilst members of the Mineworkers Pension Scheme in my constituency are much better off as a result of the measures taken as a result of the measures taken by this government two years ago and have seen further improvements in the position taken by my right in the position taken by my right hon. Friend the Chancellor today, there will still be disappointment that today is not the day that the that today is not the day that the government's decided to return all surpluses from the Mineworkers Pension Scheme to its members.

 Mineworkers paid a large health price for their commitment to keeping the lights on over many decades, and each day of delay means more mineworkers die without receiving the full fruits of their industries, all their communities. Commitment to our nation. However, turning to the positive news announced today, we have the second fastest growth in the G7. We have growth forecast upgraded once again by the IMF, as was generously acknowledged by the former Chancellor. The FTSE has risen modestly. I remember being on those benches over there when Kwasi Kwarteng was delivering his Budget and seeing hundreds of thousands, indeed millions of pounds crashing off the value of the stocks and the are important, very important to acknowledge that those who have an independent view of this outside of the political sphere have welcomed this Budget, and that is a sure sign that this government is on the right track, that every single Budget the party opposite, have predicted catastrophe.

But instead, every time the economic figures come out, they've been more positive than the party opposite have predicted. And what we've seen today, 43,800 Chesterfield households receiving £100 towards their energy bills this winter, £50 a reduction because of the changes in VAT. More pensioners who are not going to be brought into tax. We've seen positive support for self-employed partners. We've seen a really welcome increase in the rate threshold for small business rate relief. Up to 18,000. 54% of businesses in the East Midlands will now pay no business rates. We've seen no rises for the next two years on business rates, and the government have made this economic progress at the same time as building huge amounts of home grown renewable energy, holding failing water companies to account a revival in council house building, National Health Service waiting times coming down, record increases in the national minimum wage, more people in work than ever before, record investment in our National Health Service, and half a million children being brought out of poverty.

That is the difference that a Labour government has made, and possibly the greatest endorsement of this Budget is how weak the opposition has been on it. When the opposition get to their feet to say, well, I think you could have been a bit more ambitious, you know, that they haven't really got a line to attack you on. And that is, of course, a very strong endorsement of this Budget. But of course, there's much more to be done.

And of course, I should say, whilst the Leader of the Opposition was making what we all know is a difficult speech for the leader of opposition,
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Matt Western Portrait Matt Western MP (Warwick and Leamington, Labour)
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apparently she didn't. She had some of the facts redacted in the copy she received, which is why her own she received, which is why her own critique was was so weak. At least she turned up to make it. The leader of the Reform Party didn't leader of the Reform Party didn't even bother turning up to the Budget. I mean, it's extraordinary. Budget. I mean, it's extraordinary. Well, as far as I was still under the impression that the hon. Member for Clacton was the leader of the Reform Party. But why bother seeking re-election? He never turns up to this place.

I is mystifying to us, but there is so much more to be done. Russia's illegal invasion of Ukraine and Trump's ill advised war on Iran have driven up fuel prices, energy prices, the cost of fertiliser, creating cost of living crises across the globe to which we're, of course, not immune. And in that context, I welcome the Chancellor's priorities to boost Britain's resilience and to get energy costs coming down for good, climate change and biodiversity loss continue to be clear, and present threat to Britain's security and prosperity. Droughts at home and across the globe have reduced crop yields, driving up food prices, and the Climate Change Committee has been absolutely clear that climate impacts could cost the UK economy £10.7 billion over the next year, just in lost tax revenue from lower productivity due to extreme heat or disruptions from flooding.

Every independent analysis tells us that the action of taking the taking action on climate change is far cheaper than not taking action on climate change because of the costs it will have on our economy. The. Just a few weeks after the summer we've had of wildfires and drought, where extreme heat caused over 3000 excess deaths in the United Kingdom in May and June alone. There does need to be real caution on anything that can lead to higher emissions. And whilst I welcome the Chancellor's desire to see data centres here in the UK, we need to be very careful that we do this in a way that doesn't damage our climate commitment.

Now, land managers and farmers are central to preparing the UK for the impacts of climate change. Investing in UK farming will also help protect farmers from global events, in turn helping to shield consumers from rising food costs. Yet just a few weeks ago, the window for applications on the sustainable farming incentive was open for only six hours before it was fully subscribed. Now, it's great that this government is getting that money out the door and to farmers. It also shows the immense appetite for this funding and for nature friendly farming. But it is important that the government takes every step they can to ensure that we're able to provide more support for farmers who are doing things in the right way.

So in conclusion, Madam Deputy Speaker, this Budget is a Budget of stability, and it's a Budget of hope for working people and for small businesses. It's a Budget that supports entrepreneurs. It was extraordinary to hear the Leader of the Opposition say, this Budget does nothing for business when it so specifically goes out to support entrepreneurs and those risk takers in our economy. This is a Budget that is progressive. It has the most value for those with the lowest income, and it is a Budget that is taking the serious decisions to address the collapse
16:47
Graham Stuart Portrait Rt Hon Graham Stuart MP (Beverley and Holderness, Conservative)
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in our economy caused by the party opposite. It continues to deliver opposite. It continues to deliver growth while reducing the. Over several years, the debt to GDP several years, the debt to GDP ratio of our country. And for all of those reasons, it's a Budget that I'm very pleased to support. Richard Tice thank you, Madam Deputy Speaker. Poorer is what Deputy Speaker. Poorer is what every household in the country is, including in my constituency of Boston and Skegness. Yes. This year alone, 0.8% down every single year between now and the end of this parliamentary term, the average household real disposable income is down compared to where the OBR forecast just six months ago.

Look at the other main economic data GDP once again for next year, 2027, down from 1.6% to 1% under this failing Labour government GDP per Capita next year, down from 1.3% to 0.9%. And what's up? Let's just look at what's up, shall we? Borrowing government borrowing in this financial year alone, up almost £20 billion can where compared to where the OBR forecast just six months ago and over the lifetime of this Budget book, for the next five years, government borrowing will be over £65 billion more than the OBR forecast just six months ago.

This is a government that is completely out of control in terms of spending, and that's why the bond markets are applying. Madam Deputy Speaker, what's known internationally as the moron premium to this United Kingdom under this Labour government. But credit where credit's due, credit where credit's due, this, this, this Chancellor does know where the real problems are. And he tried to do a little bit. He understands that there is a crisis with energy bills, which are now forecast in January, to go up an extra £466 per household, and then another £200 per household in April, all because of the madness of net zero and the rush to renewables, which is leading as we speak.

Madam Deputy Speaker, every single day Nisa is having to tweak and twiddle the dials and add balancing costs to the tune of some £50 million a day. That is like it's ten times what it was just a few years ago per household. Just the balancing costs alone on the grid. Is next year going to be £200 per household. This is completely out of control. So whilst the Chancellor, he has shuffled the cards in the pack, he's moved a bit from bills to general taxation. He hasn't dealt with the real crux of the crisis, which is the rush to renewables, is driving up all our household energy bills at a catastrophically high rate.

Now, again, I want to give credit because I'm a constructive sort of guy where credit's due and and the government has done the right thing in approving in approving jackdaw, but they need to go further. As the Ministers at the Dispatch Box, they know in their heart of heart Madam Deputy Speaker they need to approve the oil field at Rosebank. But the Prime Minister at PMQs today was was tempted to confirm and grant many more licences in the North Sea. Because that's our energy treasure. That's where the jobs are, that's where the growth is. And this is a this is a government that is completely failing on growth.

So the energy crisis is getting worse. And everybody needs to understand that. Whereas if we use our energy treasure, the bills will come down. And then if we look at the issue around property and households, again, the Chancellor credit where credit's due, he has eased the regulations in order to try and build more homes on brownfield sites. I think he might have read my my teal paper, which I released in September, on how to reduce the cost of construction and get more things built. He's right to reduce to remove the need for biodiversity requirements on brownfield sites, but there's so much more to do to reduce the cost of construction of the new homes that I think we all agree we need to build the some 15 to £20,000 increase in the cost of homes because of unnecessary regulations.

So again, the Chancellor has not grasped the real opportunities to go for it and to reduce the cost of building. This is what we need. We all agree we need more affordable social housing, of course. But to do that, you've got to reduce and remove the unnecessary restrictions and the delays on getting planning consents. And for example, we now know that the Secretary of State for housing has given up on her 1.5 million target. In reality, we'll be lucky to get to half of that number. That's half 750,000 homes instead of 1.5 million homes.

These are the lost opportunities from a government that is obsessed with regulation, obsessed with process, obsessed with bureaucracy, but actually can't do the right thing to deregulate to get some growth. I

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give way to the hon. Gentleman. Giving way. Can you explain to me why? I mean, it seems to be extolling the benefits of building extolling the benefits of building houses. Why is it that the Reform Party in Tunbridge Wells is housebuilding.

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housebuilding. Are far from it? Well, actually, what we're trying to do is to build more houses on brownfield sites, because that's what we should do because that's what we should do all over the country, including the great town of Tunbridge Wells. We need we need to make it easier to build on brownfield sites, because otherwise, at the moment, housebuilders are giving up all over the country. And the reason they're giving up is because the costs are too high. But again, again, I think the Chancellor has been he's been looking at some of the excellent reform policies.

So whilst he's whilst he's right, whilst he's right to lift the income tax threshold for pensioners, he could have gone much further and lifted it for everybody up to our recommended level of £15,000. By being more dramatic about cutting the vast amount of wasteful spending on welfare and cutting foreign aid to overseas nations that don't need it. Those are the differences between the right things to do and the lost opportunities of this government. And again, again, the Chancellor has has, I think, listened to another reform policy, which is to lift the threshold on business rates.

But he hasn't gone far enough. So whilst £18,000 threshold is better than 12, actually it needs to be much, much more another lost opportunity. So I think in conclusion, Madam Deputy Speaker, we have we have a nation of, of, of, of voters, every household who looks at this Budget book, who listens to this Budget and says, no thanks. We're all getting poorer every single year between now and 20, 30 to 31. We're all getting poorer than the OBR forecast just six months ago. People feel it, they sense it. They know their money is being wasted on bureaucracy, on unnecessary quangos.

More task force and quangos set up during this Budget. It could have been so much better. Madam Deputy Speaker, I feel this, Chancellor, he's just not had the courage. He's not just the strength. He hasn't risen to the occasion. He's tried, but it's not good enough. And, Madam Deputy Speaker, this country, we are facing a financial crisis. We are facing an energy crisis, and we need a government that does the right thing, that cuts our bills, and that is a lost opportunity from this Budget.

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Matt Western Madam Deputy Speaker And I think it's a pleasure to follow the Member for Boston and to follow the Member for Boston and Skegness. I disagree with the vast majority of not all of what he said. I mean, growth, as we've seen, is I mean, growth, as we've seen, is running at about 2.1%. We haven't seen that economic performance for about ten years, with the exception about ten years, with the exception of 2022. As we emerged out of the pandemic and in the 24 general election, we did promise we would election, we did promise we would fix the foundations.

You cannot do that overnight, Madam Deputy Speaker. We said we would produce our highest growth rate in the G7, and we have done that. So I am proud of the government's record and I'm sure all the colleagues on this, this benches are as well. And that is not just down to what we've heard today. It's about what has happened over the last two years. And I want to place on record my thanks to the stewardship of the last Labour Prime Minister and his Chancellor. My right hon. Friend the Member for Leeds West and Pudsey, because they delivered fiscal discipline, bold economic reforms and good growth.

Now, look, we are facing the impacts of global events here at home when doing the weekly food shops or filling up at the pumps. The cost of Trump's and Netanyahu's war in Iran is set to cost each household 2500 pounds a household by the end of 2027. Now, listening to the Chancellor, today's Budget looks to build on those fiscal foundations, and I welcome the measures laid out. It will give families the breathing room they need, extending the VAT cut on electricity bills this winter and spring and into July next year. £50 off cutting the standing charges on gas bills, saving £45 for the average household.

Green levies knocked off bills. A council tax rebate of £100 for 20 million households to help in in their energy bills. That will help almost 40,000 households. In my constituency of Warwick and Leamington. But the Budget today cannot fix the cost of living overnight. For example, during 2010 2020, for those 14 years, we saw real weekly average wages rise just by £16. If we had matched wage growth seen in Germany, our earnings would be £3,600 a year higher. Now if I just turn to motorists, the extending of the £0.05 tax cuts to to fuel duty to July is really welcome.

Likewise holding down diesel. I want to congratulate the Chancellor for his help to those motorists, those business users, particularly with their higher mileage rates increasing from 25 to £0.35, which will make a significant difference to them. If I could just talk about housing briefly, the average house price in my constituency 30 years ago is five times average annual salary. Today it is ten times the average salary. So that's why I welcome the announcement that the government has made. It's critical to increase the supply, to help young people to stay in their areas, to help key workers be be located near to their work.

And that's something that's particularly relevant to not just the businesses in my constituency, but particularly to the hospital, the Warwick Hospital. So the delivery of affordable housing, council homes, by extending the discounts that local authority, the on the local authority borrowing rate is really important. And the introduction of the £4.7 billion, your first home programme is really welcome and on business. I'm delighted to see the Chancellor backing UK businesses, taking more businesses out of paying business rates, raising the. The small business business rates. 52% of all retail, hospitality and leisure businesses will pay no business rates at all.

And the real terms business rates freeze for eligible business will benefit 535 properties in my constituency of Warwick and Leamington. And can I just also highlight the relief for family businesses that the Chancellor mentioned? The relief also for entrepreneurs and founders? I think that's particularly welcome and really innovative, and I commend that. I just want to talk on the Reindustrialisation programme, the additional investment that the has been announced totalling £20 billion, supporting 100,000 jobs in sectors such as AI, defence and green energy. It will strengthen our economic resilience and in Warwick and Leamington we are very well positioned to take advantage of this, in particular our advanced manufacturing, our automotive and defence businesses.

And just as an aside, Madam Deputy Speaker, if I highlight one company, we're talking about agility, we're talking about innovation company just down the road in Oxford is spinning out of Oxford University, a PhD project which set up a business. And we were hearing about this new £1 billion businesses in the UK, that one business that spun out of Oxford University, which in 2009 had zero money by 2019, ten years later it was worth £100 million. It subsequently was bought by Mercedes just to to build on the point about pensions and ISIS and encouraging greater investment in the United Kingdom, a point made by my hon.

Friend the Member for College Hill. I do believe there's a lot of money in this country in a liquid assets, and we have to use much more of the liquid assets, such as in ISAs, to invest in the United Kingdom. That's why I would like to see more encouragement for fiscal incentive to individuals to use their savings to invest in the United Kingdom or in the United Kingdom defence sector. On the point of devolution, I just want to pick up. And of course, it's very welcome that there should be transitional growth funding. And I do agree to the combining of powers and for for Warwickshire, Coventry, West Midlands, whichever way we are going to end up, that is important.

 But I really do hope that areas such as mine will not be losing out just because of the mistakes that were made with local government reform back in the 1970s, where Coventry was hived off from the rest of Warwickshire. Yeah, if I could just come to a point really about long term strategy, and I really welcome the long term thinking that the Prime Minister is bringing to his role and how he sees government working with countries such as Vietnam and others. And you see the benefits of a real long term plan and the strategy around it to deliver permanent growth and long term prosperity for communities.

Now, in terms of AI, of course, we must have AI sovereignty through either through strategic leverage of the AI stack or a sovereign frontier AI model. So I welcome the Chancellor's announcement to have a sovereign AI unit. Just really. In summary, Madam Deputy Speaker I, I obviously welcome the measures that have been made in this Budget, particularly what's been what has been done to help households through this incredibly tough time, a tough time that's been brought on by external events, whether it be the war in Ukraine or the unnecessary war in Iran brought about by Trump and Netanyahu, which has seen prices of energy spike dramatically these last ten months, they are significant headwinds, and there is only so much a government can do to to battle those.

But I really appreciate the measures that this government, this Chancellor, have have introduced to address them. I agree with the points made by colleagues that this has been a Budget delivered by a Chancellor who is renowned for his steadfastness, his durability, and his seriousness, which he brings all his personal qualities to the role of Chancellor. And it was the. His first Budget that he delivered really underlines his vision and his the the the seriousness with which he wants to steer our country through a very difficult time. And

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I look forward to supporting the Budget. Graham Stuart thank you, Madam Deputy Speaker. It's a pleasure to Deputy Speaker. It's a pleasure to take part in this Budget debate and to follow the hon. Gentleman, the Member for Warrington, Warwick and Leamington. Like him, I tend to Leamington. Like him, I tend to think that this Budget does reflect the seriousness and the vision of the seriousness and the vision of the Chancellor. But unlike him, I don't conclude from that that he's got a deep and serious vision of the future for this country. Quite the contrary. He, alongside the Prime Minister, have come up with a whole series of small measures.

In fact, Madam Deputy Speaker, there are more measures, Budget measures in this Budget than any previous Budget, and on average, their value is lower than any average measure in previous budgets. In other words, the Chancellor is fiddling. He's playing little gifts that he can highlight and say, we're doing this for business. Look, we're we're taking 70,000 businesses out of business rates. And of course, Madam Deputy Speaker, I welcome that. But the conservative. But but of course, it's inadequate in a in a high street, which is falling and losing. That's why the conservative policy measure.

And we do have a vision and we have a leader and a shadow Chancellor with a vision is to take out 250,000 companies out of business rates in the high street so that we can get the shops, the cafes, the pubs, all these businesses that give chances to young people, that first job to learn how to, how to talk to a boss, how to, how to engage with customers, how to understand a till and the money and, and just get a chance, whether it's a Saturday job or whatever it is. And that door by this Labour government.

And I know members opposite didn't mean to do it. That door has been slammed in young people's faces. That's why that's why we've seen youth unemployment go up. That's why. And the hon. Gentleman I will give way to I will I will happily give way to the hon. Gentleman in a moment. But it's but it's why the hon. Gentleman, when he meets young people in his constituency, I'm sure, is exactly the same as me. He's meeting more and more young people who feel a sense of hopelessness. They feel that getting on the housing market is further away than ever before.

And even if they can look that far because they're struggling to get that first job, that opportunity, and this government and today's Budget shows that they still don't get it. But perhaps the hon. Gentleman does. And we can hear, finally, a non-labor partisan

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intervention and someone who deeply takes seriously the need to get business going in this country. I give way to the hon. Gentleman. Hon. Gentleman.

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Hon. Gentleman. Is very kind in giving way and his words. But does he appreciate his words. But does he appreciate that in the South West, at least that's 56% of retail, hospitality and leisure businesses completely lifted out of the business rate system entirely. Is that welcome

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system entirely. Is that welcome news to him? And I hope he has some well. I think I think I'm not an expert on this, let alone all those jobs in his particular region, but most, I think are already outside and they're not all therefore being lifted out. And hospitality UK has suggested that as few as 10% will be affected by this. And that's my point to the hon. Gentleman who I know is sincere and properly wants to reflect the very serious challenges facing his constituents in his part of the country. This government doesn't get it.

Instead of the bold measure that we should have had 250,000 businesses brought out in order to bring life and dynamism and hope back to his high street and mine. We have a government that's timid, that is playing on the margins. And that, of course, I think, is the central problem of today's Budget, as was laid out far more eloquently than I ever could, and as doubtless colleagues opposite would say, more reasonably by the former Chancellor, the Member for the right hon. Member for Godalming and Ash, now the Leader of the Opposition, said that the Chancellor had had a hospital pass inheriting the economic situation from his predecessor.

But I remember someone once saying to me, do you know what the best thing you can ever have in life, Graham is? And I said, no, I don't. What is it? It's a really lousy predecessor. And I think on that measure, the Chancellor has been quite fortunate and therefore coming forward with something this timid, this pallid and this lacking in inspiration and giving a speech that entirely aligns with those qualities, is leading to a near rapturous reception from members opposite who've had to put up with the two previous budgets with their disastrous impact on the UK economy and why, Madam Deputy Speaker, was it so disastrous?

Well, I can tell you, because growth and wealth, which the former business secretary spoke about so eloquently earlier, comes from the private sector. It doesn't come from a mission led government having a tight deadline to go and help rearrange governmental boards and the quality of the people on it that is peripheral. It's private business, which does that. And what did the former Chancellor do? She raised taxes on business by £60 billion, £60 billion. That's why there is the gap more than £60 billion. I'm currently. That is why there's a gap between the small businesses in Beverley and Heddon, in Scala, across my constituency, Withernsea, that I meet who really want to grow their business.

They've got customers who want to come in, but the tax position has made it that they are not able to offer the job to the young people. I also meet outside those shops, standing around listlessly who want that job, and that gap has been widened by that 60 billion. But according to colleagues opposite today, that gap has been narrowed because of this 70,000 business rates reduction, etc. but that's not telling the whole story, is it? It's a sleight of hand Budget as well, which is why I think it's a disappointment, because business taxes haven't gone up by another 60 billion.

Praise the Lord. But they have gone up by over 2 billion and fiddly measures. And on top of that, there's the ever populist let's attack the banks to feed the backbenchers opposite. So divorced from economic reality. And they're going to be paying 1.6 billion in 15 months. If we ever believe the Chancellor in 15 months is going to say to this particular set of backbench Labour MPs, oh, I've got a great idea. Let's look forward to the day we take the tax off the banks. So I rather fear the 15 months may be extended because of those people who've done so much damage before by leaning on their front bench anyway.

But let's assume that it's real and it only lasts 15 months. 1.5 £1.6 billion taken out of the banks. And, Madam Deputy Speaker, you know, having been a long and experienced member in this House, that the capital of banks has a big multiplier attached to it. So when you take out 1.5, 1.6 billion away from the banks, you're not hitting the rich and helping the poor. What you're actually doing is massively reducing the pool of funding that is available for the very businesses, which, if they only started to get some of their policies right, might get to a position as they profoundly want to offer a job to that young person outside who cannot get one.

Today, I give way to the hon. Lady.

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Thank the hon. Member for giving way during his discussion around way during his discussion around banks. Is he aware that Barclays Banks profits are up on 1.6% rate?

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Banks profits are up on 1.6% rate? I'm delighted. There is only one thing worse than fat, greedy, complacent, lazy banks. If that's complacent, lazy banks. If that's how you want to characterise them, there's only one thing worse. And that's. And that's broke ones. that's. And that's broke ones. Because once you have a bust banking system, the whole of society is stuffed. You can't get on the housing ladder. You can't start a small shop, you can't get anywhere. And that's why I would plead with members opposite who I know have never had little to do with private business.

They've come from their charities and their social work and their and their and their trade unions, and they have no understanding. So it seems a populist thing to do to attack the banks, but in fact, it hurts ordinary people. It means that
16:57
Jim Dickson Portrait Jim Dickson MP (Dartford, Labour)
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small shop in that hon. Gentleman's high street cannot take on the high street cannot take on the unemployed youngster outside. So I won't give away. The hon. Member won't give away. The hon. Member will allow me business investment. By the way, Madam Deputy Speaker, what's it doing next year? According to the government's own According to the government's own figures, it's falling, it's falling and debt. The debt of the nation. What's that happening? What's What's that happening? What's happened to that as a result of today, as compared to earlier in the year, it's going up in every single year of the forecast, five years of additional debt.

It was already scary. So to have colleagues opposite, like the person who spoke before me, who I respect, a very great deal painting it. Well, the Member for Chesterfield trying to say, oh, this is a great Budget for entrepreneurs. It isn't. It's a Budget that allows a listing ship of state and the economy of this country to drift ever closer to the rocks, year by year by year. We're going to see debt going up and we're seeing taxes going up. We're seeing incentives going down. And without those incentives, those people in Beverley and Withernsea and Hedon in Skirlaugh, wherever they are in my constituency, just can't offer that job to that person.

And if I look at the specifics of the Budget, how are they funding some of this? Well, the Chancellor skated over as best he could. He's going to attack. He's going to tax amusement arcades, as if coastal towns like Withernsea and Hornsea up the coast aren't hurting enough. You're going to take the entertainment of ordinary people going to the amusement arcade, and he's going to put tax up on that. He is an enemy of fun. I won't give way to the hon. Gentleman, but coastal communities are losing out. Savers, savers, savers are being hit. Again, I don't think this has come through.

Clearly the savers are being hit by £500 million increase in tax, so they'll talk about it being good for pensioners. It isn't those who've saved put money away for the future. They are going to get taxed again and again. And we're going to see tax reaching a new peak at 37.9% next year. And according to the government, you know what's going to happen, Madam Deputy Speaker, it's going to go up again. So we're going to have sky high borrowing, sky high tax. And yet you would have thought this, Chancellor, the central challenge would have been to make sure that we had a firm plan for defence spending to be 3% by 2030.

Did he deliver that? No, he did not. Suggesting that he resigned more to get that job than to do the right thing by defence. Jim Dickson thank you, Madam.

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Deputy Speaker. It's always a pleasure to follow the Member for Beverley and Northallerton, Beverley and Holderness. Sorry, Beverley and Holderness. He's always very entertaining. I'm always intrigued by how there seems always intrigued by how there seems to be an inverse ratio of the numbers of interventions he makes with the numbers that he takes. But with the numbers that he takes. But can I can I reassure him that on the lousy predecessor test, this government was truly blessed in 2024? By the hon. Member then for South West Norfolk and the hon. Member now currently for Richmond and Northallerton.

So I welcome this Budget, Madam Deputy Speaker, and it is a pleasure also to follow distinguished members of the Treasury Select Committee on both sides of the chamber. As others have noted, the IMF, when it published its most recent forecast, highlighted how, despite the consequences of US military action in Iran, our economy is proving more resilient than expected, with 1.3% growth for this year and similar for next, largely underscored by the OBR forecasts. And I back our government, as it has done this year, to exceed those forecasts, and we wish it well. In doing so.

We shouldn't underplay, however, the damage done by this conflict with price rises in important commodities like oil and fertilisers pushing up inflation. But it's positive that the IMF have upgraded our growth prospects. And this is a testament, I believe, to the work of the current and previous Chancellors, and it's welcome that we remain towards the top end of the G7 for growth, even though, as always, members of this House would want to see growth higher. And we hope very much it is, and it remains remains essential, in my view, to reassure the markets that we stick to the fiscal rules.

 And I welcome the Chancellor's pledge today to keep doing so. We must ensure we continue to keep sufficient headroom against those rules. And the Chancellor again has done that. And this as well was recognised by the IMF, who singled out the UK among the G7 for the way we are managing our debts and we are doing that, I believe, whilst as chart 3.4 in the Red book shows, in terms of distributional impact on this Budget, we're doing that whilst ensuring that those at the bottom end of the income scale do better sequentially as you go up the income scale than those at the top.

And that, I believe, is a proper Budget for working people. And it's this careful and I believe, fair economic management that will allow us to ramp up defence spending to meet the target of 3% spending by 2030, after our armed forces, frankly languished under the last government and after the

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2024 election, I'm happy to give way. So I welcome the approach to

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So I welcome the approach to move forward on defence. But since I've been elected, I even called my own government out for not funding own government out for not funding enough. Does he realise today's announcement on defence means we are making in-year cuts for the next two years on defence, because we cannot afford what we currently have in place?

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Can I thank the hon. Member for his intervention? I feel very confident that the plans laid out today take us to 3% by the end of this parliament, and 3.5% by the middle of the next decade, and

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that's what we've committed to do, and that's what I believe that we will do. I'm happy to give way. Forward to him.

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Forward to him. But apropos, the point has already been right. You may. Does he really believe that? Because the Red book gives a very different Red book gives a very different story. And what we're talking about is Ardell, and that is day to day spend on our armed forces. That spend on our armed forces. That means reserves. I am one not getting their reserve training days. It means ships that can't put to sea because of a lack of fuel. It sea because of a lack of fuel. It means no bullets. It means no exercises. Is that what he wants?

What does that say to the brave men

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forces? Page 145. Can I thank the hon. Member for his intervention? It sounds like what he's describing was the situation as it pertained for the last 14 years. We are turning that last 14 years. We are turning that round. I'd say to the hon. Gentleman, so after the 2024 Gentleman, so after the 2024 election, I believe this government has demonstrated a clear strategy to get on and fix the foundations to get on and fix the foundations of our country, not most obviously, in public spending that had fractured under the previous administration, and that includes defence as well.

This is built on long term investment in infrastructure into crucial new projects, and nowhere is this better illustrated than in my constituency in North Kent, where the funding for the Lower Thames crossing, public funding, supporting big investment for the private sector, over £10 billion of a new transport project will make such a difference to Dartford residents once it's complete, and the Chancellor's announcement that he's expanding support to businesses and infrastructure projects through the National Wealth Fund and the business, British Business Bank is most welcome, with the potential for an investment boost right across the UK.

And as a tangible, practical example of how investment can make a difference in our constituencies, I'd want to commend the Spending Review, which saw the announcement of the Structures Fund to invest in distressed transport assets across the country that were beyond the capacity of local authorities to repair. And we hope to hear in Dartford that funding has been allocated to repair the collapsed Gally Hill Road, which links Dartford with Gravesend, in the coming weeks. As the Chancellor made clear, one other long term impact of the Middle East is clearly, as members of this House have pointed out, on energy bills and it's likely to affect all of us over this winter, and I remain extremely worried about the impact this will have, particularly on the most vulnerable households.

Only this week, EDF energy put out a new forecast that has the average household energy bill rising more than a 1:45 thousand £192 a year in January and then potentially even higher in April. And clearly, the blame for these price rises should be squarely on the architect of the conflict between the US and Iran. And I very much welcome all the work this government has done since 2024 to begin to transform our energy system, and I welcome very much today's announcement that standing charges will be removed from gas bills next year, and the additional £100 in support of all those living in homes in council taxes A to D, supporting over 35,000 residents in Dartford households in Dartford over the next year.

I did hear this may or may not be true, but I did hear that conservative spokespeople were going out onto the airwaves following the Budget to say that they opposed this £100 discount. If that is the case, I think it's wrong and disgraceful. Absolutely. I do, however, hope that Ministers will look further at what we can do to shield the most vulnerable and accelerate the work to break the link between increasingly volatile gas prices and the prices we pay for electricity. I've also Madam Deputy Speaker been among those that have called for more support for business rates for small businesses, and I'm really pleased today to hear the changes that will see many cafes, shops and pubs taken out of business rates entirely paid for, rightly by a rise in machine gaming duty.

I think that was a tax. I think most of us in this House can support. And in my previous life as a local councillor, I saw the growing levels of homelessness on our streets, as I do now, and the dire consequences for those stuck there. It's right, therefore, that the government is putting in place funding for the rest of the Parliament to offer a route off the street to anyone sleeping rough. We've needed a comprehensive strategy to tackle rough sleeping for the last 1415 years. And finally, we've got it. I support also the proposed changes to bring in a first time buyer, Isa, to replace the lifetime Isa, and I look forward to more details on the.

Your first home scheme, which I believe will be a boost to new developments like those in Ebbsfleet Garden City. In my constituency. The Red book, published along with today's Budget, confirms. I'm really pleased to see the formation of either a mayoral or a foundation strategic authority for Kent. Important news for our region, which, for instance, could. If a foundation authority or a mayor is in place, find the investment to ensure that we bring international rail services back to

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Kent after they were lost six years ago, I'd be happy to give way. Thank the. Hon. Gentleman.

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Hon. Gentleman. For Dartford for giving way. I wonder whether he would agree that it is right that people in it is right that people in Gloucestershire feel somewhat left out of the devolution agenda. We've been placed on the pause list for LGR, even though there's local consensus and we're the only place in the whole of the West and South West region without a devolution West region without a devolution deal, even though there's consensus on that as well. I say this in the knowledge that the Treasury bench has someone sitting on it who is a Minister from the region in the West, and Gloucestershire would like to join that region.

As I understand it, based on what I'm hearing from local councillors. So perhaps you would agree with me that Gloucestershire could reasonably feel a bit left out and

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moment. I thank the hon. Member for his

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I thank the hon. Member for his intervention. I believe that same case is being strongly made by members of all parties, not least members of all parties, not least from these benches. On exactly that point. Two Ministers. I've heard it point. Two Ministers. I've heard it being made myself, and I think it really underscores how important devolution is. Every part of the country needs those local powers and that ability to invest at a foundation, authority or a mayoral strategic authority gives. So good, good luck with with that is what I would say, and I hope very much that that is made available to to Gloucestershire as soon as possible, because devolution remains the right thing to do, both from an economic perspective but also a democratic perspective, bringing decisions closer to people and giving our regions.

Kent, in my case, others across this House more power over our future. So, Madam Deputy Speaker, residents in Dartford, I believe, will welcome the measures in this Budget, not only for the short term relief they bring, but for the promises to keep

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our economy growing in a sustainable way into the future. OK. Sir Bernard Jenkins.

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Sir Bernard Jenkins. Thank you very much, Madam. Speaker, and I just respond to the hon. Gentleman for Dartford. In one respect, I Harwich and North Essex a very rural constituency. Any restraints applied to gas or electricity have limited effect electricity have limited effect because a lot of my constituents are on kerosene, they're on heating oil. And I confess I'm on heating oil in that in the rural area. And the and the government hasn't even removed VAT on domestic heating oil.
17:08
Bernard Jenkin Portrait Sir Bernard Jenkin MP (Harwich and North Essex, Conservative)
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So why is the government, you know, doing this pre-election A to D band doing this pre-election A to D band manoeuvre, which will benefit mostly their voters, but they're completely ignoring the interests completely ignoring the interests of rural voters and and on defence. Forgive me if I detain the House a Forgive me if I detain the House a little bit on defence, which is we are in exactly the same position as are in exactly the same position as we were when the defence Secretary resigned under Keir Starmer. In fact, the position. The Chancellor said that the.

That he set a target date for 3% in 2030. That's the same as it was when the Prime Minister, then Prime Minister, came in front of the liaison committee and he said, I'm getting work under. The Chancellor said, I'm getting work underway to get there in a fiscally sustainable way. That was the reason why. He said the then Chancellor, now Chancellor, resigned from the government. Yeah. So what was that all about? It obviously wasn't about defence because nobody can make any plans until the the Treasury has signed off figures, figures for increased defence spending, and they have not signed them off, and they're still not going to sign them off until the public spending review, which may be after the next general election.

Now, I you know, I'm sure that hon. Members opposite know that the next general election is going to be pretty tough for them with all those I mean, they they're very large majority is a bit of an electoral accident. So many of them will lose their seats, but they can trust the Prime Minister because he said on the 25th of September, he can he he he he said on the 25th of September that don't worry, the election will be in 2029, just like he said, we're not going to reopen all the arguments about rejoining the EU, just like he said.

He said we're not going to open the argument about free movement. So the hon. Gentleman in. Ladies and gentlemen, in difficult seats facing a difficult election next spring, can absolutely trust him. He's not going to do that to them. Trust is rather important in a political party. I hope it's not getting too bad over there. Now let me just say what I really think about this Budget. It's a non Budget. Exactly as my right hon. Friend the Leader of the Opposition said it was a breathing space. Another 2.2 billion of new taxes on business is by far the biggest effect of this Budget, and the impact of the two previous absolutely catastrophic budgets remains embedded in government policy.

It hammered sectors like hospitality and businesses that used to enjoy employing a lot of young people who now can afford no longer afford to do that. Take Rics, the farm business in my constituency. The other leading suppliers of potatoes and onions, to Tesco. They employ mostly low paid workers. A lot of young people. Their costs have rocketed as a result of the change in National Insurance contributions. Take the cricketers in eight Ash Green, the pub that's been virtually driven out of business by the increase in national insurance costs and business rates. By the way, there's been no cut in business rates.

This government put them up. I'm very, very pleased they've responded to the conservative campaign to increase the exemption. But we've just heard from my friend from Beverley and Holderness. It's a very slight change and I will see from them. And all these 59 micro measures are minute, as has also been pointed out on the National Insurance contributions. What does the OBR actually say? It says it says sharper falls and employment, sharper falls in employment among lower paid sectors are consistent with our judgement that these firms would be most affected by the increase in national Insurance contributions.

So that's the truth. And the government has not faced up to it. And on the on on the question of the real public expenditure outlook, let's just look at the section in the OBR on welfare spending, because 100 million here, or 200 million here or 10 million here, the Chancellor was announcing this is the real problem. Paragraph 521 OBR on page. Whatever it is, welfare spending is forecast to rise by 19 billion, 5.7% to 353 billion, or 11.1% of GDP. It is then forecast to rise in nominal terms by an average of 16 billion, 4.5% per year over the rest of the forecast period.

It utterly dwarfs any other figures that the government's been talking about. Yes, absolutely dwarfs it. And this will be a 1.3% of GDP higher than its pre-pandemic level of 10.1% of GDP in 20 1920, with a 0.5% of GDP of this increase occurring between 2025 and 20 26 to 20 31 to 2032. So they're still spending on welfare and they're not committing to spend on defence. And

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that's the reality of this Budget. I give way to the honourable. Gentleman, very grateful for him for giving way. But does he not for giving way. But does he not recognise when he talks about debt to GDP ratios, that the significant to GDP ratios, that the significant mountain of that built up under his government, and that the debt to GDP ratio has remained relatively

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GDP ratio has remained relatively stable under this government. So just listen. I beg him to listen to himself. So what he's basically saying that the reason there are such gargantuan increases in welfare payments between now and 20 2031 is all our fault. It's because of what we did. It's not. They haven't begun to tackle the welfare state problem we should have done. They must. Or we're heading for a fiscal crisis now just on this fiscal crisis. It's very interesting what the what the Red book says about the forthcoming

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gentleman. Thank my right hon. Friend for giving way. Would he share his giving way. Would he share his assessment of the impact of increasing the age of retirement to 6667 and and a target for 70 on the availability of junior jobs for

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young people to get into? No. I think if I think if he's saying that if only we weren't doing this early retirement thing, there would be only if if later retirement would give more jobs to young people. I'm afraid managing the economy like that is not very successful. It doesn't work. But on the question of the the forecast, the government sets great store by what the IMF says about the the UK's deficit reduction programme. But of course, the. What the Red book says the IMF forecasts for the UK's deficit reduction this year will be bigger than any other G20 country, I'm afraid in that in that G20 bloc, there are a lot of lemmings rushing over cliffs at the moment.

It's not a very good benchmark for success, and in any case, their forecast is based on the government's forecast, which they have given to the IMF, and it hasn't been delivered yet. They haven't started to deliver the benefit reduction programme. The debt rises from 95.5% of GDP, GDP this year to 97.3% in 2029. That's what the OBR says. The headroom is just 15,000,000,029 37 billion less than at the last Budget. And the OBR says with only a 56% chance of meeting the rule. So I'm not sure the as as the bond markets digest this, they're going to be quite as sanguine as they have been.

And I just wish to end on this point. I mean, we had it from the hon. Lady for Hornsey and Wood Green. She said if we could get back into the European Union. 60% of the economy is dependent upon trade with Europe. This is rubbish. What proportion of GDP do we export to the EU in goods? Because that's. The single market is about goods. Incidentally, our record on exports of services outside the EU has been dramatic. We've massively increased our services exports. No, I'm not giving away only 5.9% of the UK economy is goods exports to the EU.

A much larger proportion goes outside the EU. And incidentally, during our period of membership, the proportion of GDP that we exported to the Su to the EU from 1992 to 2021 was on steady decline. There are other factors that have led to the decline in our exports from the EU. But overall, I mean, this is the astonishing thing, and I'll just end on this point. We've grown our economy has outgrown France and Germany since 1992, and leaving the EU has not reversed that trend. And I just wonder if hon. Members opposite don't understand the irony of what they now say, that, oh, we're the fastest growing economy in the G7.

That's often been the case because the EU is not a very efficient market. It doesn't add much value to our economy. The the and the point is, we've gone on growing between and. But in fact, we've grown our exports to the rest. Now, I'm not giving well, I'm not giving away. I've run. I've given away twice. The fact. You shout me down, you shout me down. You don't want to hear the facts. The fact is the fact. The fact is our economy is now growing faster outside the EU than it would have done because of two sexes financial services and tech and AI, and they are not regulated by the EU.

Employment in the City of London has doubled since 2016. All the doom mongers who told us the city was finished were wrong.
17:18
Andrew Lewin Portrait Andrew Lewin MP (Welwyn Hatfield, Labour)
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Andrew Lewin. >> Andrew Lewin. >> Madam, Madam Deputy Speaker, this is a Budget that supports those who need it most through the winter that ask the banks that are on course to make record profits, to make a greater contribution. And to make a greater contribution. And crucially, it backs young people with the ambition to own their own home and to build a business. Yeah, there is lots to reflect on. And as the newest member of the Treasury Select Committee, I intend to get into detail in the weeks to come. But I do want to start with the international context because it is crucial, I believe, that we have an honest debate in this House and in the country about the impact it has on us all.

It is true that we are spending billions more on debt interest than was projected just a few months ago, but that is not because of extra borrowing by this government. That is because of the global spike in inflation caused by the war in the Middle East. And it is also the case that the IMF have

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has praised our government for reduction. Yeah, yeah.

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Yeah, yeah. But in the 21st century, no country or no economy can stand alone. Happy to give.

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alone. Happy to give. When I thank the honourable Gentleman. For giving way. He will be aware

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For giving way. He will be aware that a key part of that deficit reduction strategy, according to the Red book, is that the annual spend on mainstream schools after 2028 2029 is to reduce by 2% per year. Will he go into the next general election that on his manifesto? Yeah.

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Will it be news to me if I'll be writing the manifesto? But I'm always open for a promotion. We'll have a spending review where we have a spending review where we will get into all elements of spending on public services. But this is a government that has this is a government that has backed public services, unlike the party opposite. Yeah. But in a more uncertain world. Madam Deputy uncertain world. Madam Deputy Speaker, I think it's more it's imperative that the UK lives by our values. And I have been going through the Red book and on page 103, the single biggest increase in investment announced today is in our defence to fund the dip.

That is a very important statement of intent at such an uncertain time for our country. Europe and the world. And it's further demonstrated by the package of £10 billion in additional support in loans to Ukraine. And I must say that before the Budget speech today, I was very pleased to hear the Prime Minister reassert how important it is to him that we have a stronger economic trading relationship with the European Union. And I also I will be honest, I'm slightly pleased at how much it upset the Member for Harwich, because it means I think we are in the right direction.

It is a sad state of affairs that the Conservative Party has drifted so far away from mainstream business opinion that they are saying they won't countenance any improvement in our deal with the European Union. And that is why in places like mine, in Welwyn Hatfield, in Hertfordshire, they are no longer

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voting conservative. But it is. Happily, to my hon. Friend. I'm extremely grateful to the hon. Gentleman for giving way. It's hon. Gentleman for giving way. It's not that we don't wish to see a better deal with the EU, it's since better deal with the EU, it's since we left. Every day in government was about trying to get them to be more reasonable, and that's always more reasonable, and that's always a good endeavour. I think the fear is which the hon. Gentleman would probably recognise, is that we have a government in place which thought a government in place which thought it was a good idea to negotiate the giving away of British sovereign territory in faraway and then pay tens of billions of pounds for the privilege.

They're not the people we want representing us in Brussels,

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are they? I think the hon. Member is talking about the Chagos Islands, talking about the Chagos Islands, which has absolutely no bearing on the speech I'm making today. But if the Conservative Party wants to the Conservative Party wants to hold its position that the current deal with the EU is a good one, then I will take that debate any day of the week. Yeah, but closer to home than Deputy Speaker in Welwyn Hatfield. I won't, I won't, Welwyn Hatfield. I won't, I won't, I may come later. I'm grateful. I'm keen to make some progress. In Welwyn Hatfield, 35,000 households will benefit from the £100 direct payment being made to support with energy bills this winter, and ending standing charges on gas bills will particularly help those who are in smaller homes and flats, and it is unquestionably the right thing to do.

But I was also very pleased earlier in the week to see the announcement on the Warm homes plan low and zero interest rate loans for people who have got the ability to make energy improvements to their properties and cheaper public EV charging to that is an all round energy package that I believe we can support. And just a brief word on the National Health Service, which hasn't featured as much today in the debate as it may have done. It is the case that waiting lists are sharply down since this government was elected, and ambulance response times in my region in the east of England have improved markedly in the last year.

There is lots more work to do, there is no question of that. But it's only possible that we are seeing this improvement because of the investment made in previous budgets and today, and it was so striking that we are now in a situation where there is £37 billion more being spent on the NHS under this government than there

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was by the party opposite. Happy to give way. I very much appreciate the Member for giving way. Just Member for giving way. Just touching the NHS. One thing was slightly disappointed to see that in the Budget we didn't commit to in the Budget we didn't commit to the mental health investment standard restoring it. There's an economic imperative to this as well. economic imperative to this as well. We've got millions of people on waiting lists for mental health care. If we can get them off waiting lists and back into work,

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waiting lists and back into work, that would help grow the economy as well. Does he agree with me that we should restore the mental health investment standard? I'm grateful for the intervention that mental health support is hugely important. I absolutely recognise that. One of the things that this government is doing is introducing mental health professionals in every school, and I'm sure members across this House will recognise that they've had conversations with constituents where they see young people struggling terribly. There is more to do, but I think we are making progress. I'm going to make some more progress now.

Thank you, Madam Deputy Speaker. The Chancellor has asked today the banks to contribute more via a surcharge, and I think it's really important, again, that we look at the context of which we are having this discussion. I was looking at the figures and all of the major banks that operate in the UK are on course for record multi-billion profits, and that happens often in cycles where there are high interest rates. So it is the case that they can make this contribution via a surcharge and still have an exceptionally good year. And I have to say, I am again surprised by the Conservative Party that if they want to have an election, whenever it may come, where they go round saying we oppose a slight increase in surcharge on the banks, they will find themselves on the losing side of that argument.

But in years to come, we also need our entrepreneurs and our young people to succeed. And that's why we're so pleased to learn of the Founders Relief Scheme for British entrepreneurs this afternoon. It is a statement that we will back people with the vision and the ambition to build a business here. Madam Deputy Speaker I'm also going to let you in on a secret that the first conversation I had with our new Prime Minister, the right hon. Member for Makerfield. Well, actually one before that was about cricket, but the second one and the was about housing and home ownership.

And I said, I think it's so important that we, as a government make the case for giving people the opportunity to get on the housing ladder, especially those who can't rely on support from the bank of mum and dad. And that's why I'm so pleased by the announcement on the your first home equity loan scheme this afternoon. It has the potential to change thousands of lives in my constituency and many more across the country, with a 2.5% deposit. What that practically means if you live in Hatfield or Welwyn Garden City, you have a chance of getting on the housing ladder for a deposit well under £10,000, bringing it into reach for many more people.

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I'll happily give way. For giving way, and I do welcome the government's announcement to the government's announcement to reduce the deposit for first time buyers. But would he agree with me buyers. But would he agree with me that the price of housing is so extortionate that a 25 year mortgage at today's wages, average mortgage at today's wages, average wages will never, ever pay off the debt accrued. So either mortgages debt accrued. So either mortgages are going to end up being 30, 40, 50 years. And these young people who get on the housing ladder will end up paying for the rest of their life and may not may not have paid off their mortgage before they retired.

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The housing crisis is a multifaceted problem. We have to build more homes of all tenures, build more homes of all tenures, but this is a really important part of driving demand, particularly because young people who are renting at the moment are paying renting at the moment are paying more than they otherwise would if they could get that foot on the ladder. And that's why this deposit scheme will make such a difference. Madam Deputy Speaker, if you need extra support with energy bills this winter, it is coming. If you this winter, it is coming. If you run a small high street business.

Business rates are coming down. If you're an entrepreneur, risk will be rewarded and your tax bill in the future will come down. And if you're striving to buy your first home, this government is on your side. The world remains unstable. We are not immune to it. But this is a Budget that I believe can give confidence to people in Welwyn

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Hatfield and across the country. And I'll be calling Sammy Wilson, after which we'll be going on a

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after which we'll be going on a five minute time limit. Sammy Wilson thank you, Madam

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Sammy Wilson thank you, Madam Deputy Speaker. I think the advantage, at least of this House, is that the Chancellor, albeit inadequate, the Budget he has brought forward has brought a
17:28
Sammy Wilson Portrait Rt Hon Sammy Wilson MP (East Antrim, Democratic Unionist Party)
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Budget forward in Northern Ireland. We are seven months into the financial year and the Sinn Féin Minister, finance Minister still has not brought forward a Budget for departments in Northern Ireland, leaving people in the dark as to what money is available for health, education, roads and all of the other issues. And I welcome the fact that in the Budget today we have got a £270 million uplift as a Barnett consequential, as well as the £750 million which was available under the review. And I hope that that will stop any further excuses for not having a Budget declared in Northern Ireland.

As far as the measures in this Budget are concerned, there are some which I welcome, though I think that the. The Chancellor should have gone further. I welcome the fact that pensioners are not. Some pensioners, at least, are not going to be dragged into having to pay tax, that there will be support for people with their energy bills, though, like other members who represent rural areas, 60% of people in Northern Ireland will not be impacted by this because they heat their homes using oil and therefore will not be covered by the relief which has been made available.

The business rates relief. I think small businesses will are appreciate the impact, the increase that there has been, though again, it's up to to the Northern Ireland Executive as to whether or not they pass on those changes to businesses in Northern Ireland and on fuel duty. The freezing fuel duty, I think, is welcome. But in a place of the United Kingdom that depends greatly upon road transport for both getting goods in and getting goods out again, the fuel, the price of fuel is prohibitive. And the fact that the government has made billions from the additional VAT on fuel as a result of price increases,

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I believe that they could have gone further. Does the hon. Member agree when

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Does the hon. Member agree when it comes to hauliers, yes. It rightly outlined the issue for for rightly outlined the issue for for those who are oppressed and we have to transport everything in and everything out. But we also recognise there's a need for recognise there's a need for farmers, for the farming community, for the tractors, for the agricultural sector, and that they

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also need to be considered when it comes to help and provision. And of course, any of the big diesel petrol users would have benefited from a greater support from the government. However, when it comes to the big challenges that the government is facing and which they tell us and they admit they're facing, there has been very little in this Budget. The main issue, of course, if we're going to get out of many of our economic difficulties is to have economic growth. And whilst much has been made today of the the micro policies which will affect businesses and encourage entrepreneurs, the fact of the matter is that we are stagnating because we are taxing the life out of businesses.

We have got the highest tax burden ever and that's. Businesses tell us all the time the tax on employment stops and recruiting the tax on profits stops them investing. And if we're going to have economic growth, then we've got to address the issue of the overall burden of taxation. And that has been studiously avoided in this Budget. When I think of the farming industry in Northern Ireland, only yesterday I met with the Ulster Farmers Union, who told me that a farmers 90% of farmers have now stopped investment plans because of the inheritance tax fears. And I suppose that that's true in many other places.

And with taxation halting people's investment decisions, then of course, we're we're going to impact the economic growth. The second thing is we've got to reduce the debt. And yet we are told in the Chancellor's told us today that we will actually be borrowing more year on year over the time of this Budget. Now, if we are borrowing more, we're adding to the debt and if we're adding to the debt, we're adding to the interest we pay on that debt. And the Chancellors had even accepted today that £14 billion extra this year will be required just to pay for the increase in the interest that we have to pay on, on debt.

So as we continue to borrow, then we're not going to get that debt down as we don't get that down. We've got a tax to pay the interest on it. And again, it impacts on economic growth. And there doesn't appear to be a willingness to address that. The I will certainly.

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Be giving away. I wonder if I can draw his attention to page 22 of the Red book, which says that the IMF also forecasts the UK will deliver the biggest reduction in borrowing in the G20 between 2025 borrowing in the G20 between 2025 and 2031, and have the second lowest government debt in the G7 by 2031.

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2031. And we and we may and we may be improving in relation to other countries within the G7. But the countries within the G7. But the fact of the matter is, we still have the level of debt, which the Chancellor has said is absorbing more and more of our tax revenue to pay only the interest on. So, I mean, we are still not addressing we're borrowing more and we're adding to the debt. The third thing is said is we've got to reduce energy costs. And there has been announcements today where we're going to shift some of the burden of the the policies which have added to the cost of energy in the United Kingdom.

And one of the biggest costs has been the government's net zero policy, because it has required investment in wind energy commitment, 25 year commitments to paying premium prices for that energy, then increasing the grid network to to bring that energy from dispersed sources, as opposed to the single power stations we used to use in in the past. And all of that goes on energy bills. And yet the commitment in the Budget today is to continue with that policy. On one hand, we want to reduce people's people's energy bills, and on the other hand, we continue with a policy which has increased and will increase and will require infrastructure spending that will further increase energy bills in the future.

The next big issue, of course, is defence spending. And what have we got? Well, despite the urgency that there is in increasing defence spending, what have we got? We're going to have the review next year. We're going to have a task force, we're going, but we're not going to address the issue of spending more now. Now I understand why, because we are not addressing the issue of how we get more revenue in in the first place to spend. And the last big issue then is the whole issue of the welfare bill, which has and it's been well aired in this debate today, how it's increasing day on day.

And as the Chancellor said, that increase in the welfare bill and the way we do welfare is condemning a whole generation to no work and not working and being on benefits and being relying on benefit, and then taxpayers having to pay for that. And yet that issue has been has been pushed off. Next year we're going to have a white paper, etc. The problem is this, that we have a government that knows what the problems are. They talk about the problems in this House. They they talk about them with the general public. But even despite the fact that we've got a government with 170 majority, they have still been unwilling to take the hard decisions to address those issues.

Unfortunately, it seems that we have a government that, instead of a backbone, has a wishbone where it wishes certain things but doesn't have the courage to take the decisions to sort them out. Yeah.

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Cuts me. To follow the member from East Antrim, and it's a pleasure to Antrim, and it's a pleasure to speak again in a Budget debate, often in debates on the Budget. As a Lancashire MP, I've heard announcements about pots of money that my area has not been eligible for because we don't have a for because we don't have a devolution deal. So I was really pleased to see in today's Budget that we're now in the final stages of agreeing a devolution deal in Lancashire for a mayoral strategic authority, because that opens up the opportunities for my constituents in Lancaster and wire it to be able to have the same options as the rest of the north of England, which already has these deals.

And the indication is, of course, that Lancashire is going to be able to access the good growth funding worth £7.27 million, which will unlock the prosperity within will unlock the prosperity within my constituency and right across the Red Rose County. And I'll give way. way.
17:37
Cat Smith Portrait Cat Smith MP (Lancaster and Wyre, Labour)
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I thank my hon. right in the heart of Staffordshire, I also welcome the devolution announcement today, because it does mean that residents in Stafford. Unlike seeing the chaos at County council level, we're on to our fourth leader this week. If anyone's keeping count, we we we too can access that devolution funding. So does my friend agree with me that having the putting the power in communities hands to direct their own future is central to making sure we have good growth in every postcode.

**** Possible New Speaker ****

Yeah. I do agree with my friend and I wish her well in Stafford with the wish her well in Stafford with the situation she has with with her local council, and I would urge local leaders in Lancashire to get local leaders in Lancashire to get this deal over the line, and I will put my hands up and confess that I was perhaps the least enthusiastic was perhaps the least enthusiastic of the Lancashire MPs when it came to the prospect of having a mayor, but I recognise that without this my constituents are going to get left behind and therefore we all need to work together in Lancashire to make sure that we can access this funding.

I'd say the biggest issue that my constituents raised with me, and I was recently out doing street surgeries in Scale Hall in my constituency. I was approached by several people on the same issue of energy bills, so I suspect that my constituents will be particularly pleased to see the £100 energy support payments, which should benefit over 37,000 households across Lancaster and Wyre in council tax bands a to D. I think that on top of the extension of the 0% VAT on electricity bills until June next year and the standing charges on gas being abolished will come as welcome relief to families right across my Lancashire constituency.

I meet regularly with the business community and recently met with representatives from the Lancaster bid who made the cases to me around the challenges for retail and hospitality sector. So I'm really pleased to see that the retail, hospitality and leisure business rates freeze, which is estimated to benefit around 638 properties in Lancaster and around 640 properties in the wider council areas. My constituency, which means hundreds of businesses in my constituency, will be benefiting from that. But constituents also raise with me the challenges around the high street. So by increasing small business thresholds and removing eligibility for vape shops and the adult gaming centres, that will go down really well with my constituents, I really welcome that.

And it continues to mean that high streets like those in Garstang and in Lancaster, will thrive and be places that people want to come and spend time and hopefully spend money supporting our great local businesses. And there was also announcements in the Budget to cut fertiliser tariffs, to give farming businesses more room to breathe. That certainly will go down well with my farming constituents. But there was also the rise in fuel prices is disproportionately affecting users of red diesel, so it Lancaster and Wyre farmers will welcome the extension of the 3.7 pence cut to duty on red diesel for a further six months, and it just makes sure that it keeps the rates at the lowest level for 20 years.

And the final point that I want to make in my contribution to this Budget speech, I think, is more about a missed opportunity. And the economic cost of alcohol harm in England is estimated to cost us £27.4 billion annually, and that includes costs, the NHS justice system, wider economy and social services and the financial burden on the NHS alone stands at £4.9 billion, which is enough to pay the salaries of almost half the nurses in England. And the culprit here is the very strong, very cheap alcohol that is available everywhere you go in this country, from supermarkets to corner shops and increasingly to the delivery services will deliver it to your door day and night and often makes vulnerable people drink far more than is safe, and it creates the ideal conditions for escalating alcohol harm, which can harm.

I believe that can be reduced by introducing minimum unit pricing, something that's already in place in Wales and Scotland and has seen the reductions there. Millions of people are consuming alcohol at levels that increase their risk of serious health conditions, and the severity of that harm rises as alcohol consumption increases and cheap alcohol drives higher consumption. So at a time when the NHS is under immense pressure and health inequalities continue to widen, this is a significant opportunity that the government could have taken today to take the evidence based approach to tackle alcohol harms that not only make economic sense, but was also rapidly improve public health and save lives.

And I want to stress that, importantly, minimum unit pricing does not damage pubs, restaurants or the wider hospitality sector. It is specifically designed to target the cheapest, strongest alcohol that is sold through supermarkets and off licences, and that is the one that's most associated with serious alcohol harm. And we have to remember that alcohol related deaths have remained high since the pandemic. They have not been coming down, and I believe that we need to take radical action that would benefit the economy, but frankly, also save lives. To introduce minimum unit pricing. And it has support across the hospitality sector who recognise the distinction that the policy would see off the cheap, off trade alcohol as a broader market concern.

So I leave the front bench with the concerns that I have around not addressing alcohol harms and the benefit that could have both for the economy and from public health. But I welcome the Budget. Overall, I think it does offer breathing space for my constituents in Lancaster and Wyre.

**** Possible New Speaker ****

Thank you. Stuart Anderson thank. You, Madam Deputy Speaker. It's very interesting to follow the hon. very interesting to follow the hon. Member who started off by talking about not having a mayor, and then you're going to get a mayor. So you're going to get a mayor. So this appeals to you, or it will open routes to funding in Shropshire. In South Shropshire, we don't have a mayor. We're not don't have a mayor. We're not looking to get one.

Most of what was said today excludes areas like
17:43
Stuart Anderson Portrait Stuart Anderson MP (South Shropshire, Conservative)
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was said today excludes areas like mine who do not have local mayors. So there's a big issue around there. And this Budget today, I would categorise and back up as a Budget that fails rural communities and doesn't protect our nation. And I'll say why? Because if we take the gambling tax to start, I've got Ludlow Racecourse. Obviously you'll all agree the best racecourse in the country, and that at the moment, as well as the point to points like Bitterley and item races, they are really going to suffer from the gambling tax. That's a massive impact and there's a whole ecosystem around them.

Heating oil. 53% of my constituents are not on mains gas, so over half of my constituents today will not benefit from those budgets there. Yeah,

**** Possible New Speaker ****

I'll happily take an intervention. Few people that have mentioned heating oil in the in the debate today, for those that have looked today, for those that have looked at the details of the Budget, there is a 4% reduction on heating oil tariffs amongst the announcements. tariffs amongst the announcements. And anyone that uses heating oil this winter will be getting £100. So there is substantial support for

**** Possible New Speaker ****

So there is substantial support for people using heating oil. It's not just about gas. Yeah, yeah. So with. The current rate for heating oil

**** Possible New Speaker ****

The current rate for heating oil is over double what it was six months ago. And I do get that those are on international headwinds. What's happening. And I believe what's going to happen over the next few weeks will probably significantly put them up more. But 53% of my constituents do not feel they're getting the same support because it's not comparative as what members on gas or residents on gas are getting. And when we look as well at the pubs, I've got 166 pubs and four great breweries in South Shropshire. They are all telling me with the.

Different rate rises that they've seen over the previous few years, it's massively impacting the minimum wage. It's very hard for people to employ and give young people their first job that they would on that jobs ladder or while they're at university, earning extra money, things like that. It's getting very hard. I will do. My hon. Friend has made a very good point. It does. Is he aware that since the last election, the minimum wage for 18 to 20 year olds has risen by 30.1%, and that is coincident with youth unemployment, employment rising by 54,000.

Does he think there's a link? My hon. Friend raises a valid point. There is definitely a link because it's getting harder to employ. Let me finish answering this one. It's getting harder to employ people because businesses are not having the profits. And when we look at the businesses now, I look at my high streets. I did my high street survey. 4500 residents contributed to this. And they are saying it's harder. Businesses are saying it's harder to make a profit on the high street. You've seen the rise of the internet, other things, the taxes and the employment, what it costs now to employ people.

They're not investing, they're not taking the risk. But actually, if you look how hard it is the government has made at the moment for High Street, the Lib Dem council in South Shropshire decide to do what looks to be a catastrophic parking rate. Charges for Ludlow, Bridgnorth and across the whole area, which I'm firmly standing against because this is just another tax on my constituents,

**** Possible New Speaker ****

I will do and then I've got to make some progress. Could could the hon. Gentleman set out then, given he raised it by.

**** Possible New Speaker ****

set out then, given he raised it by. How much does he think the minimum wage should be cut? I think the minimum wage should

**** Possible New Speaker ****

I think the minimum wage should not have gone up by 3.9% or 3.4. What it is today, I believe it should have been frozen for many should have been frozen for many years or several years, and it should have been looked at there. I, I, I definitely think we should I, I definitely think we should have left that. I don't believe we should rise it because businesses cannot take that at the moment. We have to make firm decisions and just to keep putting it less, young people will have work over these rate rises.

And when I look about farming in in an hour and a half speech, there was not one thing about agriculture. 25% of my constituents, Jerome, 25% of my constituents are in agriculture. And with the failed SFI 26 window, there was a serious issue. They really feel that rural communities are being left behind. We've seen the attack on rural communities from the shotgun consultation, the trail hunting, all of that is vital for my constituency. It's huge. I think I have the second most shotgun licences in the country. It's a serious sport that is undertaken well and it's just a continual drip, drip, drip and I want to finish on talking on defence because the Chancellor resigned when he believed that defence was not funded enough.

In this year there is a current £3.5 billion cut and the next two years £1 billion each year on the Ardell page 145, I think it is. You'll see that means the defence is now getting funded less than. When the Chancellor resigned the target to get to 3% by 2030. It is. It's in page 145. Look at the in-year cuts. Look at what the industry's response at the moment is to the Budget. On defence. I've got no more interventions. I've taken the two. We look at what the industry now from ads across is saying about this cuts last.

Last week we found in this house boxer was cut to two two projects. 2 or 3 projects on boxer was cut. We found that Dragonfire might not be on the type 45 next year as planned. We found that there are training cuts that happen to impact operational capability. We found there's a cut to slay housing. If anybody seriously thinks we are funding defence, we are nowhere near it. When I was in government, when we were in government, the amount of conversations that I had, this does not work and publicly put it on record with the rest of the Defence Select Committee.

We were facing serious issues and we weren't funding it enough. Very happy to say that the SDR set out almost 18 months ago. We faced the most serious times since the Cold War. I believe it's since the Second World War that we face in these serious times, and we are only Iceland in NATO is rearming slower than us and they don't have a military. I travel a lot within NATO. I speak to other countries. I've been called out on behalf of the UK by other defence Ministers that I have fed into the now Chancellor, and he says, I know it's embarrassing.

We are on the national stage, nowhere near where we should do. Our approach to defence is seriously failing. This Budget fails rural communities and it fails defence.
17:50
Julie Minns Portrait Ms Julie Minns MP (Carlisle, Labour)
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Yeah. Deputy Speaker. I approach this Budget and regard it. >> Through two lenses. The first is, as the Labour Member of Parliament as the Labour Member of Parliament for Carlisle, asking what the Budget means for people, families and the businesses I represent. And and the businesses I represent. And the second is as a member of the Treasury Select Committee, examining whether these measures will strengthen our economy over the long term. I therefore judge the Budget against four tests. Does it improve the lives of working people? Does it strengthen the British economy? Does it make the UK a more attractive destination for inward investment?

And does it help the North? Madam Deputy Speaker, when assessing any Budget, economic stability must come first before entering Parliament and contrary to some of the views held on the other side of this chamber, I worked for businesses that were backed by one of the UK's largest inward investors, and what investors look for is not political knockabout, the likes of which we've heard from the opposite side of the chamber. Sadly, this afternoon they look for stability, for credibility, for infrastructure, for skills and a credible long term plan. And on that test, on those tests, the Budget passes.

Despite global instability. Britain recorded the joint second joint fastest growth in the G7 in the first half of this year, while business investment has risen by 7.5% since the start of this parliament, the government continues to meet its fiscal rules, maintain a buffer against future shocks and put borrowing on a downward path. That matters because without stability, there can be no sustained investment, no lasting growth and no durable improvements in living standards. My second test is whether the Budget strengthens Britain's attractiveness as a place to invest again. This Budget backs investment in innovation, skills, infrastructure and artificial intelligence, while continuing to support businesses with lower regulatory burdens and greater certainty.

Those are exactly the ingredients international investors look for when deciding where to place their capital. My third test is whether this Budget improves the lives of working people. Ultimately, growth is not a statistic. It's about whether people feel more secure and have greater opportunity. And that's why I welcome the extension of the fuel duty freeze and the £0.05 cut, which will help motorists and businesses across rural constituencies such as mine. I welcome the permanent increase in tax free mileage rates, helping care workers, community nurses and tradespeople who rely on their vehicles every single day.

And I welcome the expansion of parental pay, including to self-employed fathers and their partners. These are practical measures that will make a real difference to working households. My final test is whether this Budget helps the North. Economic success cannot be measured solely by what happens in London. It must. Must be measured by whether places like Carlisle share in that success. And that's why I particularly welcome the government's commitment to devolution. And I look forward to electing Cumbria's first mayor next year, and I trust it will be a Labour mayor. We have in Carlisle ambitious businesses, skilled workers, a strategic location and enormous potential.

We have a high street already on the up, and one that will be further strengthened by the cuts to business rates. And we have great local independent breweries. And I welcome not just the £10 million boost to small in small producer relief, but the introduction of a guest beer agreement in England that will ensure that the local breweries in my constituency are able to get their local product into our local pubs. Thanks. Madam Deputy Speaker, the government's approach to leave Olution, alongside good growth funds and greater local control, offers an opportunity for communities such as mine to play a greater role in the country's success.

This is a Budget that provides support for households today, while laying the foundations for long term growth. It recognises that when places like Carlisle succeed, the North succeeds. And Madam Deputy Speaker. When the North succeeds, Britain succeeds.
17:55
Kit Malthouse Portrait Rt Hon Kit Malthouse MP (North West Hampshire, Conservative)
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I call Kit Malthouse Madam Deputy Speaker. Although she won't be surprised that she and I have very different views about this Budget, I draw attention to my entry in the register as a business owner and frankly, as a father, not because I think I'm going to be particularly affected, because I don't think affected, because I don't think anybody's going to be particularly affected by this rather bland kind of bowl of muesli of a Budget from Chancellor is quite obviously decaffeinated this morning. Yeah. And but the reason I'm quite exercised about the Budget is from my point of view, while a number of people have said it's a missed opportunity, I actually think it's a lot worse than that.

I think in many ways it's profoundly negligent of a government to produce a Budget like this in the face of three distinct emergencies, three distinct fires that are burning in the basement of the British economy, some of which have been made worse in our forecast to be worse because of this Budget. The first, of course, which a number of people have raised, is about our debt. And it's worth remarking as a number have, that the OBR forecast that we're going to borrow even more in every year of this forecast, particularly next year, but also the massive combined with the massive downgrade of growth next year, which is also alarming.

And it's worth remembering, colleagues, that the OBR has quite a poor record in medium term forecasting and is generally optimistic. I think we can broadly agree that the the year one forecast, they generally get it plus or minus, but after that they are wildly optimistic. And every year, particularly on debt, they get the forecast completely wrong. And that matters because the the UK, the country is running effectively a structural deficit at the moment. And because of that, because of some of the measures in this Budget and in the previous two, the public sector is basically eating the private sector.

Every year that we proceed, the private sector's ability to support the public sector is reduced as a result, and we find ourselves caught in a weird kind of vise, which is exacerbated by the second emergency that I'm going to come to. And even in some of the measures today, there seems to be no contemplation of that problem. So this bank levy, this 3% extra corporation tax, who does the Chancellor think is going to be paying that? Certainly not. The international banks well managed to retain their return on capital. It'll be the businesses and the consumers that bank with them that will see a higher mortgage rates, higher interest rates on their loans, that money will be extracted from the private sector and sent directly to the public sector to be spent.

And if we continue on this path, the IMF, I'm afraid of forecasts that by 2050 we're going to be spending well over half of our GDP will be spent by the the government. And that is a disaster, because once you're in that vortex, it's very hard to come out of it. The second thing that's exacerbating that, of which there was no talk today and in fact, no measures to try and help with it, is our demographic problem. We're not having enough children in this country. I'm afraid we're now down to 1.39 children born to every mother.

We're at below replacement rate in the country. And so we have a shrinking body of workers who are expanding, having more and more difficulty supporting and expanding body of retirees. The the the pyramid is inverting in a way we've seen in other countries like Japan around the world, to disastrous effect. So if the public sector and the retired sector is sucking more and more money out of the private sector, we'll find ourselves in a downward spiral, which will be much to our detriment. And then, Madam Deputy Speaker, the third emergency that I wanted to raise is the emergency of capital.

Now, the Chancellor raised the issue of of capital. I've tried to set entrepreneurs free, and I've been a moderately successful entrepreneur during my life. And I can tell you, nothing in this Budget has done anything to reverse the assault on risk, the return on risk that has taken place, frankly, sadly, over the last 20 years from governments means.

**** Possible New Speaker ****

Be grateful to the right hon. Member for giving way, as there's been nothing done to reverse the so-called assault on risk. But how about incentivising the risk takers, those founders that will now benefit from very targeted,

**** Possible New Speaker ****

benefit from very targeted, fiscally responsible benefits on the capital. Gains that he's raised that point, because if he looks at the founders relief in the scorecard and puts it against the reduction in business asset disposal relief, in business asset disposal relief, effectively what we've seen is a straight transfer of value from family businesses and high street shops and smaller businesses to the tech bros who are going to benefit from Founders Relief. And we've yet to see the detail on that Founders relief. But the scorecard shows the net cost to the government is about £200 million.

It's negligible in the face of an economy the size of ours. And this is a real problem because we are standing on the ellipse at the bottom of the ellipse of human achievement, the like of which we haven't seen since the Industrial Revolution. And this country has got its capitalism wrong. In the past. We missed the IT revolution of the 80s and 90s because we were too busy worrying about house prices. And British capital has kind of stultified and failed to take advantage of these massive advances in technology to much to our detriment in terms of national wealth.

We live in a building we still live off to a certain extent. The wealth that was created during the Victorian era. Many of our largest companies come about because of British capitalism, naked capitalism. During that era. The palaces we live in the Cavendish Laboratory at at at Cambridge, King's College, Cambridge, the NHS, all of it built from the profits of British capitalism. And we've neglected it over the last 20 years or so, particularly by attacking the return on risk, the rise in taxation on dividends, the rises in capital gains tax, the. The reduction in any kind of relief for entrepreneurs, the complexity of enterprise investment scheme and the scheme.

All of this is a massive deterrent to anybody who wants to start a business and take a risk. And until we realise that you won't get growth until you set capital free, we will continue to be trapped in this vortex of a demographic pyramid, inversion and ever mounting debts. As the public sector consumes the private sector. The last thing I wanted to raise Madam Deputy Speaker was about the new powers that are being granted to the revenue in this bill. All members, all members should beware of what's hidden in the detail of the new powers given to the revenue.

We're getting to a situation where our economy is existing to support the revenue rather than the other way around. Chris Evans thank you.

**** Possible New Speaker ****

Mr. Speaker, and thank you for coming, and especially to you and my speech. That's my most grateful my speech. That's my most grateful of you. We've seen the rise today of a new political philosophy. It's called Miserablism. Yeah. They are called Miserablism. Yeah. They are so miserable about everything. Yeah. The Chancellor could have stood at that despatch box and said anything. that despatch box and said anything. Awarded £1 million to every single member of the in the country. And member of the in the country. And still they would have complained. Yeah. Because all they ever do is talk about prescription rather and what they will do instead.

Yeah. The fact is, when I first came into this house, all I ever heard was
18:02
Chris Evans Portrait Chris Evans MP (Caerphilly, Labour )
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about deficit reduction. I heard members who have spoken today say that we should have on those when that we should have on those when we were on those benches, we should apologise. We hear no such apology. apologise. We hear no such apology. Now. The fact is, the very tenant of Miserablism is to ignore the good news, the fact the deficit is coming down. The Chancellor has said we'll be back in the black within three years. In spite of within three years. In spite of economic headwinds. We have no control over in Ukraine and the Middle East.

The fact is, on the ground, people are seeing the change. I want to talk today about three things. In this limited time. I have, first of all, small businesses. My constituency is full of independent small businesses run by hard working, innovative people. They add to our vibrant high streets and town centres, creating a sense of community. Small businesses will find it easier, thanks to this Budget, to serve their communities and provide jobs. The increase in the threshold required to pay business rates being raised from 18,000 to from 12,000, will lift 70,000 properties in the UK up to paying business rates, and will help so many businesses in Caerphilly.

If anybody wants to see the good news in Caerphilly, just look at what's been happening. Caerphilly borough. It has. Since September it announced the fastest business start rate in the whole of Wales. Caerphilly has experienced a 49% increase in business start ups during the first eight months of this year, compared with the same period last year. A testament to Jamie Pritchard, who's a leader of our Labour controlled council. People want to come to Caerphilly and do business because they believe in what we are doing there. Alongside this, the UK government is channelling investment. South Wales has helped to unlock 23 million in Norgine, a leading European pharmaceutical company in my constituency needs to develop its Hengoed facility, which is expected to create 44 jobs, new jobs.

Now I was going to talk about one thing that does affect most people. If I had to take a straw poll in my constituency, it would be energy bills. Now extending the the VAT, VAT cut back to July will help so many people. And there are not just households which will benefit from this, but I remember visiting the business in my constituency, Reece James, who was worried about energy costs. The new British industrial competitive scheme will cut costs there as well. Gas standing charges will move from household bills. There will be a payment for £100 into people's bank accounts from A to D, and I know already the Welsh Government.

The Welsh Government has said that they will will honour that as well in Wales, but they also have complained about some sort of cut as well. Again, Miserabilism finds itself across the channel as well. But I also want to say something as well about the miners. I come from a mining family. My grandfather was a miner buried in a three ton of coal. He was invalided out the mines. He was an example of the hundreds of thousands of people who built our society, who sacrificed their life and their health to keep this country moving. And that is why I am so pleased that now 100% of the surplus of their pensions will go to them.

It is only the beginning. And yes, we do need to talk about future bonuses. But I genuinely believe, and I am heartened, that I know the Chancellor is a good man. He comes from working class stock like I do, and he will speak with the NUM, and we will come up with a deal that will be satisfactory to all sides. And I want to say to all those Ex-miners who live in my constituency, we are on your side. We hear what you're saying, and we will continue fighting for you till you get the justice you deserve.

And finally, in the last couple of seconds, I want to talk about defence. Now. We all very well. It's nice and warm to say let's hit 3.5% GDP by by 2030, but it only scratches the surface. The fact is, I'm looking at a member opposite who was a defence Minister. You know the same things. I know the MoD is a uniquely failing ministry. It is wasting money. If you want to look at an example, look at Ajax. They've already spent £5.5 billion on an armoured vehicle that is still not in service. That 5.5 billion could be used on other things like training exercises like equipment.

I honestly believe this is an appeal I would make. The Chancellor, when he was the Shadow Secretary of State for defence, and I was the shadow defence procurement Minister. We came up with a policy which said the controller has to look at the the way the Ministry of Defence spends its money. I hope he resurrects that idea and sends the National Audit Office to make sure every penny piece is accounted for, because that is the only way Martin.

**** Possible New Speaker ****

Thank you very much, Mr. Speaker, and it's an honour to follow the hon. Member from Caerphilly, and I hon. Member from Caerphilly, and I want to pick up his latest theme, which is the defence of our country. And I specifically want to talk about our readiness to fight a war. And this is what the Defence And this is what the Defence Secretary said just last week, that we have to be ready within 1000 we have to be ready within 1000 days to fight a war against Russia.

So really, this is about preparing
18:07
Mike Martin Portrait Mike Martin MP (Tunbridge Wells, Liberal Democrat)
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for the war that is in front of us rather than a war. I want to take a slight digression and just pick up on something that the Chancellor said today. He said, and I quote, in today's Budget, I am fully in today's Budget, I am fully funding the dip. So if I compare funding the dip. So if I compare the figures from today's red book versus the figures laid by the versus the figures laid by the former Chancellor when the Dip announcements were made on the 30th of June for 2027, in the Dip, we see a total Budget for the MoD of 73.8 billion.

In today's red book, we see a figure of 72.8 billion. So there's a gap of £1 billion there. And it's the same for 2020 829. So I'm sure the Treasury front bench have heard me, but perhaps the Chancellor would like to clarify his statement there, because it doesn't seem that he is fully funding the dip by the figures that were laid before Parliament. But back to readiness and the Defence Investment Plan, you know, by its very nature is about capital projects. And over the last decade in the MoD, capital expenditure has gone up by about 130%, which is obviously very welcome.

But day to day expenditure has flatlined in real terms. And if you look at the Red book today, looking at Aadl for the mod in 2027, 28 day to day expenditure in the mod is actually being cut by 2%. Now. Day to day expenditure in the mod means spare parts. It means maintenance, it means munitions, it means training and it means operations. And I'm the chair for the APPG on rearmament. And we're running an inquiry at the moment into the state of the British military. And it's sobering stuff. What we are hearing. We have no submarines that are at sea, which is in part a maintenance problem.

We have aircraft that we are unable to disperse around different airfields because we don't have sufficient levels of stocks. We have the Navy cutting training courses for tank commanders. We haven't run a submarine course for submarine commanders for many years. We have to send them to other nations to train them. So this cut in resource expenditure, day to day expenditure in the MoD is having a real effect on our ability to be ready for war now, and that has a direct effect on our ability to deter Russia by 2030, which is exactly what the government tells us that we need to be doing.

So, you know, I always apply the Granny Martin test to these things. And what the Granny Martin test is, is look at what people do rather than what they say. And the government here seems to be saying that we need to be ready to fight a war by 2030. We've had a whole slew of announcements, from the defence Secretary to the security Minister saying we need to stockpile food. I think we get it. It's a dangerous world and we need to be ready for war by 2030. But then why do we have a defence investment plan where two thirds of the capital expenditure is after 2030 and delivers projects sort of well into the 2030s?

If we really need to be ready for war by 2030, munitions, because without that, our forces wither away. The training of our people declines, morale declines, and we're simply not able to get ships out to sea or planes in the air. I mean, just for what we heard last week, we ran a session on the RAF, and we heard that for just £50 million, we could build hardened shelters on our air bases. At the moment, on our air bases, we have exquisitely expensive planes that are sitting out in the open. Do these people watch the news?

Do they see what the Ukrainians are doing to Russian airframes? So for relatively small amounts of money, we could get ready for the war that we face that the government says we face. And that is what we should be focusing

**** Possible New Speaker ****

on, rather than projects that deliver after 2030. Gareth Thomas thank you, Mr.

**** Possible New Speaker ****

Gareth Thomas thank you, Mr. Speaker. It's a pleasure to follow the hon. Gentleman for Tunbridge Wells. Perhaps because of the time limit, he did not dwell on the dismal economic inheritance that dismal economic inheritance that this side of the House were left by the party opposite, which we are still having to contend with huge still having to contend with huge national debt, public services starved of investment and dismal
18:12
Gareth Thomas Portrait Gareth Thomas MP (Harrow West, Labour )
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levels of productivity and growth. So it is encouraging that we are the fastest. We are the fastest the fastest. We are the fastest growing economy in the G7, according to the OECD, that the IMF has lauded this government's has lauded this government's efforts to tackle the national debt, and that unemployment is down. But and that unemployment is down. But the Chancellor is right that with the war between Iran and the US driving economic uncertainty and driving economic uncertainty and pushing up inflation, there is still much more to do to get to help family finances and to tackle more of the long term challenges our country faces.

I welcome, in particular, the budget's focus on the cost of living, and particularly the support to families with their energy energy bills. One of the most pressing long term challenges that our country faces is how ambitious we want to be in resetting our relationship with our European allies. Made in Europe is the canary in the coal mine. The warning that the more distant we get from Europe, the more vulnerable British jobs depend on, dependent on European export orders will become. In the European Union our voices would be louder, our reach would go further, and our economic security would be more assured.

I recognise that my constituents will want to know the costs as well as the benefits of rejoining. So I very much welcome the government's appetite to have that honest debate. This time, though, there should be a plan B and all or nothing choice to go in or not would be even more responsible than the Cameroon's failure to prepare for the possibility of exit a decade ago, so the reset must deliver more greater access to the single market of the sort the Swiss have but a uniquely British deal, but one two, recognisable to our allies in Europe, would bring substantial economic gains, albeit not the full benefits of rejoining on to on some of the measures, specifically in the Budget today I welcome very much the focus on small businesses and the sensible measures the Chancellor has set out, but I do think we need to go further to offer better access to capital to help small businesses find new export markets and to explore offering tax relief to help SMEs hire those who are not in education, employment or training.

Securing affordable finance to grow a small business remains significantly difficult for many firms. It's a sustained market failure, with an up to £4 billion gap holding back growth and being particularly acute for businesses outside the South East and for women, disabled and ethnic minority entrepreneurs. This market failure is made even more acute by high cost credit firms, offering easy to get loans without real affordability, checks, without clarity on annual interest rates, and often those who broker such loans not being offered, not being open about the commissions they charge. This is the payday lending scandal over again with entrepreneurs and small business owners being exploited.

So the further investment announced in the British for the British Business Bank today is very welcome, but it certainly needs to drive a sustained expansion of community banks, community development, finance institutions, as they're called, building capacity jointly with big banks like Santander, Barclays and HSBC, who invest in community banks in the US, but not as yet here in the EU. In the UK, there is a neglected sector of the business community that exists not to make a profit for shareholders, but to serve a social purpose and which is crucial to delivering sustainable growth in every postcode.

These co-operative and mutual businesses don't charge the highest prices. They often can't secure traditional bank finance, but they exist to achieve social goals for the communities they

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operate in. I will. Make an important point of the mutual sorry. The hon. Gentleman is making an important point about the mutual sector. Would he agree that the credit union should be part of that? And managing credit unions to

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that? And managing credit unions to become building societies will be a way of rebuilding our mutual sector in this country. I absolutely do agree with my

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I absolutely do agree with my hon. Friend. He makes a very important point about the need to do more to expand credit unions. It do more to expand credit unions. It is for these businesses and the communities that would benefit from other co-operatives and mutuals that we, on this side of the House, committed to put in place the policies to double the size of the co-operative sector. Now we need to see the capital reforms drawn up by the Law Commission that would unlock significant investment from capital markets. Crucially, without requiring a co-operative or mutual business to have to sell up and demutualize to be enacted.

And we should look at using the corporate tax regime to encourage investment in those third sector businesses. Why can't the bigger cooperative businesses be allowed to offset some of their corporation tax liabilities if they invest in co-op development funds that help bloody minded, co-operative entrepreneurs bring the hopes and ambitions of their communities to life? Lastly, Mr. Speaker, I welcome the investment in public services in my constituency that this Budget locks in new investment in primary care. In Harrow, for example, Alexandra Avenue Clinic will unlock another 100,000 face to face appointments with a GP, nurse or other health professional, a new state of the art GP surgery and over time a neighbourhood health centre is coming at the White House in Harrow College in central Harrow, and works underway to plan further investment in in other medical centres.

Locally, over £27 million has been given by government to invest in new special needs places across the borough and vital funding for electrical and safety repairs has been invested at rooks Heath High School, Whitefriars School, Noah Hill, Bentley Wood, Hatch End High and Earlsmead. Proof that this government is delivering

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for the people of my constituency. Thank you, Mr. Speaker. The disappointment of today's Budget is disappointment of today's Budget is that, having put on his running shoes for the media earlier this week, the Chancellor spent his week, the Chancellor spent his statement running away from the big challenges facing the country, ducking each difficult decision. ducking each difficult decision. And the first big challenge the Chancellor ducked is getting a proper grip on the public finances proper grip on the public finances so that we do not have to leave our children and grandchildren aspiring national debt. He tells us that everything is under control because the OBR says his fiscal rules are technically met, but the public are not fooled by Treasury scorecards and neither are the markets.

Just like his predecessor, the Chancellor promises to bring borrowing down right at the end of the period covered by his fiscal rules, in this case, with the hidden promise of 2.6% annual spending cuts, which includes those 2% per year cuts from mainstream schools every year after the next general election. Steep cuts that will clearly never happen. The markets know it. In the meantime, what he didn't say was that he was increasing borrowing from 2.9% to 3.4% next year, and from 2.5% to 2.9% the year after billions in
18:19
Mike Wood Portrait Mike Wood MP (Kingswinford and South Staffordshire, Conservative)
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extra borrowing. Like his predecessor, the Chancellor seems to take his inspiration from Saint to take his inspiration from Saint Augustine. Oh Lord, help me to be pure. But not yet. Every year, the pure. But not yet. Every year, the date for that fiscal restraint is pushed back another 12 months and borrowing revised up. In the borrowing revised up. In the meantime, he speaks of fiscal discipline. But this is fiscal policy on the never, never, and policy on the never, never, and nowhere is the reason for that fiscal timidity clearer than on welfare. Everybody in this chamber knows you cannot control public spending, and you cannot get Britain working without proper structural reform to a ballooning welfare bill.

But where we needed action, all we got were yet more task forces, more reviews and more procrastination. Mr. speaker, that failure on welfare leads directly to the most sorrowful failure in his entire Budget. On national defence, the Chancellor knows that

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urgent the urgent need for an immediate plan to increase defence spending to To 3% in 2030 better than anyone.

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To 3% in 2030 better than anyone. It's why he said he resigned as defence secretary earlier in the year. He knew the government was year. He knew the government was playing Treasury tricks, tucking MI5 pensions, Chagos Island bills MI5 pensions, Chagos Island bills and even £200 million for doing a Barrow and Furness high street under the badge of defence spending under the badge of defence spending to pad out a press release. When you strip out those accounting tricks, our armed forces are facing a real terms cut in their day to day running costs over the next three years.

Finally, Mr. Speaker, the Chancellor had the chance today to undo the terrible damage done by his predecessor and inject real, sustainable growth into our economy. Business distress is at a 20 year high. High street names like Poundland are collapsing, and young people have paid the heaviest price of all. With surging numbers of needs and a genuine youth jobs crisis. Nowhere feels the triple whammy of high employment costs, punitive business rates and relentless regulation more acutely than our hospitality sector. Our pubs, bars and restaurants are the heart and soul of communities like mine. In Kingswinford and South Staffordshire know we are coming to an end to the debate, and they are the number one place where young people get their first foot on the jobs ladder.

The Chancellor's announcement on small business relief will clearly be welcomed by those firms that do qualify. But the truth is it will do little to help most hospitality. Fewer than 1 in 10 restaurants and licensed premises are set to benefit, with the rest continuing to suffer from Labour's business rate. Bill hikes the Chancellor had a simple, practical lever right in front of him today. A meaningful increase in the alcohol duty differential for draught beer and cider pulled across the bar in a well-run local pub or restaurant, compared to cheap bottles and cans stacked high in supermarket aisles.

It would have helped British brewing, helped save community pubs and protected hospitality jobs for young people again. He knows this. In opposition he called for cuts in beer duty, but in the Treasury he is hiking the main beer duty rate. He ignores the cross-party pleas for a big reduction in draught beer duty and instead hammers publicans and brewers once again with another hike in the beer duty the used to say should be cut. The Chancellor needed to step up and take the decision needed to help pubs and hospitality. Instead, just like on debt, just like on welfare and just like on defence, he ducked it.

Our businesses, our young people and our armed forces cannot afford to

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wait in a holding pattern until this government discovers its courage. Janet Daby.

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Janet Daby. Thank you, Mr. Speaker. And unlike the hon. Member opposite for unlike the hon. Member opposite for Kingswinford and South Staffordshire, I indeed commend and welcome the Chancellor's Budget welcome the Chancellor's Budget update that he provided today, and my contributions will be very much be around the cost of living support. A care leavers support and on the NHS in particular on funding for sickle cell emergency bypass units. And I would like to put on record that I am chair of the APPG for Sickle Cell Thalassaemia.

I welcome that the Chancellor and the Prime Minister prioritised the cost of living, and since Liz Truss disastrous mini Budget, my
18:23
Janet Daby Portrait Janet Daby MP (Lewisham East, Labour)
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constituents have faced high prices and rising interest rates. Now, in and rising interest rates. Now, in 2023, an estimated 11.5% of my constituents were in fuel poverty, constituents were in fuel poverty, over 2% higher than the London average. And as fuel costs rise, average. And as fuel costs rise, this figure can only increase. And that is why I welcome the Chancellor's confirmation today Chancellor's confirmation today that he is temporarily removing VAT on electricity bills this winter, and further, the announcement of £100 discount to council tax bands. A to D means that most of my vulnerable constituents.

In fact, over 45,000 of them will benefit from this funding to help them stay warmer this winter. I also welcome the Chancellor's help to make bills fairer by scrapping fees added to gas bills. It all helps people, all helps them to maintain a decent standard of living. This leads me on to care leavers. Care leavers are some of our nation's most vulnerable young people, and some face life's highest barriers. The Nuffield Foundation found that 40% of care leavers, aged 19 to 21 were Neet, compared to 13% of that age group in the general population.

The children's commissioner found that 25% of care leavers experienced homelessness within the first two years of leaving care. Therefore, I ask the Treasury to consider care leavers aged 18 to 24 years old, living independently, but yet they receive the same benefit rate for under 25 year olds. When most of the young people under 25 years old indeed live at home. Yet they both receive the same rate of benefit. I therefore ask the Chancellor to work with the DWP to consider paying care leavers that over 25 benefit rate to support them with their independent living. Of course, the issue is that care leavers that are in work often experienced in work, poverty and that's because of the rent they have to pay and the bills.

But the information that's come out from the Chancellor today does indeed help care leavers. But there is still more to do. Moving on, I cannot but mention the Bakerloo line, and I was pleasantly surprised to hear this in the Chancellor's speech. Now, I thank the Chancellor for backing the Bakerloo line coming to south east London. The Chancellor's announcement will allow the Mayor of London to retain income tax receipts. This will allow him to invest in the vital infrastructure project in Lewisham and indeed south east London, to really impact the. And improve the transport links and it will have a positive impact on our economy.

I also welcome the 37 billion spend on our NHS. The Chancellor spoke of spending 37 billion more on health next year compared to the last year of the last conservative government, and I applaud this. We need to do more to bring down NHS, A&E waiting lists to get rid of corridor care, just to name a few. But I wish to focus on the benefits of funding for specialised health services and namely sickle cell bypass units. There are currently seven of these in total in London and in the North of England, and one of these is at my local hospital in Lewisham, and I have seen and spoken to the amazing staff, amazing staff and seeing the provision of care that has been provided.

Sickle cell disorder is the fastest growing genetic condition in the UK. Around 19,000 people live with it, live with it and roughly 250 babies are born with it each year. It causes sudden and excruciating pain, but more needs to be done to make sure that we fund the right provisions, the right units, to make sure that this provision continues. For people that have sickle cell. So I ask the government to work to carry on working, to make sure that sickle cell bypass units continue to be provided in those seven units, but also to be spread out more across the country.

Llinos Medi.
18:28
Llinos Medi Portrait Llinos Medi MP (Ynys Môn, Plaid Cymru)
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Madam. Madam Deputy Speaker, >> Madam. Madam Deputy Speaker, this was Labour's opportunity to show the people of Wales that they are listening. Following the are listening. Following the election in the Salford last May. Instead, it has delivered one of the worst funding settlements for the worst funding settlements for Wales in years. The £450 million over three years announced by the UK government today is a real terms cut to the Welsh Budget. The Welsh Government needed a further 350,000,000 in 1 year for a standstill Budget. This means a cut to public services and in addition to that, the capital budgets will be cut by 10% in real terms by the end of the decade because of the decisions made here in Westminster.

This Budget also should have begun to address the long standing injustice of Welsh rail funding. Wales has around 10% of the UK rail network, yet receives just 1% of the rail enhancement spending. To address this funding, we were promised a £14 billion rail pipeline. But today Leeds gets 300 and £300 million for one station and the entire Wales Welsh rail network gets £30 million. The government should go further to support investments and in North Wales we have fortunate and I will thank the Labour Government for the decision. With Gwynedd, Quinton has the potential to reindustrialise North Wales, strengthening our energy security and create thousands of high quality jobs.

That will only happen if the government ensures that the manufacturing jobs and the supply chain investments from the project are created in Wales. And today a step in the right direction is the announcement to support the Science Park on Ynys Mon to support the economic growth. But we must make sure that Ynys Mon and North Wales

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benefits fully of the Gwyn Dodd. I do thank you for giving me. She's speaking very passionately, She's speaking very passionately, as always, as always, but she talks about energy security in Wales. We need not be a lot easier to achieve that. If the Welsh Government did not proceed with its plan to ban

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electricity pylons. Thank you. I thank you for the

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Thank you. I thank you for the intervention. I think that you will see in the community where you have a grid connection, you will have those conversations and it's respectful for those conversations. And that national ban is not. There's a conversation on grid connection. And also I have since been elected here. I've been having those conversations on having a robust connection that actually should include undergrounding as well, to respect our communities. If our communities are hosting national significance energy projects, they also should be having energy transmission in a fairer way for the communities that they are hosting and Wales.

So, and another measure that should have been announced today is the Energy support. Wales has some of the oldest and hardest to heat housing stocks in Western Europe. Official figures show that 1 in 4 homes are living in fuel poverty across rural Wales. Many households, as mentioned already today, remain off the gas grid, including 52% on Ynys Mon, with many of them reliant on heating oil businesses to remain exposed to volatile energy costs without protection of a price cap. The Chancellor announced. The standing charge on gas will not be removed until the end of 2027, so households will not see the benefits of that this winter.

The government has not taken immediate steps to end unfair electricity standing charges, leaving households in North Wales paying the highest standard charge anywhere in the United Kingdom. The people of Wales deserve better. They deserve a government prepared to match its rhetoric and fairness with meaningful action. We did not get the fair deal for Wales in this

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Budget. Ruth Jones thank you, Madam Deputy Speaker. This Budget is the Deputy Speaker. This Budget is the right Budget at the right time. It delivers immediate relief, but also the long term investment necessary the long term investment necessary to bring back hope to Britain. I welcome the further steps announced by the Chancellor to provide additional breathing room to additional breathing room to households. This is essential. Energy bills will be cut, food tariffs will be slashed. The tariffs will be slashed. The Carer's Allowance cliff edge will be abolished. Standing charges will be scrapped, parental pay will be expanded and fuel duty will be frozen again.

Because Labour is on the side of working people, we recognise that times are tough, especially with the ongoing energy price spikes driven by Putins illegal invasion of Ukraine and, of course, the us-iran unnecessary war. This government's ability to provide to support hard working families whilst continuing to provide upfront investment in our public services, is a testament to our careful economic management. Our careful stewardship has been commended by the IMF and has allowed us to enjoy the joint highest growth in the G7, whilst keeping public debt under control. The cost of living relief announced today by the Chancellor only builds on that already announced by the Prime Minister.

In his first 100 days VAT off energy bills, a £2 bus fare cap, business relief and tackling rogue tradespeople and repeat subscription scams. I am disappointed, though, that where this support relates to England, only the minority plagued government Welsh Government has not shown the same ambition or understanding of the everyday pressures facing households. We need to see that £2 cap on bus fares in Wales, as well as the extension of £1 fares for under 21 seconds. I look forward to Prime Ministers announcing how they will match the UK, Labour's reduction in bus fares, and let's hope they do it quickly.

Barnett consequentials on spending announcements are worth an additional £450 million to the Welsh Government, and I would suggest that they spend it wisely, as people in Wales also want to benefit from this Budget for working people. With my constituency being home to the Welsh semiconductor cluster and being the chair of the APPG for semiconductors, I am extremely proud of this government's commitment to manufacturing and I recognise the role that Reindustrialisation can play in bringing well-paid jobs to every
18:34
Ruth Jones Portrait Ruth Jones MP (Newport West and Islwyn, Labour)
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postcode, including the 20 million to support UK Reindustrialisation high value jobs, especially high value jobs, especially building on the existing strengths of the semiconductor cluster in Newport West and Islwyn, boosting manufacturing and the Prime Minister's ambition to bring good growth to every postcode is particularly important in Wales, particularly important in Wales, where we felt the impacts of 40 years of neo liberalism at the hardest well-paid union jobs in our hardest well-paid union jobs in our industrial heartland and coalfield communities disappeared and were never replaced. Despite the damage done by decades of conservative governments, Wales remains a proud manufacturing nation.

The evidence is clear from my own constituency, world leading manufacturers choosing Wales for investment. Advanced manufacturing must be at the heart of a future Welsh economy. This Budget backs this ambition. This Budget is another big win for reversing 14 years of Tory under-investment in Welsh railways. Last year we saw 445 million in funding for new stations, and now we have an additional 30 million for the Cardiff Parkway station site being the neighbouring MP to this site. I particularly welcome this announcement, which will provide meaningful alternatives for commuters and shoppers wanting to travel between Newport and Cardiff.

I look forward to hearing further announcements on the delivery of this government's £14 billion commitment to transform the Welsh rail infrastructure at the Spending Review, including the additional five stations across Newport. This labour investment led approach. I'm going to carry on because I'm conscious there are other speakers here. This labour investment approach stands in stark contrast to the minority government, who proposed to close a number of the M4 junctions across Newport, which will improve traffic flow by just 3% but will have a massive impact on air and noise pollution for those living in my constituency.

But I do welcome the Chancellor's announcement today that tax free mileage rates will now permanently be set at £0.55 a mile for the first 10,000 miles, and this will go a long way to helping those who drive as part of their work, especially those providing domiciliary care. Now, we also need to know that the Welsh Government will show the same ambition in making sure we push powers from Westminster, not just to the the beheaded in Cardiff Bay. We also need funding and powers brought even closer to our communities. In my home city of Newport, we have a bold, ambitious Labour council led by Councillor Dmitri Battersea, which.

Ensuring that Newport is one of the fastest growing areas of the UK. Think of what we could achieve by giving more powers and funding directly to local areas. Madam Deputy Speaker, this Budget marks another major step forward in delivering breathing space today and fresh hope for the future, and

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I support it. Jerome Mayhew thank you, Madam Deputy Speaker. I'm going to go out Deputy Speaker. I'm going to go out on a limb and say this is a terrible Budget. It's not just a steady as it goes Budget, because everyone in this chamber knows everyone in this chamber knows we've got some really serious problems that have to be addressed by this country, both politically and economically. And this is going and economically. And this is going to be known as the kick it down the road Budget that has its eyes covered and its fingers in its ears pretending these problems aren't real and that they aren't now, and that we can afford to push them all down for another 12 to 18 months.
18:37
Jerome Mayhew Portrait Jerome Mayhew MP (Broadland and Fakenham, Conservative)
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Look at the national debt. We have already peaked above 3 trillion of already peaked above 3 trillion of national debt in the last couple of weeks, and yet this Parliament is now on course to increase increase now on course to increase increase borrowing above what was planned in 2024 by £308 billion. That's more than a quarter of £1 trillion of borrowing. No plan to get it down, borrowing. No plan to get it down, no credible plan to reduce welfare spending, which is the next major issue that we've got to address. Welfare dependency now makes it reasonable for 1000 people a day to apply for Personal Independence Payment, because they know they're going to get paid more on benefits than they are if they get a job.

We have a government, a government that recognises that needs to change. They try to make a very modest, a very modest change. Last year, and it was voted down by the members opposite, and it led to the defeat of the previous Prime Minister. And what is the government's now answer? It's the Timms report. That is the report, which of itself was created by the failure of the debate last time round, and part of its part of its part of its objects, is not to reduce spending. Madam Deputy Speaker, I'd be grateful if people could listen to the speech being made rather than making their own from the from the front bench.

But so welfare dependency has to get addressed. And yet we've got a report we're waiting for, and then a response from the government that we've got to wait for, and then a white paper sometime next year, apparently. And then potentially after that legislation to go through this House. That's no way to address this. This is a key present economic, social and moral danger that our country faces. And this government's pretending it's not there. And then we come to defence. We're told by this government that we have to prepare for a war within a thousand days, and yet do we have the plan to get to 3% of defence spending, 3% of GDP on defence spending by 2030?

 Not a bit of it. We don't have that. We have a plan for next year. So we're we're we're supposed to be satisfied with a plan to get to a plan. This is ridiculous. We've got government Ministers telling us that we've got to stockpile food, and yet we've got capital expenditure that is due to take place after that thousand day period. This is this is back to front government. And it's a negligent it's a negligent Treasury that is imposing this on our defence sector. And then we've got economic growth. We've got a plan which reduces the the economic growth for this country next year from 1.6% growth, which is pretty anaemic down to 1%.

And at no point during the the forecast period does it actually get as far as 2%. It's outrageous. And we've got and we've got tax. I won't I've only got a minute left and we've got tax rises being imposed on savers. What a weird what a weird argument that is to make people doing the right thing being imposed, having increased taxes and banks, banks which are the funders of growth. A CEO of one of the UK banks has reported to have said this. Taxing the engines of growth to reduce VAT on gherkins is end of Rome level of stupidity.

It's hard to disagree, isn't it, Madam Deputy Speaker? So here we have we've got four really serious issues, really serious issues for our country. And we have a Budget that pretends they're not there. There's a Budget that kicks it down the road. It's a Budget that says steady, steady as it goes is the right answer. I could not

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disagree more. Matt Rodda thank you, Madam. Deputy Speaker. Could I welcome the Budget.

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the Budget. Very warmly? It offers. Breathing space. Both for families and businesses

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Both for families and businesses and also, crucially, hope for the future. And this is happening at a time of really quite severe international headwinds, as we're international headwinds, as we're all very aware. And yet there are real signs of growth in the British economy, with us jointly leading
18:41
Matt Rodda Portrait Matt Rodda MP (Reading Central, Labour)
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economy, with us jointly leading the G7 in terms of growth and also the IMF saying they are welcoming the government's measures to reduce government debt and deficit. I want to deal briefly with the breathing, breathing space measures and then move on to some of the longer term points. So just starting with the key measures that will help offer breathing space and support for families and for businesses in my constituency, many residents live in older properties. Many of them live in Victorian houses or possibly ones from the 1930s, and I was delighted to see that they will benefit from a whole host of measures to reduce their energy bills.

That will be a very difficult winter for them. I'm pleased with this, and I think it shows a real understanding of the pressures on families at this very difficult time. And if I could particularly thank the Chancellor for the measure to offer £100 paid directly to residents, I think that's a very sensible way of pursuing this and the host of other measures across a range of issues, which will all help that quite severe pressure on family finances at this time. In addition to that, very briefly, can I also welcome the measures to support small businesses, particularly those in our high streets?

Very welcome in reading and in many other towns and cities across the country. And indeed, it's interesting to note that now 47% of small businesses in hospitality, leisure and retail in the South East will not be paying business rates, which I welcome. And I'm very pleased to see. I would like to, though, in the time available to me, move on to the longer term measures and in particular, those that relate to improving devolution to help support businesses and development and regeneration in this country, and a series of other measures to support businesses and homeowners. So in terms of regeneration, there's some real opportunities with the announcement of the new Mayoralties, and I'd like to warmly welcome the Thames Valley mayoralty of Berkshire, Oxfordshire and Swindon, and in particular, the scope for mayors to free up land near railway stations.

And as many members from across the House have have seen, this is a huge pool of land that's available in my own town on one side of the railway, in reading in the town centre, there's £1 billion regeneration project which is bringing jobs and growth and new housing to the town centre. On the other side, where there are a series of small, fractured sites with developers not working with each other, there isn't regeneration. And one of the significant advantages of bringing in mayors is it allows a mayoral development corporation, which can bring together these disparate sites and make them much more attractive to developers.

Now, warmly welcome that, and I look forward to hearing more from the Chancellor and the local government ministry about that type of work. As the as the whole mayoral scheme moves forward in the New Year. Also. Madam Deputy Speaker, the support for home ownership and the support for new council houses is warmly welcome. In my area we live in an area of high house prices. Many people are struggling to get on the housing ladder and also part of the growth of businesses in the Thames Valley has been due to the inward movements of people from across the rest of the UK and indeed around the world.

So housing is needed and these are two important measures to support home ownership and having homes for people to rent as well. And just finally, if I may, I would like to warmly welcome the measures to support entrepreneurship, which I hope will significantly support our tech entrepreneurs. There are 300,000 people in Berkshire who work in tech or telecoms, and they are driving growth in our county and across southern England. Indeed, the country as a whole, we've been we've benefited from a number of key infrastructure projects, particularly the Elizabeth line. I'm looking forward to other measures as well.

In future, the Western Rail link to Heathrow and many other things. But the help to support entrepreneurs is important, and I want to warmly welcome that and commend the Treasury for their work on that. Thank you, Madam

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Deputy Speaker. It's been a pleasure to speak today. Doctor. Speaker.

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Speaker. I couldn't really make up my mind when I was listening to the Chancellor, whether this was a gathering note for an early general election or simply a wasted opportunity. Well, we've been told opportunity. Well, we've been told in the last few minutes that the Prime Minister has said to reporters, I can rule out calling a reporters, I can rule out calling a general election in the next 12 months. So that's sorted that, and I'm sure there are many honourable right hon. Members opposite who will be heartily relieved by that. So we're left with a wasted opportunity a Budget that contains no growth strategy worth the name, nothing on welfare except 1 or 2 small rises here and there, nothing on reducing the size of the state.
18:46
Andrew Murrison Portrait Rt Hon Dr Andrew Murrison MP (South West Wiltshire, Conservative)
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When countries in Europe are giving serious attention to reducing the size of the state after Covid, this government is doing very little indeed. To put it politely, the indeed. To put it politely, the Netherlands reducing its headcount in its civil service by 15%, in its civil service by 15%, excepting the military and the police. If we were to do some something even approaching that, something even approaching that, that would be the thick end of 100,000 headcount, freeing up resources for deficit reduction in the interests of generational fairness, what I'm particularly focussed on is good growth in the B 12, B 13 and BA 14 postcodes.

But my constituents are seeing none of it. What they did see practically on day one of this government two and a half years ago, was cancellation of the A303 improvements. What it saw was the long grassing of the North South strategic study to link south coast with the M4 that seems to have gone by the board, meaning no Westbury bypass after all these years, we're seeing continuing fiscal encouragement for a much loathed plan for an incinerator at Westbury. We've seen VAT and charitable rate relief changes for independent schools, which has closed one in my constituency, a foreign languages college that brought in a great deal of foreign investment, the retrenchment of one independent school, and only yesterday, news that a further school very close to my constituency is finally, after over 100 years, closing down directly as a result of government policy, not much growth there.

We've seen the family farm tax, we've seen family business tax, we have seen sebum in the Finance Act 2025 going to come in on the 1st of January to add to farmers woes, something that I had thought the government might mention in the Budget. It's been said earlier on that farmers have featured hardly at all in this Budget. Well, cbam was an obvious thing to do to reduce the cost of fertiliser. There are farmers in my constituency who are seriously considering not planting this year because of the cost of fertiliser. This was the opportunity to put that right.

My constituency is very military. We heard a deafening silence on 3% of GDP on defence by the end of this decade, making a complete mockery of the now Chancellor's resignation in June. Goodness me, his name's sake. Denis Healey must be turning in his grave in 1969. Of course, he famously said, once we cut defence expenditure to the extent where our security is imperilled, the grounds on which the current Chancellor, of course, resigned in June. We have no houses, we have no hospitals, we have no schools. We have a heap of cinders. And yet it is precisely, precisely this issue, the welfare of our defence personnel and our ability to to protect the state that the now Chancellor resigned for in June.

I have to say that is a quite extraordinary thing. And now we find that Ardell is going to be cut in real terms over the next two years. And let me just explain what that means in the time available to me. Madam Deputy Speaker, it means that defence personnel's accommodation will not be kept up to the extent that they should be. It means establishments won't be renovated. It means there'll be no fuel for ships at sea. It means dockyard workers will not get overtime, and that means ships will be anchored off at a weekend rather than service people being able to get home to their families, it means no exercises.

I speak as a reservist. It means no reserve service days. That means demoralising our reserve. This is catastrophic and it's no way to behave. And it certainly is not indicative of a government that is halfway serious about the defence of this country. Yes.
18:50
Leigh Ingham Portrait Leigh Ingham MP (Stafford, Labour)
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Leigh Ingham. >> Thank you, Madam Deputy Speaker. And to many of you, it won't come as a surprise today that I want to talk about town centres, because talk about town centres, because Stafford, the constituency that I represent, is a market town. The clue is in the name, but since 2024, Stafford hasn't had an actual market, and it's really hard to think of a more powerful symbol of what happened to towns like mine. Over the last decade and a half, towns like Stafford are full of hard working people who really want to get on. They want a good job, a warm home, and a safe community.

And it's not a lot to ask for. Under the last conservative government, they watched as the foundations of the community life were stripped away. Youth centres disappeared. We had the third worst youth service cuts in the country. Important buildings were left to decay and eventually their market closed. The damage this neglect does to a town is more than financial. It starts to chip away at the heart of a place, and it changes how people feel about their home. Now, Stafford has a vibrant, independent business scene. You can get unbelievable hot chocolates in Drunken Smuggler, the best sellers from that little bookshop.

Or you can buy incredible vinyls from double double records, plus many more. These businesses are investing in their own time, their money and their energy in our town. And they've told me many, many times we need our market back. They want Stafford to be a destination once again, and so do I. A place where people come and choose to visit, to spend time to spend money and build a future. And that is why I'm so proud today that this government has committed £10 million towards a brand new all day market hall and event centre in Stafford, something I've been working on for for a good while now, as my hon.

Friends can attest, this is an investment that says towns matters and my town matters, and it's an investment that will support businesses. It will create opportunities and help breathe life back into our high streets. But this debate today is obviously about something bigger than one town and one project. It's about who gets the power to shape their future. Because if we are serious about growth, serious about opportunity, and serious about rebuilding Britain, we cannot continue to run every important decision through Whitehall. And the truth is, the people that know Staffordshire best are the people who live and work there.

And that's why the case for strategic authority in Staffordshire and Stoke on Trent is so strong. We've already seen the difference investment can make in Stafford. Over the last couple of years we've seen growth, we've seen confidence start to return and we've seen investment at a scale not seen for many years. But of course there's so much more to do. This commitment today, though, is a clear sign that this government cares about towns like ours, believes in their future and is prepared to break back that with action. I look forward to working with colleagues across the House to make this vision a reality and to ensure that Staffordshire and Stoke on Trent has the powers, the investment, as my colleagues have talked about and the opportunities they need to thrive for generations to come.
18:53
Ben Spencer Portrait Dr Ben Spencer MP (Runnymede and Weybridge, Conservative)
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Hey Doctor Ben Spencer. >> Hey Doctor Ben Spencer. >> Deputy Speaker Sadly, this Budget doesn't. >> Tackle the critical national issues that we face. It doesn't have a plan to reduce spending on welfare. It doesn't have a plan to increase spending on defence. It increase spending on defence. It doesn't have definitive interventions to improve growth, to tackle our spiralling debt or to deal with the record high taxes all of us currently face. So what about locally? What is it? How is it scored there for constituents and Runnymede and Weybridge? Does it keep Runnymede and Weybridge moving? While there's nothing on level crossings, not much on rail or indeed roads backing local jobs and businesses, it's not doing anything about the catastrophic National Insurance employee contributions.

What about defending our greenbelt on natural environment? Well, there's nothing on the Environment Agency and in terms of better protection from flooding. And I'm glad that the flooding Minister is is on the front bench. It is notably absent any mention of the River Thames scheme, the largest infrastructure to be put forward by the Environment Agency. Not a mention in this Budget which is deeply, deeply concerning. How about supporting children and families? Well, again, nothing on Sadie and childcare. So the scorecard from Runnymede and Weybridge keeping my constituency moving is nil nil, nil, nil nil. And why is that?

Because this Budget is a tomorrow Budget. It's a future Budget with all the key decisions being left to after a review, or indeed not within this Parliament. And I've got some news for the benches opposite and indeed the benches to the left of me. We know what that means. The fact that the Chancellor and the Prime Minister would rather do a non-budget and call a general election, rather than making the hard decisions today, tells you everything you need to know about this Labour government. Yeah, and there is another way with the Conservatives and my I'm looking constituents.

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Hey. I beg to move that the debate be now adjourned.

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now adjourned. The question is that the debate be now adjourned. As many as are of

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that opinion say aye. Of the contrary, no. I think the ayes have it. The ayes have it. Date to be resumed. What day? Tomorrow?

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Tomorrow? Tomorrow. Point of order. Point of order. Andrew Bowie. Thank you very much.

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Thank you very much. Madam Deputy Speaker, I am for granting this point of order. I am seeking some clarity due to the fact that this week and indeed last week, both the Prime Minister and the Secretary of State for Energy Security and Net Zero indicated that no decision had been taken on whether or not they were going to grant approval to the Rosebank oil field. However, today in the Obrs Economic and Fiscal Outlook publication, it stated that their projected oil and gas receipts for the next year, which are now expected to raise £5.1 billion for the Treasury, includes, and I quote, production from currently producing fields including jackdaw and the Nzta's estimate of production from development of new fields, which includes Rosebank and from future discoveries.

So, Madam Deputy Speaker, might you be able to offer some guidance on how this House and indeed the country can get some clarity on whether or not the Rosebank oil field is has been granted approval, will be granted approval, or whether or not the OBR's forecast can be trusted at all.

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I thank the hon. Gentleman for his point of order. I received no notice from Ministers that they intend to make a statement on this intend to make a statement on this matter. The matter he raises is not a matter for the chair, but Ministers on the front bench will Ministers on the front bench will have heard the hon. Member's point of order. Petition.

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of order. Petition. Neil Duncan-Jordan thank you. Madam Deputy Speaker. I rise to present this petition

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I rise to present this petition signed by hundreds of my constituents, which calls for urgent action to ease the cost of living pressures that many families face, and for greater support for the many local businesses that make Poole the place it is. Ahead of the Budget, I shared these proposals directly with the Chancellor because I believe we need to recognise the distinct challenges
18:58
None Portrait Petitions
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facing coastal areas. The petitioners, therefore, request that the House of Commons urges the that the House of Commons urges the government to implement a strategy for coastal communities that supports affordable housing, supports affordable housing, coastal economies, lower household energy costs, cleaner waterways and energy costs, cleaner waterways and stronger representation for coastal communities within government. And the petitioners remain. ET cetera.

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Thank you. Petition support for coastal communities.

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communities. Thank you. Thank you.

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Thank you. Thank you. I beg to move that this House do now adjourn. The question is that this House

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do now adjourn. Doctor Ellie Chowns. Thank you. Thank you. Very much. Madam Deputy Speaker.

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Not long after my election in 2024, I received an email from a father of three whose home had been flooded for the second time in five years. He wrote that the increasing uncertainty in the weather caused by global warming only increases the flood risk in the immediacy, and in future, we fear we won't be able to secure insurance on the property, and we live in constant fear of repeat situations for something that, in theory, can be resolved. Those are the words of one of my constituents. And here's where it stayed with me, because they capture exactly what I hear across North Herefordshire and what I'm sure colleagues here across the country, flooding is no longer something that people talk about as a freak event or a piece of bad luck.

Increasingly, they expect it
18:59
Ellie Chowns Portrait Adjournment: Flood resilience Dr Ellie Chowns MP (North Herefordshire, Green Party)
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to happen again. And as our climate changes, flooding is becoming something that communities now have something that communities now have to plan around. Now, we recently marked Flood Action Week, and I pay huge tribute to everyone from local volunteers to emergency responders who work tirelessly to help who work tirelessly to help communities prepare. But for many, flooding is no longer an occasional emergency. It's becoming a part of emergency. It's becoming a part of life. Now, we've already seen unprecedented, deadly climate impacts this summer. The climate crisis is no longer a future threat. It's here now and affecting homes, farms, businesses and critical infrastructure across the country.

 And as we head into winter, scientists are warning that a powerful, supercharged El Nino could contribute to much wetter and stormier conditions during parts of this winter. So we know that the risks are growing, and we know that the cost of failing to prepare will be borne by our communities. And

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it's worth recognising. Absolutely. Martin. First of all, can I commend the hon. Lady for North commend the hon. Lady for North Herefordshire for bringing this forward beforehand back home? Not the Minister. Responsibility. the Minister. Responsibility. They've allocated £16,000. I would hardly get the JCB and the trailer down to where the coastal erosion down to where the coastal erosion and the floods are happening. Does the hon. Lady agree that it's a case of penny wise and pound foolish? Don't address the flood resilience issues in the coastal erosion. Now pay for it substantially later. It's a case now.

The Minister should bring the money and make it available.

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I thank the hon. Member for his point, and absolutely, it's something that I'll come on to in something that I'll come on to in in my speech. There's a huge benefit cost ratio for investment early on in flood resilience. It early on in flood resilience. It pays back many times over. So let's recognise the scale of the challenge that we face. 6.3 million properties across the UK are already at risk of flooding. The Climate Change Committee estimates that flooding already crossed the that flooding already crossed the UK around £3.3 billion every year, and once the annual damages could increase to about £4.5 billion a year by the middle of the century.

If we fail to adapt, it would be much cheaper, as the hon. Member says, to invest now to ensure that we're protected against that. And the costs are measured not only in pounds but in the strain placed upon families trying to rebuild their lives. So the bill for flooding is already here. The question is whether we invest now to reduce those costs or pay far,

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far more later on. I will. Just in terms of investment,

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Just in terms of investment, residents of Beso, which is in my Camborne, partly in my Campbell, Redruth and Hayle constituency and partly in the constituency of the partly in the constituency of the Member for Truro and Falmouth. But they're fed up with with floods now every winter linked to abandoned every winter linked to abandoned local metal mines. And this is a persistent problem across Cornwall and the Mining and Remediation and the Mining and Remediation Authority, whose Budget partly sits with Defra, does not have adequate funding to deal with the challenges of Beso. And does the right hon.

Member agree with me that as the impacts of climate change worsen, Cornwall's former mining community should not be left exposed without that flood resilience?

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I thank the hon. Member for his intervention. And yes, again, the point here is that as we face increasing frequency and severity increasing frequency and severity of floods, existing problems are going to become worse. And so we need to invest to protect communities against them, because investment early is going to be cheaper than paying the costs in

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the long run. Absolutely. I thank my hon. Friend for giving way. And in my constituency of Stratford-on-Avon, the Shipston Stratford-on-Avon, the Shipston Area Flood Action Group has led natural flood management projects, working together with local landowners to slow the flow of the River Stour upstream. Does she agree that we need greater investment in natural flood management so that communities are protected before flooding occurs,

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while we also help restore nature? I thank my hon. Friend for her

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I thank my hon. Friend for her excellent point, and in fact, I was about to make exactly the same point myself in my speech. Natural flood management has got to be a flood management has got to be a core element of our response to flood risk. Madam Deputy Speaker, I've met families who've gone I've met families who've gone through the ordeal of seeing their homes flooded again and again. I've met farmers who've watched valuable met farmers who've watched valuable topsoil disappear from fields that they've worked for decades. I've met parents whose children can't get to school because roads have become impassable.

And I've met business owners wondering how they'll cope when the next storm comes. For all of these people, flood resilience isn't an abstract issue. It's about whether they can

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live, work, study and plan with confidence. I'm very grateful to the hon. Member for giving way. She's making Member for giving way. She's making a powerful case. Residents in my Bicester and Woodstock constituency have experienced the devastating effects of flooding and live in effects of flooding and live in fear of it happening again. Does she agree with me that it's extraordinary that when the local flood agency looks into these flood agency looks into these matters, identifies the steps that can be taken, it does not have the powers to compel other agencies, in particular the water companies, to particular the water companies, to take appropriate measures to prevent these things from happening again in the future.

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I thank the hon. Member for his point, and at this point, about co-ordination between agencies is absolutely crucial. Again, a point absolutely crucial. Again, a point that I shall be coming on to here. This is an issue that crosses This is an issue that crosses boundaries. River catchments don't respect administrative boundaries. They don't respect sectoral boundaries. We need to have a fully boundaries. We need to have a fully joined up approach. Now herefordians know what severe flooding looks like. In 2020, Herefordshire experienced the worst flooding in more than 200 years of recorded history. Storm Dennis was absolutely devastating for many families and businesses.

And six years on, residents tell me it's not only the severity of flooding that worries them, it's also the frequency. And in fact, the Minister may remember that I raised this issue basically every single month for my first few months in this chamber, because we were facing floods that frequently, communities that barely recovered from one flood are increasingly finding themselves preparing for the next. And so I hope that the Minister will be able to set out today exactly what action the government is taking to better prevent, prepare for and respond to flooding. Now, flooding means different things in different places.

In my constituency in Lyonshall, it means the worry that a new development may not have been built with the infrastructure needed to manage water safely in, and it means anxiety about whether support will be available when the next flood comes. One issue repeatedly raised with me by residents in Iceland is the flood recovery framework and following Storm Bert in 2024 late 2024, I attended a public meeting with more than 100 local residents. As ever, the people closest to the problem already knew what needed to be done. And so after those conversations, I wrote to Ministers asking whether responsibility for activating the flood recovery framework should rest more with local authorities.

Because from the perspective of someone whose homes flooded, distinctions about national thresholds make very little sense. Local people and local councils understand the impact better than anyone else I will.

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Can I thank the hon. Lady for giving way for her excellent speech as well? I'd like to talk a little bit more about natural flood bit more about natural flood management and how it sits naturally with district councils in Stroud, which is my constituency. Stroud, which is my constituency. For over 12 years, we've had more than 1200 interventions. And in fact, I think we lead nationally in fact, I think we lead nationally in this. And can I particularly praise Chris Utley, who works for the District Council and is an absolute does a fantastic job with that natural flood management.

And he's saved hundreds of homes and businesses from the repeat of the terrible 2007 floods. So would she join with me in urging the government to make it as easy as possible for councils to access the 25 million funding the government has earmarked for natural flood

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management so that we can unlock this tremendous potential in local government. I thank my hon. Friend for his

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I thank my hon. Friend for his point, and I am always in favour of government making it easier for local authorities to be able to unlock funding, as well as government providing more funding to enable the good things like natural flood management to happen. natural flood management to happen. Just to finish on the point of the flood recovery framework, I would like to ask, Will the Minister look again at whether local authorities should have a greater role in activating support under the flood recovery framework? Now, many of the flooding incidents affecting my constituency aren't caused by rivers bursting their banks.

 They're caused by heavy rainfall, overwhelming surface drainage systems and surface water. Flooding is becoming a greater risk. Our planning system and development standards must catch up. Now, many colleagues across the House have called on the government to commence schedule three of the Flood and Water Management Act and finally make sustainable, urban, sustainable drainage systems standard practice. So will the Minister set out whether and when the government will commence schedule three and make sustainable drainage systems standard in new developments? Madam Deputy Speaker, better planning must also be part of the solution. Now people understand that new homes are needed, but they expect flood risk to be properly reflected in planning decisions.

And this is at the core of the Green Party's policy of the right home, in the right place, at the right price. Now, I've seen this in my own constituency. A constituent came to see me in my surgery a little while back from Canon Pain. They'd moved into a new development relatively recently. Their neighbour was flooded out of their house six weeks after moving in, because the surface drainage provisions were not adequate. This was in a newly built development. I, of course, raised it with with the council subsequently, but this just highlights that we must integrate flood resilience into development.

 We can't be building developments that are going to flood. So shortly after they are built. We need to have it much more clearly specified in the planning process and much clearer follow up to ensure that conditions placed on planning applications are actually followed through. Now, flood resilience also has to be better integrated into how we manage land. One of the absolutely lovely parts of my job is meeting farmers across North Herefordshire, people who understand better than most that all of these strands are interconnected. Soil health affects water retention. Water affects crop yields. What happens upstream affects communities downstream, and what happens on one farm can affect flood risk miles away.

And that's why I'm so impressed by schemes such as Whitegates, where farmers are working together to hold more water in the landscape to improve soil health, reduce pollution,

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restore nature and strengthen resilience, including flood catchment. On that. Point.

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Point. I thank my hon. Friend for giving way. She's making a really powerful case in constituencies vulnerable to flooding. Like Waveney Valley, farmers are indeed essential to managing water in a way that stores it on land and way that stores it on land and protects communities downstream. Countryside stewardship Higher Tier payments fund the work that creates wetlands, restores floodplains and plants woodlands. But agreements are slow to reach farmers who are ready to mobilise, delaying essential work ahead of periods of heightened flood risk. So would my hon. Friend agree that DEFRA must properly resource both the budgets and the capacity in Natural England and the Rural Payments Agency, so Yeah.

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I thank my hon. Friend for an excellent point. Yes, government has an absolutely crucial role to play in supporting farmers, to put play in supporting farmers, to put in place the measures that are so helpful for our long term resilience and have so many wider resilience and have so many wider community benefits, too. Now, this work is key because healthy soils, healthy rivers, and resilient landscapes are key to long term food security. Now, as the NFU food security. Now, as the NFU points out, 58% of England's highest quality agricultural land lies within floodplains, underlining that flood resilience isn't just an environmental issue, but a food security issue, too.

And I know many farmers whose land has been absolutely underwater with devastating impacts on their livelihoods. Farmers are increasingly having to manage both floods and drought as part of normal business planning. They want to be part of the solution, but what they need is the certainty and the support to make long term investments in managing water, improving soil health and restoring nature. And indeed, I met with the Herefordshire Rural Hub recently about the local Farmers Water Action Group, which is looking at exactly how they can help to manage excess water in the winter. Not enough water in the summer.

Connect those things together so that we can support our communities. And when farmers hold on to water on their land to protect homes and infrastructure downstream, they're providing a much wider public benefit. So does the farm. Does the Minister agree that farmers who help to reduce flood risk in this way should be properly recognised and fairly rewarded for the role that they play? And more broadly, we need to invest much more in natural flood management, as my hon. Friend said earlier, restoring wetlands, improving soil health, reconnecting rivers with their floodplains, planting trees, restoring hedgerows. All these things help to slow the flow of water through the landscape, and every drop of water held upstream is a drop that doesn't have to be managed in an emergency downstream.

Now, as we've noted, rivers don't recognise administrative boundaries and neither does flood water. What happens upstream affects communities downstream, many miles away often. And so can I ask the Minister, what is the government doing to improve coordination and cooperation between local authorities, farmers, drainage boards, regulators and water companies across whole catchments? Now flooding and drought are, of course, as I've already noted, two sides of the same coin, and I welcome the establishment of the new Flood and Drought Resilience Taskforce, which is currently looking at community engagement, water resilience and property flood resilience. And let me pay tribute to flood Mary, one of my own constituents who's played such a crucial role over many years in encouraging the adoption of property flood resilience.

Now, the test for me is how that work of the Flood and Drought Resilience Taskforce will translate into practical action on the ground for communities such as those in North Herefordshire. Now, Met Office figures show that the winter of 2020 526 last winter was the eighth wettest in England since records began. And yet by August this year, 71% of England had entered drought status. These are these extremes of flood and drought writ large. And in our faces right now. It perfectly illustrates why flooding and drought can no longer be treated as separate challenges. So can I ask the Minister what plans does the government have to increase water storage, including new reservoirs, so that excess winter water can help tackle flooding while also improving resilience to summer droughts?

Now, Madam Deputy Speaker, the case for action is overwhelming. Flooding threatens homes, food production, local economies and the long term viability of communities. We know that investing now is far cheaper than paying for the damage later. And in fact, the Climate Change Committee estimates that benefit cost ratios of 3.1 to 5.1 for natural flood management, 5 to 1 for property flood resilience, and five 5 to 1 for other approaches to flood risk management. This is great value for money, fantastic return on investment and we know what works better planning, better maintenance, stronger protection for homes, support for farmers and approaches that work with nature rather than against it.

And indeed, I saw lots of this in action when I visited the Netherlands a couple of years ago with the

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The Environmental Audit Committee. And what was absolutely striking there was that in that country, they work out what needs country, they work out what needs to be done to protect communities, what the most cost effective investments are, and then how they're going to mobilise the they're going to mobilise the funding. But in this country, we seem to operate where, you know, we fight with the Treasury for a little pot of money, and then little pot of money, and then everybody has to get their elbows out to kind of engage in a bit of a bunfight about what resources can bunfight about what resources can be secured for different places.

We need a much more holistic approach. And it does require more investment up front, but it will pay back many times over. So I'm sorry, we're short of time. I'm just going to finish now. The responsibility of government is not simply to respond to flooding after it happens, it's to build the resilience of our communities will need in a rapidly warming climate. The question is whether the government is ready to act at the scale that the challenge of flood resilience demands. Thank you.

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Minister. Thank you, Madam Deputy Speaker, and I will do my best to croak my way, I'm afraid, through the through the rest of this debate. But I thank the hon. Lady for But I thank the hon. Lady for raising this really important debate. And it was heartening that there was so much. I found myself there was so much. I found myself nodding along with as she was, as she was speaking. I know the
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Emma Hardy Portrait Emma Hardy MP, The Minister of State, Department for Environment, Food and Rural Affairs (Kingston upon Hull West and Haltemprice, Labour)
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she was speaking. I know the emotional and financial impact of flooding can be devastating on families and businesses. And like her, I've spoken to many people who've been affected by floods, some farmers whose crops have been damaged, seen and heard from communities affected by flooding. And it isn't just the economic impact, it is absolutely the impact on their mental health and wellbeing and the scars of flooding remain a long time after those flood water has receded, receded and completely agree with the points that she was making around climate change. And we have and the situation we have now, where it's 81% of the country that is in drought.

At the same time, we saw some flooding just last week. And in one particular area where it's drought, they had a flood as well. And so dealing with the impact of climate change, which is absolutely here and now, which just on a slightly of a note, I find it quite frustrating that there are some parties within this House, Mr Speaker, which don't seem to accept that climate change is both real and here, though luckily I can look around me and say, nobody in here comes Eastleigh. So that's positive. And this year, as the hon. Lady said, maybe especially challenging because we're expecting a strong El Nino and increased likelihood of wetter and stormier conditions across the UK during autumn and winter.

We are better prepared this year than we were last last year. We were better prepared than we were the year before. That's partly because of the number of flood defences that we've been able to build successfully. It's partly because we've been able to restore and maintain more the flood defences we have. But it's also because when we had the original flood task force, what we wanted to do after each episode of flooding each winter is do some honest lessons learned and what worked, what didn't, what can we do better, and set up that cycle of continuous improvement.

And she's absolutely right, which is why I'm pleased. It's now the Flood and Drought Resilience Task Force that we're thinking about this together, because, again, I agree with the hon. Lady when she was talking about the things that help with drought, help with flooding as well. If the soil is able to retain more moisture, it helps with drought in the summer because it helps with groundwater levels, but it also means it absorbs more when there's a flood. So again, in full agreement on that, and interesting that she mentions the Netherlands. I met with somebody just last week.

I was talking about how they're doing their they do their regional planning. And exactly as the hon. Lady says, how do they look at a region and decide what's the best intervention that we need to take in that area? We're looking to sort of introduce a regional for for water in this country. And that's absolutely in my mind as well, is what's the best answer? Because we've not mentioned in the debate today the issue we have around water pollution. But we know that many of the cases we have around water pollution is too much water, rain, water ending up in the system and creating overflows.

So actually, to add to our why should we do this? And it's a good thing. It actually helps decrease pollution as well. If we have areas where we can hold more water. And of course, I my huge admiration for flood Mary, who is a wonderful, wonderful person and so wholeheartedly agree with that on the flood recovery framework that is run by Mhclg. But I will ensure that her remarks are heard by that by that relevant Minister. So the expanded existing Flood Resilience Task Force, which I've already mentioned, is all about how do we prepare not only for more frequent periods of increased rainfall, but also frequent periods of low rainfall as well?

Looking at the two sides of the same coin, as the hon. Lady said, we've had the eighth wettest in England winter since 1836, and yet we've had the driest in some parts of the country in a century as well, just following straight after. And this is bringing these challenges together. So at the at the my focus at the moment is how do we take the rain as it falls? When it falls, use it to fill up our reservoirs. So in the best possible position for March, but also make it easier for farmers. I'm really interested in what hon.

Lady mentioned about the work that her farmers are doing in their area. There's a great scheme that's happening with a wag, with a water abstraction group in another part of the country which are looking at this. And I think it's it's absolutely a way to go forward. We've brought more people into the task force than we've ever had ever had before. And as she's mentioned, some of those action groups are taking away specific actions. Some of the other things I know the hon. Lady was on in the Environment Audit Committee, that we've taken away some of the recommendations from the report that they did, which was very, really good piece of work.

And one of them was, how do we create that one stop shop for information? So we've launched the Flood Action Online, which is about helping communities understand their their flood risk and looking for flood information. So again, really be so helpful if colleagues around the room could help share that, get that information out. And just on another one, while I'm while I'm asking everyone for favours, the priority services register as well, Madam Deputy Speaker, which helps identify people who are vulnerable, who would need water in case of an outage, because, of course, flooding can cause problems with water supply.

Anything like that would be super helpful. And we have changed the the rules on investment. And I know again, the hon. Lady and I agree on our love of nature based solutions and slowing the flow, which is just a win for everybody. And I was pleased to hear that there's some in in her area as well. We're talking about a minimum level of investment. So it's not the only thing I would correct my hon. Friend on is it's not just saying it's a small amount of money going in. I mean, that is a minimum amount.

And we set it as a minimum because we want to really encourage people to do more nature based solutions where it's possible. Of course, the pushback I get is it's not always suitable. Of course, it's not always suitable in everywhere. But I think where we can, let's let nature do what it does best. And if it helps slow the flow and creates and supports biodiversity, then surely that's a thing we can all absolutely get behind. While I've got the floor, and I'm able to talk a little bit about what we've been doing. After more than a decade of underinvestment by the previous government, we've invested £2.65 billion in our first two years, delivered real change, stabilise the condition of existing defences.

We've done 250 flood defence projects, new and improved defences that have come online. And she's absolutely right. Again, the money that we've put into that will will prevent an estimated £10 billion in economic damage to provide communities better protection, restore pride in our towns and defend valuable farmland from being regularly flooded. Earlier this year, we had our ten year Flood and coastal Erosion Investment Programme. This will benefit 200,000 properties over the next over the next three years. These are ambitious targets, but the ones I'm proud to get behind and again, it's forecast to generate more than £27 billion of avoided economic damage.

So I think that's pretty good for an investment of £7.9 billion. We save 27 billion. I think I should have mentioned that earlier with the Chancellor. I will keep mentioning it. It's almost £7 of benefit for every £1 invested as well. And the Environment Agency is continuing to work in Herefordshire Council with the River Lugg Internal Drainage Board to reduce that risk faced by local communities. So I'm aware of the £276,000 investment in a new hydraulic model of the River Wye to improve the evidence base for future investment planning and development decisions along the river.

And turning to the issue of house building, although obviously it's not, I'm not directly responsible for it, but just to sort of, I suppose, reiterate the government's stance. Government is committed to building the homes the country needs while ensuring they are resilient and safe from flooding. Recently, they concluded a consultation on the new National Planning Policy Framework. The updated policy clarified how key flood risk tests should be applied and strengthens policies relating to coastal risk. Policy remains clear that inappropriate development in areas at risk of flooding should be avoided by directing development away from areas of highest risk, where development is necessary in areas at risk of flooding.

Permission should only be granted if it can be demonstrated that the development will be safe for its lifetime, without increasing flood risk elsewhere, and additionally, the NPF now requires sustainable drainage systems in new development designed to the national standards. I'm pleased she also mentioned property flood resilience, which is another one of my favourite things. We've got a new flood ready report which was published in October last year. 22 recommendations, 50 supporting actions across six themes, which is looking at how we can move this forward and keep meeting regularly with the leadership group to see where we can sort of make this something that's considered more of a normal part of, of something people every day.

The chair now sits on the flood resilience groups, which is really positive as well. I will, if it's OK. Madam Deputy Speaker conclude. So to conclude, this government is committed to strengthening resilience to flooding. This not only keeps people safe, but supports economic growth in our rural and local communities across the country by protecting businesses, reducing disruption and safeguarding jobs. These measures contribute to the stability and growth in the face of increased climate change and flood risk. The government's record investment in flood defences will benefit communities across the country, and our reforms to the flood funding rules will ensure more balanced system that strengthens rural resilience and delivers benefits for farming communities and the environment alike.

It is a personal priority and a privilege to be the Minister responsible for flooding, and I remain determined to ensure that our approach to flood risk is effective and coordinated to support the public we all serve. Thank you.

**** Possible New Speaker ****

Thank you Minister. The question is that this House do now adjourn as many as are of that opinion say
This debate has concluded
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