Spending Review 2025
Debate between Baroness Wheatcroft and Lord Livermore(3 days, 18 hours ago)
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Lord Livermore (Lab)
Yes. The noble Baroness says that we are not spending enough on the health service. Over the next five years, £30 billion will be invested in day-to-day spending, with over £5 billion specifically allocated to address the most critical issues. The noble Baroness likes to tell us how she does not believe in economic growth. If we do not have economic growth, how will we find the money to fund our public services? I sat through the national insurance Bill. The noble Baroness opposed it and the additional money that it brought into our National Health Service. She says that this is not enough money. How exactly is she going to find the money? She is mouthing “wealth taxes”. If she thinks a wealth tax is going to raise that many billion pounds, I would love to see her proposals.
Baroness Wheatcroft (CB)
My Lords, the capital investment contained in the spending review will be very welcome in many parts of the country. The problem will be making sure that it is money well spent. As those of us who were here in the morning heard, public bodies often are not the greatest at making sure they can build a door, let alone a motorway. How will the Government ensure that we get value for money on our projects? Just having an office called the “office for value for money” might not be enough. I was cheered that the Chancellor said the amount of money being spent on consultants had come down. Can the Minister put a figure on that and tell us what the budget for consultants over the next few years will be?
Lord Livermore (Lab)
I do not have the specific budget for consultants over the next few years to hand. I am more than happy to write to her with that figure if it is available. She is right that we have reduced the number of consultants. It ballooned under the previous Government, who like to talk about saving money but did not always walk the walk.
We are investing an additional £113 billion in capital spending, which is enabling so many of the projects that we are discussing today. It would not be possible if we had not rewritten the fiscal rules that we inherited from the previous Government, which guaranteed neither stability nor investment. We inherited such a poor public infrastructure situation from them as they repeatedly cut investment spending to patch up the holes in their day-to-day spending. The noble Baroness mentioned the change to the fiscal rules. Alongside the fiscal rules, we have set out very clear guard-rails to ensure that that money is spent wisely and carefully through public finance institutions. I am very confident that we have set out those guard-rails and will ensure that we get the value for money that she is describing.
Basel 3.1
Debate between Baroness Wheatcroft and Lord Livermore(2 months, 1 week ago)
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Baroness Wheatcroft (CB)
Could the Minister reassure the House that simply not wanting to pay any more tax would not be a reason for renegotiating?
Lord Livermore (Lab)
I am happy to give the House that assurance.
Closed-Ended Investment Companies: Cost Disclosure
Debate between Baroness Wheatcroft and Lord Livermore(2 months, 3 weeks ago)
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The Financial Secretary to the Treasury (Lord Livermore) (Lab)
My Lords, last year, the Government legislated to reform retail disclosure so that it is fairer and more proportionate. Recognising the concerns mentioned in the Question, the Government also took exceptional action to exempt investment companies from cost disclosure requirements to provide interim relief while the replacement regime is finalised. Operationalising this legislation is now a matter for industry and the regulator.
Baroness Wheatcroft (CB)
My Lords, I thank the Minister for that response, but despite the Government’s welcome SI, and FCA emergency guidance last November, some retail platforms continue to ban customers from investing in UK investment trusts that do not disclose their ongoing charging figures, even though those figures are misleading, as the Government accept. Will the Minister hold urgent talks with the FCA to insist that this barrier to investment be removed immediately?
Lord Livermore (Lab)
I am very grateful to the noble Baroness for the question. I also pay tribute to other noble Lords, including the noble Baronesses, Lady Altmann and Lady Bowles, for their continued championing of the investment trust sector and for bringing their concerns to the Government’s attention in their Private Members’ Bills in this Parliament and the previous one. As a result of their campaigning, the Government have now legislated to provide the Financial Conduct Authority with tailored powers to deliver a new disclosure regime. The Government have also temporarily exempted investment companies from cost disclosure legislation.
On the specific matter raised by the Question, of requirements by investment platforms for the investments they offer, that is now a matter for the industry and the regulator. While I recognise that the Government may not have gone as far as the noble Baroness would like, we have a shared objective of ensuring that that this reform achieves the right outcomes for investment companies and for the sector as a whole.
Growing the UK Economy
Debate between Baroness Wheatcroft and Lord Livermore(4 months, 1 week ago)
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Lord Livermore (Lab)
I am grateful to the noble Baroness for her question. I know that this is an area in which she is particularly expert—far more expert, I am sure, than I am. I will say a couple of things. First, I completely agree: it is often said to me that the UK is a very good place to start a business and a less good place to scale up a business. I think that has to be central to our thinking when it comes to economic growth and growing those small businesses. When it comes to entrepreneurs and those who we want to take greater risks in our economy, one of the most important things we can do is ensure economic stability, because the more stable the economy is, the more willing people are to take the risks that we want them to take. She asks about employment rights. All the evidence now suggests that, the more secure a workforce is, the more productive it is. We were talking about productivity before and, on secure rights for workers, workers who are more economically secure are going to be more productive workers in the economy.
Baroness Wheatcroft (CB)
My Lords, the Minister acknowledged the importance of resetting relations with the EU. I understand the importance of sticking to the golden rules his party has laid down about not rejoining the single market or the EU customs union, but does he acknowledge that it is really important to improve those trading relations as quickly as possible? Therefore, will the Government not just discuss but pursue wholeheartedly joining the pan-Euro-Mediterranean convention?
International Banking: Payments
Debate between Baroness Wheatcroft and Lord Livermore(6 months, 2 weeks ago)
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Lord Livermore (Lab)
The answer to the noble Lord’s first question, in terms of whether we consider them effective, is yes. In the case of Russia’s invasion of Ukraine, these measures have dramatically reduced Russia’s access to global financial markets and weakened its ability to finance its illegal invasion of Ukraine. Russia’s increasing reliance on North Korean and Iranian weapons highlights the impact these sanctions have had. We will pursue any necessary steps with our allies to maintain and reduce opportunities for the circumvention or evasion of international sanctions.
Baroness Wheatcroft (CB)
My Lords, does the Minister agree that a sensible use of the sanctions now might be to seize the money that has been taken and sanctioned from the Russian regime and give it to the Ukrainians now, while they can use it?
Lord Livermore (Lab)
That is very much the spirit that lies behind the Financial Assistance to Ukraine Bill, which will shortly be before your Lordships’ House. The Financial Assistance to Ukraine Bill provides spending authority for the UK to implement our commitment to the G7 Extraordinary Revenue Acceleration Loans to Ukraine scheme, a landmark agreement which provides a collective £50 billion to Ukraine.
United Kingdom Declining Birth Rate
Debate between Baroness Wheatcroft and Lord Livermore(7 months, 1 week ago)
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Lord Livermore (Lab)
To clarify, the OBR is very clear that, over the next five years, employment will grow by 1.2 million people.
Baroness Wheatcroft (CB)
The Joseph Rowntree Foundation calculates that 30% of children are living in poverty. Does the Minister have access to any information on what that might mean for long-term fertility prospects in this country?
Lord Livermore (Lab)
The noble Baroness makes a very important point, which is why reducing child poverty is central to this Government’s objectives. The previous Labour Government made massive strides towards reducing child poverty and, unfortunately, we had to sit and watch while it rose under the party opposite over 14 years. We have established the Child Poverty Taskforce to ensure it falls. It is a contributing factor, but so are affordable housing and affordable childcare, as I have said, and we are prioritising all those things.
Fiscal Rules
Debate between Baroness Wheatcroft and Lord Livermore(7 months, 2 weeks ago)
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Lord Livermore (Lab)
It may surprise the noble Lord but, yes, I absolutely agree with what he says. That will be a vital part of the guard-rails we set out in the Budget tomorrow.
Baroness Wheatcroft (CB)
My Lords, borrowing to invest in genuine projects that will improve the productivity of the country obviously makes sense, but if the Government are going to look at the fiscal rules again, will they consider when and how they will account for unfunded public sector pensions? At some stage, the country needs to know about those obligations too.
Lord Livermore (Lab)
I hear what the noble Baroness says. As I have said already, the Chancellor will set out the Government’s full fiscal plan, including the precise details of our fiscal rules, in tomorrow’s Budget.
Public Spending: Inheritance
Debate between Baroness Wheatcroft and Lord Livermore(10 months, 2 weeks ago)
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Lord Livermore (Lab)
I am extremely grateful to my noble friend for his kind words. He is quite right: not only are the previous Government guilty of what we are discussing today, of running up an enormous overspend and of hiding that from Parliament, the public and the Opposition at the time, but they left us with possibly the worst economic inheritance since the Second World War. That contrasts sharply with the performance of the economy under the last Labour Government. Of course, growth is absolutely our priority. That growth will take time, but we are absolutely committed to doing what it takes to return this economy to a sustainable level of growth.
Baroness Wheatcroft (CB)
My Lords, I welcome the Minister to his position on the Front Bench. As we listen to this tale of consistent overspend and budget failures being swept under the carpet, it is very hard to imagine that civil servants in several departments were not increasingly unhappy about what was going on, including a lack of a spending review since 2021—extraordinary really. Can the Minister assure those civil servants that they will not be guilty if they come forward and talk of any pressures that have been applied to them? The previous Government had form on that, and I think that there should be an amnesty for any civil servant who was put in a deeply uncomfortable position by, in effect, telling untruths to the country.
Lord Livermore (Lab)
I am grateful to the noble Baroness for her question. Of course, at the end of the day, civil servants advise and Ministers decide. We have full confidence in the Treasury and all civil servants in the way that they do their jobs. She is absolutely right that part of the problem was the continual delay to hold a spending review; the last spending review was in 2021. That sits behind so many of these problems: that budgets were never adjusted to account for any of the decisions that were taken subsequent to that spending review.
The Chancellor announced yesterday that she has commissioned the OBR to deliver a full economic and fiscal forecast, which will be presented alongside a Budget on 30 October. She also announced that the Government have launched a multi-year spending review to conclude in spring 2025, setting budgets for at least three years of the five-year forecast period. As part of this, final budgets for this year and next year will be set alongside the Budget on 30 October. The Government are also committed to holding a spending review every two years, which will set departmental expenditure limits for three years, to avoid uncertainty for departments and bring stability back to our public finances.
European Investment Bank
Debate between Baroness Wheatcroft and Lord Livermore(10 months, 3 weeks ago)
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Baroness Wheatcroft (CB)
If the Government are to set a good example about investing in the UK, should they not perhaps start at home and invest a little more of the MPs’ pension fund?
Lord Livermore (Lab)
I think that is a question for Parliament rather than the Government.