Spring Forecast Statement

Lord Pitt-Watson Excerpts

Tuesday 17th March 2026 Lords Chamber

[Lord Pitt-Watson (Lab)]

My Lords, as many noble Lords have pointed out, we have been living in uncertain times, made considerably more uncertain in the last three weeks by the Iran war. Against that, the Spring Statement is creditable. Growth is returning, and that is the Government’s central mission. Inflation and borrowing are predicted to go down. Lots of that is through government action: beginning to balance the books, trade deals, industrial policy, planning reform, creating new sources of finance, training, sensible investment and direct investment. If I may be a bit cheeky, it has also led to a huge investment in the North Sea in offshore wind.

However, growth is not in the Government’s gift. It is not generated principally by Governments but by people, and particularly by businesses. That is what the noble Lord, Lord Bilimoria, and the noble Baroness, Lady Neville-Rolfe, were drawing our attention to. It was also the point my noble friend Lord Barber made in talking about what is happening in Devon and what Luísa Diogo was saying about releasing the music in people in Mozambique. For that reason, I will address my remarks to the role of business.

Some of the measures that the Government have taken have been tough on business. One in particular is national insurance. But I have not heard of any businessperson who says they do not want the Government to balance the books. Similarly, we need good working conditions for people. The wealth comes from them. It is hard if you are a businessperson and your competitor can undercut you by abusing zero-hours contracts, but it is tough if you are an employer and you have to pay for that. So, we should take off our hats to the businesses that are bearing this burden and that underpin our national prosperity. It is in partnership with them that growth will be delivered.

How does business feel? I was pretty encouraged by a recent interview with Andy Haldane. He is the former chief economist at the Bank of England and, I say to the noble Lord, Lord Bilimoria, the new president—taking over from the noble Baroness, Lady Lane-Fox—of the British Chambers of Commerce, which is part of the International Chamber of Commerce. In its survey, 46% of businesses said they expected to grow this year, up from 35% last year. He said that businesses have

“a pipeline of very investable projects”.

I talked to Andy about this a couple of weeks ago. Of course, Iran was a big concern to him, but he was keen that business should get on with it. He said that, given the economic challenges we face, this is a time for business to step up and lead, not lobby, demonstrating by deed what is needed to fire business dynamism, without which there will be no growth. I was delighted by that, because he is right: without business dynamism, there can be no growth.

As some noble Lords know, my own background is in finance. It is a topic that is debated greatly in the House. I have sat in debates, since my introduction a couple of months ago, on the report of the Financial Services Regulation Committee on how financial services regulators should encourage growth. This week, we are debating the pensions Bill, including provisions on how to get the UK pension funds to invest more domestically.

Here is some good news. I was talking to the chief executive of the ICGN—the International Corporate Governance Network—Jen Sisson. The ICGN, of which I am a former director, represents those responsible for the stewardship of shares and other securities: over £50 trillion of them. That is most of the world’s large institutional investors. It pointed out that international investors overweight the United Kingdom because of its accountable, honest and open capital markets, and its history of stable, code-based corporate governance. These long-term investors are keen for the UK to be proud of its position and to think about how they, the international stewardship community representing those big investments, could help our country engage business to grow and grow profitably.

The new group, the Governance for Growth Investor Campaign—with £200 billion of British pension funds, 40% of which is already invested domestically—is also eager to push for growth. I talked to its chair, Caroline Escott. She said, “Of course, we invest significantly in Britain and want to continue to do so. It is good for our returns and it is also good for the beneficiaries of our funds”. Again, the campaign is keen to work with the Government to see how best it can co-ordinate what is a mission for the nation.

I started by noting that growth was the central mission of the Government. I finish by advocating that, if growth is to be delivered, it needs to be a partnership and a national mission, particularly a mission for business. It needs to sing. The more uncertain the times, the more important that partnership is going to be. The Government already have a strong outreach to the business community. This is something they cannot do enough of. I am sure that I speak for many Members of the House, maybe not just those in my own party, when I say that, if we can help in the delivery of the growth mission, we will be more than happy to do so.