Taxes

Alec Shelbrooke Excerpts

Tuesday 15th July 2025 Commons Chamber

[Sir Mel Stride]

I am not sure that I fully understood the point, but the hon. Gentleman seems at least to accept that there is a real black hole when it comes to this Government, of at least £6 billion.

[Sir Alec Shelbrooke (Wetherby and Easingwold) (Con)]

Does my right hon. Friend find it extraordinary that when the Government came into office they made a big play of putting the OBR on a pedestal, but because they did not like the news, they now want to dismiss it and water it down?

[Sir Mel Stride]

Well yes, exactly. The Government will look to any floating branch or whatever to cling on to, to try to look a little better than they truly are.

We have seen a Government who have indulged in spending like it was the 1970s. The result of that has been to push up inflation, which has led to interest rates being higher for longer than they otherwise would have been. It is all very well for Labour Members to trumpet the fact that there have been four interest rate cuts since they came into office. The reality is that if they had not lost control of inflation, there would have been more and they would have come more quickly. The headroom that the Chancellor has against her fiscal targets is wafer-thin. This is the usual Labour way: spending and spending and spending until it runs out of other people’s money.

--- Later in debate ---

[Sir Alec Shelbrooke (Wetherby and Easingwold) (Con)]

The motion is simply asking the Government to commit to what they put in their manifesto. It seems that we are hearing every sort of speech other than speeches that address that point.

Let us first take the national insurance rise. It is extraordinary to ask us to believe that businesses in Labour Members’ constituencies are delighted that their taxes have gone up because that will help public services. I am sure that they are all keen to see their taxes go up again to satisfy the new 30% pay rise that resident doctors want. We were told that that would not happen, and that that was why the Government had to put up taxes the last time. A bit of reality has to come to this conversation, given that local businesses are either cutting people’s hours, on a recruitment freeze, making redundancies or going into liquidation.

Let us think about companies that go into liquidation. After 30 years of trading, a company in my constituency went into liquidation last month, simply because it could no longer cope with the NI rise. That was the straw that broke the camel’s back. Twelve people were made redundant immediately, meaning there would be no more taxes—no more income tax or purchasing tax—from that business, and on top of that, benefits would have to be paid.

We are on a downward spiral of tax and spend in this country. Indeed, it is quite incredible to listen to the speeches from Labour Members. It is as if nobody has left the country, no money has been withdrawn from the City, and no person has taken their assets elsewhere. Those are literally the headlines on the economy, day after day, in the Financial Times and other newspapers, yet we get a lot of harking back to the past, rather than recognition that Labour has been in power for more than a year.

[Joy Morrissey]

My right hon. Friend makes an excellent point about growth and wealth creators being taxed out of this country. They are simply taking their money and leaving, as the Labour party continues to tax them.

[Sir Alec Shelbrooke]

My hon. Friend sums things up perfectly. What terrifies me is that the Government do not seem to be taking any notice of that. When they talk about bringing in more taxes, such as a wealth tax, Labour Members all cheer. When my right hon. Friend the shadow Chancellor—I think it was him—said that Labour Members do not care, and would like to see more people who have wealth go, someone on the Government Benches shouted “Good!” It is absolutely incredible to say that the people who generate the wealth in this country are the enemy.

Let us just think about my constituency of Wetherby and Easingwold, which does exactly what it says on the tin: Wetherby and Easingwold are the two main market towns in the constituency. Market towns are part of the big ecosystem of the economy that is linked around farming, and the farming tax has created a huge problem in the farming community. People are scared to invest in capital equipment. That is the first thing. “How are we going to pay these bills? Is it even worth passing the farms on? So let’s pause our investment.”

That ecosystem in my constituency is not just about the farmers and what gets sold at the farmers’ market. It is about the businesses that service farm equipment. It is about the businesses that supply mechanical support. It is about the businesses that are involved in every aspect of the supply chain around farming in my constituency, and the worry and concern that is being felt throughout the communities means that they do not spend any money. That means that the Government are now losing out on VAT and on other taxes. So, what is their answer? Let us bring in a wealth tax; let us tax more—it is quite frankly frightening. In terms of taxation, I am terrified of where this country is heading.

[Iqbal Mohamed (Dewsbury and Batley) (Ind)]

The right hon. Member is making an important speech. Some 80% of millionaires in our country want to pay more tax. They want to contribute to our society and to our public services, so does he agree that when people want to pay more tax, they should be given the opportunity to do so?

[Sir Alec Shelbrooke]

I am sure it has just slipped the hon. Gentleman’s mind that people have the ability to do that. Famously, when Stanley Baldwin was the Financial Secretary to the Treasury, he gave a third of his wealth to the country to try to help with the national deficit. He did it behind the scenes and just signed it “FST”. He did not actually declare that it was from him. People can pay more tax if they wish. What they cannot do is sit in an unfair position where they can see that we do not have the most competitive taxes in the world; otherwise, they would stay here. It is blatantly obvious what is happening. If I were to throw a party at my house and I locked everybody in and halfway through the party they were trying to tunnel under the fence or get out in a hot air balloon, I would not say, “Well, that’s going really well. Let’s lock some more doors.” This is an overall assault on the lifeblood of the economy of this country. All this motion does today is ask whether the Government will be sticking to their manifesto promises.

When the Chancellor came to the Dispatch Box last July, about a year ago, she kept talking about the OBR. She talked up the OBR, saying we could never again have a situation like under the Tories where they ignored the OBR. She announced £22 billion-worth of taxes for the alleged black hole. The OBR immediately came out and said, “That’s not true, it doesn’t exist.” At best, it was £9 billion, and most of that had been caused by giving pay rises to the public sector because, allegedly, that would solve the problem. We on these Benches warned that, without reform, the public sector would come back. And boy, have they come back!

If the Government wanted to be believed that there was a £22 billion hole, one, why did they raise taxes by £44 billion; two, why did they then do another £30 billion-worth of borrowing; and three, how come we now have a £30 billion hole? That is a £100 billion hole in the economy that has been created since 12 months ago. How can anybody say that the Government have taken responsibility for the economy and are building it up? Somebody on the Labour Benches said that we were trying to rewrite history, but they are trying to rewrite the last two weeks! Labour is the only party I have known to come to the House trying to cut welfare and increased the bill! Where is the money coming from?

What do we hear? We hear that we must get rid of the triple lock, because it is now going to cost £15 billion instead of £5 billion. How about we stop people self-declaring just to have time off work and get on universal credit, which is costing £40 billion, and we do not hit people who are on fixed incomes who do not have the ability to do other things? A great number of the retired people in this country are carrying the burden of supporting their families in work, looking after their grandchildren, and doing those things unpaid. We should be grateful to pensioners in this country and not be saying, “You’re the ones whose income we’ve got to cut” because the Government are letting welfare run out of control.

This does not stop at what the Government have done to businesses in my constituency or to the ecosystem that relies on a rural economy, and it does not stop at them wanting to put solar panels all over credible farming land, pushing those businesses out even further, because they have brought in VAT on schools, and they have done it through pure ideology and envy. My constituents are not rich people. They have cars that are 15 or 20 years old. They do not go on holidays. They have been putting money in to give their children the best education, and they are now having to withdraw their children from those schools.

[Joy Morrissey]

The Labour party has decided to tax hard-working families on their choice of education. It means that people can no longer send their child to a SEND special school. It means they no longer have the choice to use their money, because the Labour party wanted to take a little more tax from them. Does my right hon. Friend agree that it is not a fair process and it is actually excluding people who want to protect their children for the future?

[Sir Alec Shelbrooke]

My hon. Friend makes a very powerful point. I am just wrapping up, but I will tell you this, Mr Deputy Speaker: I am a comprehensive schoolboy, and I am not going to take any lessons off the private schoolboy on the Front Bench who tells me that it is unfair that we are not taxing people who are trying to do the best for their children—talk about pull up the ladder, I’m all right, Jack.

Overall, the economy is being destroyed under this Government. We will have a political kickabout this afternoon, but I am terrified of where we are going. The 1970s is back good and proper—public sector strikes, ridiculous pay demands constantly bringing the Government down, 240% debt to GDP ratio predicted on this path, more and more taxes to come, and more and more wealthy people leaving. We saw what happened by 1977 when we went off to the IMF. The situation was so bad that the IMF said no! We are on that path, and it terrifies me.

[Several hon. Members rose—]