Budget Resolutions

Gareth Thomas Excerpts

Monday 1st December 2025 Commons Chamber

[Gareth Thomas (Harrow West) (Lab/Co-op)]

I commend the skill and courage of my right hon. Friend the Chancellor, who has faced the most difficult inheritance of any post-war Chancellor since Hugh Dalton in 1945. I welcome the cost of living measures, the cut in energy bills and the increase in the minimum wage, and the lifting of the two-child cap is very welcome too. In addition, I commend the work that my hon. and learned Friend the Economic Secretary to the Treasury has begun on tackling financial exclusion.

My right hon. Friend the Chancellor has been particularly skilled at increasing capital funding, and I will campaign for more of it to be invested in Harrow, not least in council or co-operative housing. Indeed, the lack of new socially rented housing being built in Harrow by the Conservative-run council is a disgrace. Not one new council home that had not already been agreed has been built since the Conservatives took over control, making the housing crisis in my constituency much worse.

More capital investment in schools in Harrow West is certainly needed. After 14 years of Tory neglect, there are classrooms that cannot be used, windows that cannot be shut, roofs that need fixing and sports facilities that need modernisation. Crucially, more investment is needed in our NHS too. Notably, a new intensive care unit at Northwick Park hospital is needed to ease pressure on the A&E unit and improve the quality of care.

I welcome the explicit mention in the Budget of the role of co-operatives in our economy and the publication of the call for evidence on co-operative growth. Co-operatives and mutuals are rarely given the attention they merit, yet the opportunities for growth and, crucially, for the locally owned growth they generate are significant. I hope the Treasury will bring forward its own specific call for evidence on how credit unions, mutual insurers and building societies can expand to play their part in growing our economy.

The standout issue for co-operatives is their ability to issue capital instruments that do not lead to de-mutualisation. This has been done successfully in Australia, where 600 million Australian dollars has already been raised to grow mutuals, notably in the elderly care sector. There is serious interest from co-operatives here in using similar capital instruments to invest in social care. The movement is vital for tackling financial exclusion, and for delivering jobs and better opportunities in our country’s most deprived neighbourhoods.

The banking industry should partner with, and invest in the growth of, credit unions and community development finance institutions. Many British banks do so already in the US, where it is a requirement; they should do so in their own backyard too. The Government cannot double the size of the co-operative and mutual sector of our economy on their own. Businesses in the sector need to do that themselves, but greater interest, imagination and urgency from the Treasury—which, under the Conservative party, paid only passing attention—in tackling the finance, legislative and capacity challenges that the sector faces will be critical.

My right hon. Friend the Chancellor, in the run-up to the Budget, rightly drew attention to the impact of Brexit and the dismal trade and co-operation agreement negotiated by the Conservative party. The OBR continues to estimate that the impact of Brexit has been a 4% hit to our GDP, with sustained damage to our tax revenues, to jobs and to family finances. In short, it has been an unparalleled act of economic self-harm, with the TCA easily the worst trade deal ever negotiated. I welcome the steps that the Government are taking towards a sanitary and phytosanitary deal to lower food prices and reduce border delays, and a youth mobility scheme and energy co-operation make obvious sense too. These will benefit growth, but I believe that we should go further and use the 2026 UK-EU summit to agree on the ambition of a more profound reset. With imagination and sustained business encouragement, a better deal to lower trade barriers could be possible. 

The recent EU-Swiss deal is interesting for the greater flexibility the EU has now shown to a close and serious partner. As we rebuild our country’s relationship with our allies across the channel, it is surely time, within our red lines, to be bolder in our ambitions to strip away the red tape that the Conservatives love about trade with Europe, particularly for goods exports. The needless rules, the different standards and the extra unnecessary checks they introduced in the TCA are making it harder for British businesses to sell into the EU. Mutual recognition of qualifications and easing business mobility restrictions are worth exploring too.

[Ms Creasy]

My hon. Friend is making an incredibly powerful point about going further on our relationship with Europe. Does he recognise that the OBR says that Brexit, as negotiated by the previous Government, is one of the “structural challenges” facing our manufacturing industry, so perhaps again being part of the Pan-Euro-Mediterranean convention, for example, would be one way to help businesses with all the extra paperwork created by the rules of origin changes?

[Gareth Thomas]

I understand that the Department for Business and Trade, my former Department, is about to issue a call for evidence on exactly how to negotiate membership of that, and I very much look forward to its happening.

If we are to get faster and more significant growth, we have to take the axe to more of the red tape that Boris’s trade deal introduced, so I urge my right hon. Friends to continue to be bolder and more ambitious for a deeper and more profound EU reset agenda.

Lastly, I think we should consider in the coming months how to rebuild the fiscal space to fund the development assistance that gives us so much soft power. That assistance supports our security needs, and it is vital to the effectiveness of key parts of peacekeeping, global health and the empowerment of those whose prospects are being damaged by poverty, conflict and climate change. I look forward to supporting the Budget in the Division Lobby tomorrow.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Sir Gavin Williamson.