Graham Stuart
Main Page: Graham Stuart (Conservative - Beverley and Holderness)Department Debates - View all Graham Stuart's debates with the HM Treasury
(2 days ago)
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Sir Mel Stride
I think what the hon. Gentleman said was a gross impertinence, Madam Deputy Speaker. He also referred to you as an absolute “shower”, which is totally unreasonable. I have always been a great admirer of yours, as you know, and always will be. [Hon. Members: “ Name him!”] Name the hon. Gentleman—quite.
We have a Government who are grossly incompetent. As soon as they came into office, what did they do? They talked down the economy. It is no surprise that the British Chambers of Commerce is now saying that the No.1 concern of its members is high taxes, or that the latest survey by the Institute of Chartered Accountants in England and Wales once again shows that business confidence is down—and that is for the fourth survey in a row.
Graham Stuart (Beverley and Holderness) (Con)
Amid the shadow Chancellor’s quite correct exposition on the subject of where the Government have gone wrong, does he not have a little pity for the Ministers on the Government Front Bench? After last week, it is quite clear that they are no longer responsible for the running of the Government, as that has been handed to the hard left who have no interest whatsoever in balancing the books, and do not care about rising debt, rising gilt costs and the other irresponsible outcomes of this Government, who are now absolutely out of control.
The Chief Secretary to the Treasury (Darren Jones)
I congratulate the shadow Chancellor on another theatrical performance—one that I know we all enjoyed across the House. I remember fondly his previous attempts to weave the story of “Alice in Wonderland” into his contributions. The only conclusion I can draw today is that he has not found his way out of the rabbit hole just yet.
The shadow Chancellor made a number of points where he seemed to rewrite history. It was all the fault of Russia invading Ukraine, with not one mention of Liz Truss—“Who’s that? We’ve never heard of her.” When asked why, if everything was so hunky-dory under the Conservatives, they suffered such an historic loss, the answer was, “Oh, I don’t know.” There was no answer to the question. We had hope when he said, “I will tell the House what I would do differently.” I sat and listened carefully, and the grand reveal: “I would focus on productivity.” Well, I think the Conservatives said that before, and how did that go? Not one policy, suggestion or apology for their record—not one thing.
In contrast, this Government were elected with an historic landslide and on a mandate of change. [Interruption.] Conservative Members question our historic landslide, but they should look at the number of seats we have on our side of the House, and how many they have on theirs. I encourage them to remember that the aim of the game is to get Members in this House. It was an historic landslide for the Labour party at the last election, elected on the promise of change—to put pounds in the pockets of working people and to deliver for the renewal of Britain.
At the Budget last year we fixed the foundations, stabilising the public finances and putting Britain back on the road to growth, after 14 years of Conservative waste and decline. [Interruption.] I know that the Conservatives do not want to hear it, but every time one of them gets up to speak—we have heard it already—it is as if they have forgotten about the £22 billion black hole they left in the public finances. Rather than act to fix it, they called an election, ran away and left it for us to clear up their mess. This Labour Government will never repeat the mistakes of the Conservative party.
Graham Stuart
The Chief Secretary said the name of the game is to get the maximum number of seats. I gently suggest to him that that is not the name of the game; the name of the game is to serve the British people and honour the promises we make to them. [Interruption.] He thinks that is amusing. If he wants to know where his vast majority came from, it came with a series of promises that, one by one, he is breaking.
Darren Jones
I roll my eyes because, evidently, all my hon. Friends put themselves forward and stood to serve the country. As my right hon. Friend the Prime Minister has made very clear, he changed the Labour party to make sure that we put the country first. The right hon. Gentleman makes the case that the name of the game is not to get Members elected to this House; if that is the case, he obviously played the game very well, because the Conservatives failed to do that miserably.
At the Budget, we took the decisions necessary to stabilise the public finances and give our public services a vital injection of cash to start to turn around the years of decline that members of the public across the country know: NHS waiting lists growing, schools crumbling, the prisons crisis, and project after project being cancelled or delayed. That investment was underpinned by changes to the tax system to make it fairer and more sustainable, while protecting working people against higher taxes in their payslips.
John Grady
I am very happy to reflect that the covid pandemic happened, but I also reflect that Liz Truss and Kwasi Kwarteng’s mismanagement happened. The Conservatives lost the last election because they made a mess of the economy. They have lost their reputation for economic competence, which is why they have lost so many MPs and suffered an extinction event. I read in today’s Times that it was thought that the common crane had been extinct for more than 500 years in Scotland, but it is now reported that there are six or seven nesting pairs in Scotland—more than we have Conservative MPs, and there may be a reason for that.
The Opposition motion implies a reversal of more than £20 billion in taxes. The Opposition need to explain how they would fund that. What cuts would they make, and what effect would that have on the businesses they claim to support? They need to explain whether they would reverse the investment in the NHS, which is essential to businesses. Many businesses have said to me that they want to see investment in the NHS in order to get the waiting lists down and reform the service. That is exactly what my right hon. Friend the Secretary of State for Health is doing. The disruption caused to businesses by NHS waiting lists is significant, but they are now coming down—if only the same could be said for Scotland.
The Opposition must explain whether they would reverse the investment in education, because businesses say to me every week that they want to see investment in skills. They need skilled workers to grow their businesses. It is essential for economic growth.
Graham Stuart (Beverley and Holderness) (Con)
As a Scottish MP, does the hon. Gentleman wish to differ slightly with those on his Front Bench, who have said there should be no new licences for North sea oil and gas? That policy does not mean that we will consume a drop less oil and gas; it simply means that we will import it from abroad with higher emissions and with tens of billions of pounds of tax and tens of thousands of jobs lost. Surely, as a Scottish MP, he should speak up for his constituents and say to those on the Front Bench, “Come on—let’s get those licences going again.”
John Grady
All I will say, Madam Deputy Speaker, is the plain fact is that North sea oil and gas will be produced for many years to come, and the Government support that. The Government are also supporting investment in the industries of the future, such as offshore renewables. Under the Conservative Government, there was a contracts for difference auction with no successful bids, setting back our access to fixed-price, cheap electricity. That is the Tory economic policy on energy: turning up their noses at cheap, fixed-price energy. It is little wonder we are in such a mess.
Dave Doogan (Angus and Perthshire Glens) (SNP)
The first line of the Tories’ motion gets to the word “manifesto”, and I accept their premise that that is what this is about—it is about the commitment
“not to increase taxes on working people, and not to increase National Insurance or the basic, higher or additional rates of Income Tax”.
I do not think that is a tall order. The next item on the list, however, is VAT. Never mind the headline rate, the concern now, from comments inside the Government, is about what will be dragged into VAT or have its reduced rate increased. There is no clarity on that from the Government, much less any reference to it in their manifesto from which Parliament, and taxpayers across these islands, can take any comfort or otherwise.
The motion
“calls on the Government to reaffirm the statement made by the Chancellor of the Exchequer…that…personal tax thresholds will be uprated”
in the manner that they said. That is a fair point. Fiscal drag is an iniquitous thing to inflict on people. It eats into pay rises and erodes people’s incentives to get on and progress, and there is a real concern, given the fiscal misadventure—it seems to be one farce after another with this Government, and one U-turn after another. They talk about introducing stability into the fiscal dynamic. Well I am holding my breath waiting for that to happen, but I think I am making a mistake in that pursuit.
Worst of all—well, it is not worst of all, but it is really bad—are the changes to agricultural property relief, which were also not in the Government’s manifesto, and I sincerely urge the Minister to pause and review those changes. As others have articulated, that measure was clearly something that Treasury officials put in front of every new Chancellor, and every new Chancellor to date has had the wit to say, “Well, I’m not doing that,”—expect for this Chancellor, who is lacking in wit and much else to recommend her. She said, “Ooh, I’ll just go ahead and do that,” completely failing to understand the agricultural economy as it exists in these islands.
My constituency of Angus and Perthshire Glens is the garden of Scotland and the highest productive agricultural land in Scotland. An ecosystem exists around that farm enterprise, of recruitment, training, plant sales, feed stock, markets, fuel sales—it all exists, and it revolves like satellites around the farm business. Those farmers are now saying, “Why would I invest? What on earth would I invest for? Why am I investing my hard-earned capital into increasing technology and lowering the cost of production, so that I can get more competitive food on to the shelves of supermarkets and help with the cost of living, which this Government are incapable of doing anything about, meaning that my asset values go up, and so that when I die and my assets transfer, my tax bill goes up?”
Graham Stuart
The hon. Gentleman is giving a powerful speech on this subject. I was at the Great Yorkshire Show last week, and there we had not only livestock and farmers, but the whole supply chain around that. The only conversation there was exactly as the hon. Gentleman describes, of a whole industry brought low because of this misconceived measure. He talked about Chancellors being presented with things. The caravan tax was presented to the Chancellor in 2012, and it took Government Back Benchers to persuade those on the Front Bench to change path. I hope Labour Members might do the same with the farm tax.
Dave Doogan
That is a welcome and comprehensive round-up of some of the broader issues on this, but it speaks to the fiscal innumeracy that says, “There is no cost to any of this; we can just help ourselves to that and it won’t have any impact.” As the right hon. Member for Wetherby and Easingwold (Sir Alec Shelbrooke) pointed out, if we speak to any rural plant sales or dealership, and they will say that sales have gone off a cliff, along with the VAT, employment, income tax, and national insurance that went with them. That speaks to a Treasury and a Chancellor who have a passing understanding of the price of everything but could not identify value in a line-up.
The motion goes on to talk about pensions. This is difficult, because I do not believe for one minute that we should pull pensioners whose income is only the state pension into tax. Neither do I believe that by dint of being a pensioner someone should get tax relief on the same income that somebody who earns that income will not get tax relief on. The Government are in a difficult position on this, and that is of their own making. Unless and until they guarantee to uprate the rates and protect pensioners from fiscal drag, there is little point in making a great big song and dance about the triple lock, if what that does is pull pensioners into taxation.
Where I diverge from the movers of the motion—
Dave Doogan
Yes, it had to come, and I am relieved that there is a cleavage. Where I diverge with them is on a wealth tax. I see that we are in a state—the UK is not a country—where poverty levels among our children are rising in every country in the UK except Scotland. In Scotland, it costs us £150 million a year—it will be £200 million by the end of the decade—to mitigate Westminster’s mismanagement of child poverty.
We cannot say that it is somehow punitive for people with assets of more than £10 million to attract an annual, modest rate on those assets. That is reflective of the highest tax burden that ordinary people have paid since the second world war—incidentally, I say to Conservative colleagues that that was the case before the election. The Labour party has just knocked that into the stratosphere with its misadventure.
There has been no talk anywhere in this Chamber today about Brexit. I remember the Prime Minister—what was she called? Theresa May. She was asked repeatedly, “What does Brexit mean?” She said, “Brexit means Brexit,” which is as nebulous as it sounds. In 2025, we now know what Brexit means. It means enduring child poverty and flatlining growth, no matter who is in charge of the Treasury in the United Kingdom. It means a common purpose between Labour and the Conservatives to have a neurotic policy on immigration. It means pale imitations to substitute for EU programmes, such as substituting Erasmus with the pointless Turing scheme, or EU structural funding and other funding with “levelling up.” It means a permanent drag on business.
The further we get from covid, the more we see that the fundamentals that are wrong with this economy are due to Brexit. The Minister, in his summing up, will doubtless say—
Bradley Thomas
The Government have not seen a success. Where we have seen tariffs imposed on the economy, the Government have not reduced them. There is a competitive disadvantage as a result of what we are seeing in the global economic climate. When Labour governs, Britain suffers.
Graham Stuart
On the trade deals, it turned out that the deal with the US entirely excluded the British bioethanol industry, until the President of the United States phoned up the Prime Minister and he unilaterally gave away the entirety of the market, putting at risk hundreds of jobs at Vivergo and thousands of jobs in the supply chain and at Ensus.
Bradley Thomas
I thank my right hon. Friend—that is another failure by Labour.
Dr Sandher
The global financial crisis affected every single nation across the world. I do not deny, by the way, how difficult things were in 2010, but we also left the Conservatives an economy that was growing, record low waiting lists, and investment in our nation and a plan to insulate our homes. Because they did not follow through on our plans, we had the worst insulated homes in western Europe, and some of the highest energy bills to go with that. Yes, we left in a difficult moment, but we left the Conservatives with a strong foundation for going forward.
The Conservatives left us poorer, sicker and slower, thanks to their their record on tax. In the worst cost of living crisis in a century, they attempted to cut taxes for the wealthiest. Everybody on the Labour Benches thought Truss was mad; I really do not know what Opposition Members believe anymore.
Graham Stuart
I am sure the hon. Gentleman would not want to mislead the House, so he will recognise that in 2010, fewer than 12% of homes in this country were properly insulated with an energy performance certificate rated C or above; when we handed over power last year, that figure was over 60%. He can look up those numbers, and I ask him to never misrepresent that record in this House, because that is the reality.
Dr Sandher
We saw it in the insulation build-out; David Cameron, as he put it, cut the green crap. Insulation rates were rising when we left office, but they were cut throughout the 2010s; as a nation, we have not had that insulation. That is why we brought in the warm homes plan and are funding it with £13 billion. Millions more homes will be insulated under this Government, bringing down energy bills by hundreds of pounds. Those plans for insulation are funded by the tax rises that the Conservatives oppose. Time and again, we ask them what they would like less investment in, and time and again, no answer is given.
We on the Government Benches are trying to build a country according to our values—a country where each of us is doing well, is doing better, is better educated, is healthier and finds it easier to get around. Those are the building blocks of our nation’s wealth. To build that wealth takes investment, which must be funded, and those who benefit most from our nation’s productivity should be asked to contribute more. That is exactly what this Government are ensuring.
Graham Stuart (Beverley and Holderness) (Con)
It is a pleasure to take part in this debate. It is worth reminding the House of the situation in July last year: we had the fastest growth in the G7; employment was 4 million higher than in 2010, with up to 33 million people in employment; inflation was on target, at around 2%; and the UK, between 2010 and 2024, had grown faster than Germany, France, Japan and Italy. That was the legacy of Conservative stewardship.
I have asked Labour Members to give a more rounded picture, but sadly they almost always refuse to do so. Debt to GDP had gone up significantly, partly because of the massive deficit that we inherited in 2010, at more than 10% of GDP—that was phenomenal and had to be brought down over time—and partly because of covid and Ukraine, when we intervened to pay half of everyone’s energy bills. That is a more rounded picture. Overall, we managed to come out with people helped through covid and through the energy crisis, and with remarkably high levels of employment. Yet just a year later, under this Chancellor’s watch, that strong foundation has crumbled.
The Labour party needed to recognise that the economy was recovering and to let it grow. Instead, by coming in and being held by the manifesto commitments not to put up the main taxes on the one hand, and on the other, thinking that they were being clever and somehow keeping to their pledges by imposing national insurance rises on business but not individuals, that had the most bizarre and perverse effect.
The £25 billion hit on the economy created by the jobs tax comes down to about £16 billion after behaviour change, according to the OBR. Then, after compensation for the public sector, it comes down to about £11 million. Then, people have had to scrabble around for hospices, GPs and so on, which means the net is probably about £10 million, and that is before the depressing impact on the overall economy, meaning it almost certainly comes to single-figure billions. But guess what the OBR also says: from next year, 76% of the impact of the £25 billion hit comes out of ordinary people’s wages. That is the situation.
The Government have imposed a tax of £19 billion on ordinary people’s earnings in order to generate less than £10 billion of tax revenue. That is utterly insane, and I ask Members on the Government Back Benches to have a look at that, follow it and come back. I would love to hear that those numbers are wrong, because I would love to hear that we are not doing something as suicidal, crazy and damaging as it appears to be.
I wish I could drink the Kool-Aid, like the hon. Member for Rugby (John Slinger). The funniest thing about him—a man for whom I have a great deal of respect and affection—is that, unlike some of his colleagues who spout this stuff, he gives every impression, which I believe, that he believes it himself. That is what is truly extraordinary.
John Slinger
I thank the right hon. Gentleman for allowing me to intervene. I am certainly not drinking Kool-Aid. I do believe what I say, and I believe it firmly. I respect the right hon. Gentleman as a colleague, even though he is from a different party, but there is no Kool-Aid for me.
Graham Stuart
I thank the hon. Gentleman for that.
The economy has contracted for two consecutive months, shrinking by 0.3% in April and 0.1% in May, in a textbook sign that we are in, or could be headed into, recession. Employment is down too, with Office for National Statistics data showing that payroll jobs have fallen by more than 100,000 in a single month, with around 274,000 fewer jobs compared with last year and unemployment climbing to 4.6%.
Following the excellent speech from my right hon. Friend the Member for Salisbury (John Glen), I would just say that we should look at the big picture. Again, I appeal to colleagues on the Labour Benches. There was a magnificent victory for Labour last year in the election, with 400-plus MPs elected, and it really is up to Labour Members to recognise just how scary a position we are in. We have debt to GDP at about 100% and we have a world in which the fastest growth is to be found in developing states, some of which are quite hostile to us and to our values.
The truth is that no rich, powerful country has a divine right to stay that way. Wealth does not just come down from the heavens. Even in the 14 years when we were in government, too often in this place we seemed to obsess only on how we would spend money. From the moment we got up in the morning to the time we went to bed at night, we would talk about how we would spend the money, but we have to generate it first. It does not matter whether our No. 1 concern is the alleviation of poverty, the defence of the nation, education or the health service—we have to have a strong economy.
That is why the Government were right. One of the reasons they got that majority may be because they said that their No. 1 mission was economic growth. Remember that? It does not come through in the speeches from Labour Members now. Their No. 1 mission was economic growth. We should be sweating in Select Committees, in all-party groups, on the Floor of this House and in Westminster Hall over how we deliver that economic growth, so that we are not going backwards but are actually growing the economy.
We also have to accept something that is going to be tough for Labour Members, most of whom have not had any private sector experience and who tend to believe that the rich are just there to take money off and wealth creators can be endlessly offered haircuts and will just put up with it and if they do not, it shows some moral flaw on their part. We have to accept that the art of government is to recognise the realities, to align the incentives of actors—in this case in the economy—with the public goods we want to see. After a year, there are so many flashing red lights and warning signs that the Government are not getting that right, so they need to be prepared to think again.
I was involved after that omnishambles Budget of 2012, when I was part of helping the then Chancellor see his route to a better path forward, and my experience tells me that Labour Members must recognise that the country is potentially in a really serious, parlous position. We have no divine right to be a wealthy, powerful nation. The next four years are important. I hope and expect that there will be a Conservative Government after that, but whatever happens, the next four years are important and I hope that Labour Members will start to give rather more nuanced and thoughtful speeches in order to influence the Front Bench.