Budget Resolutions

Iqbal Mohamed Excerpts

Monday 1st December 2025 Commons Chamber

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

Does the hon. Lady agree that it is the linking of electricity prices and of renewable energy prices to gas that is creating these high energy prices, and that de-linking them would immediately cut prices for the consumer?

[Katie Lam]

That is not the immediate problem. The energy prices currently being baked in by the prices the Government are agreeing at the moment will see energy prices sky high for years and years regardless of what happens to the price of gas.

The Conservatives’ cheap energy plan will save households hundreds of pounds and offers a much-needed lifeline to British industry. I very much hope that the Secretary of State for Energy Security and Net Zero will adopt at least some of its measures.

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[Sam Carling (North West Cambridgeshire) (Lab)]

That is very generous, Madam Deputy Speaker. I am delighted to speak about a Budget that builds on what this Government started last year and takes the necessary decisions to grow the economy and protect working people. With a focus on reducing the cost of living, cutting NHS waiting lists and reducing the national debt, this is a Labour Budget with Labour values.

We have already taken measures to cut the cost of living. We have been improving our energy security, which will bring down energy bills permanently and protect us from the thrall of international markets. We have started rolling out free breakfast clubs in schools, so that parents can get to work on time and kids can start the day ready to learn. We have expanded free school meals and raised the minimum wage, bringing a pay rise to millions of workers.

I am delighted that we are moving forward with further measures. Energy bills are being brought down for households by an average of £150 from April. We are introducing measures to tackle child poverty, which will make this Government the biggest reducers of child poverty since records began. We are lifting over 450,000 children out of poverty and benefiting around 3,200 children in my constituency, according to analysis in the Daily Mirror.

As with last year’s Budget, we see a significant boost to pay for those on the lowest incomes. When the Conservatives, among other parties, decry that by saying that it will impact on inflation, they need to look at the numbers. The OBR forecast shows that Government policy, particularly the energy bills package and the fuel duty freeze, will reduce inflation by 0.4 percentage points in the next financial year. Gilt yields shot down on Wednesday as the Chancellor delivered the Budget. The markets have confidence in our handling of the economy. On Thursday, JPMorgan Chase announced that it will build a new centre at Canary Wharf that will provide 12,000 jobs and boost our economy by £10 billion. That is not the kind of decision that a major player with global reach makes if it does not trust the Government’s handling of the economy. It is a huge vote of trust and mark of confidence in what we are doing.

This is a hugely progressive Budget, as was last year’s. On average, households in the lowest income deciles will benefit most from the decisions taken by this Government from the 2024 Budget onwards. Indeed, by percentage of income, all but the richest 10% of households will benefit from overall policy decisions in 2028-29. When it comes to slashing the cost of living, this Government are backing up their words with real action, reversing the damage done by our predecessors. [Interruption.] Conservative Members are chuntering at me, but I think they need to remember that the last Parliament was pretty much the only one on record in which living standards fell.

People in Peterborough and North West Cambridgeshire are really going to feel the benefits locally. I am delighted that the Chancellor announced £20 million for the new Peterborough sports quarter during her speech. That includes funding for a new Peterborough pool, after the Conservatives closed our regional pool when they ran the council. [Interruption.] Again, I am being chuntered at. The Conservatives closed the pool we had when they ran the council. These are the measures of a Government who are making a difference. By comparison, under our predecessors, living standards were hammered, wage growth was stagnant, and millions more experienced food insecurity.

Labour built the NHS, and we have always been its best custodians. We have proved that in our time in office so far. We promised 2 million extra appointments in our first year, but thanks to massive investment from our first Budget, we hit that target seven months early, and have delivered 5.2 million extra appointments since July 2024. Waiting lists are falling for the first time in 15 years.

[Iqbal Mohamed]

I welcome the investment in the NHS and the reduction in waiting lists for everyone in our country, but does the hon. Member agree that over time, the money that is going to private companies to reduce the waiting lists should be redirected to the NHS, so that profits do not leave the NHS, and there is more money to treat patients?

[Sam Carling]

The hon. Member has made his point. As we heard from the Chancellor, all NHS efficiencies will be reinvested in its budget, and I welcome that. My constituents rarely raise with me the specific way in which their healthcare is being delivered. What they want to know is why they cannot get a GP appointment and why they cannot get to hospital on time. What we are doing will deliver changes.

We must also talk about our national debt. Reducing the debt is a necessary and moral issue. Of every £10 we spend, £1 is spent on Government debt interest. Imagine what we could achieve if we had that money available to invest in our local communities. I am therefore delighted that due to the measures that the Chancellor has announced, combined with the action we took last year, debt as a share of GDP will fall consistently. We will achieve a Budget surplus of £22 billion in 2029-30, which would be the largest surplus for over 20 years.

Let us not forget that the UK was the fastest-growing economy in the G7 for the first half of this year, and both the IMF and the OECD forecast that for 2025 as a whole the UK will have better growth than the eurozone, Canada, Japan, France, Italy and Germany. So while Reform and the Conservatives scream doom and gloom, the Government are quietly getting on with the job. The Budget builds on everything we achieved last year, and I know that we will see the cost of living slashed, debt reduced and NHS waiting lists brought down.

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[Harriet Cross (Gordon and Buchan) (Con)]

One of the most incoherent, damaging and destructive decisions that the Government took last week was not to scrap the energy profits levy. The levy will destroy our oil and gas sector, as the Government have been told by so many sources, including the industry itself, the renewables industry, the unions and Offshore Energies UK. The Government know exactly the impact that keeping the EPL will have on jobs, investment, our supply chain and our transition to cleaner renewable energies.

[Iqbal Mohamed]

Does the hon. Lady agree that the fossil fuel companies have put all their eggs in the basket of carbon-generating fossil fuels, and have not diversified over the past 30, 40 or 50 years? They have no other sources of income. Why should we pay the price for their profligacy?

[Harriet Cross]

No, I do not agree, because that is factually untrue. Investment in green technologies, including carbon capture, EV charging point roll-outs, wind and solar, is being driven by our oil and gas companies. They will stop investing in green technologies and our domestic supply if we tax them into the ground, and that is exactly what the EPL is doing.

The Labour Government have kept the EPL, which means that our oil and gas companies are being taxed at 78%, which is more than is faced by any other mature basin in the world. They also removed investment allowances, ensuring that our oil and gas companies are the most uncompetitive when they are trying to invest in the North sea. As a result, the companies and the skills that we need for the transition are moving abroad. Across the UK, we are losing tens of thousands of North sea jobs. That impacts every constituency. Do not think it is just north-east Scotland that is impacted; every single hon. Member in this House has oil and gas worker constituents—energy workers—who are losing their jobs today because of the Chancellor’s choice last week to keep the EPL. That impacts everybody.

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[Dr Ellie Chowns (North Herefordshire) (Green)]

With sky-high bills, unaffordable, cold and mouldy homes, and one in three children growing up in poverty, our country is in crisis. Life has become unaffordable for millions of people, and years of devastating cuts to our public services, from hospitals and schools to social care, mean that those who most need support are too often unable to access it. Every day I hear from my constituents in North Herefordshire, who are living through this crisis and crying out for change.

Instead of delivering change, this Government have repeatedly claimed that there is not enough money to go around. That simply is not true. Last year, billionaires saw their collective wealth increase by £35 million a day. Britain’s 50 richest families now hold more wealth than half the population combined. A wealth tax of 1% on assets over £10 million and 2% on assets over £1 billion could raise nearly £15 billion. If we also aligned rates of capital gains tax with income tax and introduced national insurance on investment income, so that wealth is taxed at the same rate as work, we could raise over £30 billion a year.

This Budget needed to mark a turning point and an end to the politics of the past 18 months—a politics that has, sadly, scapegoated refugees and migrants while failing to tackle the inequality and the real issues that drive people into hardship. Of course, I welcome the long overdue scrapping of the cruel and counterproductive two-child benefit cap. That should have been done on day one after the general election. Instead of delivering a transformational Budget that confronts the cost of living crisis and taxes extreme wealth fairly, this Labour Government have, sadly, chosen to paper over the cracks —to tinker, not transform.

For example, take the Chancellor’s decision to remove policy costs from energy bills. Nearly 3 million households in England were fuel poor in 2024—that figure could be more, depending on how it is calculated. This is a huge problem, especially in the west midlands and especially in my North Herefordshire constituency, where fuel poverty is particularly high because of the nature of our housing and low wages. It is therefore essential that we do everything in our power to cut bills. But the decision to lower bills by cutting vital funding for home insulation by a quarter is not a real solution; it is robbing Peter to pay Paul. Home insulation is one of the most effective ways to bring down bills: upgrading the average UK home to a decent standard saves households £210 a year.

Analysis from the New Economics Foundation shows that, because of the Government’s decisions regarding the energy company obligation and the warm homes plan, the poorest households living in the coldest homes have now lost two thirds of the support they were due to receive for energy efficiency upgrades. When the UK has some of the worst-insulated homes in western Europe, we should be scaling home insulation up, not down, and using progressive taxation to pay for it. I am delighted that the Secretary of State for Energy Security and Net Zero is back in his place to hear me make these arguments.

[Iqbal Mohamed]

Will the hon. Lady give way?

[Dr Chowns]

I will not, because many Members want to get in.

Frankly, given that a typical energy bill in October 2025 was £478 a year higher than four years before, it is indefensible that this Budget does nothing to address the structural factors that keep costs high. In 2024, almost a quarter of the average energy bill went straight to the pre-tax profits of the major electricity generators, networks and household suppliers. If we are serious about tackling the cost of living crisis, we must stop private companies profiteering while ordinary people cannot afford life’s basics. Those basics should not be a luxury. We can have lower bills and more investment in affordable, warm homes, all while protecting our planet at the same time.

In ordinary times, a Budget that tinkers at the edges might be acceptable, but after the financial crash, a decade of Conservative and Lib Dem austerity, the pandemic and the fuel price crisis, the country is at breaking point. This Budget needed to go further and be bolder. That is what a Green Budget would do.

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

At a time when families in the four corners of our nation are struggling just to get through the week, the test for any Budget is simple: does it make life easier for ordinary working people? Does it put money in the pockets of low-income and middle-income earners? Does it strengthen our public services? Does it support those who are working hard, yet falling behind because of rising prices, high inflation and chronically stagnant wages?

The first thing I welcome is the lifting of the two-child benefit cap. I welcome the Chancellor finally bowing to pressure from campaigners, my independent alliance colleagues, and the seven Labour Back Benchers who defied the whip last year to vote for its abolition, but telling families that they must wait until 2026—nearly two years after Labour came into government—is not the Labour way. While children go hungry now, today and this winter, that is unconscionable.

For many winters, families have been choosing between heating and eating. Food banks remain at record high levels of usage, and warm banks are now a thing that we accept in our society. Every month, millions are one broken boiler or late pay check away from crisis. A modern economy cannot function when its people are too poor meaningfully to participate in it. That is why we need radical tax reform that prioritises a fairer tax system that funds our future.

One of the great myths of our political age is that there is not enough money to fix these problems. That is simply not true. Our tax system is full of holes wide enough for billionaires to sail yachts through; we must get a grip in this place.

[Ayoub Khan (Birmingham Perry Barr) (Ind)]

In my constituency, child poverty is at some 50%, so I certainly welcome the scrapping of the two-child benefit cap. Does the hon. Member agree that a wealth tax is the only way that we can resolve the underlying issue, which is the cost of living?

[Iqbal Mohamed]

I will come to that in the short time I have remaining.

It is not true that we do not have enough money to fix these problems. If the Chancellor was serious about rebuilding Britain, she would adopt straightforward, fairer tax reforms. As many Members across have said, we could raise tens of billions of pounds by closing loopholes that allow foreign multinationals to shift profits offshore and avoid paying UK corporation tax while onshoring expenses and taking advantage of subsidies and tax relief. We could implement the digital services tax that was originally promised, ensuring that big tech finally pays its fair share of its record profits. We could end the preferential treatment of income from wealth over income from work by taxing capital gains at closer parity with earnings. We could introduce a genuine windfall tax on excessive profits, particularly in energy, finance and banking, and reform tax reliefs that disproportionately benefit the wealthy, and instead redirect revenue to public services.

These are not radical ideas; they are basic principles of fiscal fairness. The Budget is a moral statement, and today’s Budget shows us a Government who still choose war over welfare, profits over people, and short-term headlines over long-term stability. To borrow a phrase, they are choosing the few over the many.

[Madam Deputy Speaker (Caroline Nokes)]

I call the shadow Secretary of State.

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[Mr Holden]

My right hon. Friend has made an extremely important point. These taxes are hitting across the board, and they are hitting the employment of his constituents. That is on top of the tax rises that we saw last year: the changes in business property relief, business rates and agricultural property relief, and the national insurance tax rises. It is hammering working families up and down the country, while the Government pretend that it is not.

How on earth can the Secretary of State claim that this Budget will keep inflation down? Every policy choice that the Government make fires costs straight back into the system. It is happening with policy after policy, as if some giant socialist Gatling gun were spraying costs on to businesses, passengers, taxpayers and, indeed, the entire country.

[Iqbal Mohamed]

Will the right hon. Gentleman give way?

[Mr Holden]

I am afraid that I have no time to give way further.

Do the Government not understand that every time they hike up taxes, the cost of food goes up? Do they not understand that an indiscriminate tax hike means that the cost to the producer rises, the cost of getting the food to the shops rises, and the cost to the supermarket selling the food rises? It is a conveyor belt of wholly avoidable costs.

That brings me to the core of my argument. What are this Government actually for? Disposable incomes have been revised down, along with growth, while taxes, inflation and business rates are all up. What else is up? The number of entrepreneurs leaving the country. We thought it would be capital flight—in fact, that is what the Treasury was briefing out: real worries about capital flight—but it is not just capital flight; it is entrepreneurial flight. It is labour fleeing the country as well. People are leaving. The only thing left is land, and the Government are taxing that as well.

My right hon. Friend the Member for Salisbury made a very good point in his speech. He said that he had never seen such speculation ahead of a Budget that had worried family businesses—family businesses in his constituency and in mine. I have never known a Budget to be talked about as much as this Budget was in advance of its production. It is quite incredible. The economy is being harmed just by the briefing put out by the Government. They were doing it on the Prime Minister’s own plane. It is unbelievable.

However, it is not just small businesses that are being affected. We hear today that Zipcar, which is important to a great many people in London, will be closing its operations from the end of the year. That will have a huge impact, and it is happening because of the taxes on the company and the congestion charge imposed by the Mayor of London.

My hon. Friend the Member for Isle of Wight East (Joe Robertson) made a good point earlier when he said that, once upon a time, Labour talked of being the party of a hand up, not a handout. Well, Labour is now, quite clearly, the party with its hand in the pocket of working Britain. The hon. Member for Leeds East (Richard Burgon), the hon. Member for Salford (Rebecca Long Bailey) and my hon. Friend the Member for Bridgwater (Sir Ashley Fox) all made the same point; they are not normally on the same page, but they were today. They pointed out that it would be working people paying the price for those extra tax rises, because of thresholds that are frozen year after year owing to decisions made by this Labour Government.

The Government are not on the side of motor manufacturing either. Real concerns have been expressed by that sector, as was pointed out by the hon. Member for Brentford and Isleworth (Ruth Cadbury), the hon. Member for Ellesmere Port and Bromborough (Justin Madders), and my hon. Friend the Member for Hinckley and Bosworth (Dr Evans). How on earth, as the hon. Member for South Antrim (Robin Swann) asked earlier, will a pay-per-mile scheme work when people are crossing the border? Is the Labour party really going to tax people for driving on foreign roads? We shall have to see.

The hon. Member for Buckingham and Bletchley (Callum Anderson) made a very sensible point when he said that fiscal prudence was a means to an end. It is a means to the end of getting debt interest down, and keeping borrowing rates for businesses and families down. That is exactly right, but we did not see it from this Government. They think that people will not notice, but the Chancellor determinedly obfuscated about the figures. She talked of a black hole imposed on her, but in truth, taxes on working people are rising to pay for more welfare.

The Government think that people will not notice that they are being bribed with their own money, taken from them via the tax on electric vehicles and energy. They think that small businesses will not notice business rates going up, or national insurance taxes going up. But people have noticed. They have noticed the broken promises on tax, on working people and on bills. They have noticed the smoke and mirrors. The Government are robbing Peter, but not to pay Paul; they are robbing Paul too. People were worried ahead of the Budget this year, and now they are worried about what the third Labour Budget next year will deliver, because they know that this failing Government will be coming back for more.