Taxes

Lord Clarke of Nottingham Excerpts

Tuesday 15th July 2025 Lords Chamber

[Lord Livermore (Lab)]

I am grateful to my noble friend for his question. A council tax cap of 5% was introduced by the previous Government. Councils do not have to increase council tax by 5%, but under the rules they cannot increase it by more than 5% without a local referendum. That remains the position.

[Lord Clarke of Nottingham (Con)]

My Lords, when the Treasury team are preparing the Budget, will they have a look at the precedent of Sir Geoffrey Howe’s Budget of 1981, which was delivered in very similar economic circumstances to those of today? It was the most unpopular Budget of my political lifetime but also one of the most successful, because it paved the way for recovery with growth, lower inflation and rising living standards. Does the Minister think that the present Chancellor has the courage to concentrate on the public interest and the medium-term health of the economy, or will there be an obsession with rather reckless promises in the manifesto or short-term reactions in the newspapers and opinion polls?

[Lord Livermore (Lab)]

I am grateful to the noble Lord for his question and for his expertise. That Budget created the deepest recession in British history, so I do not know that we necessarily want to follow it in its entirety.