Budget Resolutions

Luke Akehurst Excerpts

Wednesday 26th November 2025 Commons Chamber

[Sir Oliver Dowden (Hertsmere) (Con)]

I refer Members to my entry in the Register of Members’ Financial Interests, including my position as chair of the United Arab Emirates all-party parliamentary group.

It did not have to be this way. The roots of this Budget and its failure are in the last one. It began with the unnecessary delay and scaremongering before that Budget, which frightened consumers and scared off businesses from investment. Then, when the Budget was announced, the Chancellor made three key errors. She chose to do probably the worst thing for jobs and growth: she put up national insurance contributions. She chose to drive human and financial capital away from the United Kingdom through the abolition of the non-dom tax status, and she chose a totally unrealistically low level of fiscal headroom. By the time the Chancellor sat down, markets were already preparing for the next round of tax rises, and the sense that there would be tax rises only grew with the U-turn on welfare reforms. The problem is that the Government are making exactly the same mistake all over again—and there was a litany of leaks, culminating, extraordinarily, in the OBR publishing the entire content of the Chancellor’s Budget before she even stood up, which rendered the entire speech meaningless.

This Budget makes a simple and clear choice: there will be higher welfare spending, paid for by higher taxes. For my constituents, that means higher income taxes, higher taxes on their savings, and higher taxes on their dividends. Further, in constituencies like mine, house prices have soared over the past 30-odd years to astronomical levels, and there is a real risk that older people in family homes that they bought for a very low price will have to scrimp and scrape to find several thousand pounds every year, just to stay in their family home, which they so love. That is a real problem that will emerge from this Budget, and I urge the Chancellor to look, at the very least, at ameliorating measures to stop older people having to sell their home to pay their council tax bills.

Behind this decision lies a strategic choice, and we all know exactly what has happened. The Labour leadership has watched in fear as its vote haemorrhages to the left, and this Budget is all about shoring up Labour’s tax base. The taxes of the residents of Bushey, Radlett, Potters Bar and Borehamwood are being hiked to pay for higher welfare costs, in order to appease Labour’s Back Benchers.

[Luke Akehurst (North Durham) (Lab)]

The right hon. Gentleman mentions taxpayers in his Hertsmere communities, which I have visited and know. Does he accept that among his constituents, there will be families who receive benefits and have more than two children, and who will be positively impacted by today’s Budget? Could he at least nod in the direction of those of his constituents who will benefit from the measures that the Chancellor has set out?

[Sir Oliver Dowden]

The problem with that analysis is that many people on the same street will think to themselves, “I chose not to have another child because I could not afford to have another, but my neighbour is now able to have more children, paid for by the taxman through welfare.” That is the fundamental unfairness at the heart of this Budget announcement.

Worse than that, this failure to grasp welfare reform risks neglecting a whole generation. Already, young workers’ prospects are under threat from artificial intelligence, and employment prospects are being hit by Labour’s jobs tax and labour market regulation, which is discouraging hiring. Now the message seems to emerge from the Government: “Don’t worry: abandon ambition. There is ever-higher welfare spending under Labour. That is the reason why you should vote for us.”

--- Later in debate ---

[Sammy Wilson (East Antrim) (DUP)]

May I, on behalf of the whole nation, thank the Chancellor for advance sight of her statement over the last few weeks? I do not know what she hoped to gain by that—she may have hoped to make it more palatable—but I am afraid that the leaks have not made it any more attractive today than when they came out of the Treasury and, in fact, we are seeing a repeat of last year.

In last year’s Budget, we were told that there was a black hole, that it was all down to the Tories and that we would have to have all the tax increases that we have had over the last year to fill it. Well, like some kind of fiscal JCB, the Chancellor seems to have dug another one and now she is back again, looking for more tax increases. Labour Members might say, “Yes, there is pain to be taken, but at least we are now getting the target right and going after the wealthy.” I have heard that so many times today, but let us look at the facts: the real tax increase here is the freezing of the thresholds.

What does the OBR say? As a result of the freezing of the thresholds, we will not drag dead rich people into the tax brackets. Instead, we will drag into the tax bands three quarters of a million people who are currently not paying tax because their income is so low, along with people on modest incomes who will be dragged into the top tax bands. Let us not fool ourselves that this will be financed by rich people, because the only evidence we have been given about rich people is the council tax on big mansions, which will generate only £400 million of the extra tax that is required and will not do so until 2031. This Budget still hits those who are working.

[Luke Akehurst]

If the right hon. Gentleman were to look at the Budget book, he would see that the graph that shows the progressiveness of this Budget shows that, in every decile, it is redistributive. He might be correct about the impact of the specific measures he has spoken about, but the overall impact of the Budget is that the poorer people are, the better off it makes them, and the richer they are, the less well-off it makes them.

[Sammy Wilson]

Some of that redistributive impact is the result of taxes being taken off people who are on modest incomes for welfare increases. This is a figure that the Chancellor has quoted in the House time and again: one in seven under-25s is now fully reliant on benefits and is not in work. Where is that money coming from? It is coming from people who are working on a daily basis and, in many cases, for not a great deal of money, but who will be dragged into the tax system.

This is an unfair Budget, because it still relies on taking money from working people who are not mega-rich to pay for some of the Government’s grandiose schemes. Some people may argue that if it works, it is worth doing, but let us look at the record of the previous year. The OBR tells us that the outcome of the Chancellor trying the same tactic last year has been that investment is now predicted to fall as a percentage of GDP. Output growth is going to fall by a sixth, productivity is going to fall from 0.4% to -0.4%. Consumer expenditure is down by 0.5%. People are receiving less and profits for companies are going to fall from 12.5% to 10.75%, all of which will affect investment and economic growth, and undermine the very objective that the Chancellor says she is seeking to achieve.

Of course, many people will argue that that is fine, but we have levels of expenditure that we have to finance, so how do we pay for it? Let us look at some of the decisions that the Government have made over the last year. Welfare payments are going to go up quite substantially to £58 billion over the period of this Parliament. On net zero, environmental taxes are going up by 60%, affecting the profitability of companies, and the renewables obligation next year is going to cost us £3 billion. So net zero, the impact of which we are all experiencing on jobs, is going to lead to further costs. I think many people would question whether those are the kinds of things we should be spending money on at a time when we have an abundance of fossil energy in this country.

Tax avoidance has not been dealt with. I have heard tax avoidance being mentioned every time we have a Budget, including under the previous Government, but it is never dealt with. The Googles and Amazons of this world still sell goods here but do not pay taxes in this country. The budget for welfare in relation to immigration is now predicted to go up to £15 billion. Also, we have had debates in this House time and again about the bases in the Indian ocean that we had possession of. We gave them back to Mauritius and we are paying Mauritius for that. What is Mauritius going to do with the billions that we give them from taxpayers here? It is going to cut its own taxes. We are putting up our taxes in order to allow taxes to be reduced in another country when we did not even need to do it. So there are ways in which the money could have been achieved.

I welcome the announcement about the loan charge. As a vice-chairman of the loan charge and taxpayer fairness all-party parliamentary group, I trust that we will now see the Government treating the ordinary people who are affected by the loan charge in the way in which they treated big business. Businesses were given a concessionary payment of 15%, while some of the ordinary people who were affected were being charged nearly 100%. I hope that the McCann review leads to that being sorted out.

As far as Northern Ireland is concerned, I welcome the Barnett consequentials and I hope that the Northern Ireland Assembly and the Sinn Féin Finance Minister in the Northern Ireland Assembly will spend the £370 million wisely—

--- Later in debate ---

[Luke Akehurst]

Does the hon. Gentleman not agree that it was not a U-turn, but that there were better economic statistics that meant that the hole the Chancellor was trying to fill was smaller? People on both sides of the House should welcome the numbers being better. I find it quite bizarre that anyone would attack the Chancellor for finding herself in a better situation. It would be worse for our economy and all of us, including our constituents, would be worse off if we had had to look down the barrel of any change to the headline rates of income tax, quite aside from our manifesto pledges.

[Dr Spencer]

I suggest the hon. Member looks at the OBR report, which, as I mentioned, was released half an hour before the Chancellor stood up and which goes into detail about why that statement is entirely false.

Surrey is one of the biggest contributors to taxation revenue. It is my constituents who will be particularly hit, if not targeted, by the Budget measures. I hear their frustrations all the time about the amount of money we contribute and the lack of reciprocity when it comes to investment in Surrey so we can continue to be an economic powerhouse. My constituents worry about the future, particularly about what the Budget means for opportunities for their kids and about the debt that we are laying on them because of decisions made today. Sadly, this Budget and the one before it show that Labour is totally unable to rein in spending. We have yet another Budget of higher welfare paid by tax.

There has been a lot of focus in this debate on poverty and childhood poverty. That is absolutely right; it is a really important subject to tackle. It is important that we help all families, and everyone, out of poverty in the best way, but we fix and work towards resolving child poverty by ensuring that people have jobs and by focusing on the tax—