Employers

Luke Evans Excerpts

Wednesday 11th November 2026 Commons Chamber

[Julia Lopez]

I agree with what my right hon. Friend says. That characterisation of employers is why Labour gets itself into such problems in the first place. He talks about the issues relating to national insurance and public services. The NHS also has to pay a higher national insurance bill because of the changes that the Labour Government have made, and that has caused all kinds of challenges across the public sector.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

My hon. Friend is exactly right. One of the biggest problems when national insurance went up was that places such as hospices, pharmacies and care homes were not excluded. It is one thing to say that we are putting more money in, but all that money and more was taken elsewhere to pay for the staffing. Is that not part of the problem?

[Julia Lopez]

It is absolutely part of the problem. Labour did not think that through, and I have an example of that same phenomenon with the hospice in my constituency, as well as with a number of public sector organisations and charities.

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[The Financial Secretary to the Treasury and Paymaster General (James Murray)]

The Budget of two weeks ago was a Budget to steer Britain through the economic storms we are facing. It provided breathing space now on the cost of living and the cost of business with fresh hope for the future, and it was built on fiscal discipline, which underwrites every promise this Government make. When the Chancellor stood at this Dispatch Box two weeks ago, he faced a choice: he could have followed the route of the Conservatives—sacrifice stability, borrow irresponsibly and make unfunded promises straight out of Liz Truss’s playbook—but instead he chose a responsible route to keep the public finances under control, protect working people, back businesses and invest in Britain’s future.

[Dr Evans]

I have asked this question a number of times over the past couple of years: could the right hon. Gentleman define “working people” for the House?

[James Murray]

Working people are those millions of people across the country who put so much in every day but have not been getting back what they deserve. Those are the people this Government are backing, and that is why, at this Budget, the Chancellor chose to prioritise breathing space for families and businesses, including on the cost of energy. He set out how we will tackle the long-term challenges facing our country. For families, that will mean a £100 household energy payment to support 20 million households—80% of households in England—along with an extension of the VAT cut for electricity bills and a further extension to the fuel duty freeze.

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[Daisy Cooper]

The hon. Gentleman is right to raise the fact that we have some of the highest energy costs for business. We have called on the Government to extend their scheme for energy-intensive businesses. We have made it clear that we want to see further action on decoupling the link between gas and electricity. I have had meetings with Ofgem about making sure that there is better regulation for small businesses, particularly when they are looking to brokers for their energy deals. There needs to be far more action, not just for energy-intensive businesses, but for the small businesses on our high streets.

As I was saying, the impact on businesses of all these higher taxes has exacerbated the youth unemployment problem. That is why we now see vacancies at a five-year low. It is wrong to blame young people for not applying for or getting jobs when there simply are not jobs for them to apply for. That is why we Liberal Democrats have talked about growing our economy and pulling the biggest single growth lever that we can by joining the single market, which would reduce costs for businesses.

[Dr Luke Evans]

Have the Liberal Democrats done any modelling of what the impact would be on those young people who are not employed if we rejoined the European Union and had free movement or if we had a youth mobility approach and there was an influx of young people into this country?

[Daisy Cooper]

If there are no jobs in the UK, there will not be people coming to the UK to take jobs that do not exist. If we could join the single market, it would reduce red tape, reduce form-filling, and make it cheaper for businesses in the UK to grow. They would create more jobs, and there would be more jobs for young people. I simply cannot believe that the Conservative party, despite all the evidence and all the studies, will still not accept that having a stronger relationship with Europe is the single biggest way in which we can grow our economy—and it is only if we grow our economy that we can cut taxes and cut bills. For as long as the Conservatives refuse to acknowledge the damage of their Brexit deal, they will remain an out-of-touch, anti-growth, anti-business party.

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[Dr Sandher]

I choose to use the labour force survey statistic because it includes both the self-employed and those who are low-paid and do not appear in the PAYE figures. I pick that figure because it is more comprehensive, and I believe it is more correct, as it includes everybody in work.

I want to briefly pick up the point about unemployment. The right hon. Member is right to say that both employment and unemployment have increased, but that in part is good news; it is because those who were economically inactive are now seeking work, so they are now in the category of “unemployed”, rather than “inactive”. We have more people in work, and more people looking for work.

Our argument is that, for businesses to create prosperity, they need not just lower taxes—I take the Opposition’s point on that—but the sales and the foundations to create prosperity. They need a healthy workforce. That is why we are investing in the NHS and waiting lists are falling. They need good skills, which is why the number of apprenticeship starts in this country is such a focus for this Government. They also need lower energy costs, which means providing home-grown, cheaper, cleaner energy. Those things help employers produce more in this country, and help businesses hire more people.

[Dr Luke Evans]

I am very grateful to my Leicestershire colleague for giving way. Could he point to where in the Budget Loughborough cafés or restaurants will get specific support with their energy? The British industrial competitiveness scheme is only for manufacturing, and all the tax levies that are coming off bills—the carbon taxes, the green levies—will not do so until 2028. I am not aware of any support specifically for cafés in Loughborough or restaurants on his high street. Am I wrong?

[Dr Sandher]

As the hon. Member will know, we are also freezing rates, but on a personal note, I do everything I can to support every pub in my constituency, because that is the service we Labour Members believe in.

We know that our approach, our philosophy and our moral aim leads to material prosperity because we have seen it before. We saw Attlee create collective prosperity after collective sacrifice, and Blair and Brown renew a nation after 18 years of Conservative Government. We see how our aims lead to better outcomes. Labour Members believe that our country thrives when everybody thrives. Businesses do well when everybody does well—when the young person who leaves school knows that they can get a good job in a local business; when that business can hire them, because it knows that they have the skills that it needs; and, more importantly, when the business knows that consumers can buy its goods, because we are making life affordable for all. That is how we Labour Members are creating jobs and helping business people like my mum and dad.

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[Dr Luke Evans (Hinckley and Bosworth) (Con)]

“Yes”—it is a small word, but it is absolutely crucial to creating a successful economy. Yes to that first investment; yes to opening that business; yes to giving that young person a job; yes to taking that risk; yes to expanding; yes to investing—all those things are so crucial to getting a successful company and a successful economy. However, the Government cannot build an economy by making it harder for businesses to say yes. The economy responds not to a Prime Minister saying, “We must have growth,” and his intentions, but to the incentives that Ministers put in place—or, in this case, the disincentives.

We have heard it mentioned before—in relation to the jobs guarantee, for example—that the Government are trying to incentivise people into work, while at the same time disincentivising businesses from taking on people. That is like pressing the accelerator while putting on the handbrake. The Government have given so many businesses a reason to say no. The NICs increase, the business rates increase, the minimum wage increase and the red tape in the Employment Rights Act are a toxic concoction for our businesses, and are having a devastating effect.

Let me take the examples of the café in Burbage, the restaurant in Barwell and Earl Shilton or even the gym in Hinckley. They have had the jobs tax. They have had the minimum wage go up. They have had employment red tape added. They have had business support changed and taken away. They have had business rates go up. They have had their energy bills go up—there was no support in the Budget for that. Is it any wonder that the ONS has said that from October 2026, some 16% fewer hospitality businesses have been created? Across the entire economy, business creation is down by 3.5%.

Let us turn to the wider argument about the environment. As my constituency neighbour, my hon. Friend the Member for Mid Leicestershire (Mr Bedford), has said, business confidence has been down for seven consecutive negative quarters. Businesses are losing the confidence to say yes. Why? Because of the employment costs. In a report by the Institute of Chartered Accountants in England and Wales, 53% of businesses cite labour costs and 41% cite taxation. That figure is double what it used to be.

Young people have been mentioned a lot. There are 981,000 people aged between 16 and 24 who are not in education, work or training. That is 30,000 more than last year. It is almost 1 million people, for the first time since 2013. That compares unfavourably with the likes of EU countries; for the first time ever, we are above the EU average.

Why does all this matter? The contribution from my hon. Friend the Member for Hornchurch and Upminster (Julia Lopez) from the Opposition Front Bench got me thinking. We can count the trees that have fallen, but we cannot see the forest that has never been planted. What do I mean by that? We can see the 12,000 job losses in Poundland. We know that Morrisons has had to lay off 5,000 people. Jaguar Land Rover has had to lay off 4,000 people. Claire’s on the high street has had to lay off 2,500 people. Whitbread, which runs Premier Inn, has had to lay off 3,800 people. We can also count the young people who are going abroad. We know that 250,000 people went, of whom two thirds were under the age of 35. But what about the businesses that never opened? What about the investment that was never made, the job that was never offered, or the apprenticeship that was never started?

The cost of this Labour Government’s “no” economy is so great. This is about the opportunity that has never been taken, and the future that we could have had. That is not recorded in any figures. No matter how hard this Government tell businesses to hire, they cannot force people to be hired, or force young people to stay. We cannot build a “yes” economy by giving businesses thousands of reasons to say no. That is why I support the motion.

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[Graham Stuart]

If the hon. Gentleman wants to intervene on me, I would be delighted to let him come in.

Yesterday, the deputy governor of the Bank of England said that one of the reasons why youth unemployment has gone up faster than unemployment generally—remember, because of that gigantic brake on the economy, overall unemployment has gone up by 250,000 under this Government—was the cost of employing young people, including because of the minimum wage, the jobs tax and so on.

[Dr Luke Evans]

Would my right hon. Friend care to comment on the state of the graduate market, too?

[Graham Stuart]

The situation is affecting all young people, is it not? I have used this quote in the Chamber before, but it is worth repeating, even for the tiny number of Labour MPs who were prepared to come here, to vaguely try to support the Government. Ronald Reagan said about the left:

“If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidise it.”

Labour taxed it with a jobs tax; then it regulated it with the Employment Rights Act 2025 until it stopped moving. Then young people were not getting employed anymore. Labour said, “Yippee!” Labour MPs were literally going around the TV studios saying, “Look at us—there is a jobs guarantee.” They have taxed it; they have regulated it until no one is getting employed; and now they will say, “We will subsidise it.” They have absolutely no conception of how private enterprise works, or how the economy works. They are letting the country down, and they increasingly know it, albeit that they do not say so in the Chamber quite yet.

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[Blair McDougall]

Unemployment is still lower than in comparable economies—[Interruption.] The hon. Gentleman asked the question, so I will answer. Employment is up and inactivity is down in this country. It is precisely because we are concerned about youth unemployment that we are introducing measures such as the £2,000 hiring payment for smaller employers to take on young people and the £3,000 jobs grant for those at risk of sliding into youth unemployment. As several hon. Members have noted, that is in stark contrast with the increase of a quarter of a million in youth unemployment and inactivity in the last few years of the Conservative Government.

[Dr Luke Evans]

rose—

[Paul Holmes]

rose—

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[Blair McDougall]

It is precisely because we recognise, as many right hon. and hon. Members have mentioned, that retail and hospitality give so many young people their first job that we are lifting so many of those businesses out of business rates and lowering the tax burden on those individuals.

I will follow the Prime Minister’s lead and note that we agree on a lot despite the debate across the House. We agree, as many hon. Members have said, that small businesses in particular are the backbone of our economy, we agree that more must be done to support business to employ people, and we agree that young people should be supported.

[Dr Evans]

rose—

[Blair McDougall]

I will make some progress.

We agree that young people should be supported into work. However, we disagree fundamentally on how to go about that. The hon. Member for South West Devon (Rebecca Smith) spoke about the minimum wage, but told the House that she did not want to talk about what might happen in the future. I think I know why that is. It is because in a report from the Prosperity Institute, the shadow Business Minister in the other place committed to freezing the minimum wage for five years. That is a real-terms cut of 12% for the poorest workers that will not just take £8,900 out of the pockets of the poorest workers in the country, but take that money out of the tills of businesses in their communities.

The way to fix the issue we have with youth unemployment is to increase the number of apprenticeships, increase the flexibility of those apprenticeships, invest in the growth sectors that will create the well-paid jobs of the future, ensure that those young unemployed people are more attractive to potential employers and take all the other measures that we are taking to invest in business.

The Tory plan for those young people who have been rejected over and over again and who are close to being broken by the experience of being let down by the system is to punish them for that. We will not do that. The Conservatives offer only insecure hours, cuts to incomes and poverty pay. That did not work for 14 years, it did not work for employers and it will not work now.

Question put.