Budget Resolutions

Matt Western Excerpts

Wednesday 26th November 2025 Commons Chamber

[Matt Western (Warwick and Leamington) (Lab)]

Here we are three years on from the Tory Truss kamikaze Budget. It is worth recalling just how bad that was—absolute carnage, with interest rates rocketing and mortgage market mayhem, and people and businesses left to pay for the Conservative chaos. That 49-day con trick was an ideological experiment that will scar this country for many years to come. It is worth remembering that their catastrophic failure was hailed by the hon. Member for Clacton (Nigel Farage) as

“the best Conservative budget since”

the 1980s. So much for economic illiteracy! There is clearly much to be done in our schools.

It remains for this Labour Government to clean up the mess of the last Conservative Government. It was not just the Truss Budget; successive Conservative Budgets failed the public, whether it was with the lowest investment levels in the G7 despite having historically low interest rates, or with stagnant wages and flatlining productivity.

[Jim Dickson (Dartford) (Lab)]

One of the things the Chancellor was clear about in her speech was the way we need to continue to build capital investment to improve the long-term growth rate of the economy. Does my hon. Friend agree that projects such as the lower Thames crossing, which will hugely reduce congestion and poor air quality in my constituency and create thousands of jobs and new opportunities for business, are great for our economy?

--- Later in debate ---

[Matt Western]

I absolutely agree with my hon. Friend. That was one of the great failings of the last 14 or 15 years; when interest rates were at record lows, that was the time as a nation to invest in our infrastructure. Any business would have done that. Unfortunately, that did not happen.

Returning to productivity, if we had continued at the same rate as when the Labour Government left office, the average worker would be making £5,000 extra per year. That is the loss in productivity we face. This past 15 years we have seen national debt rocket—from 2010 to 2024, it increased by a third—leaving us paying more on debt interest than on defence. That is the reality.

I recognise what the Chancellor is doing, and I congratulate her on her determination in delivering for the British people. As she said, it is a Budget that addresses the most important and pressing issues for people up and down our country, so I am encouraged by the proposed changes in business rates, whether that is for the hospitality sector—our pubs, cafés and so on—or small retail, and also by the taxation on dividends. It cannot be right that unearned income pays considerably lower tax than earned income.

The Budget today has made some difficult choices, but we can tackle these problems and address the concerns of our constituents and the problems facing businesses. We need to recognise the deep structural problems that undermine our economy, and without a doubt the biggest worry for my constituents is the cost of living. Despite inflation having fallen, the price of goods is 28% higher now than in 2020. The weekly food shop, for example, is now 37% higher than just five years ago. Given that, I am pleased to see the announcements on the cost of living set out today: the £150 saving on energy bills, the train fares freeze, the freezing of fuel taxation, support for childcare and the increases in the living wage. It builds on the progress we have already made, with wages having risen more in 10 months under this Labour Government than in 10 years of the Conservatives.

Let me turn to the automotive sector, which is really important for my constituency of Warwick and Leamington, where thousands are employed either by companies such as Jaguar Land Rover and Aston Martin or in the supply chain. I am proud of the support that the Government have already set out. We have delivered £2.5 billion under DRIVE35—a bold industrial strategy that provides clarity and long-term direction for industry —as well as a £1.5 billion loan to protect the Jaguar Land Rover supply chain. In addition, the US trade deal is huge for this country, as is the India trade deal. The additional £1.3 billion for the electric car grant is very welcome, as is the additional £200 million for EV infrastructure.

As chair of the all-party parliamentary motor group, I have heard concerns from the industry about the 3p mileage tax on EVs. I hope that the additional support for vehicle purchase, along with the infrastructure grants, will help to offset that, but we must not allow a repeat of what happened in New Zealand, which saw a significant reduction in take-up and demand.

I welcome the fact that the Government’s plans to change the employee car ownership schemes have been put on hold. They would have cost the industry £1.5 billion and risked 5,000 jobs. I thank the Treasury team for listening to Members, given the important role that those programmes play in vehicle manufacture and in meeting manufacturers’ zero emission vehicle mandate targets over the coming years.

I will focus—perhaps unusually in this place—on the productivity problems facing the UK. Since 2009, productivity has flatlined. The previous Government failed people and businesses. How can UK productivity have fallen so far that it is now 20% lower than that of the United States and Germany, and 12% lower than that of France? I have never believed that productivity is a puzzle; for me it is about fair employment rights, addressing the casualisation of the workforce, incentivising investment and improving on skills delivery. I welcome the measures aimed at young people, including the free apprenticeship training for SMEs and the youth guarantee scheme.

If we are to improve productivity, we need people to be fit to work. That is why sorting the NHS workforce, ending the strikes and getting people back into work has been so important. The initiative providing 30 hours of free childcare has released young parents back into the workplace—again, improving productivity. All that, along with restored stability and international credibility, means that investment is flowing back into the British economy.

Since July of this year, the Government have secured over £250 billion of investment in high-growth sectors, supporting 45,000 high-quality jobs. That is in additional to the increased capital spending of £107 billion laid out by the Chancellor at the previous Budget, and a National Wealth Fund equipped with £28 billion to catalyse investment. That is all incredibly significant.

On exports, as a trade envoy, I am very aware of our opportunities abroad and of the confidence that other countries have in this country—they want to invest here. In fact, we know that Britain was the fastest-growing G7 economy in the first half of this year, and that it recorded the second highest growth year on year. That is now allowing us to rebuild our public services. The NHS has already delivered 5 million additional appointments, including an extra 23,000 in my local NHS trust.

The Chancellor talked about money for defence. I would like more clarity not just on defence but on security. As chair of the Joint Committee on the National Security Strategy, I say that it is incumbent on us now to place more focus and resource in areas of resilience and wider security—and not just of our shores. We have seen cyber-attacks on Jaguar Land Rover and Marks and Spencer, for example. JLR took a £1.7 billion hit. That is what we are facing, and we must wake up to that reality and put more resource into it. That is a plea to those from the Treasury who are listening.

I have listened closely to Opposition Members, and I fear that there is a degree of naysaying. We have got growth back into the economy, and there is so much in the Budget to be positive about. We are making good progress, but we must be patient. It takes time to clear up the mess when rebuilding, but that is what we will do.