Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 9th December 2025 Commons Chamber

[David Williams (Stoke-on-Trent North) (Lab)]

1. What assessment she has made of the potential impact of her fiscal policies on low-income households.

[The Chancellor of the Exchequer (Rachel Reeves)]

The approach in the Budget provides significant support for low-income households, taking an average of £150 off people’s energy bills from April next year, freezing rail fares and prescription fees for a year, and expanding the free childcare offer. The steps that I have taken as Chancellor, including the removal of the two-child limit and the expansion of free school meals, will also lift about 550,000 children out of poverty.

[David Williams]

Child poverty rates remain far too high in my constituency of Stoke-on-Trent North and Kidsgrove. What assessment has the Chancellor made of how the fair decisions taken in the Budget will address poverty among low-income working families in my constituency and across the country?

[Rachel Reeves]

My hon. Friend may know that about 4,000 children in his constituency will benefit from the removal of the two-child benefit limit. That means 4,000 more children being able to go to bed in houses that are not cold and damp and waking up in the morning and being able to have breakfast, and parents being able to afford things that they cannot currently afford. This Government are also providing funds for free school meals in England and delivering free breakfast clubs in every state-funded primary school in England, and extending the warm home discount to 3 million more children. I am proud to be the Chancellor whose actions have led to the largest expected reduction in child poverty over a Parliament since records began.

[Esther McVey (Tatton) (Con)]

The biggest issue for those on low incomes is losing their jobs. Does the Chancellor believe that there is any link at all between her increase in employer national insurance contributions —her job tax—and employment levels slumping to a 14-year low?

[Rachel Reeves]

The number of jobs has increased by 329,000 this year. That is the record of this Government in getting people back into work. The youth guarantee is dealing with the fact that when we took office last year, one in eight young people were not in education, employment or training. That is the Conservatives’ record; this Government are addressing it.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

I commend the steps that my right hon. Friend took to support those on low incomes, both in the Budget and through the recently published financial inclusion strategy, but may I encourage her to go further on the issue of savings, given that a quarter of the people in the UK have little by way of savings and, indeed, one in seven have no savings at all? Will she encourage employers to work with local credit unions to help those who want to save automatically, and to save even a small amount from their pay packets, to do so?

[Rachel Reeves]

Through the financial inclusion strategy led by the Economic Secretary to the Treasury, we are extending Help to Save within the universal credit system, and working with banks and building societies. I know that, as a Labour and Co-operative MP, my hon. Friend works closely with the co-operative movement and with building societies to ensure that more people from low-income backgrounds can save for the future.

[Sammy Wilson (East Antrim) (DUP)]

Low-income families have been hit by being dragged into tax bands that they were not in before and by energy costs, and now the chief executive of Aldi has said that unless the Chancellor reviews her raid on farm inheritance tax, rising food prices will hit those families as well. If she will not listen to the farmers, will she at least show some concern for consumers, and look again at this tax?

[Rachel Reeves]

Since the Budget, the Co-op has cut or frozen the prices of 2,700 essential products at a cost of £1 billion, recognising the impact that the cost of living still has on families, but also reflecting the Budget package that supports our high streets, including our supermarkets.

[Stephen Gethins (Arbroath and Broughty Ferry) (SNP)]

2. What assessment she has made of the potential impact of leaving the EU on economic growth.

[The Chancellor of the Exchequer (Rachel Reeves)]

The Office for Budget Responsibility has estimated that productivity will be 4% lower than it would have been had the UK not withdrawn from the EU. However, alongside the trade deals struck with the US and India, the Government are resetting our relationship with the EU to get better deals on, for example, food and farming, as well as on electricity trading. The hon. Member’s party talks about how leaving the European Union has been costly and disruptive, but somehow thinks that Scotland leaving the UK and its internal market would be magically effortless and cost free. I must say that the SNP is no better than those who promised the public an extra £350 million a week for the NHS. It is all talk, but no delivery.

[Stephen Gethins]

I will try to strike a note that is maybe a little better. We worked together with the Prime Minister, the Chancellor and others to overcome the Tories’ secrecy about their analysis of what it would be like to be outside the single market and the customs union. If we can overcome Tory secrecy on an analysis of leaving the EU, with it now costing an estimated £250 million a day, when will the Labour party release its analysis?

[Rachel Reeves]

The Office for Budget Responsibility has produced an independent analysis and confirmed that it believes that 4% is the correct number, and the OBR continues to maintain that in its forecasts.

[Torcuil Crichton (Na h-Eileanan an Iar) (Lab)]

Has the Treasury made any assessment of the SNP’s plans to separate Scotland from its main market, the rest of the UK, which accounts for 60% of its trade? While I am at it, may I thank the Chancellor for the £820 million extra for the Scottish budget?

[Daisy Cooper (St Albans) (LD)]

The botched Brexit deal has wrapped up British businesses in red tape and blown a hole in the public finances to the tune of £90 billion a year. The Chancellor insists that her No. 1 mission remains to get economic growth. If that is the case, will she and her Ministers vote with the Liberal Democrats this afternoon to make sure that we get rid of that red tape and deliver on a new UK-EU customs union?

[Rachel Reeves]

Since we came to office last year, we have reset our relationship with the EU, which is why last May we agreed with the EU an expansive set of changes to our relationship, including on food and farming, on electricity and energy trading, and on youth mobility and Erasmus. We are taking all that forward, but at the same time we are taking opportunities to trade more with fast-growing economies around the world, including India, and we also got the first, and the best, trade deal that anybody has secured with the US. That is how we are going for growth, alongside passing the Planning and Infrastructure Bill last night in this place.

[John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)]

3. What assessment she has made of the potential impact of extending the freeze on income tax thresholds on working people.

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[Kevin Bonavia (Stevenage) (Lab)]

7. What fiscal steps she is taking with Cabinet colleagues to reduce costs for commuters.

[The Chancellor of the Exchequer (Rachel Reeves)]

Transport costs represent 14% of household spending, so the Government took decisive action in the Budget to freeze all regulated rail fares in England for one year from March 2026—the first time that has happened in 30 years.

[Kevin Bonavia]

I thank the Chancellor and the Transport Secretary for freezing rail fares next month, which will help to ease commuting costs, especially for my constituents who use Stevenage and Knebworth stations. However, affordability alone is only part of the railway jigsaw; regeneration schemes like Stevenage station gateway, supported by the Government’s towns fund, are part of a wider £1 billion regeneration programme for our town and provide a real opportunity to modernise transport hubs and improve connectivity, helping commuters get to work more easily. Will my right hon. Friend ensure that infrastructure investment for projects like the station gateway are prioritised, so that commuters can get to work—

[Rachel Reeves]

rose—

[Mr Speaker]

Order. I am sorry, Mr Bonavia, but the Chancellor is ready now—your season ticket has run out.

[Rachel Reeves]

I just want to talk about Stevenage, Mr Speaker. The Government’s action is saving commuters in Stevenage £285 a year on the cost of a five-day season ticket. With the uplift of £120 billion in capital spending, the Government have also committed to the sorts of projects that my hon. Friend mentions, particularly around transport hubs. I will arrange for my hon. Friend to have a meeting with the relevant Transport Minister.

[Mr Speaker]

Let’s try another ticket: Tom Tugendhat.

[Rachel Reeves]

In Tonbridge, as elsewhere, regulated fares will be frozen for a year from March next year. I know that many of the right hon. Gentleman’s constituents commute into central London every day, and our rail fares freeze will mean that commuters in Tonbridge and all our constituencies have a bit more money in their pockets.

[Jack Abbott (Ipswich) (Lab/Co-op)]

8. What steps she is taking with Cabinet colleagues to support entrepreneurs.

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[Lorraine Beavers (Blackpool North and Fleetwood) (Lab)]

T1.   If she will make a statement on her departmental responsibilities.

[The Chancellor of the Exchequer (Rachel Reeves)]

Covid fraud and error under the previous Government’s mismanagement cost the taxpayer £10.9 billion. They played fast and loose with the public purse and left the front doors wide open to fraud. That is why I have appointed a covid corruption commissioner to carry out the independent review. This Government are doing everything to recover taxpayers’ money. We have already got back around £400 million, with more to come. That money belongs to the British people in our communities and in our NHS. We welcome the publication of the commissioner’s independent report and will respond fully in the new year.

[Lorraine Beavers]

The British people are paying the bill for criminal covid fraud. Under the Conservatives, waste and corruption exploded and taxpayers’ money was stolen. Will the Chancellor make sure that the Labour Government continue to go after those who stole from the British taxpayer and make sure that we get every penny back?

[Rachel Reeves]

I could not agree more. The previous Government failed to protect public money, while this Government have generated around £400 million by getting money back. We all know what happened: the Tories dished out contracts to their friends and donors—money that never belonged to them. This Government will leave no stone unturned because that money belongs to taxpayers, not with cronies or crooks.

[Mr Speaker]

I call the shadow Chancellor.

[Sir Mel Stride (Central Devon) (Con)]

The process surrounding the Budget was utterly chaotic. We had months of damaging speculation, fuelled by briefings and leaks from the Treasury itself. They included briefings on 14 November that moved markets and gave the appearance, at least, of being deliberately inaccurate, which is why we need the Financial Conduct Authority to investigate. May I ask the Chancellor a simple question? Did she at any point authorise or allow confidential details of the Budget or the forecast to be briefed to the press—yes or no?

[Rachel Reeves]

No.

[Sir Mel Stride]

The Office for Budget Responsibility’s own guidance states:

“The interim rounds are transmitted to the Chancellor in confidence”.

Yet the Chancellor repeatedly stated before the Budget that the OBR had downgraded its productivity forecast. In her statement in Downing Street on 4 November, she said in relation to the OBR’s forecast that

“it is already clear that the productivity performance…is weaker than previously thought.”

Why did the Chancellor breach the confidentiality of the OBR?

[Rachel Reeves]

In its spring statement, the OBR was clear that productivity was coming in lower than forecast, and it was clear that it was reviewing that over the summer. The numbers that the OBR has since published showed that in the final pre-measures forecast the fiscal headroom was just over £4 billion. I was clear in my speech on 4 November that I did not want to reduce the headroom; I wanted to increase it. I increased it to bring back the stability that is much needed in our economy after 14 years of Conservative government.

[Josh Fenton-Glynn (Calder Valley) (Lab)]

T5. Having worked on child poverty for over a decade, I have seen at first hand the damage to health, education prospects and life chances that poverty can cause, put at £40 billion a year by the Child Poverty Action Group. Can the Chancellor assure me that the child poverty strategy will build on the historic Budget announcement on the two-child cap, and do more to reverse the appalling rise in poverty that we saw under the Conservatives?

[Sir Ashley Fox (Bridgwater) (Con)]

T2.   Unemployment is higher today than it was on the day the Chancellor took office. Will she tell the House why that is the case?

[Rachel Reeves]

Employment is up since we took office, and part of the reason for the disparity between those numbers is the fact that people who were economically inactive are now seeking work. That is exactly what we want, for people to be seeking work and to get back into work, but there are more jobs in the economy today than when we took office.

[Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)]

T8. As a former deputy headteacher, I and other school leaders knew of the pressures faced when having to turn libraries into classrooms due to underfunding by the Tories, which disproportionately affected children in our deprived areas. Does the Chancellor agree that her £5 million commitment for libraries and books for secondary schools is an example of how increasing opportunity for all children is good for our future economy?

[Rachel Reeves]

My hon. Friend will know that when I was at secondary school, my school library was turned into a classroom because there were more students than there was space. We have put £10 million into primary schools to get a library in every single primary school in this Parliament, and next year, to celebrate the national year of reading, we are putting £5 million into having more books at secondary schools, and I am really proud to be doing that.

[Matt Vickers (Stockton West) (Con)]

T3. Since this Government came to office, 110,000 jobs have been lost in the hospitality sector and eight pubs are closing every week, but the Chancellor has made it worse. Jonathan at The Devonport has told me that his business rates are set to treble. Does the Chancellor realise that her Budget will cost people their jobs, landlords their businesses and communities their pubs?

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[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

It has been a rocky week for the Office for Budget Responsibility, so I am glad that the Chief Secretary to the Treasury recognises and has reiterated the value of an independent regulator in this space. Nevertheless, a lot of criticism of the OBR is swirling around. Would the Chief Secretary or the Chancellor like to remind people about the role of the fiscal risks and sustainability report, which does look longer term at the economy, and the importance that this has in planning? As the Chancellor said, it is not destiny just because of the figures, but that report is particularly useful in that respect.

[Rachel Reeves]

I have huge respect for the Office for Budget Responsibility, and I reappointed Richard Hughes for a second term earlier this year. We deeply regret the publication of the Budget document ahead of the Budget. Richard Hughes has apologised for that and has resigned, but I thanked him for his leadership of the OBR. My hon. Friend is right to point to the longer-term risks that the OBR also points out. That is why at the Budget we took measures on electric vehicles and on high-value properties, because we need to reform the tax system so that it works for the future.

[Edward Morello (West Dorset) (LD)]

T6. The cost of delivering public services in rural Britain is higher than in urban areas. The cost to access services is higher for communities in rural places like West Dorset than it is for those in urban Britain. Will the Treasury commit to reviewing the funding formula, so that local government, integrated care boards, fire services and all our vital community services get the funding that rural communities deserve?

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[Sarah Owen (Luton North) (Lab)]

Removing the two-child benefit cap means that 5,000 children in Luton North will be lifted out of poverty. Many live in households where parents work but ends still do not meet. Does the Chancellor agree that action like this and the youth guarantee scheme will end the vicious cycle of poverty for good?

[Rachel Reeves]

I thank my hon. Friend for this question and for all the campaigning work she has done on it. Removing the two-child limit, combined with the changes we are making around free school meals, the warm home discount, capping the cost of school uniform and rolling out more childcare to more families, will lift more families—more children—out of poverty. It is worth noting that around 70% of kids growing up in poverty are in a family where someone works.

[Steve Barclay (North East Cambridgeshire) (Con)]

The Office for Budget Responsibility shows that welfare spending will be £32 billion a year more at the end of this Parliament, just as a result of decisions in the last Budget. Why was the Chancellor not more honest in the Labour party manifesto about the choices she wanted to make?

[Antonia Bance (Tipton and Wednesbury) (Lab)]

Last week I went to Alucast in Wednesbury, one of our brilliant foundries. I have also been to Newby Foundries. Both told me of their relief that the landfill tax will not impose significant additional costs on them. I wonder whether the Chancellor would like to set out the action she is taking to support our brilliant manufacturing and automotive industries at this Budget.

[Rachel Reeves]

I thank my hon. Friend for that question. We are backing building and getting Britain building with the Planning and Infrastructure Bill, which passed yesterday—I think without the support of Conservative Members, but frankly, we do not need them. We are backing our automotive sector with changes to employee car ownership schemes, the electric car grant and so much more. We are backing the British manufacturing industry—automotives, buses, trains and everything else.

[Stephen Flynn (Aberdeen South) (SNP)]

Prior to the election, the Daily Record reported the Chancellor as having said that Labour will be as economically radical as Thatcher. With the closures at Grangemouth and Mossmorran, uncertainty over the Acorn project and 1,000 jobs being lost every month in the North sea, have I finally found a promise that this Chancellor has kept?

[Rachel Reeves]

As the right hon. Gentleman knows, we are backing Grangemouth and have put money into the Acorn carbon capture and storage project. We are taking £150 off people’s energy bills in Scotland. In England and Wales, NHS waiting lists are falling. I wonder why they are still increasing in Scotland.

[Rachel Blake (Cities of London and Westminster) (Lab/Co-op)]

Short-term lets—[Interruption.]

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[Alan Mak (Havant) (Con)]

The Budget cut the venture capital trusts tax relief that allowed investors to back Britain’s fastest-growing companies. How can the Chancellor claim to support our entrepreneurs when she is cutting off the funding that they rely on?

[Rachel Reeves]

I hosted an event last night for entrepreneurs. Speaking at it were the chief executives of Quantexa and Motorway, both of whom welcomed the changes that we made to support entrepreneurs at the Budget, particularly the changes we made around enterprise management incentives, the enterprise investment scheme, VCT, and the three-year stamp duty holiday for companies choosing to list here in Britain. We are backing entrepreneurs in Britain, and they are backing our changes.