Richard Holden
Main Page: Richard Holden (Conservative - Basildon and Billericay)Department Debates - View all Richard Holden's debates with the HM Treasury
(2 days ago)
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Sir Mel Stride
I think this debate is actually about the tax policy of this Government. As I have clearly set out—[Interruption.] To be fair, there was the small matter of covid, which came along and shrank the UK economy by 10% overnight. People at the time speculated that we would see mass unemployment, the like of which our country had never, ever seen, yet through our intervention we ensured that that did not happen.
Likewise, when the Ukraine-Russia war brought inflation to our shores through energy price spikes, peaking at 11.1% at the back end of 2022, we took the tough decisions, along with the Bank of England, to bring that inflation down. In the meantime, we protected millions of low-income families up and down the country from the consequences of that inflation. That came with a £400 billion price tag, so it is not surprising that some taxes had to rise in order to pay for that.
Mr Richard Holden (Basildon and Billericay) (Con)
The shadow Chancellor is making an excellent speech. Does he agree that the danger is that if Governments do not have a prudent financial position, they end up in the situation that we are now seeing, with the interest on Government debt going up and up? We are now paying around £10 billion a year more than we were at the time of the general election.
Sir Mel Stride
My right hon. Friend is absolutely right. With the increasing Government debt to which this Government are constantly adding, and the higher interest rates for longer for which they are responsible because of their extravagant spending, we are spending about £100 billion a year on simply servicing that debt, which is twice what we spend on defence. That is not sustainable, and things will get worse under this Government.
Joe Powell (Kensington and Bayswater) (Lab)
I congratulate the shadow Chancellor on securing a debate on this motion. When this Government came into office, they found Britain’s public finances vandalised, the economy wrecked, debts soaring, sky-high mortgages, a cost of living crisis that has touched every household in this country, and a mismanaged pandemic, rife with dodgy contracts and corruption. The Conservatives today pretend that they have discovered fiscal responsibility, but we all remember that they increased taxes 25 times in the last Parliament, and gifted us the reckless Liz Truss mini-Budget, which sent mortgages spiralling and tanked the markets.
No Government in living memory have had a worse economic inheritance than this one. The Conservatives have no credible economic plan for dealing with the debt, no credible plan for growth, and no credibility whatsoever with the British public. What they did to the public finances and the national debt even before the pandemic is unforgivable.
Mr Holden
Labour Members pretend that 2010 was year zero. In truth, in 2010 there was an annual deficit of 10% of GDP in Government spending, which meant that the Government were borrowing £1 for every £4 they were spending. Does the hon. Member not acknowledge, or understand, that that was a far worse economic inheritance than any Government have been offered since the second world war?
Joe Powell
I thank the right hon. Gentleman for that intervention, because it is important to talk about debt. I was disappointed that the shadow Chancellor failed to acknowledge that the inheritance in 2024 was total national debt of close to 100% of GDP, which was up from 60% in 2010. The annual debt payments that the Government are having to make—as others have said, they are close to £100 billion, thanks to the Government’s economic inheritance—are 8.3% of total public spending. Imagine what we could do if we spent that money on the NHS, our schools, or fixing the housing crisis.
This goes much deeper than debt. The truth is that we inherited a sick economy, affecting living standards, wages and public services, and there was no plan for growth. The Conservatives left Britain with rising debt and flatlining growth, yet they oppose the very measures that the Government have taken to fix their mess.
Mr Richard Holden (Basildon and Billericay) (Con)
The damage that this Labour Government have dealt to our economy is a real kick in the teeth for all those who voted for them last year—and for those who did not vote for them, but who wished them well and believed their words at the general election. Time and again, my right hon. Friend the Member for Richmond and Northallerton (Rishi Sunak), and many others on this side of the House, warned that the new Labour Government’s priorities and promises on tax were not to be trusted, and that members of the public should take their words with a bucket of salt. The Labour party cried foul, diving to the ground like a premiership footballer screaming blue murder, but what has come to pass is far worse than many on this side of the House imagined it would be. For all the Government’s talk of fixing the foundations, I have been pained to watch the suffering, distress and anxiety that they have wilfully chosen to inflict on the British people. They have hammered the small businesses on which people rely for their jobs, through changes to business property relief, agricultural property relief, VAT and dual cab taxes, and through the business rate rises and the national insurance tax rise.
I cannot think of a policy as woefully constructed and as disastrously executed as the national insurance tax rise. This Government claim to have been elected on a platform of promoting growth, but they are choosing to boost growth by blowing up businesses. That is so inexplicable that it calls into question the Government’s ability to govern. The people hit hardest by the tax rises are those starting out in their first job, who will be hit by the thresholds, and part-time workers—often women—trying to get back into the labour market. It is among those groups that we see the highest rises in unemployment since the Budget.
It is because of the Government’s choice to raise taxes that businesses are cutting back on hiring staff. They are also making staff redundant, shelving expansion plans and closing their doors. I see that in my constituency, where unemployment is up by about a sixth in the 12 months since the general election. It is also because of that choice that inflation is up and growth is down, and because of choices made by the Labour party that this country will continue to miss out on investment opportunities and economic security.
That brings me to the people who will feel the impact most acutely. During the pandemic, we celebrated key workers—the care home workers, teachers and hospice workers who went out every day in horrendous conditions to do their job in a spirit of service. What kind of Labour Government would willingly choose to punish those who represent the heartbeat of the nation? Only recently, I heard from a woman in my constituency who runs a small childcare business, which she kept going during the pandemic. She wrote to tell me that because of the tax rise, she has had to cut back her assistants’ hours and turn away parents. On the one side, the Government pretend that wages are increasing, but on the other, employers are being forced to cut hours, so people are no better off. It is happening in every constituency up and down the country, and that is the real cost of this Government’s choice.
The national insurance tax rise means less money for schools and teachers, for hospices and their staff, and for the healthcare workers who were applauded during covid—those operating in the most difficult circumstances. It is a fundamental disgrace that the Labour Government, who are always so keen to paint themselves as the kinder, more cuddly, and more friendly party, have made the catastrophic choice to balance the books and fix their failures on the back of essential workers and volunteers. The Government are raising taxes on hospices, which they are supposed to stand up for.
Joe Powell
I thank the right hon. Gentleman for his defence of teachers. I am sure that he welcomes the pay rise for teachers of 5% last year and 4.4% this year, funded by the Budget.
Mr Holden
The hon. Gentleman may shake his head, but he should look at the statistics. Schools in my constituency and his will cut support staff and teaching assistants as a result of the black hole that his Government have created for their workers.
It is particularly pernicious that the Government are raising taxes on hospices. I visited St Luke’s hospice in my constituency at the weekend. It is having to raise hundreds of thousands of pounds a year more—money that would be going towards care for the most vulnerable at the end of their life—to pay for a tax rise that Labour Members will today vote to maintain, while Conservative Members say that it should be removed.
My hon. Friends and I will always raise these issues, as we have the issues for farmers and our food security, or the mind-boggling plans to drive away wealth creators to fill up the Treasury’s coffers, and we will continue to do that in opposition. We are asking the Government to listen to us, because we want the Government to change course and do the right thing. Bizarrely, we do not actually want the Government to drive the country off the edge of a cliff.
John Slinger
In the spirit of listening, I would be very grateful to know which of our investments in the public sector the right hon. Gentleman would cut.
Mr Holden
The Chagos deal comes to mind, which the Government seem so keen on: handing over British taxpayers’ money for something we already own. We would not have made the same decisions that this Government have made. We made it very clear in government that we would not have handed out pay rises to train drivers without the need for reform, or to the junior doctors, who have come back yet again with another double-digit pay demand. The hon. Gentleman needs to think about those things. He can say, “What would you have done?” but we actually said that we would not do those things before they happened, so actually we are the ones who have been financially responsible. He is the one handing money away to Mauritius, so that it can cut its income tax, while the Government Front Benchers seem a bit wary of answering the question of whether they will have to raise taxes later this year. We Opposition Members can guarantee that they will.
I call on the Government to do what is right and look again to their manifesto. The Government should choose to back enterprise, reward work, not punish those who help out in hospices, create growth and opportunity in every corner of our country, and back others who do so, instead of taxing everyone and everything they possibly can. Otherwise, I fear that this Labour Government will face the same fate as all other majority Labour Governments that have ever existed, and leave unemployment higher than when they entered office. That is not exactly the Labour party that people voted for in my constituency or across the country.
Dr Jeevun Sandher (Loughborough) (Lab)
The motion before us shows the difference in values between the two sides of this House. The Conservatives’ motion speaks of wealth creators, but specifically says that only a few of us create wealth. On the Labour Benches, we believe that every single worker creates wealth in this country. We have seen the consequences of 14 years of their values in action: falling living standards, higher waiting lists, higher energy bills and a weaker nation. Our values, as we saw under the previous Labour Government, left us with a stronger, wealthier and prosperous nation, in which we taxed the wealthiest to invest in the services that we all rely on. We left a more prosperous and stronger nation last time, and that is what we are building this time.
We have seen the damage of the past 14 years, as expressed in the motion. We have seen what the Conservatives’ values mean in practice. They believed that if a few did well, and there were a few tax cuts for those at the top, our country would be wealthier. That started in 2013, and continued with Truss. In reality, at the end of that 14 years, no one did well. We had the longest squeeze on wages since Napoleon threatened our shores. We were the only high-income nation to see sickness rise after the pandemic, had the highest energy bills in Europe, and were the worst-connected country in western Europe. That is the Conservatives’ record. I believe the right hon. Gentleman wanted to make an intervention.
Mr Holden
The hon. Gentleman says that the last Labour Government left the country in a fantastic state. As I have mentioned before, they left behind a massive deficit and unemployment higher than when they took office. Does he not understand that a deficit of over 10% of GDP was an horrific legacy to leave in peacetime? Also, unemployment being higher was a betrayal of the people the Labour party is meant to stand up for.
Dr Sandher
The global financial crisis affected every single nation across the world. I do not deny, by the way, how difficult things were in 2010, but we also left the Conservatives an economy that was growing, record low waiting lists, and investment in our nation and a plan to insulate our homes. Because they did not follow through on our plans, we had the worst insulated homes in western Europe, and some of the highest energy bills to go with that. Yes, we left in a difficult moment, but we left the Conservatives with a strong foundation for going forward.
The Conservatives left us poorer, sicker and slower, thanks to their their record on tax. In the worst cost of living crisis in a century, they attempted to cut taxes for the wealthiest. Everybody on the Labour Benches thought Truss was mad; I really do not know what Opposition Members believe anymore.