The Secretary of State for Levelling Up, Housing and Communities (Michael Gove)
My right hon. Friend the Chancellor of the Exchequer delivered his Budget statement against the backdrop and in the shadow of the covid pandemic, but he also did so unveiling a new era of economic optimism, as we build back better after that pandemic and secure the investment required to make sure that every part of this United Kingdom flourishes economically and every citizen has the chance to achieve their fullest potential.
It was striking that the Office for Budget Responsibility, in its assessment of the Chancellor’s response to the covid pandemic, said that he was “remarkably successful” in the steps that he had put in place. It is important, against the backdrop of the Budget statement and the spending review that accompanies it, to reflect for a second on the Chancellor’s success. The plan for jobs, which he was responsible for, has ensured that, contrary to the grim expectations that we would face unemployment of perhaps 12%, it is now expected to be 5% at most. It is also striking that the Office for Budget Responsibility estimated that the scarring effect on the economy—the drop in GDP that we would inevitably suffer as a result of the covid pandemic—would no longer be 3%, but just 2%.
Those figures, which reflect the success of my right hon. Friend’s approach hitherto, should be in our mind as we consider the approach that he is taking, because it is only as a result of success in ensuring sound money, success in ensuring an approach towards a balanced budget that commands the confidence of the markets, and success in ensuring that more of our fellow citizens can remain in employment that we have the foundations today on which to build, unite and level up our country.
Tony Lloyd (Rochdale) (Lab)
The right hon. Gentleman talks about success. In part of my constituency, child poverty is something of the order of 60%. That compares with a national average of just under 20%. Is that a success because, if not, what does levelling up mean for the children in my constituency?
Michael Gove
The hon. Gentleman makes an important point. At the heart of levelling up is a recognition, as he rightly reminds the House, that while talent is spread equally across this country, opportunity is not. There is a series of measures in the Budget statement designed to specifically attack the problem of child poverty. The creation of new family hubs is specifically designed to address that, as is the additional investment in the supporting families programme, the successor to the troubled families programme.
I should add that the changes to the taper on universal credit will also ensure, allied to the changes in the national living wage, that someone who is on the minimum wage, who is therefore in work, and who is receiving universal credit will receive at least £250 extra a year as a direct result of the national living wage increase and an additional £1,000 a year as a result of the associated changes to the taper. I recognise that eradicating poverty is not the work of one Budget, but it is only fair that everyone across the House recognises that there are measures in this Budget statement—measures being taken by this Government—directly to address the problems that the hon. Gentleman raises, because they are a scar that needs to be healed.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
Will the Secretary of State tell us whether the number of family hubs will match the number of Sure Starts that have been cut since 2010? Does he regret the loss of so many Sure Starts and recognise the serious damage that has been done to a generation?
Michael Gove
The right hon. Lady is right to point out that the Sure Start programme was always intended to help those who were most in need, but it was also intended to provide a universal offer. Inevitably, during the difficult period that we had after the 2008 financial crash, we had to make sure that we targeted resources accordingly, but after a period of retrenchment, we are now entering a period of renewal and reform. The family hubs are targeted not just at those who have children in the first 1,000 days of their life, which reflects superbly on the work of my right hon. Friend the Member for South Northamptonshire (Dame Andrea Leadsom); they are there to ensure that we have a comprehensive nought-to-19 offer. They go further than Sure Start children’s centres originally did—that is no criticism of Sure Start children’s centres—providing services that they did not.
Maria Eagle (Garston and Halewood) (Lab)
Will the Secretary of State give way?
Michael Gove
I will make a bit of progress and then try to take more interventions, if that is okay.
It is also important to recognise that the Budget statement saw a significant increase in public spending overall. It is the case that no Government can be judged purely by how much they spend. How that money is spent is critical. Additional public spending without reform and without a focus on value for money is money wasted. But I do not think that anyone across the House can deny that, with reform and with a focus on value for money, additional public spending, appropriately targeted, can help to transform public services for the better. In this Budget statement, £150 billion more will be spent over the spending review period. That is a 3.8% growth, in real terms, and in the Department for which I am responsible there is a 4.7% increase. Alongside that, there are the biggest increases in capital investment from any Government for 50 years; the biggest block grants ever given, since the dawn of devolution, to the Governments in Scotland, Wales and Northern Ireland; and an increase of 6.6% in the national living wage, which takes it to £9.50 an hour. All Governments can face criticism and all Chancellors can be attacked, but I do not think it credible for anyone in this House to say that the package that the Chancellor unveiled last week is any way not equal to the challenges that we face.
The question for Opposition Members, including those on the Front Bench, is what they would do differently. If they argue that we should spend even more, where would they spend it? Which budgets would they prioritise? If they were to spend more, which budgets would they deprioritise? What would they cut to fund the additional spending? If they would not cut, would they borrow more? If so, how much more? With what impact on our credibility in international markets, on interest rates and on our capacity to fund our debt and deficit? Let us bear in mind that debt is falling and the deficit is being reduced as a result of the Chancellor’s shrewd approach.
If the Opposition were to borrow more, would they tax more? If so, whom would they tax? What credibility can they have on tax when we introduced a specific one-off increase to fund the national health service and social care—and the Labour party voted against it?
Those are all questions that Opposition Front Benchers want to avoid. To what lengths have they gone to avoid it? Well, earlier today I spent a few seconds on Twitter, not tweeting, but studying that social platform. In particular, I studied the tweets of my opposite number, the hon. Member for Croydon North (Steve Reed), who has been tweeting promiscuously and vociferously over the weekend—but what has he been tweeting promiscuously and vociferously about? Has he been tweeting about the spending review? Has he been putting forward alternative plans for local government, alternative propositions on levelling up, a new plan for housing or perhaps a new proposition on communities?
No. The hon. Member has only one tweet about the spending review. In contrast, he has tweeted five times as often about Crystal Palace football club. We are all, I think, in awe of Patrick Vieira’s success in ensuring that Crystal Palace could beat Manchester City 2-0 at the weekend, but however historic and unprecedented that victory is, I think we all have a right to ask whether, if Labour is silent on the spending review—if it has nothing to say by way of criticism or alternative—that is perhaps an indication of the success of the Chancellor in framing a Budget and a spending review right for this country.
Ed Davey (Kingston and Surbiton) (LD)
To get back to some serious points for a moment, UN Secretary-General António Guterres told Glasgow’s COP26 today that the world’s
“addiction to fossil fuels is pushing humanity to the brink.”
Will the Secretary of State use his planning powers to protect the beautiful parts of his own county of Surrey and prevent it from being turned into a British Texas? Why are Conservative Ministers prepared to allow new oil drilling in the Surrey hills and the north of Scotland when we are in a climate crisis?
Michael Gove
I have huge respect and affection for the right hon. Member, but I remember when we sat in Cabinet together and he was Secretary of State for Energy and Climate Change. I remember when he spoke to the Liberal Democrat conference, when such a thing occurred —when there were enough Liberal Democrats to get together to fill a conference hall. I remember him telling that Liberal Democrat conference hall that it was time—please forgive my language, ladies and gentlemen—to get fracking. Now that he is no longer in government and is in opposition, he seems, curiously enough, to have reversed his position, an unprecedented thing for a Liberal Democrat to do.[Laughter.] Saying one thing to one constituency and another thing to another? Remarkable!
I should say that my own views on fracking in Surrey—and indeed elsewhere—are on the record, and the right hon. Member can be reassured that my opposition to fracking in Surrey, particularly in a case that came up in my constituency, is on the record; but because my views are on the record of the past, I should say no more about the future.
Mr Clive Betts (Sheffield South East) (Lab)
May I return the Secretary of State to the 3% increase in spending power for local councils? Has he seen the analysis by the Institute for Fiscal Studies? It states that the 3% includes the £5.4 billion that the Government have used from the levy, but as the way in which councils must spend it is specified, it amounts to only a 1.8% increase in money that they can choose, and the 1.8% is there only if they put their council tax up by 3% a year.
Michael Gove
The hon. Gentleman makes an important point. Additional funding is, quite rightly, being devoted to improving adult social care, and it is also the case that the overall rise in core spending power for local government is at 3%. If we look back, we see that that is a significant increase, and it is also part of the broader increase of 4.7% overall in the spending that we are providing. Local government is not just being given more money for discretionary spending and for adult social care; we are also seeing additional spending from the Department for Education on special educational needs, we are seeing additional spending for transport, particularly in our city regions, and we are seeing the levelling-up fund as well. It is important to look in the round at the amount of money available to local government and spent in local areas.
Maria Eagle
Knowsley, which is one of the boroughs that my constituency covers, has gone from being the fifth most deprived local authority in 2010 to being the second most deprived now. One would have expected a Budget such as this, about levelling up, to focus particularly on giving necessary resources to Knowsley, but despite being a priority 1 area it has been overlooked for the levelling-up fund, having previously been overlooked for the future high streets fund and the towns fund. What does Knowsley have to do, now that it is the second most deprived area, to get some money from the Government so it can try to level up? [Interruption.]
Michael Gove
The hon. Lady has made an important point. There are specific and long-standing issues in Knowsley and other parts of Merseyside that we need to address as part of levelling up. However, I think she does herself down slightly, because I understand that thanks to her advocacy in her constituency two levelling-up bids succeeded, and although they do not affect Knowsley, they do affect Liverpool. Some £20 million has gone towards helping Liverpool City Council with regeneration, and £37 million has gone towards recovery. Those sums are not insignificant.
Nevertheless, I take the hon. Lady’s point about Knowsley. I think it important to remind her, and indeed the House, that the £1.7 billion in the levelling-up fund which was allocated by my right hon. Friend the Chancellor is just one third of the total sum allocated over the course of the spending review, and I look forward to working with her and with other colleagues to make sure that the remaining funds can be allocated effectively.
Peter Grant (Glenrothes) (SNP)
I do not know whether the Secretary of State heard this, or indeed whether the hon. Member for Garston and Halewood (Maria Eagle) heard it, but when the hon. Lady asked what her constituents had to do to get their fair share of levelling-up funding, the clear message from the Tory Back Benches was that they had to return a Tory MP. Tory MPs clearly think that it is all about putting money into Tory-held constituencies. Does the Secretary of State agree with his own MPs that levelling-up funding will be targeted at Conservative constituencies, or does he need to have a private word with them afterwards to stop them giving away party secrets?
Michael Gove
We do not need to look into the crystal ball; we can just read the book. There are a number of Scottish National party MPs whose advocacy has ensured that they receive levelling-up funds in their constituencies. I congratulate the hon. Member for Edinburgh North and Leith (Deidre Brock) on securing £16 million for UK Government money for the Granton gasholder in her constituency. The hon. Members for Central Ayrshire (Dr Whitford), for Aberdeen North (Kirsty Blackman) and for Aberdeen South (Stephen Flynn)—and even the right hon. Member for Ross, Skye and Lochaber (Ian Blackford)—have managed to secure money from either the levelling-up fund or the community ownership fund in this Budget.
It is fantastic that we have Scottish National party MPs petitioning my right hon. Friend the Chancellor of the Exchequer to bypass the Scottish Government in order to spend UK Government money in their constituencies. [Hon. Members: “More! More!”] And indeed there will be more, because in the forthcoming community renewal fund allocations, more money will be going to constituencies represented by Scottish National party MPs. That is because, as the Chancellor of the Exchequer pointed out in his Budget speech, we are stronger, better and wealthier together. It is great that Scottish National party MPs are putting the UK Government’s money where the Scottish Government’s mouth isn’t.
Levelling up is about making opportunity more equal across our whole United Kingdom. It is a recognition, as the Prime Minister and the Chancellor of the Exchequer have said, that while talent is spread equally across the United Kingdom, opportunity is not. If levelling up is to succeed, yes, we need funds such as the levelling up fund, but we also need a systemic approach to how the Government support local government, other institutions and the private sector in order to spread prosperity.
One of the challenges that we face when it comes to levelling up is that the difference between the more economically successful areas of the United Kingdom and those that are less successful involves a kind of “Anna Karenina” challenge. In the first line of that novel, Tolstoy points out that all happy families are happy in a similar way, but each unhappy family is unhappy in its own way. We can apply that to communities that need more help. The challenges that Knowsley faces are different from the challenges that Grimsby faces. The challenges that Bury faces are different from those that Burnley faces. We need to recognise that while all the challenges faced in coastal towns, in satellite towns around our major cities and in rural areas have common features, they all deserve to be addressed in a unique way.
If we are going to improve economic productivity and wellbeing, we need to recognise—as the Under-Secretary of State for Levelling Up, Housing and Communities, my hon. Friend the Member for Harborough (Neil O’Brien), has pointed out—that for levelling up to succeed, we need to ensure that local leadership improves and that we build on the success of, for example, combined authority Mayors such as Andy Street and Ben Houchen. We also need to improve living standards where they are lower, and to improve public services, particularly where opportunity has fallen behind. We also need to play a part in helping to restore pride in place, so that communities feel in a genuine sense that they have taken back control.
The Budget succeeded in addressing many of these challenges by ensuring that the funding was there to focus on each of the ingredients that require to be in place if we are to have levelling up. One of the first and most important areas in which the Budget made provision for change was in education, particularly in further education and in skills. An additional £3.8 billion is being spent over the course of the spending review period. That is a real-terms increase for those 16 to 19-year-olds who are in full-time education, and there is additional money to ensure that our groundbreaking T-levels are more available. There will be additional hours for those in further and technical education to ensure that they get the very best tuition, and there will be skills boot camps to ensure that we can accelerate the move of people into the labour market.
There will also be eight new institutes of technology—prestige further education institutions concentrated in the areas that most need levelling up. On top of that, the multiplier programme will provide more than £500 million to improve adult numeracy across the United Kingdom. All of this comes together in a package to recognise that, as well as building on the success of our education reform programme in schools, we also ensure that adult, technical and vocational education at last receives the focus, attention and funds that it deserves.
As well as investing in skills, we are going to invest better in small and medium-sized enterprises, which are of course the engine room of our economy. That is why the Chancellor outlined plans for the British Business Bank to expand in order to ensure that SME finance is more readily available. Regional funds are being extended across the northern powerhouse. The existing success of the BBB’s Cornwall operation is being extended to cover the whole of the south-west, and there will be new branches of the bank opening in Scotland, Wales and Northern Ireland in order to build relationships with small businesses and to ensure that they have access to the debt and equity finance that they need.
Alongside that, there will be increased investment in research and development. An additional £20 billion will be spent over the spending review period, going up to hit our £22 billion target, and this research and development money will move outside the greater south-east, where so much research and development expenditure has been concentrated in the past, in order to ensure that, whether it is in Manchester or Newcastle, areas of university excellence that require additional investment to ensure the smarter diffusion of innovation into the economy are supported in the way that they should be.
On top of that, we have the global Britain investment fund: £1.4 billion that will ensure those sectors that are strong and growing in our economy get the additional inward investment they need to drive up economic growth. We know inward investment is often the route to higher productivity, and that is why there will be £1.4 billion specifically targeted on the automotive sector, on renewables and on life sciences.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
Can the Secretary of State just explain to the House why, if the global Britain fund is forecast to be so successful, the Office for Budget Responsibility has downgraded our trade forecast?
Michael Gove
I will say two things. It is great to see the right hon. Gentleman in his place. When he left as Chief Secretary to the Treasury, he famously left a note saying that “there is no money” left; now, as he can see, there is significant money available to be allocated in all these areas. I recognise that he was speaking in jest and that those words should not be taken out of context.
More broadly, we face, as indeed every country faces, a global race for talent and a global appetite for additional investment. It is because of the global Britain investment fund, because of what we are doing in research and development and because of the way we are reforming UK Research and Innovation that we will be in a position to ensure that our economy is equipped to take advantage of the opportunities that Brexit brings, and the opportunities that the Chancellor of the Exchequer has outlined. I am confident that the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) will see our exporting ability and the inward investment routes into this country grow in years to come.
I should point out that at the beginning of my remarks, I said that the initially pessimistic view that was taken of our capacity to weather the covid storm has been gainsaid by the success of the Chancellor’s approach. Again, there is no need to look in the crystal ball; the right hon. Gentleman need only look at the book. The book and the record show the success of the Chancellor’s approach.
Michael Gove
I will try to make a little bit more progress.
It is also significant that, if we are to level up, we must ensure that we have appropriate investment not only in business itself, through the funds I have mentioned and the initiatives I have outlined, but in transport. We must ensure that the private sector is firing on all cylinders, and that means ensuring in particular that our great city regions have the transport networks required. That is why my right hon. Friend the Chancellor has devoted £5.7 billion over the course of the spending review period to supporting the ambitious plans put forward by metro Mayors and others to improve transport.
More than £1 billion has been allocated to the Mayor of the West Midlands Combined Authority, and more than £1 billion also to the Mayor of the Greater Manchester Combined Authority, Andy Burnham. Mr Burnham said last week—a point he made on Twitter and on broadcast; he was happy to comment on the spending review, unlike the hon. Member for Croydon North—that this was a “very positive first step.” He said:
“This feels like a breakthrough today…this is a big down payment”
on the infrastructure we need.
Mr Burnham welcomed that investment, and of course alongside it we had £830 million for West Yorkshire, £570 million for South Yorkshire, £710 million to improve transport in the greater Liverpool region and £300 million for Teesside. All those investments will help the Mayor of Greater Manchester, as he rightly wants to, ensure a Transport for London-style approach to the delivery of transport in that great region.
On top of that, as the Chairman of the Housing, Communities and Local Government Committee, the hon. Member for Sheffield South East (Mr Betts), pointed out, we have £4.8 billion going to local government over the spending review period. This is necessarily an injection of cash to help local government ensure it can play its part in levelling up, and to ensure that it is supported by thriving businesses. We have also reformed business rates and moved towards a three-year evaluation, relief on improvements, including improvements that will help to deal effectively with climate change, and a 50% reduction for small businesses in the most affected sectors.
All that comes alongside a commitment to additional spending from my Department to help those most in need. We also have £630 million a year allocated over the next three years—that is £1.9 billion in total revenue—to help to deal with homelessness and to eliminate rough sleeping. There is also additional capital investment specifically targeting those who have problems with drug use and those who have been in custody, to ensure that we can help them into the accommodation they need to deal with the challenges they face. Overall spending in this area is 75% higher than pre-pandemic levels.
Michael Gove
I am more than happy to give way to the Member of this House who has done more to deal with homelessness than any of us.
Mr Speaker
Just before you do, may I just say to the Front Benchers that I am getting bothered, as we have a lot of Members I want to get in? I am enjoying this very much and it is great entertainment, but I am getting bothered, as this is about Back Benchers as well and so I hope we are going to save some time for them. I think we are nearly 30 minutes in.
Michael Gove
My hon. Friend is absolutely right: those pilots have been successful. One thing we want to do is make sure we can apply their success more broadly, and further announcements will be made in due course.
Mr Speaker, I am very conscious of the fact that there is so much to unpack in the Budget and so many more people wish to speak. However, it would only be appropriate for me also to point out, before I come to my conclusion, that when it comes to housing itself—to the provision of safe, decent and affordable housing—my right hon. Friend the Chancellor has risen to the occasion, with £11.5 billion for our affordable housing programme and £1.8 billion for urban regeneration, and with a determination to ensure that we take a brownfield-first approach to the provision of new housing, recognising that what we need to do, which is right for the climate, levelling up and growth across this country, is concentrate on regenerating those communities that have suffered economically in the past and whom it is our duty to help now.
I hope the House can see that across the piece, in every area that matters when it comes to levelling up—supporting the private sector to invest and to export; making sure that local government has the tools it needs to play its part as a leader in regeneration; making sure that the money is there to help the most vulnerable, who should be our first concern; ensuring that both the funding and the reform package is in place to provide the schools of the future and the skills that we need; and, above all, making sure that there are decent, affordable homes available to all our citizens—the Chancellor’s package meets the need of the hour. That is why I commend this Budget statement to the House.
Several hon. Members rose—
Ed Davey
My hon. Friend is a real campaigner when it comes to the environment and climate change, and she is absolutely right. I make a prediction to her: this continuing concerted love-in with fossil fuels will be seen by our children as criminally negligent.
Let me be crystal clear about the Glasgow COP. Having led the UK delegation to three past COPs—in Doha, Warsaw and Lima—when I was Secretary of State for Energy and Climate Change, and having prepared the UK’s negotiating position ahead of Paris, I desperately hope that Glasgow succeeds. But when I see the Government’s gross diplomatic mistakes ahead of COP26, and when I hear a Budget speech that does not even mention climate change, I fear for the outcome of Glasgow, and I am angry with this Government.
I regret to say that, as I watched the Prime Minister pose in Rome’s Colosseum, he reminded me less of Emperor Augustus than of Emperor Nero. He talks about ending coal use across the globe, while refusing to stop a new coal mine being opened in Cumbria. He asks world leaders for the political will to act on climate change, while allowing new drilling—new drilling!—for oil on land in Surrey and offshore in Scotland. With the Secretary of State for Levelling Up refusing to use the planning power that he has for climate action, I fear that the only levels that will go up under his leadership are the sea levels.
I have to say to the Secretary of State that I am proud to be the Minister who passed the regulation that did more to stop fracking under this Government and I am proud that I passed it under his own nose in the Cabinet. He was one of the people urging me to go on to fracking but, because I fooled him, I managed to make renewable energy the watchword of the Liberal Democrats in power. We nearly quadrupled renewable energy. We made Britain the world leader in offshore wind power, despite opposition from the Conservatives. I am so proud that it is the Liberal Democrats who were responsible for cutting coal use in this country more than any other party.
By failing to take tough action on fossil fuels, the Government have missed an opportunity to help people who are struggling with heating bills, and to help Britain’s industries which are struggling with high energy costs. Here is what the Liberal Democrats would have done. We would have brought in a one-year windfall tax, on the gas producers making an absolute killing with the rise in global gas prices. We would have used that windfall and shared it with Britain’s fuel-poor and with Britain’s struggling energy-intensive industries. We would have used the cash from our fossil fuel windfall tax to target help on low-income households having to choose between heating and eating. For this, we would have more than doubled the warm home discount, and doubled the number of people who benefit from it.
Ed Davey
In a second.
We would have matched that immediate help with heating bills with a massive programme of home insulation, where this Government have so spectacularly failed. As I give way to the Secretary of State, I hope that he will say what investment there is under this Government for people to insulate their homes. The answer, by the way, is none.
Michael Gove
The right hon. Gentleman boasted that he had deceived members of the Cabinet, raising questions, inevitably, about the reliability of any Liberal Democrat promise. In 2013, he said this:
“Shale gas represents a promising new potential energy resource for the UK. It could contribute significantly to our energy security, reducing our reliance on imported gas, as we move to a low carbon economy.
My decision is based on the evidence. It comes after detailed study of the latest scientific research available and advice from leading experts in the field.”
He also said that the US’s economy had benefited greatly from fracking, and that was why we could benefit here. Which of those words does he now enjoy eating?
Ed Davey
The Secretary of State is known very well for his debating skills, but he is also known for his political skills. My political skills were shown in my ensuring that his Ministers, and he, believed that we were taking real action on fracking when I was passing the regulation that did more to stop fracking—let him hear this. We did more to stop fracking than any other group of politicians. I am really proud that the Liberal Democrats did more on renewable energy—
Michael Gove
On a point of order, Madam Deputy Speaker. The record must show that fracking was banned in the UK, but that it was the right hon. Gentleman who removed that ban because he was confident that the procedure would be safe from now on.
Mr Clive Betts (Sheffield South East) (Lab)
First, I associate myself with the comments of the hon. Member for Harrow East (Bob Blackman) about the need for more money for social housing and cladding and the importance of dealing with the issues of rough sleeping. We have dealt cross-party with those matters on the Housing, Communities and Local Government Committee.
Generally, I am supportive of the whole idea of levelling up, but I must say to the Secretary of State that I could be a lot more enthusiastic if I knew what it meant, how it would be achieved and how success would be measured. The recent report by the Business, Energy and Industrial Strategy Committee said that, for all the current documents, levelling up was
“a wide ranging and disjointed programme of random policies…it is difficult to see how they all tie together under one over-arching strategy.”
I think that is a fair comment on what exists now.
Presumably, it is the job of the Secretary of State, with his new responsibilities, to produce that overarching strategy and to tie together all these disparate funding streams. I presume we will see all that in the White Paper, which is hopefully coming shortly, and no doubt we can explore that further with him when he comes to the HCLG Committee next week.
However, as well as having an overarching national strategy, councils need the ability to plan and have a local strategy. That means doing away with all the disparate pots of money they have to bid for. The Local Government Association last calculated that there are 117 different pots of money that councils have to bid for. I am not making a party political point here; if we go to Conservative leaders of councils, they will be just as strident in their criticisms as Labour council leaders on this. Will the Secretary of State please look at that as a major issue?
Mr Betts
I see the Secretary of State nodding, so hopefully we might be able to get some change there.
The Secretary of State is right to emphasise the importance of transport. Yes, the South Yorkshire region got £600 million, but its bid to the levelling up fund for transport expenditure got turned down completely. When councils look at their local plans, there is a levelling up fund, a bus service improvement plan, a city region sustainable transport settlement plan and a zero emission bus regional areas fund to bid for. That is four different pots of money that councils must bid for to fund local transport services and that they must try to tie together, in the hope they may get some of them. That is really no way to enable our city region Mayors to plan the transport for their areas—no way at all.
That, of course, is against the background that in the Sheffield city region, expenditure on buses is £5 per head of population. It is £70 per head of population in London. That really needs to be addressed in levelling up.
I welcome the successful levelling-up fund bid from Sheffield for the regeneration—or the beginning of the regeneration—in Attercliffe in my constituency. I also welcome the £1.8 billion for brownfield sites, which is really important. Peter Freeman, the chair of Homes England, came to look at Attercliffe and the sites there, and I say to the Secretary of State that some changes to the way Homes England distributes its money are needed. First, we need to do away with the 80:20 rule, whereby Homes England is obliged to spend 80% of its money in the south-east—that simply cannot be right. We must look again at the Green Book evaluations of spending on housing sites, which are totally biased towards uplift in land values. There is bound to be a bigger uplift in land values on a greenfield site in the south than on a brownfield site in the north, and that needs addressing. We also need to look at the no additionality rule; where a derelict site with 100 old homes is cleared and 100 new ones are put in, thus really regenerating the area, Homes England funding cannot be got towards that. Those three issues do need addressing.
Finally, we had a discussion about the Institute for Fiscal Studies analysis of local government spending and what that meant. I say to the Secretary of State that in the past 10 years local government has been the major subject of austerity cuts—it has had bigger cuts than anywhere else. Those cuts have fallen disproportionately on the poorest areas; it has not been levelling up, but a major exercise in levelling down. The very areas that he says he now wants to help have had the biggest cuts to their funding in the past 10 years. This Budget will probably stop the cuts getting worse, but it is not seriously going to reverse them. There is a Government policy on levelling up, an aspiration and even a Department and a Secretary of State with “levelling up” in the title. I look forward to him actually showing us what levelling up means, and producing the policies and a coherent strategy that actually deliver it.
The Exchequer Secretary to the Treasury (Helen Whately)
It is a pleasure to close this debate. I thank the many right hon. and hon. Members who have spoken today for their speeches. The number who have spoken and the passion of their speeches demonstrates just how much we want levelling up, in this Chamber and in the constituencies that we represent.
Levelling up is the defining mission of this Government and it is a golden thread running through this Budget and this spending review. We believe that the place where a person grows up should never dictate their prospects, yet, as the Chancellor said last week, for too long, the location of people’s birth has determined too much of their future. Right now, communities throughout the country are held back by disparities in health, education and jobs.
Levelling up is about no longer accepting the consequences of a skewed economy, no longer accepting lower expectations, no longer accepting limited life chances, and no longer accepting that each new generation must choose between their family and their future, forced to travel to far-flung cities like modern-day Dick Whittingtons in search of opportunity. Levelling up is a new and optimistic future for the whole country—a future where a person’s hard work determines their success no matter whether they live in Burnley or Bromley. It is a future where there is a chance to succeed in your education, to follow your dreams and to achieve your ambitions wherever you live.
What does that mean in practice and how are we going to do it? First, we are investing in people across this country so that they have the skills they need to seize opportunities. We will start at birth and in childhood, with an extra £500 million investment, recognising the importance of the first 1,001 days of a child’s life, continuing through school and into adulthood with £3.8 billion extra spending on adult skills, welcomed I know by my hon. Friend the Member for Waveney (Peter Aldous) among others.
We are investing in places and in the infrastructure that connects them. We are investing £130 billion in infrastructure, including £21 billion in roads and £46 billion in railways. I was delighted this afternoon to hear colleagues welcoming our investment in roads, rail, buses and broadband across the country. May I congratulate many of those who have secured investment in the first round of the £4.8 billion levelling-up fund, including my hon. Friends the Members for Stoke-on-Trent South (Jack Brereton), for Stoke-on-Trent Central (Jo Gideon), for St Ives (Derek Thomas), and for Tiverton and Honiton (Neil Parish). I should also mention my hon. Friend the Member for Stoke-on-Trent North (Jonathan Gullis) who not only argued for more of the pie, but who probably got the highest word count per minute achieved in this Chamber this afternoon—a position that was hotly contested.
Stephanie Peacock
A quarter of kids are growing up in poverty in Barnsley yet both of our applications for the levelling-up fund were rejected, Can the Minister tell us why that is? If this Government are so committed to levelling up, why is the Secretary of State for levelling up not in his place?
Helen Whately
I am sure that the hon. Lady well knows, having followed this debate and recent conversations about the Budget, that constituencies and Members on the Conservative Benches and on the Opposition Benches have received funding from the levelling-up fund, including Members of the Opposition Front Bench. I encourage the hon. Lady’s constituency to bid in future rounds of the levelling-up fund. So far—[Interruption.] If she would please listen to what I am saying rather than continuing to shout at me. She asked me a question and I am responding. It is important to her constituency that she listens. Her constituency is clearly seeking levelling-up funds. I would be delighted if it received them. It will have the opportunity to bid for further funding in future rounds, along with other Members and constituencies that have expressed an interest in doing so.
Across the UK, we are creating the conditions for businesses to invest and flourish, because businesses create jobs and drive the growth that will see people’s living standards going up. This was an argument that was made skilfully by my hon. Friend the Member for Bosworth (Dr Evans) among others. Hence, we have a £1.4 billion global Britain investment fund and £1.6 billion additional funding for the British Business Bank’s regional funds.
As we pursue levelling up, we are empowering local leaders to shape and drive the transformation in their communities—local leaders who know best what their communities need. That was a point made by my hon. Friend the Member for Henley (John Howell) among others and exemplified by the £5.7 billion five-year consolidated transport settlements for the eight city regions.
During today’s debate, I heard several colleagues make comments such as “Don’t forget about the south”, from my hon. Friend the Member for Southampton, Itchen (Royston Smith); “Don’t forget about London”, from my hon. Friend the Member for Wimbledon (Stephen Hammond); and “Don’t forget Suffolk and Norfolk”, from my hon. Friend the Member for Waveney (Peter Aldous). I also heard, “There’s not enough money for the north.” I assure hon. Members across the House that levelling up will happen across the UK, in all regions and nations of the United Kingdom.
David Linden
One wonders why the Government need to level up after 11 years in power, but that is perhaps a damning indictment of their record in office. The Minister talks so much about levelling up and a level playing field, so why is it that English sparkling wine gets a tax cut in the Budget, but Scotch whisky only gets a duty freeze?
Helen Whately
I am delighted to pick up on the hon. Member’s comments. I am surprised that he did not welcome the level of funding—the highest ever block grant—that Scotland is receiving as part of the Budget and spending review. We are making much-needed reforms to the alcohol duty system, which has been recognised by many commentators over the years as dysfunctional and in the interests of neither public health, nor our economy. We are now moving to a fairer system that taxes more alcoholic drinks at a higher level. This is also fair to whisky. The hon. Member for Glenrothes (Peter Grant) called for whisky and wine to have the same duty rate by unit of alcohol. That is exactly what we are proposing in the reforms that will be introduced in 2023, because we recognise the importance of many parts of the sector—whether it is beer, cider, English and Welsh sparkling wine, or whisky—to the UK economy.
We are ensuring that regions that have historically received less investment are no longer overlooked. For example, some £500 million of the £1.7 billion of the first round of the levelling up fund will indeed go to the north of England, but there are examples of levelling up fund investment all around the country.
Helen Whately
I will make a bit more progress.
I heard some Opposition Members say that rich people are not paying in enough. Well, I ask them to look at the Government’s distribution analysis and the analysis of the Resolution Foundation. These analyses say that the Government’s policies boost incomes for those on the lowest incomes, while those with the broadest shoulders—the better off—are the ones who will be paying the most. I also ask Opposition Members to acknowledge, as so many Government Members did, how both the increase to the national living wage by 6.6% and the changes to the universal credit taper rate will help millions of households on the lowest incomes. For example, a single parent of two children who works full-time will be £1,200 better off next year thanks to these changes.
Liam Byrne
I only intervene because I am sure that the Minister does not want to lead the House astray. The Resolution Foundation is very clear in its analysis that three quarters of the 4.4 million people on universal credit will be negatively affected and the bottom fifth of people will be £280 a year worse off as a result of the £20 uplift being stripped away. I am sure that she would want the record to reflect that.
Helen Whately
I stand by what I said: the Government’s distribution analysis and the Resolution Foundation analysis say that this Budget and spending review boost the incomes of those on the lowest incomes, and that those who are better off are paying in the most. The crucial point about the changes to the taper rate for universal credit is that it is about ensuring that people keep more of what they earn, and get the benefits and rewards of their hard work. The effect that it has is a tax cut for those on the lowest incomes.
There were times when I wondered whether Opposition Members were scrutinising the same Budget as Government Members. At many points, it felt as though they had missed the point. It was clear that the Opposition have no alternative plan. It was not clear whether they felt that we were spending too much or too little; what they would cut; what they would change; or where they would raise funds from. We on the Conservative Benches know that we are making the hard, responsible decisions, and setting ourselves up for the future.
I come to a serious point I want to make. Colleagues rightly pointed out that public spending is relatively high, and I share colleagues’ concerns about the size of the state at the moment. In fact, the Chancellor himself spoke about this last week. We on the Conservative Benches know that government should have limits. We want people to keep more of the rewards of their efforts, and we have said that, by the end of this Parliament, we want taxes to be going up, rather than down.
Helen Whately
I would like to quickly correct the record. My apologies: I wanted to say that, by the end of this Parliament, we on the Conservative Benches want taxes to be going down. [Hon. Members: “Hear, hear!”] I thank my hon. Friends for their support.
Several hon. Members rose—
Helen Whately
I would like to sum up. In this Budget and spending review, we are seizing the moment to end historical disparities in education, health and employment opportunities, so that in the years ahead, more people throughout this United Kingdom will have the opportunity to live healthier, happier lives, and to fulfil their hopes, dreams and ambitions, wherever they live in the country.
Mr Deputy Speaker (Mr Nigel Evans)
Before the Whip moves the motion to adjourn the debate, may I say that there were 65 contributions from Back Benchers today? That has to be some sort of record for a Budget resolutions debate. I congratulate each and every one of you on your contribution.
Ordered, That the debate be now adjourned.—(Mrs Wheeler.)
Debate to be resumed tomorrow.