House of Commons (21) - Written Statements (15) / Commons Chamber (6)
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(4 months, 1 week ago)
Commons ChamberBefore I respond to the first question, I simply want to say that I know the whole House will be concerned about the extremely serious incident that has taken place in Southport. All our thoughts will be with the families and loved ones of those affected. I have been in contact with the Merseyside police and crime commissioner and the Merseyside mayor to convey my support to the police, and our thanks to them and emergency services for their swift and courageous response. The response to this awful incident is currently unfolding, and the House and the public will be updated in due course.
Small boat crossings undermine our security and put lives at risk. Criminal gangs are profiting from this trade in human lives. That is why we are establishing a new border security command with additional cross-border police, and new counter-terror powers.
Six boats came over the channel on Saturday, and there have been reports of another four today. That is more than 500 illegal migrants being escorted into our waters by the French authorities. Does the Home Secretary agree that it is time to stop paying the French any more money until they stop being complicit in this evil trade?
The hon. Member will know that these boat crossings are extremely dangerous. Another woman died in the channel yesterday, and criminal gangs are deliberately cramming boats to maximise their profits. They have been getting away with it for far too long. That is why we need the new border security command. It is also why we need to work not simply with the French police, but with police forces and organisations right across Europe and beyond, to pursue the gangs and prevent the boats from leaving the French coast in the first place.
The thing about borders is that they have two sides. The best way to secure a border is to have a constructive relationship with the country that it is shared with. What steps will the Home Secretary take to reach out to France and Belgium, in order to secure the border?
My hon. Friend is right that we need to strengthen work to prevent the gangs who are pursuing this vile trade in people. That is why we have immediately strengthened the UK presence in Europol and in the operational taskforces that go after the gangs. We are already in touch with leaders in France and Italy and right across Europe, so that we can strengthen co-operation, because the gangs are getting away with it and lives are being put at risk as a result.
May I start by extending my support to the Home Secretary for whatever incident is going on in Southport, and to Merseyside police, given the incidents we are sadly seeing in Merseyside today?
Earlier this month, the right hon. Lady refused to rule out the UK accepting migrants from European countries in exchange for a returns deal with Europe. Does she accept that under any deal she does, some of those sent to the United Kingdom from the European Union could harbour extremist ideologies or pose a security threat? Will she commit to ensuring strong safeguards, including a right of refusal on a case-by-case basis, to stop anyone who could put Britain’s security at risk from entering this country?
There will always need to be proper safeguards on security, and proper security checks on those who come to this country, but the problem with the boat crossings is that they undermine that border security. There are no checks on dangerous boat crossings, which put lives at risk, and on who criminal gangs choose to put into boats. We are clear that we need stronger border security. That is why we are setting up a new border security command, and counter-terror powers in new legislation. We recognise that returns—for example, of failed asylum seekers—have dropped substantially since the last Labour Government were in place. We have to turn that around; we want to increase returns.
For far too long, violence against women and girls has been treated as an inevitability, rather than the national emergency that it is. Our mission is for the whole country to halve violence against women and girls within a decade. That has to start with drastically improving the policing and criminal justice response.
I am proud to support the Government’s mission to halve violence against women and girls. I know from my time as a councillor that the experience of victims is much better if the police empathise with them. Will my right hon. Friend agree to look at work done by Alison Lowe, the Deputy Mayor of West Yorkshire, on connecting survivors with police, to ensure that the police are more empathetic when dealing with these awful crimes?
As a West Yorkshire MP, I join my hon. Friend in paying tribute to the work done by not just the Deputy Mayor of West Yorkshire, but the mayor and the chief constable. They have been looking at ways to improve women’s safety on the streets and speed up charging for domestic abuse. Charge rates for domestic abuse have dropped by about 40% across the country over the last eight years. That has to be turned around, because we need justice on those terrible crimes.
I welcome the Home Secretary’s comments, particularly in the light of a National Police Chiefs’ Council report that states that one in 12 women will be victim of a violent crime by a man. While police action is necessary, does she agree that this is a whole-Government and whole-society problem? We have to look at societal change and education, including health education, and we have to look at misogyny in the round, because it is about more than just violence; it happens to women every day, in the most everyday of circumstances.
I agree with the hon. Member that this has to be a broad mission; that is why the Prime Minister has talked about it being not just for Government or any individual Department. We will work on it across Government, but it must be about society as a whole. The Education Secretary has talked about tackling toxic misogyny in schools as well.
I welcome the steps that my right hon. Friend is taking to reduce violence against women and girls. Women’s refuges and other dispersed accommodation play a vital part in helping women and their children to escape domestic abuse. Scarborough has the highest domestic abuse rate in North Yorkshire, but we do not have a single refuge in the constituency of Scarborough and Whitby. Planning permission for a women’s refuge at Danes Dyke was granted in 2022, but progress has stalled due to rising business costs. Will the Home Secretary please advise on how the shortfall in funds referenced by North Yorkshire council, Beyond Housing and Homes England can be dealt with, so that this vital service can be built?
My hon. Friend is right to point out the important work done by refuges, as well as all kinds of voluntary sector groups who do immensely important work supporting victims and providing specialist advice. We have to recognise that funding for local council services has been hit; that is one of the issues that will be covered by my right hon. Friend the Chancellor in her statement in due course. We want to see work done in every community across the country as part of this mission, so that we get the best impact from every pound there is for supporting women and girls who face violence and abuse.
My constituency carries painful scars from a time when vulnerable girls were subjected to abuse and exploitation, but across the country it is not just so-called grooming gangs that present a danger to girls; abuse happens online, in institutions and in the home. What measures will the new Government put in place to target perpetrators and address the root causes of abuse and violence, to ensure that what happened to vulnerable girls in my constituency can never happen again?
My hon. Friend makes an immensely important point. She is a strong voice for victims of the most terrible abuse and violence. We need to ensure that victims get support, and that action is taken against perpetrators. Too often, the focus is on the too-weak support for victims, and there is not enough proper, strong action to go after perpetrators and ensure that they face justice for their terrible crimes. We will set out a new perpetrators programme to properly ensure that the police pursue the most dangerous offenders when it comes to violence against women and girls. That is the best way to ensure that everyone can stay safe.
The situation facing specialist charities is acutely difficult. Many local services have had to close their doors due to a lack of funding, including, sadly, Suffolk Rape Crisis. Long-term sustainable funding is crucial if women are to be supported after abuse and kept safe from future harm. Could my right hon. Friend confirm that Labour’s mission will include a review of funding for these life-saving services?
Our mission needs to be comprehensive, and to involve every area and local community; it is not just about the work of Government. We want strong partnerships in every area across the country, focusing on how to prevent violence against women and girls, ensuring that victims get support and pursuing perpetrators. We are keen to work closely with voluntary and third-sector organisations and refuges to make sure that we do that.
There were nearly 400 offences of violence against women and girls in Derby in 2022-23—shamefully, a fifth of all crimes in the city. I welcome the £83,000 for closed circuit television that will be put into operation by our new Derbyshire police and crime commissioner, but what further support can this Government provide so that women feel safe, and are safe, in our city centres?
I agree on the importance of that. As well as doing work specifically to target violence against women and girls, this Government are determined to increase neighbourhood policing, to get police back on the streets to make sure that people feel safe. We have lost around 10,000 neighbourhood police officers and police community support officers in the past eight years. We need to turn that around so that everyone can feel safe on our streets.
How will my right hon. Friend work with the devolved nations to ensure that we meet those targets?
My hon. Friend raises an important point. The mission needs be right across the UK. We must address this issue in all corners of our country, work in partnership, and learn from what has and has not worked in keeping women safe. We will continue to do that.
The right hon. Lady may be aware of Plymouth’s “Male Violence against Women and Girls Report” and its recommendations. It was commissioned to help the city, including part of my constituency, rebuild following two violent tragedies in 2021. Our belief has always been that our recommendations could form a blueprint for how towns and cities across the country address violence against women and girls. Will the right hon. Lady meet me to discuss how we might work together on this issue?
The hon. Member raises an important point. I have talked to Plymouth MPs over many years about the terrible incidents that Plymouth has had to endure, the impact on the community, and the importance of learning lessons to prevent future violence. We will continue to work with Plymouth, and I am sure that the safeguarding Minister will be happy to talk to her further about this. We need to ensure both prevention and a strong and robust response from law enforcement.
I applaud the new Government’s mission to halve violence against women and girls. In my previous role as the chief executive of Devon Rape Crisis, I learned how insidious widespread access to pornography among our children and young people is, and how damaging it is to both boys and girls. Could the Secretary of State assure me that the Department for Education will be involved in this mission, with a widespread education programme in all schools across the country about how dangerous pornography is? Will she commit to working with internet companies to further tighten up safeguards, in order to create a fail-safe mechanism, so that our young people cannot access this vile pornography?
The hon. Member may know that a review on pornography was established under the Conservative Government. That is due to report in the autumn, and we look forward to its conclusions. Let me take the opportunity to say that we will work with anyone on tackling violence against women and girls. Far too little has been done for too long, and we have inherited a legacy of far too much damage, but we want to pull everyone together to tackle this terrible crime.
Does the Home Secretary agree that it is shocking when there is violence against female emergency workers? How committed is she to ensuring that perpetrators face the full weight of the law?
Women must have the protection of the law wherever they face violence. That includes women emergency service workers, women police officers, and women shop workers who face violence in their job. That is one of the reasons why we are strengthening the law on assaults against shop workers, which particularly affect women at work, and why we need stronger action in policing. Too often, violence against women and girls has been seen as an inevitability, rather than a national emergency on which we need much stronger action.
Next month, the community in Twickenham will once again remember Amelie Delagrange, the French student who, many Members will remember, was brutally murdered on Twickenham Green some 20 years ago. Sadly, so little has changed since then. In a local survey by Richmond and Kingston youth council, 69% of boys said that they would not intervene, or would be unsure about intervening, if they witnessed friends sexually harassing someone. May I reiterate calls from both sides of the House for work with the Department for Education to make sure that boys, as well as girls, learn what is and is not acceptable?
The hon. Member is right that this needs to start early and start young. There is a strong personal commitment from the Education Secretary to starting this in schools, and continuing it throughout life, so that young men grow up understanding the importance of challenging misogyny and standing firm against violence of all sorts against women and girls. The hon. Member refers to awful cases from the past. She is right that for too long we have seen these cases and nothing has changed. We cannot let that go on. This has to be a moment for change. It is an opportunity for all of us to come together to make sure that happens.
I thank the Home Secretary very much for her positive answers to all the questions put forward. University of Ulster research from 2023 shows that an eye-watering 98% of women in Northern Ireland experience at least one form of abuse in their lifetime. Between 2017 and 2021, 35 women and girls were murdered there, a level of violence unprecedented across this United Kingdom of Great Britain and Northern Ireland. What discussions will the Home Secretary have with the Justice Minister back home about strategies for Northern Ireland for tackling abuse?
The hon. Member is right to raise this issue; it affects us in all corners of the United Kingdom. We are keen to work in partnership everywhere and anywhere to tackle these appalling crimes. The truly awful thing is that sometimes, when a terrible murder is looked into, authorities come to the conclusion that things could have been done to prevent the abuse, or the terrible murder or crime. We have to make sure that lessons are learned, and that it is not groundhog day, with us making the same mistakes again and again.
Once again, I welcome the right hon. Lady to her place. I welcome her Government’s commitment to halving violence against women and girls. It is an incredibly important agenda, and it builds on the work that the previous Government —my Government—did in this area. This issue remains a long-standing priority for me. I am very proud that, as Foreign Secretary, I led the international women and girls strategy, which meant that this issue was addressed internationally, not just domestically. Her desire to halve incidents of violence against women and girls fits neatly with my aspiration at the time to make the United Kingdom the safest place in the world to be a woman or girl.
We have seen an increase in arrest rates for violence against women and girls—they went up by 25% between 2019-20 and 2022-23—and a 38% increase in charge rates for rape over a year, but we recognise that there is significant and regular under-reporting of violence against women and girls. I want to make sure the right hon. Lady’s agenda does not inadvertently dissuade women from coming forward, so what specifically will be the metric by which we measure the halving of violence against women and girls?
The shadow Home Secretary has made the important point that we need to be addressing the prevalence of violence against women and girls, not simply the reporting. We know that there are many areas in which reporting needs to increase because there is often under-reporting, and we have work under way at the moment in order to ensure that that can be measured.
The right hon. Gentleman talked about the increase in charge rates. If a very small number increases by just a little bit, it is still a very small number. The charge rate is still far too low, and the number of prosecutions and convictions for domestic abuse is more than 40% lower than it was eight years ago. This requires a major overhaul of the system, and I look forward to working with the right hon. Gentleman’s party and with all parties in order to do that, but we must be very honest with ourselves about the damage that has been done.
We are determined to stamp out the scourge of serious youth violence, and we have set out an unprecedented mission to halve knife crime within a decade. We will introduce legislation to remove dangerous knives from our streets, and will tackle online knife sales with new sanctions for technology executives whose companies fail to obey the law. Our new young futures programme will prevent teenagers from being drawn into violence by bringing services together around them to ensure that they stay on the right path.
My constituency is in the west midlands, which, sadly, has been described as the knife crime capital of the United Kingdom. Only last September 16-year-old Terrell Marshall-Williams lost his life when he was stabbed to death with a so-called Rambo knife, and in March this year 17-year-old Harleigh Hepworth was stabbed to death in a park.
When we were previously in government, we used to have a slogan: “tough on crime, tough on the causes of crime”. Given that issues such as drug abuse, lack of access to adequate mental health services and cuts in community provision—including youth centres—are considered to be causes of youth crime, how will my right hon. Friend’s Department use initiatives such as the young futures programme to tackle not only youth violence but the causes of youth violence?
Let me first offer my condolences to the families of my hon. Friend’s constituents who so tragically lost their lives. Tackling serious violence and halving knife crime is a core part of our safer streets mission, but to be successful it will require action across Whitehall and with all partners including police, probation youth services, technology companies, charities and community organisations. My hon. Friend mentioned the preventive element provided by our young futures programme. The young futures hubs will be staffed by a range of trained professionals to support young people and help to prevent them from being drawn into violence.
The last Government lost control of the asylum system, which has meant sky-high asylum accommodation costs but also too many cases in which people have fallen through the net and ended up destitute. That has added to the already heavy burden that local authorities have to deal with. This Government will get a grip. We have already set out plans to process asylum claims that have been stuck in record high backlogs, and have given assurances to the Secretary of State for Housing, Communities and Local Government that we will take action to reset the relationship between the Home Office and local authorities.
No recourse to public funds is a policy that prevents most migrants in the UK from accessing most forms of welfare support. I would like to see the policy scrapped altogether to reduce child poverty and homelessness, but, at the very least, will the Minister stop applying it to the visas of any parents of children under 18 to ensure that children can be adequately protected against poverty and destitution?
No, the best way to deal with the issue of destitution, in my view, is to decide asylum claims quickly and accurately so that those who are entitled to work can do so and can have such recourse, and those who are not can be swiftly removed.
Levels of violence and abuse towards retail workers are unacceptably high, with a shoplifting epidemic plaguing our high streets across the country. That is why this Government will bring in a new offence of assaulting a retail worker, and end the effective immunity for shoplifting of goods below £200. Unlike the Conservative party, we want to send a message that all shoplifting is illegal and that offenders will not escape punishment.
Record rates of retail crime and shoplifting are blighting our high streets, including in Ipswich, where too often such instances act as a flashpoint for completely unacceptable levels of violence, threats and abuse directed towards retail workers. I very much welcome the Government’s commitment to ending the £200 threshold for prosecuting shoplifters, and the introduction of a stand-alone offence that will give shoplifters the protection they need. Will the Minister join me in Ipswich to meet local retail staff, so that she can hear about their experiences and the vital difference that these steps will make?
I commend my hon. Friend for raising this issue. It is true that the steps we are taking owe much to the work of the Union of Shop, Distributive and Allied Workers, the Co-op, the British Retail Consortium and the Association of Convenience Stores. Everyone has a right to feel safe at work, but the March statistics show a 30% increase in shoplifting offences, many of which are violent, over 12 months. We welcome the operational commitments made by the police in the retail crime action plan. I know that the Minister of State, Home Department, my right hon. Friend the Member for Kingston upon Hull North and Cottingham (Dame Diana Johnson) has heard my hon. Friend’s request and that she will be happy to visit Ipswich with him.
As a Back Bencher and chair of the all-party parliamentary group on retail, I campaigned alongside retailers and the likes of USDAW to up the ante on protecting retail workers. I know that retail workers welcomed my party’s action on the retail crime action plan, particularly the use of tagging and facial recognition technology. Can the Minister assure us that there will be no let-up in the use of facial recognition and tagging to clamp down on this and other crimes?
I thank the shadow Minister for his question, and I can confirm that we are continuing to look at this issue. We welcome the operational commitments that have been made by the police in the October 2023 retail crime action plan and, indeed, the commitment from police across England and Wales to prioritise attendance where violence has been used towards shop staff.
Antisocial behaviour is blighting high streets and town centres right across the country, and our communities are paying the price. That is why this Government have made tackling it a top priority. We will restore neighbourhood policing, putting bobbies back on the beat in every corner of the country, and we will introduce new respect orders so that the police can get repeat offenders off our streets.
Antisocial behaviour is one of the most common issues raised my constituents in Bolton North East. Can the Minister assure me and my constituents that her Department will take clear steps to tackle the issue head on?
Absolutely. We have been very clear that we see neighbourhood policing as the bedrock of restoring public confidence in policing, and the neighbourhood policing guarantee is a crucial part of that. The police have powers to crack down on the antisocial use of dangerous and deafening off-road bikes, which causes much concern in many of our constituencies, so that they can be seized and destroyed far more swiftly.
I thank the Minister for her answer, and I would like to associate myself with the comments made by the Home Secretary in respect of Southport. During the election, my constituents in Cardiff West repeatedly raised the issue of antisocial behaviour. I know they will be grateful for the Minister’s answer, but can she assure me that this Government will work closely with the South Wales Police and our new police and crime commissioner, Emma Wools, to deliver on this vital mission?
Absolutely. As I said in my opening answer, a priority for the Government is tackling the scourge of antisocial behaviour. We know that the police and local authorities have a range of powers to deal with antisocial behaviour, which we will strengthen through new legislation.
Crime and antisocial behaviour was the No. 1 issue on the doorstep during the election, and my constituents in Birmingham Northfield are paying the price for years of cuts to community services and neighbourhood policing. Figures released last week show that there was a 10% fall in recorded crime in Birmingham last year, but the number of shoplifting reports was up by a third. Will the Minister arrange a meeting with me, Simon Foster the West Midlands police and crime commissioner, and Birmingham city council, to discuss how respect orders and other measures can reduce the crime and antisocial behaviour that is blighting our communities?
My hon. Friend is absolutely right about this being one of the top issues on the doorstep during the general election campaign. It is worth reflecting on the fact that the powers in the Anti-social Behaviour, Crime and Policing Act 2014 actually weakened the response to antisocial behaviour, and for far too long the Conservatives wrote this off as just low-level crime. That is why we are introducing respect orders and stronger powers for the police to tackle persistent antisocial behaviour offenders and get them out of our town centres. Of course I would be happy to meet my hon. Friend to discuss this issue.
Residents in the Highfields area of Stafford have expressed concern around off-road vehicles being used in pedestrian areas. People, especially the elderly and vulnerable, have reported feeling intimidated and concerned for their safety and the safety of others. Could the Minister please tell me what the new Government have planned to tackle this issue?
I am very aware of this issue and, as I said in an earlier response, we want to make sure that there is swift action to deal with it. We think the neighbourhood policing guarantee, getting police officers back on to the beat to see what is going on, will provide that reassurance. Stopping antisocial behaviour is key and we will make sure that that happens, but I am happy to discuss it with my hon. Friend as well.
I welcome my right hon. Friend and her team to their places, and I thank the Home Secretary for visiting Leigh prior to the election to acknowledge the issues that we face in our towns. As my right hon. Friend knows, our town centres are struggling with persistent antisocial behaviour, often fuelled by drugs and alcohol abuse. That is placing a significant strain on our police force, deterring residents from visiting the towns and causing unease in the business community. I welcome the Home Secretary’s measures for more policing, but for fear of just moving the problem along, will my right hon. Friend outline the potential for collaboration among support agencies to better manage the complex nature of these offences?
I thank my hon. Friend; how nice it is to see her back in her place in this House. Of course, collaboration will be key to tackling antisocial behaviour. In line with our manifesto, we will be introducing powerful new respect orders, giving the police greater powers to get persistent antisocial offenders off our streets. We will also introduce zero tolerance zones through a form of expedited public space protection orders, to prevent antisocial street drinking or local drug dealing, for example, from blighting particular areas.
At Manchester airport this past week we have seen how antisocial behaviour can quickly spiral into serious violence. We have also seen how police officers can become subject to trial by social media with only partial information. The previous Government brought forward the use of force review to give police the clarity and confidence to act in the most challenging of circumstances. Will the right hon. Lady assure the House that she will continue this important work and stand on the side of our brave officers?
I would just say to the shadow Policing Minister that one of the incidents he is referring to is clearly still under consideration by the Independent Office for Police Conduct, and it would be wrong for me to make any further comment on that at this time. Of course the police have our backing in the difficult job that they have to do, particularly around antisocial behaviour, and we will of course do what we can to support the police when they need that support.
As the Minister has said, the physical presence of police officers—coppers on the beat—is crucial to tackling antisocial behaviour, but during recent years we have seen the number of police officers in the highlands of Scotland decline hugely. That is extremely worrying and does nothing for public confidence in the police force. I know that policing is devolved to the Scottish Government, but may I with some passion ask the Minister: what advice does she have for me as a Scottish Member?
I am sure the hon. Gentleman does not need advice from me. He is quite clear that this is a devolved matter, so he obviously needs to take it up with the Scottish Government and Police Scotland. As an incoming Government we recognise that having enough police on the beat and being visible is important to the public feeling safe. That reassurance is vital, so perhaps the hon. Gentleman will take it up with the Scottish Government and Police Scotland.
Facial recognition technology is being used effectively by police forces to identify suspects more quickly and accurately but, of course, it is essential that any new technologies are accompanied by strong safeguards and are underpinned by a robust legal framework. This Government will give careful consideration to the overall impact of all new policing technology.
I welcome my hon. Friend’s response, but facial recognition technology is being used by the police in publicly accessible places, and it breaches human rights and discriminates disproportionately against black people. The previous Government failed to introduce legislation to restrict its use, so can my hon. Friend confirm when there will be legislation to protect us? Will he meet me and representatives of civil liberties organisations to discuss this matter further?
I understand that the National Physical Laboratory has independently tested the algorithms that the police have been using in live facial recognition cases and has found them to be highly accurate. It found no statistically significant differences based on ethnicity at the settings the police generally use.
It is extremely important that any new technology used by the police is accompanied by strong safeguards, including to prevent bias or disproportionality, and that a robust legal framework is in place to govern the use of these new technologies. My hon. Friend still has concerns, and I am sure the policing Minister, my right hon. Friend the Member for Kingston upon Hull North and Cottingham (Dame Diana Johnson), or I will be happy to meet her.
After 14 years of Conservative chaos, we inherited an asylum system that not only does not work but costs billions of pounds. We are determined to restore order to the asylum system so that it operates swiftly, firmly and fairly. Additional caseworkers will be used to clear the backlog of claims and appeals while properly enforcing the rules and ensuring that those with no right to be here are swiftly removed.
I appreciate the efforts that my hon. Friend has outlined. As the backlog is cleared, what steps will the Home Secretary take to ensure that newly recognised refugees do not face homelessness and destitution in the weeks after being granted status? Specifically, will she consider extending the move-on period to 56 days, in line with the Homelessness Reduction Act 2017?
The Government are aware of the need for a smooth transition between asylum accommodation and other accommodation for those asylum seekers who are granted leave to remain. We understand this issue, and we are considering it.
According to a 2022 YouGov poll, 81% of people support a right of asylum seekers to work. Currently, successful asylum seekers have little choice but to present to their local authority as homeless, as they have no way of saving for a deposit or proving an income to a potential landlord. Some councils, such as Bournemouth, Christchurch and Poole council, of which I was formerly leader, have joined the “lift the ban” coalition in supporting people’s right to work after six months.
I accept that the Minister has talked about speeding things up, but two thirds of asylum seeker claims are currently taking more than six months, so it will take some time to do that. A right to work would reduce the homelessness burden on councils and improve the mental health of asylum seekers, helping them to integrate with the host authority and filling vacancies in our economy. Will the Minister work with Refugee Action to consider that?
No, the answer is to speed up the asylum system so that we can get proper results much faster, and swiftly remove those who do not have a right to be here, while ensuring that those who do can be integrated and begin to work.
It will always be a Government priority to protect our elections against foreign interference. Established processes are in place to protect the UK’s democratic integrity, including the National Security Act 2023, providing security services and our law enforcement agencies with the tools they need to tackle state threats. Last week, the Home Secretary and I convened the defending democracy taskforce to consider any issues arising from the election.
During the recent general election, some of my constituents in Cowdenbeath and Kirkcaldy were understandably frustrated by delays in the postal voting system. I understand that the Electoral Commission is looking into this and I hope that lessons will be learned. Our democratic system must always be protected from both domestic and foreign malign interference, including misinformation. Will the Minister update the House on the work being undertaken by the defending democracy taskforce to review measures put in place to protect the general election? Will he also explain what efforts are being made to protect our wider democratic system?
I welcome my hon. Friend to her place. The defending democracy taskforce met for the first time under the new Government on 25 July. The taskforce brings together Ministers from across Government, along with representatives from law enforcement and the intelligence community. Last week’s meeting discussed how political intimidation and harassment has no place in our society, and how the taskforce will drive a whole-of-Government response to the full range of threats to our democracy. The taskforce will bring to bear the full range of tools and capabilities to meet this challenge.
I warmly welcome the appointment of the Minister and congratulate him on it. Like me, he will appreciate that the security and intelligence agencies are reluctant to be seen to interfere in the democratic process, but does he agree that steps must be taken to ensure that the proceeds of kleptocracy in countries such as Russia are not used to infect democratic political parties in this country and elsewhere?
The right hon. Gentleman speaks with great wisdom and authority on these matters, and he has huge experience of them, so I will not detain the House any further, but say yes, I agree with him.
Last week’s crime figures showed that shoplifting has increased by 30% in a year and street crime has gone up by 40% in a year. At a time when antisocial behaviour has become a serious challenge in some town centres, neighbourhood policing figures are down by a further 28%. This is deeply damaging because communities need to feel safe, particularly at the heart of their communities. That is why this Government are determined to restore neighbourhood policing. The new crime and policing Bill announced in the King’s Speech will include strong measures to support neighbourhood policing and to give the police stronger powers to crack down on shoplifting and antisocial behaviour in order to keep our streets safe.
I am grateful to the Home Secretary for that answer. My constituents in Newcastle-under-Lyme raise crime and antisocial behaviour with me almost daily, which is why they welcome the Government’s commitment to restoring meaningful and effective neighbourhood policing. Will she meet me to discuss how Newcastle-under-Lyme can best benefit from this important step in the right direction?
The policing Minister and I would be very happy to talk to my hon. Friend about the importance of rebuilding neighbourhood policing in his constituency and across the country. Fundamentally, this is about making communities feel safe, and about restoring the confidence of local communities in policing and community safety in their area.
The scrutiny of Government can work properly only when Ministers are open, honest and transparent. It is therefore disappointing that the Home Secretary has still failed to respond to my letter of 10 July—[Interruption.] Well, if Ministers on the Treasury Bench do not believe that responding to letters from the Opposition Front Bench matters, that is probably something that they might like to take up with you, Mr Speaker.
On the right hon. Lady’s first outing at the Dispatch Box, her statement was late and, in that statement, she used unpublished figures—almost a week later, she has still not provided any published evidence for the figures she used. My question today is simple. I have raised it with her previously but she has still not given me an answer. Where is she going to send failed asylum seekers from Afghanistan, Syria and Iran?
Order. We are on topical questions, which are meant to be short and quick. Members on both sides of the House will be unable to get in, so please, look to those on the Front Bench and others who have held us up.
For the former Home Secretary to talk about scrutiny and transparency, given that he failed to tell the House that he was spending £700 million over two and a half years on sending four volunteers to Rwanda, is just shocking. The problem with his policies is that he was not sending failed asylum seekers or asylum seekers anywhere. In fact, his Government sent more Home Secretaries to Rwanda than they did asylum seekers.
I totally sympathise with what my hon. Friend has set out. The police do have powers to seize vehicles being used illegally or in an antisocial manner, and to fine individuals who fail to stop when instructed to do so. We will set out our plans to crack down on antisocial road users in due course.
There is a crofter living in the Rhiconich-Kinlochbervie area of my constituency. He is very hard-working, he is well-liked locally and he has done a great deal for the local community, but he is German and he is trying ever so hard to get leave to remain, but it is taking forever. I would be very grateful if the Minister asked her officials to meet me to see how we can speed this matter on.
I would be more than happy to meet the hon. Gentleman.
I thank my hon. Friend for raising that important case. This was an awful attack on a serving soldier in her constituency. All of our thoughts will be with him and with his family and friends, and we wish him a most speedy recovery. We give Kent Police our full support in investigating this incident and in providing reassurance and community patrols in the area.
The right hon. Gentleman makes an important point. Spiking is a terrible crime, it is extremely dangerous and too often it is not taken seriously enough. We will work with anyone and everyone to tackle this appalling crime, so that not only is more work done to prevent spiking in the first place, but, when it does take place, the perpetrators feel the full force of the law.
The Government recognise the importance of tackling rural crime. We are committed to safeguarding rural communities with tougher measures to clamp down on antisocial behaviour and strengthen neighbourhood policing and stronger laws to prevent farm theft and fly-tipping. The national rural crime unit provides police forces with specialist operational support in respect of the theft of farming or construction machinery, livestock theft, fly-tipping, fuel theft and equine crime.
The right hon. Gentleman, who has a long-standing interest in these matters, knows that we do not comment on whether an organisation is being considered for proscription. What is clear is that Iran’s malign activities, including the activities of the IRGC, are completely unacceptable. I can give him an assurance that we keep these matters under very close review.
For the communities in my constituency mourning the loss of a young person to knife crime, the Government’s commitment to ban zombie knives, machetes and ninja swords cannot come soon enough. Can the Home Secretary confirm that, in bringing forward this vital legislation, she will ensure that the penalties for selling those weapons illegally will be substantial and that they will apply personally to executives at the highest level in any retail outlet, including online marketplaces such as eBay and Amazon?
The Government have a manifesto commitment to ban ninja swords and other weapons and will be taking it forward as soon as possible. I have listened carefully to what my hon. Friend has said. Ensuring that lethal blades that have been used to kill teenagers on our streets are no longer available to buy or sell is a key priority. We will also implement the ban on zombie knives and zombie-style machetes, which was approved by Parliament in April.
I think most people in this country want to see strong border security and a properly controlled and managed asylum system, where we do our bit for those who have fled persecution and conflict, but where those who have no right to be here are returned. We do not have any of those things at the moment. That is why we are strengthening our border security and why we continue to support important routes such Homes for Ukraine and the support for Afghanistan.
In Tooting town centre, we have had Operation Kenny rolled out this year, which has been fantastic in tackling violent crime and making people feel safer. It has meant more police patrolling the streets on a continuous basis and has led to a 70% reduction in crime. We would like to see that programme rolled out across the country, so can I tempt the Home Secretary to visit Tooting to see the fantastic effects that it is having?
I thank my hon. Friend for highlighting that important work being done on the streets of London. We want to ensure that policing has the support it needs from central Government. I am sure that the Home Secretary or I would very much enjoy a visit to see that in action.
I agree with the hon. Member that the problems we have seen with off-road bikes—the deafening and distressing harassment that they can sometimes cause—are serious. That is why this Government are determined to strengthen the law on off-road bikes to give the police more powers and to put more police on the street. I hope that his party will support that now.
In my home town of Blackpool, knife crime has risen 416% since 2015-16. When I was out with young people in Blackpool a few weeks ago, they told me that it is now the norm that young people across my town carry a knife. Will the Secretary of State agree to meet me to discuss this matter urgently and address the issue in Blackpool?
My hon. Friend is right that we have seen deeply damaging increases in knife crime. That is why we are making it part of our mission on crime to halve knife crime over the next 10 years. That has to involve stronger action on knife sales, stronger action in the law and stronger prevention with the new young futures programme.
The seasonal agricultural workers scheme remains absolutely vital for farmers, largely due to the piecemeal nature of its running by the last Government, which means that farmers have not been able to make the investment decisions that they want to. Will the Home Secretary commit now to a scheme for the whole of this Parliament to provide certainty to farmers and workers?
The hon. Member will know that the Migration Advisory Committee recently produced a report on the seasonal workers scheme. The report is being kept under review and we will update the House in due course.
I had the pleasure of visiting the Metropolitan police special operations unit in my constituency with the new Policing Minister on Saturday. We discussed a range of issues with the officers, from counter-terrorism to dealing with violent crime, protests and antisocial behaviour. Does the Home Secretary agree that we need additional resources for our police officers and urgent action to work with the Met to keep our streets safe in London?
It was a great pleasure to be on that visit with the local constituency MP. We will consider funding around the police settlement in the weeks and months ahead.
A few days ago, the Home Office published a notice about the use of the Northeye detention centre in my constituency, telling residents very little except that no decision had been made. As a matter of urgency, will the Home Office publish what options it is considering for the centre’s use and commit to a timetable for telling residents when it will come to at least a provisional decision that I and my constituents can feed into?
The site was purchased by the former Government. I understand the uncertainty that has been caused by this, especially in the local community, and they will want to know the Home Office plans for the site. A decision will be made on the use of the Northeye site at the earliest opportunity and I will keep the hon. Member informed.
(4 months, 1 week ago)
Commons ChamberBefore I begin my statement, my thoughts and prayers are with those affected by the events in Southport, and I am sure that the whole House will join me in paying tribute to our emergency services who are dealing with this ongoing situation.
On my first day as Chancellor of the Exchequer, I asked Treasury officials to assess the state of public spending. That work is now complete and I am today presenting it to this House. In this statement, I will do three things. First, I will expose the scale—and the seriousness—of what has been uncovered; second, I will lay out the immediate action that we are taking to deal with the inheritance; and third, I will set out our longer-term plans to fix the foundations of our economy. Let me take each of these points in turn.
First, I turn to the inheritance. Before the election, I said that we would face the worst inheritance since the second world war: taxes at a 70-year high, debt through the roof, and an economy only just coming out of recession. I knew all of those things, and during the campaign, I was honest about them and about the difficult choices that they meant. The British people knew them too. That is why they voted for change. But upon my arrival at the Treasury three weeks ago, it became clear that there were things that I did not know—[Interruption.]
Order. This is an important statement for all constituents, including mine. If I am struggling to hear it, they are struggling at home as well. You will all get your chance to ask questions; I think it is more important to hear, and then comment.
There were things that the Conservative party covered up—covered up from the Opposition, from this House and from the country. That is why today we are publishing a detailed audit of the real spending situation, a copy of which will be laid in the House of Commons Library. I take this opportunity to thank the Chief Secretary to the Treasury, my right hon. Friend the Member for Bristol North West (Darren Jones), for his leadership, and Treasury officials for all their work in producing this document.
Let me now explain what that document has uncovered. The previous Government published their plans for day-to-day spending in the spring Budget in March, but when I arrived at the Treasury, I was alerted by officials on the very first day that that was not how much the Government had expected to spend this year. It was not even close; in fact, the total pressure on those budgets across a range of areas was an additional £35 billion. Once we account for the slippage in budgets that we usually see over a year and the reserve of £9 billion designed to respond to genuinely unexpected events, that means that we have inherited a projected overspend of £22 billion. That is a £22 billion hole in the public finances now—not in the future, but now. It is £22 billion of spending this year that was covered up by the Conservative party. If left unaddressed, it would mean a 25% increase in the budget deficit this year, so today I will set out the necessary and urgent work that I have already done to reduce that pressure on the public finances by £5.5 billion this year and over £8 billion next year.
Let me be clear: I am not talking about costs for future years that the previous Government signed up to but did not include, like the compensation for infected blood, which has cross-party support. I am not talking about the state of public services in the future, like the crisis in our prisons that they have left for us to fix. I am talking about the money that the previous Government were already spending this year and had no ability to pay for, which they hid from the country. They had exhausted the reserve and they knew that, but nobody else did. They ducked the difficult decisions, put party before country, and continued to make unfunded commitment after unfunded commitment, knowing that the money was not there. That has resulted in the position that we have now inherited: the reserve was spent more than three times over only three months into the financial year, and the previous Government told no one.
The scale of this overspend is not sustainable, and to not act is simply not an option. This month, we have seen official Office for National Statistics figures showing that borrowing is higher this year than the Office for Budget Responsibility expected, and the disaster of Liz Truss’s mini-Budget shows what happens if we do not take tough decisions to maintain economic stability. Some, including the Leader of the Opposition and the shadow Chancellor, the right hon. Member for Godalming and Ash (Jeremy Hunt), have claimed that the books were open. How dare they? It is not true, and I will tell the House why: there are very clear instances of specific budgets that were overspent and unfunded promises that were made, but that—crucially—the OBR was not aware of for its March forecast. I will take each in turn.
The first is the asylum system. The forecast for the number of asylum seekers has risen dramatically since the last spending review, and costs for asylum support have risen sevenfold in the past three years, but instead of reflecting those costs in the Home Office budget for this year, the previous Government covered up the true extent of the crisis and its spending implications. The document I am publishing today reveals a projected overspend on the asylum system, including the previous Government’s failed Rwanda plan, of more than £6.4 billion for this year alone. That figure was unfunded and undisclosed.
Next, in the wake of the pandemic, demand for rail services fell. Instead of developing a proper plan to adjust to that new reality, the Government handed out cash to rail companies to make up for passenger shortfalls, but failed to budget for this adequately. Because of that, and because of industrial action, there is now an overspend of £1.6 billion in the transport budget. That was unfunded and undisclosed.
Since 2022, the Government, with the support of the whole House, have rightly provided military assistance to Ukraine in response to the Russian invasion. The spending audit found that there was not enough money set aside in the reserve to fund all these costs. We will continue to honour these commitments in full, and unlike the previous Government, we will make sure that they are always fully funded.
On top of these new pressures, since 2021 inflation was above the Bank of England’s target for 33 months in a row—hitting 11% at its peak—but the previous Government had not held a spending review since 2021, which means that they never fully reflected the impact of inflation in departmental budgets. That had a direct impact on budgets for public sector pay.
When the last spending review was conducted, it was assumed that pay awards would be 2% this year. Ordinarily, the Government are expected to give evidence to the pay review bodies on affordability, but extraordinarily, this year the previous Government provided no guidance on what could or could not be afforded to the pay review bodies. That is almost unheard of, but that is exactly what they did. Worse still, the former Education Secretary had the pay review body recommendations sitting on her desk. Instead of responding and dealing with the consequences, the Government shirked the decisions that needed to be taken.
I will not repeat the previous Government’s mistakes. Where they provided no transparency to the public, and no certainty for public services, we will be open about the decisions that are needed and the steps that we are taking. That begins with accepting in full the recommendations of the independent pay review bodies. The details of these awards are being published today. That is the right decision for the people who work in, and most importantly the people who use, our public services. It gives hard-working staff the pay rises they deserve while ensuring that we can recruit and retain the people we need.
It should not have taken this long to come to these decisions and I do not want us to be in this position again, so I will consider options to reform the timetable for responding to the pay review bodies in the future. This decision is in the best interests of our economy too: the last Government presided over the worst set of strikes in a generation, which caused chaos and misery for the British public and wreaked havoc on the public finances. Industrial action in the NHS alone cost the taxpayer £1.7 billion last year. That is why I am pleased to announce today that the Government have agreed an offer to the junior doctors that the British Medical Association is recommending to its members.
My right hon. Friend the Health Secretary will set out further details. Let me pay tribute to him: his leadership on the issue has paved the way to ending a dispute that has caused waiting lists to spiral, operations to be delayed and agony for patients to be prolonged. Today marks the start of a new relationship between the Government and staff working in our national health service, and the whole country will welcome that.
Where the previous Government ducked the difficult decisions, I am taking action. Knowing what they did about the state of the public finances, they continued to make unfunded commitment after unfunded commitment that they knew they could not afford, putting party before country and leaving us with an overspend of £22 billion this year. Where they presided over recklessness, I will bring responsibility. I will take immediate action. Let me set it out in detail.
On pay, I have today set out our decision to meet the recommendations of the pay review bodies. Because the previous Government failed to prepare for these recommendations in the departmental budgets, they come at an additional cost of £9 billion this year. The first difficult choice I am making is to ask all Departments to find savings to absorb as much of this as possible, totalling at least £3 billion. To support Departments as they do this, I will work with them to find savings ahead of the autumn Budget, including through measures to stop all non-essential spending on consultancy and Government communications. I am also taking action to ask Departments to find 2% savings in their back-office costs.
I will now deal with a series of commitments made by the previous Government that they did not fund, because if we cannot afford it, we cannot do it. First, at the Conservative party conference last year, the former Prime Minister announced the introduction of a new qualification: the advanced British standard. That is a commitment costing nearly £200 million next year, rising to billions across future years. This was supposed to be the former Prime Minister’s legacy, but it turns out that he did not put aside a single penny to pay for it. So we will not go ahead with that policy, because if we cannot afford it, we cannot do it.
Next, the Illegal Migration Act 2023, passed by the previous Government, made it impossible to process asylum applications or remove people who have no right to be here.
Instead, they relied on a doomed policy to send asylum seekers to Rwanda on planes that never took off, leaving tens of thousands of people stuck in hotels on the public purse. We need a properly controlled and managed asylum system where rules are enforced, so that those with no right to be here are swiftly removed. So we have scrapped their failed Rwanda scheme, which placed huge pressure on the Home Office budget. To bring down these costs as soon as possible, my right hon. Friend the Home Secretary has already laid legislation to remove the retrospective element of the Illegal Migration Act, which will significantly reduce the use of hotel accommodation. These measures will save nearly £800 million this year and avoid costs spiralling even further next year. This was a bad use of taxpayers’ money, and we will not do it.
The previous Government claimed they were levelling up the country. They made promise after promise to the British people, but the spending audit has uncovered that some of those commitments were not worth the paper that they were written on. At autumn statement last year, the former Chancellor announced £150 million for an investment opportunity fund, but not a single project has been supported from that fund.
So following discussions with my right hon. Friend the Deputy Prime Minister, I am cancelling it today, because if we cannot afford it, we cannot do it.
The previous Government also made a series of commitments on transport, promises that people expected to be delivered and promises that many Members across this House campaigned on in good faith, but the Conservative party has failed them. We have seen from the National Audit Office the chaos that the previous Government presided over, with projects over budget and delayed again and again. The spending audit has revealed £1 billion of unfunded transport projects that have been committed to next year, so my right hon. Friend the Transport Secretary will undertake a thorough review of these commitments. As part of that work, she has agreed not to move forwards with projects that the previous Government refused to publicly cancel, despite knowing full well that they were unaffordable. That includes proposed work on the A303 and the A27, and my right hon. Friend will also cancel the restoring your railway programme, saving £85 million next year, with individual projects to be assessed through her review. If we cannot afford it, we cannot do it.
The previous Government had plans for a retail sale of NatWest shares. We intend to fully exit our shareholding in NatWest by 2025-26. But having considered advice, I have concluded that a retail share sale offer would involve significant discounts that could cost taxpayers hundreds of millions of pounds. It would therefore not represent value for money, and it will not go ahead. It is a bad use of taxpayers’ money, and we will not do it.
Next, let me address the unfunded pressures in our NHS and our social care sector.
In October 2020, the Government announced that 40 new hospitals would be built by 2030. Since then, only one new project has opened to patients, and only six have started their main construction activity. The National Audit Office was clear that delivery was wildly off track, but since coming into office, it has become clear that the previous Government continued to maintain their commitment to 40 hospitals without anywhere close to the funding required to deliver them. That gave our constituents false hope. We need to be straight with the British people about what is deliverable and what is affordable, so we will conduct a complete review of the new hospital programme, with a thorough, realistic and costed timetable for delivery.
Adult social care was also neglected by the previous Government. The sector needs reform to improve care and to support staff. In the previous Parliament, the Government made costly commitments to introduce adult social care charging reforms, but they delayed them two years ago because they knew that local authorities were not ready and that their promises were not funded, so it will not be possible to take forward those charging reforms. This will save over £1 billion by the end of next year.
Order. I want Government Members to be quiet as well—I want to hear the Chancellor of the Exchequer.
I can understand why people, and Members, are angry. I am angry too. The previous Government let people down. The previous Government made commitment after commitment without knowing where the money was going to come from. They did this repeatedly, knowingly and deliberately.
Today, I am calling out the Conservatives’ cover-up and I am taking the first steps to clean up what they have left behind, but the scale of the inheritance we have been left means that the decisions we have so far announced will not be enough. This level of overspend is not sustainable. Left unchecked, it is a risk to economic stability—and unlike the Conservative party, I will never take risks with our country’s economic stability. It therefore falls to us to take the difficult decisions now to make further in-year savings.
The scale of the situation we are dealing with means incredibly tough choices. I repeat today the commitment that we made in our manifesto to protect the triple lock, but today I am making the difficult decision that those not in receipt of pension credit or certain other means-tested benefits will no longer receive the winter fuel payment, from this year onwards. The Government will continue to provide winter fuel payments worth £200 to households receiving pension credit or £300 to households in receipt of pension credit with someone over the age of 80. Let me be clear: this is not a decision I wanted to make, nor is it the one that I expected to make, but these are the necessary and urgent decisions that I must make. It is the responsible thing to do to fix the foundations of our economy and bring back economic stability.
Alongside this change, I will work with my right hon. Friend the Work and Pensions Secretary to maximise the take-up of pension credit by bringing forward the administration of housing benefit and pension credit, repeatedly pushed back by the previous Government, and by working with older people’s charities and local authorities to raise awareness of pension credit and help identify households not claiming it.
This is the beginning of a process, not the end. I am announcing today that I will hold a Budget on 30 October, alongside a full economic and fiscal forecast from the Office for Budget Responsibility. I have to tell the House that the Budget will involve taking difficult decisions to meet our fiscal rules across spending, welfare and tax. [Hon. Members: “Ah!”] Mr Speaker, they still don’t get it, do they? Parties in Downing Street, crashing the economy, gambling on the election—party before country, every single time.
It will be a Budget to fix the foundations of our economy, and it will be a Budget built on the principles that this new Government were elected on. First, we will treat taxpayers’ money with respect by ensuring that every pound is well spent, and we will interrogate every line of public spending to ensure that it represents value for money. Secondly, I can repeat from the Dispatch Box our manifesto commitment that we will not increase taxes on working people. That means that we will not increase national insurance, the basic, higher or additional rates of income tax, or VAT. Today, my hon. Friend the Exchequer Secretary is publishing further detail on our manifesto commitments to close tax loopholes and clamp down on tax avoidance to ensure that we bring in that money as quickly as possible. My third principle is that we will meet our fiscal rules: we will move the current budget into balance and we will get debt falling as a share of the economy by the end of the forecast.
These are the principles that will guide me at the Budget, but let me be honest: challenging trade-offs will remain, so today I am launching a multi-year spending review. This review will set departmental budgets for at least three years, providing the long-term certainty that has been lacking for too long. As part of that process, final budgets for this year and budgets for next year, 2025-26, will be set alongside the Budget on 30 October.
I will look closely at our welfare system, because if someone can work, they should work. That is a principle of this Government, yet under the previous Government, welfare spending ballooned, while inactivity has risen sharply in recent years. We will ensure that the welfare system is focused on supporting people into employment, and we will assess the unacceptable levels of fraud and error in our welfare system and take forward action to bring that down.
To fix the foundations of our economy, we must ensure that never again can a Government keep from the public the true state of our public finances. The fiscal framework I have inherited had several flaws. It allowed the Government to run down the clock on departmental budgets to avoid difficult decisions and to push them back beyond the election, so I am announcing the most significant set of changes to our framework since the inception of the Office for Budget Responsibility. These changes will come into effect in the autumn.
First, we have introduced legislation to ensure that we can never again see a repeat of the mini-Budget. Secondly, we will require the Treasury to share with the Office for Budget Responsibility its assessment of immediate public spending pressures, and we will enshrine that rule in the charter for budget responsibility, so that no Government can ever again cover up the true state of our public finances. Finally, we will ensure that never again do public service budgets get set at only a few months’ notice. Instead, spending reviews will take place every two years, with a minimum planning horizon of three years, to avoid uncertainty for Departments and to boost stability for our public finances. I have already spoken to the chair of the Office for Budget Responsibility to brief him on the findings of our audit and our reforms.
By launching the spending review, I am also today starting the firing gun on a new approach to public service reform to drive greater productivity in the public sector. We will embed an approach to government that is mission-led, that is reform-driven, with a greater focus on prevention and the integration of services at a national and local level, and that is enabled by new technology, including through the work of my right hon. Friend the Secretary of State for Science, Innovation and Technology on the opportunities of artificial intelligence to improve our public services. We will establish a new office of value for money, with an immediate focus on identifying areas where we can reduce or stop spending, or improve its value.
We will appoint a covid corruption commissioner to bring back money that is owed to taxpayers after contracts worth billions of pounds were handed out by the previous Government during the pandemic. Ahead of the spending review, I will also review the cost of our political system, including restricting eligibility for ministerial severance payments based on time in office. I expect all levels of government to be run effectively and efficiently, and I will work with leaders across our country to deliver just that. That means effective local government, a civil service delivering good value for the British taxpayer and reform of our political institutions, including the House of Lords, to keep costs as low as possible.
The Budget and spending review will also set out further progress on our No. 1 mission: to grow our economy. Economic growth is the only way to sustainably improve our public services and our public finances, so we will use the spending review to prioritise specific areas of capital investment that leverage in billions more in private investment. It will not happen overnight—it will take time and it will take focus—but we have already made significant progress, including: planning reforms to get Britain building; a national wealth fund to catalyse private investment; a pensions investment review to unlock capital for our businesses; Skills England to create a shared national ambition to boost skills across our country; and work across government on a new industrial strategy, driven forward by a growth mission board, to ensure that we deliver on our commitments.
Our country has fundamental strengths on which we can build, and I look forward to welcoming business leaders to the international investment summit in Britain later this year. I know that if we can create the stable conditions that investors need to thrive, we will return confidence to our economy so that entrepreneurs and businesses big and small know that this is the best place in the world to start and grow a business. That is the bedrock on which economic growth must be built.
The inheritance from the previous Government is unforgiveable. After the chaos of partygate, when they knew that trust in politics was at an all-time low, they gave false hope to Britain. When people were already being hurt by their cost of living crisis, they promised solutions that they knew could never be paid for, roads that would never be built, public transport that would never arrive and hospitals that would never treat a single patient. They spent like there was no tomorrow because they knew that someone else would pick up the bill. Then, in the election—perhaps this is the most shocking part—they campaigned on a platform to do it all over again, with more unfunded tax cuts and more spending pledges, all the time knowing that they had no ability to pay for them. No regard for the taxpayer. No respect for ordinary, hard-working people.
I will never do that. I will restore our country’s economic stability. I will make the tough choices. I will fix the foundations of our economy so that we can rebuild Britain and make every part of our country better off. I commend this statement to the House.
I thank the Chancellor for advance sight of her statement, and I echo her thoughts for the people and emergency services of Southport.
Today, she will fool absolutely no one with a shameless attempt to lay the grounds for tax rises that she did not have the courage to tell us about—[Interruption.]
Order. I want the Cabinet to act like a Cabinet, not like a rabble that is trying to shout at the shadow Chancellor.
The Chancellor says that the information is new, but she told the Financial Times:
“You don’t need to win an election to find”
out the state of public finances, as
“We’ve got the OBR now.”
Paul Johnson of the Institute for Fiscal Studies has said:
“The state of public finances were apparent pre-election to anyone who cared to look”
which is why he and other independent figures say that her argument is not credible and will not wash.
Those public finances were audited by the OBR just 10 weeks before the election was called. We are now expected to believe that, in that short period, a £20 billion black hole has magically emerged, but for every single day in that period—in fact, since January, in line with constitutional convention—the right hon. Lady had privileged access to the Treasury permanent secretary. She could have found out absolutely anything she needed. Will she confirm to the House that she did have meetings with the permanent secretary of the Treasury before the election? Will she tell the House whether they discussed public finances? Will she tell the House whether they discussed any of the pressures that she is talking about today? If so, why are we only hearing today what she wants to do about them? That is why today’s exercise is not economic—it is political.
The Chancellor wants to blame the last Conservative Government for tax rises and project cancellations that she has been planning all along. The trouble is, even her own published numbers expose the fiction behind today’s announcement. Just four days ago, she presented to the House the Government’s estimates of spending plans for the year. Those estimates are a legal requirement. The official guidance manual is clear that Departments are responsible for ensuring that estimates are consistent with their “best forecast of requirements”. They are signed off by the most senior civil servants—the accounting officers—in every Department. Yet, four days on, she is saying that those estimates are wrong. Who is right: politically neutral civil servants or a political Chancellor? If she is right, will she ask the cabinet secretary to investigate those civil servants and apologise to the House for laying misleading estimates? Of course not, because she knows that those civil servants are right and today’s black hole is spurious, just like when she says that she inherited the
“worst set of economic circumstances”
since the second world war. When BBC Verify asked a professor at the London School of Economics about that claim, he responded:
“I struggle to find a metric that would make that statement correct.”
The metrics speak for themselves. Inflation is 2% today —nearly half what it was in 2010 when we had to clear up the mess inherited from a Labour Government. Unemployment is nearly half what it was then, with more new jobs than nearly anywhere else in Europe. So far this year, we are the fastest growing G7 economy. Over the next six years, the IMF says that we will grow faster than France, Italy, Germany and Japan.
Just two days before the election was called, the managing director of the IMF praised the previous Government’s handling of the economy, and said it was in a good place. This week, the Institute for Fiscal Studies said that it was
“not a bad situation to take charge of”
and certainly not comparable to the 1940s or 1970s. If the right hon. Lady is in charge of the economy, it is time to stop trash talking it. What is the point of going to New York or Brazil to bang the drum for more investment if she comes home with a cock and bull story about how bad everything is? She should stop playing politics with Britain’s reputation and get on with running the economy.
When it comes to public finances, will the Chancellor confirm to the House that, far from being broke and broken, as Downing Street briefed the media, the forecast deficit today is 4.4%, compared with 10.3% when Labour left office in 2010? In other words, when Labour was last in office, we were borrowing double the current levels. Will she confirm another difference between today and 2010? The Conservatives came to office then, honest about our plans and saying straightforwardly that we needed to cut the deficit. She has just won an election telling us repeatedly that taxes will not go up. How many seats were won on the back of commitments not to raise tax, while she is quietly planning to do the exact opposite?
On the details that the Chancellor has announced today, will she confirm that around half of today’s fictitious black hole comes from discretionary public sector pay awards—in other words, not something that she has to do, but something where she has a choice? Will she confirm to the House that, apart from the teachers recommendation, none of the other pay review body recommendations was seen by the last Government, as they arrived after the election was called? Today she has chosen to accept those recommendations, but before doing so, was she advised by officials to ask unions for productivity enhancements before accepting above-inflation pay awards, to help to pay for those awards, as the last Government did? If she was advised to do that, why did she reject that advice and simply tell the unions, “Here’s your money, thanks for your support”? Will she confirm—[Interruption.] I know Labour Members do not like the truth, but here it is. Will she confirm that one of the reasons for her funding gap is that she has chosen to backdate a 22% pay award to junior doctors, to cover the time when they were striking?
We are just three months into the financial year, so why did the Chancellor not mention today that, at the start of the year, the Treasury had a reserve of £14 billion for unexpected revenue costs, and £4 billion for unexpected capital costs? Additionally, why has she not accounted for the Treasury’s ability to manage down in-year pressures on the reserve—last year alone by £9 billion? Why has she apparently not accounted for underspends—typically £12 billion a year? Has she totally abandoned the £12 billion of welfare savings planned by the last Government? If so, will she confirm that to the House? Has she also abandoned £20 billion of annual productivity savings planned by the last Government? If not, why are they not in her numbers? Finally, for someone who claims continuously the mantle of fiscal rectitude, will she confirm that in order to pay for her public spending plans, she will not change her fiscal rules to target a different debt measure, so she can increase borrowing and debt by the back door?
Every Chancellor faces pressures on public finances. After a pandemic and an energy crisis, those pressures are particularly challenging, which is why in autumn 2022, the previous Government took painful but necessary decisions on tax and spend. But we knew that, if we continued to take difficult decisions on pay, productivity and welfare reform, we could live within our means and start to bring taxes down. She, on the other hand, knew perfectly well that a Labour Government would duck those difficult decisions. She has caved in to the unions on pay, left welfare reform out of the King’s Speech and soft-pedalled on our productivity programme. That is a choice, not a necessity.
That choice means that taxes will have to go up and the right hon. Lady chose not to tell us before the election. Instead, in 24 days—just 24 days—she has announced £7.3 billion for GB Energy, £8.3 billion for the national wealth fund and around £10 billion for public sector pay awards. That is £24 billion in 24 days: around £1 billion for every day she has been in office, leaving taxpayers to pick up the tab for her profligacy.
Doing it this way, she makes the first major misstep of her time as Chancellor, because that great office of state depends more than any on trust—[Interruption.] In her first big moment, she breaks that trust with an utterly bogus attempt to hoodwink the public about the choices she has. Over 50 times in the election, Labour told us it had no plans to raise taxes. Now, in a U-turn that will forever shame this Labour Government, she is laying the ground to break her word. When she does, her first Budget will become the biggest betrayal in history by a new Chancellor. Working families will never forgive her.
The shadow Chancellor had an opportunity this afternoon to admit what he had done, the legacy he had left. Instead, he takes no responsibility. The word the country was looking for today was sorry. He could not find those words; no wonder the Conservative party so definitively lost the trust of the British people at the election three and a half weeks ago. We say never again. [Interruption.] Never again should a party that plays fast and loose with the public finances be in charge of the public finances—[Interruption.]
Order. Can I just say to the Whips, who hold responsible jobs and I expect them to keep them that way, that just because they might not be at the end of the Bench does not mean they have to chunter all the way through and pass comment? I don’t need it and I won’t put up with it.
First, specifically on the black hole, we could not have known these numbers because the Conservative party did not tell the OBR these numbers. That is why we are in the position we are in today. That is the biggest scandal of them all.
The shadow Chancellor asks about the estimates. He should recognise the estimates we laid yesterday because he produced them. We had to lay those estimates to allow public spending to continue, but since those estimates were produced, information was given to us by Treasury officials about the true scale of the overspending by the Conservative party.
The shadow Chancellor mentions the IFS. Paul Johnson from the IFS has just said that it appears that these overspends are genuinely unfunded—words not from me, but from the independent IFS, which the shadow Chancellor referenced.
The shadow Chancellor mentions what happened to the reserve. Well, the reserve has been spent, shadow Chancellor. It was spent by you three times over. That is why we are in a position of a £22 billion in-year gap between spending that was happening and the funding to produce it.
If the shadow Chancellor could do all the things he spoke about today, why were they not in the forecasts? If he was able, as he says, to make those in-year changes on welfare and productivity, they would have been in the forecasts. They were not.
On the issue of the pay review bodies, the previous Government set the remit for those but they refused to give them any indication of affordability. That is almost unprecedented. The teachers reported before the election and that recommendation sat on the former Education Secretary’s desk. Today, we are drawing a line on the industrial action: the £1.7 billion cost to the NHS alone last year and 1.4 million cancelled appointments. We are incorporating a third of those pay increases into efficiencies in our public services, as the shadow Chancellor suggested we should.
When it comes to tax, I am not going to take any lessons from the Conservative party. The Conservative party took the tax burden to the highest level in 70 years.
The response of the shadow Chancellor just confirms what we already knew: the previous Government were deluded, out of touch and grossly irresponsible. Today, we begin to fix the mess that they have created.
In 2010, we repeatedly heard the words, “The Labour Government did not fix the roof while the sun was shining.” Is it not the case that the last Government not only did not fix the roof, but destroyed the entire foundations of our public services?
In the context of difficult decisions, I welcome two points made by my right hon. Friend. First, there was the encouragement to work with local councils to increase the take-up of pension credit. The Levelling Up, Housing and Communities Committee called for that repeatedly in the last Parliament, but it was not taken up. Secondly, can the Chancellor confirm that she intends to provide multi-year settlements, ultimately, for local councils, which—again—have called for that repeatedly? It would be a welcome step to help them with the very difficult financial situation that they are facing.
I can confirm that we will be arranging multi-year settlements with local authorities, as well as with Departments. It is extremely important that both Departments and authorities can plan for the future knowing what money is available, rather than running down the clock towards the end of the year.
I thank my hon. Friend for welcoming the announcement that I made today about working with local government to improve the take-up of pension credit. It is woeful that it is so low. It is vital that everyone receives the money to which they are entitled, especially pensioners, which is why we have taken on those recommendations from elderly people’s charities today to ensure that we work with local government to boost take-up of that benefit.
I thank the Chancellor for advance sight of her statement. Let me associate myself with the expressions of gratitude to our emergency services; the thoughts of all Liberal Democrats are with those affected by the incident in Southport.
Years of Conservative chaos and mismanagement have left our economy on life support and in desperate need of emergency care. Things cannot go on like this any longer. We must now revive growth by getting people off NHS waiting lists and back into work, so we urge the Government to invest wisely in GPs, dentists and hospitals, not only to support patients but to improve efficiency in the NHS and deliver the growth that is so desperately needed after years of Conservative failure.
The outgoing Conservative Government will go down in the history books as one of the most damaging Administrations that our country has seen, and today’s statement has thrown that picture into even starker relief. It was not just their catastrophic mini-Budget; we saw a vicious cycle of stagnation and recession, driven by years of chaos and uncertainty. For the first time, living standards declined over the course of a Parliament as people experienced the harshest cost of living crisis in generations. Our public services were abandoned: waiting lists soared, schools crumbled, and our social care was in crisis. The dire state in which the Conservatives left our public finances is indicative of their irresponsibility.
People are painfully aware that Conservative chaos has real-life consequences. Interest rates were sent soaring, and millions of people saw their mortgage payments increase by hundreds of pounds a month. That is why, more than ever, we need to foster economic stability to draw a line under the uncertainty of the last few years. An important step in rebuilding confidence in our economy is the setting up of a long-term industrial strategy. That will help to unlock vital investment, create good jobs, and help us to tackle the climate emergency. Will the Chancellor reassure the House that the Government will start work on such a strategy as soon as practically possible?
We cannot talk about rebuilding our economy without talking about the crisis in health and social care. Millions have long-term health conditions that make them too ill to work, and millions more are stuck on NHS waiting lists. Many others cannot leave hospital because there is no care provision. The Liberal Democrats have always understood that we cannot have a thriving economy and strong public finances until we fix the crisis in health and social care, which is why we put forward detailed proposals to deliver more GPs, invest in dental services, and cut ambulance waiting times. Equally, we must give people the good-quality care that they deserve, so we urge the Government to work across party lines to implement a system of free personal care and give our unpaid carers the proper support that they need. The last Conservative Administration left people with crippling care costs. That is why it is urgent for us to have cross-party talks on social care, and I urge the Government to begin those as soon as they possibly can.
Investing in health and care is not just about giving people the fair deal that they deserve; it is also about sound management of our public finances. Will the Chancellor guarantee that the NHS and social care will be at the heart of her plans to address the Conservative party’s legacy of mismanagement? Part of that legacy is the previous Government’s promise to deliver 40 new hospitals, which was postponed, redefined and never properly funded. It turned out to be yet another empty Conservative promise, but having listened to many colleagues on these Benches over the last few years, some hospitals are clearly in dire need of investment, with crumbling roofs and buckets to catch the leaks. Will the Chancellor meet Members whose constituents will be affected by today’s announcement, to hear directly about the situation in their hospitals?
Lastly, let me turn to the other side of the equation: securing the funding that our public services so desperately need. Over the last Parliament, we saw the Conservative party raise taxes on hard-working households again and again, just to pay for its own mistakes. Does the Chancellor agree that it would be unfair to ask working people to pick up the tab a second time, after they have already suffered through years of painful tax rises? My party has set out detailed proposals to raise funding for our public services in a fair way—for example, by reversing the Conservatives’ tax cuts for big banks, putting in place a proper windfall tax on oil and gas producers, and raising the digital services tax on social media giants. I urge the Chancellor to draw from these ideas, which could raise billions of pounds by asking some of the largest companies in the world to pay their fair share.
There is no doubt that our economy, our public services and our public finances have been left in a precarious position. Now the hard work must be done to repair the damage and return stability, growth and prosperity to our country. That is what the Liberal Democrats will always champion, and we sincerely hope that the Government will look closely at our proposals to end the crisis in health and social care, grow our economy and give people a fair deal.
I thank the hon. Lady for her contribution, particularly the theme about helping people into work and fixing our national health service. I totally agree with her about the immense damage that the Tory mini-Budget did, particularly in pushing up mortgage costs for so many of our constituents.
The hon. Lady asks about industrial strategy. My right hon. Friend the Business and Trade Secretary will be setting out more details of the modern industrial strategy, which will enable us to work in partnership with business to exploit the big opportunities that the country and the economy have for growth and prosperity in all parts of the UK.
The hon. Lady asks about health and social care. She is absolutely right to highlight the huge challenge of the waiting list—it was at 7.6 million when the Conservatives left office. I welcome the deal to get junior doctors back to work, and I am sure the whole country will, because it will mean that people can get operations and treatment when they need. After last year’s industrial action cost our economy £1.7 billion and caused 1.4 million appointments to be missed, the deal will be welcomed by people on NHS waiting lists. Of course, this Government have made a commitment to provide 40,000 additional appointments every single week. That is why we will crack down on tax avoidance and ensure that, finally, non-doms who make their home in Britain pay their fair share of tax here.
My right hon. Friend the Health Secretary will meet constituents who are affected by the previous Government’s betrayal on building 40 new hospitals, because we recognise, as the hon. Lady says, the importance of ensuring that all our constituents have the health services they deserve. I could not agree more with her that it should not be working people who pick up the tab for the Conservative party’s failure. That is why I have restated our commitment not to increase taxes on working people—there will be no increases in income tax, national insurance or VAT. That is the commitment on which we campaigned in this election, and I stand by that commitment.
I congratulate my right hon. Friend and the Labour Government on making such a strong start, and particularly on the emphasis on transparency and accountability for the hard-earned money of our tax-paying constituents. She said that the Treasury will be asked to share with the Office for Budget Responsibility its assessment of immediate public spending pressures, and that she wants to enshrine that rule in the charter for budget responsibility. Will she also make sure that that is a public document that is reported to Parliament, to maintain this vital transparency going forward?
I thank my hon. Friend for her question. She speaks from her experience as Chair of the Public Accounts Committee, and I agree with her entirely. The charter for budget responsibility will be published. We have already introduced legislation for the new fiscal lock that we set out in our manifesto, so that we can ensure that a Government can never again do what the previous Government did, which was to overspend by £22 billion within one year.
What a chilling political choice, to choose to take away the winter fuel allowance from a 90-year-old on an income of £10,000 a year. And that was a political choice. I want to ask the Chancellor more about productivity. She used the word once during her speech. What discussions has she had about improving productivity, which according to the Office for Budget Responsibility is still 5% lower in the public sector and has not recovered since the levels we enjoyed before the pandemic?
The challenge of productivity sits across both the public and private sectors. In the last 14 years, productivity has flatlined in the public and private sectors and we need to boost both. We need to boost productivity in the public sector to ensure that we get better value for money for our public services, but we also need to improve productivity in our private sector so that we can improve living standards and have the money for our public services.
I welcome the Chancellor’s statement about public sector pay, but is it not clear that, after savaging public services, holding down public sector pay and driving 3 million people into food banks, this crazy ideological austerity programme of the Tories has failed massively while at the same time, the richest 250 people in the country gained wealth of £500 billion? Can I tempt the Chancellor to say that, while we accept that there are hard decisions to make, we reject the ideological commitment to this form of Tory austerity?
I thank my hon. Friend for that question. We do owe it to our armed forces, our prison officers, our police officers, our nurses and our teachers to reward them properly for their work, and that is what we did today in implementing in full the recommendations of the pay review bodies. I echo his view that a return to austerity would be no way to run our economy. It resulted in growth haemorrhaging in the last Parliament, with all the damage that that did to living standards and to the money for our public services.
The Chancellor is like a dodgy car mechanic. She says she has done all the searches, she gives you a fixed price, you hand in your car keys and then, a few weeks later, she has found all these new problems. The price has doubled, but it is too late—you have given her your car and you both know that this was her plan all along. Trust and credibility are critical to a Chancellor. Why has she been so careless and so quick to throw hers away?
If the right hon. Gentleman has any chance of fixing the mess that his previous Government made, he might want to start with an apology.
I thank the Chancellor for her honesty on the incredibly serious situation that she has just outlined. Does she agree that the above-inflation pay deals agreed by this Government with our public sector staff will begin the process of rebuilding trust between them and our Government and will benefit the public purse by reducing strike action?
I thank my hon. Friend for that question. Let us just be clear that the pay recommendations today are in line with private sector pay. These are just the pay deals that are received by the majority of workers in the private sector. My hon. Friend is right that we owe a debt of gratitude to our frontline workers, who got us through the pandemic and so many other challenges over the last few years, and they deserve to be paid properly for their work.
During the recent election campaign, we in the SNP repeatedly warned about an £18 billion hole in the Labour party’s spending plans. Now that the Chancellor has confirmed that today, will she apologise to those voters in Scotland who supported the Labour party leader in Scotland when he said:
“Read my lips, no austerity”?
Will she also reverse the 9% cut in Scotland’s capital allocation, please?
I am not sure if hon. Gentleman was paying attention. The £22 billion black hole is this year. The Institute for Fiscal Studies was warning about a black hole of £18 billion over the lifetime of the Parliament. Those are two very different things and both of them can be true. What we are showing today is an in-year gap of £22 billion that the hon. Gentleman did not know about, that no one on this side of the House knew about, that the OBR did not know about, and that the country did not know about. This is new information that is being published today, above and beyond what anyone knew when we were campaigning in the election.
Frankly, the Conservatives’ response leaves something to be desired. After 14 years of stripping the engine of this country’s economy, their response is simply taking the piston.
I am so proud that we now have a Chancellor who is not penny wise and pound foolish, but is conscious that all our constituents will have to pick up the pieces after the past 14 years. Can the Chancellor tell us a little more about her audit and what it has identified about the money wasted by the previous Government and their mismanagement of capital projects? We now know, for example, that the failure to rebuild Whipps Cross hospital has cost us an extra £15 million in the last few years alone. Our constituents will pay the price of the last Government for many years to come. This new Labour Government need to be honest with them. Sorry seems to be the hardest word for the Conservatives to say, but can the Chancellor tell us just how much money it will cost?
This country is owed a £22 billion apology by the Conservative party, and my hon. Friend is right to highlight the overspends, including on the hospitals programme; there is a £4 billion gap between what was announced and what is needed for those hospitals. There is also a £6.4 billion overspend on the asylum system. That was all unfunded and undisclosed until I disclosed it today.
I welcome the affirmation of the funding for Ukraine, which I presume was already fully allocated from the Treasury reserve, in the usual way.
On the mainstream defence budget, the Chancellor has announced that all departmental spending will now be reviewed every two years. Given the speed at which Whitehall works, this means that the minute one review is finished, work will start on the next. All public spending, particularly capital spending, will effectively be under permanent review. This will not work. How can we commit to 10-year defence programmes, such as the vital new Tempest fighter, if all departmental budgets are up in the air every two years?
First, there is a £9 billion reserve for departmental expenditure, and it was spent three times over before I arrived in the Treasury. That is why we face these problems today.
Secondly, yes, we fully intend to set longer-term budgets for capital expenditure, but we will have three-year spending reviews every two years for day-to-day departmental expenditure, which is really important for giving certainty, so that Government Departments can plan for the future. Today, no Department or local authority knows its budget beyond next March. That is no position to put Departments in, including the Ministry of Defence.
I welcome my right hon. Friend’s statement, and particularly what she said about the public sector pay award. Could she share a little more about how, given the appalling economic conditions that we now face, she will incorporate equity in her decisions on how to address the in-year deficit?
I have to be honest that the decisions I have made today are tough decisions. They are not the decisions that I wanted to make, or that I expected to make. Given the seriousness of the inheritance that I face, they are the right decisions, the responsible decisions, and the fairest decisions that I could make in the circumstances.
The legacy of the Conservatives’ new hospitals programme is dire, but the Chancellor will know that there is also a cost to delay. We have life-expired buildings that will continue to need to be patched up until they are replaced, so I urge the Chancellor, as I urged the Secretary of State for Health and Social Care last week, to give the go-ahead to those projects that are ready to go and involve life-expired buildings. Will she review the outdated rules, and allow hospitals to spend more of their capital funds on helping with repairs and rebuilds?
I welcome you to your place, Madam Deputy Speaker. My right hon. Friend the Secretary of State for Health and Social Care will meet with people affected. We were promised a new hospital in Leeds that has never been built, so I understand the concerns that right hon. and hon. Members have about the hospital programme. However, there is a £22 billion in-year overspend, which means taking incredibly difficult decisions. They are not the decisions that we would want to make, but they are responsible ones in the circumstances, given our dire inheritance from the Conservative party.
I used to work in the Treasury; what we have heard today about the Conservative party is shocking and shameful. The Chancellor has set out how far away the last Government were from meeting their own targets on hospital building. Does she agree that our plan, by contrast, represents a deliverable way to ensure we get waiting lists down?
My hon. Friend is welcome on the Government Benches with his expertise. Everything in our manifesto was fully costed and fully funded, including 40,000 additional NHS appointments every single week, which will be funded by cracking down on tax avoidance and ensuring that people who make their home in Britain pay their taxes here. We will finally deal with the terrible situation of non-doms claiming that they do not live in Britain for tax purposes, despite making their home here. Those people should contribute to the public purse; under Labour, they will.
Congratulations on your election, Madam Deputy Speaker.
I cannot hope to match the splendid double entendre of the hon. Member for Walthamstow (Ms Creasy), but I may I say to the Chancellor that one effect of being here for a long time is a realisation that no one party has a monopoly on wisdom? Given the impartial assessment by the Library that covid cost this country between £310 billion and £410 billion, is she willing to at least concede that the previous Government did a pretty good job in getting inflation down to 2% less than two years after the pandemic?
The pandemic is no excuse for making unfunded spending commitments, which is precisely what the previous Government did. The right hon. Gentleman mentioned the pandemic, during which the Government handed out contracts to friends and donors to their party, putting them in a VIP lane. That is why we are appointing a covid corruption commissioner. We want that money back in our public services, where it belongs.
Welcome to your place, Madam Deputy Speaker.
It was not just the public finances that the Conservatives mismanaged over 14 years; they failed to support industry too. Figures published today demonstrate that Britain has dropped out of the top 10 countries for manufacturing for the first time since the industrial revolution. I welcome my right hon. Friend’s commitment to leveraging millions more in private investment to make up for the record low levels of private investment we saw under the previous Government. Does she agree that the latest manufacturing figures show how critical it is that the Government work closely with business and trade unions on a long-term industrial strategy?
I too saw the numbers today that show that Britian is out of the top 10 manufacturing countries, which is shameful given our history at the heart of the industrial revolution. I pay tribute to my hon. Friend for his work, which ensured that Labour went into the election as the most pro-business party. Through the reforms that we have already announced in our first three weeks in government—planning reforms, the creation of a national wealth fund, reform of our pension system and a modern industrial strategy—we will go about making Britain the best place to start and grow a business, and the best place to invest. We look forward to holding our international investment summit in the UK later this year.
I have sympathy for the Chancellor’s seeking to address the issues that she has outlined, but the solutions that she has set out today are focused on spending cuts. Will she please say more about the opportunities that she is looking at for bringing revenue into the Exchequer, so that we can have the investment that is needed, whether in new hospitals—we all know that hospitals around the country are crumbling—or in the railways, as people are stuck in traffic jams and struggling with high rail fares? In particular, has she considered introducing a wealth tax? A tax on the very wealthiest in society—people with assets of more than £10 million—would raise tens of billions of pounds during this Parliament, and it could address the fact that we have growing billionaire wealth, while ordinary people are suffering from these cuts.
I thank the hon. Gentleman for that question. I have just set out the non-dom tax loophole closures, and my hon. Friend the Exchequer Secretary has published a written ministerial statement today setting out our manifesto commitments around the energy profits levy, VAT on private schools, and the non-dom changes, which we will consult on and introduce in the Budget. We will not be introducing a wealth tax. We want this to be a great place for investors, and a wealth tax would have the opposite effect.
May I thank my right hon. Friend for her transparency and openness about the dire state of our inheritance from the Conservatives? The Tory leadership race is now clearly in full swing, which is important. People across the Filton and Bradley Stoke constituency, and across the country, deserve to know why none of the contenders came clean about this black hole when they were in government. Or were they kept in the dark by the Chancellor’s predecessor as well?
Far be it from me to give advice to Tory leadership contestants, but if I were taking part in this contest, I would want to distance myself as much as possible from the Government in the previous Parliament who caused this terrible mess.
The Chancellor committed to long-term planning for capital expenditure. Last March, the then Chancellor committed £20 billion to carbon capture, usage and storage, without which a net zero future cannot be delivered. In the light of the right hon. Lady’s review, can she set out for the House what commitment this Government will make to investment, including to that £20 billion for CCUS?
We have already created a national wealth fund, which will leverage in billions of pounds of private sector investment, including in carbon capture and storage, as well as green hydrogen and renewable-ready ports. We will set out all our spending in the spending review later this year.
Congratulations on your appointment, Madam Deputy Speaker. It feels really good to be back on the Government Benches. The annual accounts of the Department of Health and Social Care show that £9.9 billion spent on personal protective equipment was written off. Does the Chancellor agree that we could claw back this money through the covid corruption commissioner, and then possibly use some of it to eradicate child poverty?
I thank my hon. Friend for that question. It is to the previous Government’s huge shame that they spent billions of pounds of taxpayers’ money on VIP-lane contracts, and on PPE that was never used; in some cases, it has literally gone up in smoke and been burned. We are appointing a covid corruption commissioner because that money belongs not in the pockets of Tory donors, but in our public services, and we will do everything within our power to get their money back.
Last week, the Secretary of State for Health and Social Care said:
“Hospitals with reinforced autoclaved aerated concrete are at the top of my list of priorities.”—[Official Report, 23 July 2024; Vol. 752, c. 517.]
If the new hospitals programme is delayed via review, so will be the rebuilding of the five RAAC hospitals that are not among the 40 referenced. Without avoiding the question with a soundbite, what reassurances can the Chancellor give that we will break ground on any of the new RAAC replacement hospitals, and specifically Hinchingbrooke hospital in my constituency of Huntington during this Parliament?
The hon. Gentleman should blame the previous Government for not funding the commitments that they made. My right hon. Friend the Secretary of State for Health and Social Care will meet all the people affected, including those affected by hospitals with RAAC problems, as soon as possible. As a Leeds MP, I recognise the importance of new hospitals and ensuring that our hospital estate is fit for purpose, but we cannot spend money that we do not have.
The shadow Chancellor said the books were open and that the Office for Budget Responsibility had audited the Government’s figures shortly before the election. However, the chair of the OBR has today published a letter confirming he intends to launch a review into the preparation of the March forecasts, stating:
“We were made aware of the extent of these pressures at a meeting with the Treasury last week.”
I am only new here; perhaps the Chancellor can inform me how to get the shadow Chancellor to correct the record?
The OBR has just published a letter, as my hon. Friend said, which states:
“We were made aware of the extent of these pressures at a meeting with the Treasury last week”,
and goes on to state:
“If a significant fraction of these pressures is ultimately accommodated through higher DEL spending in 2024-25, this would constitute one of the largest year-ahead overspends against DEL forecasts outside of the pandemic years.”
This is incredibly serious. That is why I came to this House today to set out that £22 billion overspend compared with what the Government set out at the previous Budget. This letter from the chair of the Office for Budget Responsibility can leave no one in this Chamber in any doubt about the seriousness of the situation.
I thank the Chancellor for her candour and her clarity today. There will be many residents and patients at Frimley Park hospital in my constituency—surrounded by a forest of acrow props holding up RAAC-riddled roofs—who will be deeply anxious at her announcement. Can she recommit to the Health Secretary’s commitment last week to prioritising spending, where possible, on those RAAC-affected hospitals and bring some comfort and clarity to the patients and the staff of Frimley Park hospital?
I fully understand the hon. Gentleman’s concerns. I know that during the election campaign, like so many Members across the House, he will have campaigned in good faith, believing that the money was there. I can say in all candour today that the money was not there for this hospital programme. Although it is not my apology to make, I apologise on behalf of the Conservatives for the state of the public finances that they have left for us to sort out. My right hon. Friend the Health Secretary will meet the hon. Gentleman and everyone affected so that we can do whatever we can to make sure that we can get hospitals in the condition that his constituents, and so many of our constituents, rightly expect.
Will the Chancellor confirm that, despite the Conservatives’ failure to set aside money for transport commitments, Labour’s plan to modernise the network—vital for my community in East Thanet—will deliver a unified rail system that means we can deliver more for passengers and local communities?
We have had to make difficult decisions today to cancel road and rail infrastructure projects. These are not decisions we wanted to make, but if the money is not there, we cannot go ahead with those projects. It is as simple as that. The money has to be there and the sums always have to add up, because I will not make the mistakes of the previous Government and Liz Truss, crashing the economy and sending interest rates and mortgage rates spiralling for our constituents. That is why I have had to take these actions today to get a grip on public spending and public finances. I make no apology for that, but I recognise the damage it does to so many constituents with projects that they had expected to see happening.
When the Chancellor’s legislation enables illegal entrants to leave their current accommodation, where will they go?
Under the previous Government, no applications were being processed and so nobody was being sent home. We will process those applications and send people who have no right to be here back home.
I thank my right hon. Friend the Chancellor for her excellent statement, putting public finances and public services back on their feet. Having seen how extensive this Tory cover-up has been, with unfunded commitments in multiple Departments, does she agree that it is not just her predecessor as Chancellor, but every member of the last Cabinet who is complicit in that cover-up?
I do not believe that any member of the previous Cabinet could not have been aware of the scale of this cover-up and the scale of the overspending. They should hang their heads in shame. Instead of coming to this Chamber today and issuing platitudes, they should have done the right thing and apologised to the country.
The Chancellor has made two key political decisions this afternoon: one, to fund extraordinarily high public sector pay increases; and two, to clobber pensioners to pay for it. Will she explain to the House and every pensioner who will lose their winter fuel allowance in the process why she did not challenge the Bank of England on the taxpayer bailouts that it requires, to the tune of tens of billions of pounds, to cover its losses from bond sales?
First, it is an extraordinary omission that the previous Government did not set affordability criteria for the independent pay review bodies, which meant that they were able to come back with these recommendations. It would be almost without precedent not to accept recommendations from an independent pay review body. If the hon. Gentleman wants to go to the doctors, nurses, teachers, police officers and those in the armed forces in his constituency and say that they do not deserve a pay increase in line with private sector wages, that is up to him, but I believe that those public sector workers deserve those pay increases.
On pensions and the winter fuel payment, this is not the decision I wanted to make and it is not the decision I expected to make, but we have to make in-year savings, which is incredibly difficult to do. Without doing that, we would put our public finances at risk. We are ensuring that everybody who is entitled to pension credit—the poorest pensioners—continue to get the winter fuel payment, and we will work with the Department for Work and Pensions, local authorities and charities to boost the take-up of pension credit.
Thank you, Madam Deputy Speaker, and welcome to your place.
I thank my right hon. Friend for her forensic approach to the nation’s finances. As she digs deeper, she will see that York, the city I represent, is at the bottom of many of the matrices for the funding formulas. Will she look at the funding formulas before the Budget so that we can see the distribution of funding? The last Government handed out, for pet projects, much of the money that she is trying to get control of now, but will she look at how that is distributed across the country?
I know, particularly around flood defences, that there are many great needs in the York constituency that my hon. Friend represents. These decisions will all be made at the time of the spending review.
Residents of Eastbourne will be outraged to learn that the Conservatives’ promise of a brand-new hospital for our town was not worth the paper it was written on. Eastbourne deserves better. Under-investment has consequences and, at the moment, Eastbourne district general hospital is closed for births due to that under-investment, and it has been since December. It needs investment. Will the Chancellor confirm that her Government will invest in midwives, doctors and nurses, as well as hospital buildings, to protect local services there and across the country?
I can see, on behalf of the hon. Gentleman’s constituents, the frustration and anger that he feels at the previous Government letting his constituents down so badly by not funding the hospitals that they promised. I commit to my right hon. Friend the Health Secretary meeting everybody affected. We also have a workforce plan, to invest in the future workforce in our national health service, and we are announcing today that we are accepting in full the recommendations of the independent pay review bodies to pay properly our doctors, nurses and others who work in our NHS.
Congratulations on your new post, Madam Deputy Speaker.
There can be reasonable political debate across the House about the total levels of public spending—there was a lot of that during the election campaign, with our calling for higher levels of public investment—but there should be complete agreement about the need for the Treasury to ensure that public money is well spent. At the top of that is making sure that the policies and commitments of every Department match their budgets. We hear from experts right around the country today that they do not match those budgets, so can the Chancellor reassure this ex-Treasury official, this House and my Swansea constituents that this will never happen under this Labour Government?
I thank my hon. Friend for that question and welcome him to his place in this House—he speaks powerfully, based on his previous experience. I will fix the mess that we have inherited, but it is a terrible mess: a £22 billion in-year gap between what was forecast to be spent and what was actually being spent by the previous Government. We will get a grip on our public finances; that requires tough choices, but that is the role of Chancellor, and it is the role of Government. These are choices that the previous Government ducked and diverted, but we will make the difficult decisions to get our public finances back on a firmer footing.
We could do with some masterclasses in short questions and short answers.
Earlier, the Chancellor quoted Paul Johnson of the Institute for Fiscal Studies, but she omitted the end of his comments. He said that half of the spending hole she claims is public sector pay
“over which govt made a choice”.
That is the truth, is it not? The Chancellor does a good shocked face, but she chose to create her own spending hole, did she not?
It was the previous Government who set the mandate for the pay review bodies. It is extraordinary that they did not include in that remit a measure of affordability, but they did not, which is why the pay review bodies made these recommendations. The previous Education Secretary could have rejected those recommendations, but she let them sit on her desk, because the previous Government were not willing to make tough decisions. We have made those decisions, including making sure that a third of the cost of these pay awards is absorbed, but there is a cost to inaction: last year, there was a £1.7 billion cost to the NHS alone because of industrial action.
Under the previous Government, there was at least a £17 billion black hole in defence, and of course they had hollowed out the armed forces. However, it is a surprise to find out today that not enough money was set aside in reserve to fund all the military assistance needed for Ukraine. Would the Chancellor say a bit more about that?
The problem that the previous Government got into was that every time they wanted to make a commitment, they said it would be paid for from the reserve. By the time I came into the Treasury on 5 July, that reserve had been spent three times over, because they put so many commitments into that reserve that they could not afford. That is the situation that we inherited, that is where the £22 billion black hole comes from, and that is why I am having to make difficult decisions today to get a grip on the public finances.
The Chancellor spent the election campaign saying that she was going for growth through investing in infrastructure. Instead, she is cutting it, while funding inflation-busting pay deals and scrapping pension benefits for the worst-off. Does she agree that in the battle for the two faces of the Labour party, the face of tax rises, borrowing and boom and bust won, and the British people—hard-working people—will ultimately lose under her leadership?
There is nothing pro-growth about making unfunded spending commitments. There is nothing pro-growth about a lack of respect for taxpayers’ money. We will continue to provide the winter fuel payment for the poorest pensioners, those in receipt of pension credit.
I thank the Chancellor for her statement today and for being straight with the public about the state of our finances—I know my constituents want a Government who tell it to them straight. Does she agree that ducking tough decisions and hiding bad news, as the Conservative party has done, just makes a bad situation even worse?
The previous Government and the previous Chancellor should hang their heads in shame for the inheritance they have left for this Government to fix, but I will fix this mess: I will put our public finances and our public spending on a firmer footing. That is the responsible thing to do, and that is what I will do.
I welcome you to the Chair, Madam Deputy Speaker.
Everybody and their granny knew that there would be a multi-billion-pound black hole; only the Chancellor seemed to be deaf and blind to the situation. We knew that she would be here explaining the sheer scale of it, yet when we raised this issue during the election campaign, we were told that we were being misleading and that it was all mince. Well, we know now. Does cutting winter fuel payments to all pensioners not seem and feel like Tory austerity? What discussions has the Chancellor had with the Scottish Government, because as she will know, this is a devolved responsibility.
My right hon. Friend the Chief Secretary to the Treasury briefed the Scottish Government today on these decisions. These decisions are necessary: it is not in the interests of the Scottish people to have unfunded commitments, and to put our public finances and reputation for economic stability at risk. These are not easy decisions—they are difficult decisions—but the fault for them lies with the previous Government. The hon. Gentleman claims that what I have announced today is austerity, when we have just given a pay rise to more than 2 million public sector workers—he does not know what he is talking about.
I thank my right hon. Friend for her clarity and candour. After 14 years of sluggish growth and low living standards, and then a cost of living crisis, how callous was it that the Tories went into the election asking for another five years in power with a manifesto of false hope, undeliverable promises and no mention of the numerous black holes that she has now uncovered? What will she do instead to offer my constituents some real hope?
I thank my hon. Friend for that question; I am pleased to have her as a constituency neighbour in Leeds. She is absolutely right that the previous Government went into the election knowing that there was a £22 billion black hole. What did they do during that election? They made more unfunded spending commitments and more unfunded promises about tax that they knew they could not keep. That was deeply irresponsible. After all the damage that they have done, they should have come to the Chamber today and apologised.
Would the Chancellor confirm that all the information presented today was not known to her before last Thursday, when the estimates were laid?
When I arrived at the Treasury three weeks ago, I asked Treasury officials to do a full analysis. We concluded that analysis over the weekend and I am publishing it today for the House of Commons.
I thank the Chancellor for the urgent update. With living standards now worse than when the previous Government took office, people across the country continue to suffer the consequences of their broken promises and mismanagement, but this final fiscal mic drop is truly shocking. Does she agree that, in contrast to the unfunded fantasy promises put forward by the Conservative party, Labour’s manifesto showed cast-iron discipline in being fully costed?
I thank my hon. Friend for the question. Everything in Labour’s manifesto was fully costed and fully funded. We now know that on top of the £22-billion black hole that the previous Government left, they made unfunded commitments during the election. That was deeply irresponsible and the country was right to reject them.