The Parliamentary Secretary, HM Treasury (Lord Pitt-Watson) (Lab)
My Lords, it is a privilege to open this Budget debate. I welcome the noble Baronesses, Lady Aglionby, Lady Kitching of Penistone and Lady Ussher, and the noble Lord, Lord Neri, and I very much look forward to their maiden speeches. I also pay tribute to the former Chancellor, the right honourable Member for Leeds West, for the work she led to create fiscal discipline and repair our public finances. She was ably assisted in that task by the noble Baroness, Lady Martin, and by my predecessor in this role, the noble Lord, Lord Livermore, whom I hold in high regard.
I intend to keep my remarks today as factual and to the point as possible and, in the spirit of your Lordships’ House, to avoid the kind of political point-scoring that dominates the debate in the other place. I know we have more than 50 speakers and I may not be able to respond in full at the end. I have asked my staff to prepare a note on which I will comment and which I will circulate among Ministers and senior management at the Treasury so that the value I know we will get from this debate is transmitted to the Government.
This Budget is part of a long-term programme of government, one that will reflect the vision articulated by the Prime Minister and the Chancellor in their speeches at the Labour conference, one which will find expression in the 10-year plan that we will publish in the coming weeks, and one that will be reflected in the spending review next year. This Budget is set at a time of considerable uncertainty in the world economy—two wars, a challenging ally in the United States, unpredictable oil prices and interest rates rising. As the Chancellor has made clear, we cannot wish these global economic storms away. We must instead set out a course to steer the country through them.
The Budget therefore seeks to do a number of things. First, it shows how we will live within our means, within the fiscal rules. Secondly, it shows how we will fund defence, to which this Government are unequivocally committed. More than that, the Budget seeks to give breathing space to British people and—along with the conference speech and the 10-year plan—hope for the future.
I will start with fiscal discipline. In this Budget, we have chosen to use some of the fiscal headroom established last year to absorb the impact of the Iran war to protect the economy, British businesses and family budgets. But let us be clear: we meet the fiscal rules in full, and for the first time since 2022, in the third year of the forecast. While there are challenges, we should be proud of the resilience of this economy. Today, the Office for National Statistics announced 0.7% growth for this third quarter; I hope I have done my arithmetic right, but I think that is 1.9% so far this year. This is stand-out resilience. Last year, new borrowing by the Government fell to its lowest level in six years as a percentage of GDP and will continue to fall across the forecast. While government debt is high and interest payments much higher than we would like, action is being taken. Kristalina Georgieva, managing director of the IMF, has said that the UK stands out as a country and is one where
“action to reduce debt and deficit has been taken decisively”.
It is a tough world, but business investment is up and people and businesses are resilient.
The Government aim to underpin this resilience by providing breathing space for families and businesses. I have been asked what breathing space means. Let me use a metaphor. I commute to the House on the Tube; sometimes it is excessively crowded and stuffy, and I am older than I used to be. From time to time, a younger person will stand up and give me a seat. This is breathing space for me, but it is also more than that, because I feel grateful that they have understood how I felt in giving me their seat. This Budget does not solve all our problems, any more than the person who offered me the seat stopped the train being crowded. The world is still uncertain, but we can, as a Government, offer some breathing space.
Here is one example. For British people, energy costs are a particular challenge, so we are delivering immediate measures to help with rising bills, including the £100 household energy payment paid directly to households living in council bands A to D in England. That is breathing space. This will be funded by a time-limited 3% increase in the bank corporation tax surcharge; I am grateful to the banks for making that possible. Alongside this, the Government are extending the removal of domestic VAT on electricity until July, extending the 5p cut on fuel duty and abolishing gas standing charges to give people more control over their bills. Overall, in 2026-27 households in England are estimated to benefit by an average of around £160 from the support we are providing on energy. The households on the lowest income are expected to benefit the most, with the bottom 20% benefiting by around £230, almost four times the top 20%. We know that higher energy bills are a challenge for businesses too, so we are reducing bills by up to 25% for more than 10,000 eligible businesses from next April through the British industrial competitiveness scheme. This will not solve every problem, but it does offer breathing space.
Beyond energy, the Government are taking further action to support our lowest paid workers by increasing the national minimum wage and national living wage from April. To help those who use their vehicles for work, we are increasing the higher mileage rate and making permanent the increase in the standard milage rate announced earlier this year. To back businesses and high streets, we are taking 70,000 small retail, hospitality and leisure properties out of paying business rates altogether. For all other businesses in these sectors, we are freezing their business rates in real terms. If you want to remember two statistics from this Budget, remember 20 million and 70,000. There are 20 million households which will receive the household energy payment, and 70,000 high street businesses are no longer paying rates.
These measures provide breathing space for now, but the only way we can keep British families and finances secure for the long term is through an economy that is growing strongly. We believe that needs a positive response from government and local government. For decades, decisions about economic growth have been taken by people who are miles away from the communities they are trying to serve. With the best will in the world, they cannot be responsive. As a result, Britain has become one of the most geographically unequal large economies in the world. So we will be delivering an ambitious devolution package, putting power in the hands of local leaders who know best how to drive growth in their areas.
The Fiscal Devolution Roadmap, published alongside the Budget, sets out a plan for business rates to be retained locally by the end of the decade, and for mayoral strategic authorities to be assigned a share of the income tax generated from their area by 2028. Additionally, we are extending devolution and the advantages that come with it to 10 more areas in England, so that 90% of England’s population will be covered by a mayoral or foundation strategic authority. Good growth funds—flexible funding for local leaders to invest in local communities—will be rolled out across the country, supported by £285 million of capital grant funding, so that mayors and local leaders have more flexibility to invest in their own growth priorities.
We are also delivering radical reform of our energy system, because our priority is to bring energy costs down and to help British businesses compete and British households cope. We will buy and build new projects only when they lower bills and can connect to the grid. We will break the grip of international gas prices on our bills by moving more of our old renewables on to fixed-price contracts. We will build cheaper, faster grid connections through GB Grid; and, crucially, we are putting an end to the practice of loading levy costs on to bills.
Thirdly, we are supporting entrepreneurs. If you have a micro-business, you were formerly allowed £1,000 of income tax-free; now it is to be £3,000. We are going to pilot an entrepreneur scheme for young people. If your company is ambitious, we want you not just to start here but to scale, stay and prosper in the UK. The new capital gains founders’ relief will provide a 10% rate on lifetime gains, up to £10 million, for the founders of and early investors in high-growth innovative companies. To mobilise private investment in the UK, we are providing an additional £20 billion of capital to the National Wealth Fund and the British Business Bank. That is no small package for entrepreneurs, large and small.
One final measure I should mention is that we are putting in £700 million to support artificial intelligence security, resilience, adoption and innovation in the UK. Complementing that, our new data centre covenant will introduce strict tests that strategic data centres must meet to invest in local communities, support local jobs and help to re-industrialise Britain.
Finally, I would like to talk about some other big challenges facing our country. On defence, I think this House is absolutely united in understanding that defence of the nation is the first duty of a government. This Government have driven the biggest boost in defence spending since the end of the Cold War. At the Budget two weeks ago, we took the decision to reprioritise budgets across Whitehall to fund the defence investment plan in full.
At the spending review next year, we will set out details of how we will meet our NATO commitment to spend 3.5% of GDP on defence by 2035. Crucially, this includes setting a target for 3% in 2030. The Secretary-General of NATO has welcomed our plans, confirming that they represent a credible path to meeting our commitments. He said:
“The UK role in transatlantic security is vital”.
This move puts Great Britain on a credible path
“to ensure we’re all investing what’s needed to remain ready and able to deter aggression and defend our freedom and security”.
Alongside this investment in defence, the Government are delivering a multi-billion pound package of financial support for Ukraine, because we will continue to stand by Ukraine for as long as it takes.
Housing has become more difficult, and housebuilding is slower than we would have liked but we cannot give up on building. This Budget will put another £1.5 billion into social and affordable housing to deliver 10,000 additional homes. It will put £4.7 billion behind the Your First Home scheme for first-time buyers and cut unnecessary costs and delays for housebuilders. The focus is on getting more homes built and helping more first-time buyers through the door.
We have already promised everyone sleeping rough a route off the streets this winter, and the Budget confirms a further £430 million to keep that offer open for the rest of this Parliament—not just this winter, but every winter.
We will continue to invest in Britain’s public services. Since 2024, we have aimed to rebuild our public services. Our investment has made Britain’s streets and borders safer. It has fixed crumbling classrooms. It has helped restore the NHS. But there is still so much more to do.
As we look ahead to the spending review, we start with ambition, but there will be choices we must make about prioritisation. We must continue to deliver efficiencies, building on the £16 billion of efficiencies and savings generated last year. We must continue to deliver an effective, efficient state of which people can be proud.
On welfare, I think the Prime Minister and Chancellor have been clear that the bill needs to come down, but in a planned and sustainable way, following the guidance that we get from the Milburn and the Timms reviews.
This is a Budget to deliver good growth, with growth in every postcode. It is part of a wider programme for government and for the nation. It is underpinned by fiscal discipline, the bedrock of the economy. It funds defence. It provides support to families and businesses now, and kick-starts work on the big changes needed to put this country on a better course, with breathing space today and fresh hope for the future. I look forward to our debate.
Lord Gadhia (Non-Afl)
My Lords, I note my interest as a board member of the Bank of England but will speak in a personal capacity.
In my first Budget debate in this Chamber in 2017, I highlighted the Augustinian challenge of the repeated deferral of fiscal discipline: the desire to become virtuous but not quite yet. Almost a decade and several Chancellors later, I fear little has changed. The Chancellor’s “do no harm” Budget is understandable after recent turbulence, but a Budget which postpones difficult decisions today while leaving Britain more exposed to tomorrow’s shocks is not necessarily a harmless one.
The fiscal numbers should concern us. According to the OBR, Britain’s debt to GDP ratio has increased more than that of any other G7 economy since 2006. Public debt is forecast to peak above 97% of GDP while annual debt interest payments reach £160 billion by 2031-32. Much attention has focused on the Chancellor’s fiscal headroom, but the more fundamental issue is fiscal space: our capacity to withstand the next crisis without emergency measures or surrendering economic choices to financial markets.
The OBR’s sensitivity analysis illustrates the risks. Higher energy prices could increase borrowing by £17 billion in 2027-28. Weaker productivity could add £40 billion later in the forecast. Higher interest rates could increase the annual deficit by £16 billion. These are all plausible scenarios, not remote possibilities, and each one alone would blow the headroom. Yet fiscal consolidation remains largely promised for the future, including the inevitably sensitive period approaching the next general election. I am reminded of Lewis Carroll’s White Queen, whose rule was
“jam to-morrow and jam yesterday—but never jam to-day”.
Fiscal prudence is always promised in the later years of the forecast, but it somehow never quite arrives in the present.
Procrastination has a price. The OBR’s July Fiscal Risks and Sustainability report estimates that stabilising debt over the long term would require a permanent fiscal adjustment of 3.8% of GDP if undertaken in the early 2030s. Postpone that adjustment by two decades and the required correction more than doubles to 8% of GDP—roughly equivalent to the entire health budget. These are illustrative scenarios, but the message is unmistakable: the longer we delay, the more painful the eventual choices become. We cannot indefinitely kick the can down the road; eventually, we will run out of road.
Our problem extends beyond fiscal arithmetic. Britain’s economic malaise is often described as a growth problem; I suggest it is also a crisis of decision-making and national ambition. Consider the evidence. Britain had the lowest investment rate in the G7 in the second quarter of this year, at just 19% of GDP. Our productivity performance remains disappointing, despite world-class universities, financial services, scientific research and advanced engineering. We possess the ingredients for prosperity but struggle to turn potential into performance.
I see four mutually reinforcing constraints to growth. The first is political capacity: the willingness to make difficult decisions, the benefits of which extend beyond the electoral cycle. The second is institutional capacity: the ability to translate decisions into delivery, rather than endless planning, consultation and regulatory delay. The third is economic incentives: ensuring that work, investment, innovation and entrepreneurship are properly rewarded. The fourth is cultural aspiration: sustaining the belief that enterprise and effort can genuinely improve people’s circumstances.
These weaknesses reinforce one another. Political indecision discourages investment. Weak investment undermines productivity. Stagnating living standards erode confidence and aspiration. Declining confidence makes difficult political choices harder still. Britain risks becoming trapped in a low-growth, low-confidence, low-aspiration equilibrium. We have become remarkably adept at protecting existing prosperity, but less effective at creating new prosperity.
Perhaps the greatest danger is not that Britain lacks ambition but that too many people are losing faith in the rewards of ambition. The response cannot simply be higher taxes, more borrowing or another industrial strategy; it requires a political culture prepared to confront trade-offs, institutions empowered to deliver and an economic settlement that encourages productive wealth creation. Crucially, fiscal discipline and economic growth are not competing objectives; they are mutually reinforcing. The forthcoming spending review must therefore establish—
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords—
Lord Gadhia (Non-Afl)
I am just winding up. The forthcoming spending review must therefore establish a credible, deliverable path towards lower debt, while protecting the investment and reforms that are essential for future prosperity.
Lord Pitt-Watson (Lab)
My Lords, I thank noble Lords very much for this debate. It is a pleasure to close it.
For the most part, I have enjoyed and been challenged listening to the contributions. I will not be able to respond adequately to them all unless I hold your Lordships very late this evening, but I have asked my staff to draw up the key points that have been made and will circulate that with my comments around my colleagues at the Treasury. Like other speakers, I congratulate the noble Baronesses, Lady Aglionby and Lady Kitching, and my noble friends Lady Ussher and Lord Neri on their excellent maiden speeches. What a range—from countryside and nature in Cumbria, to local government in the Peak District, to finance, politics and music. The speech from my noble friend Lord Neri about his dad reminded me greatly of my own father. I found it quite moving.
We have had a lot of speeches in favour of the Budget. I will not quote all the noble Lords who have spoken in favour, but I was particularly taken by some of the comments from noble Lords who are not from my party—the noble Lords, Lord Bilimoria and Lord O’Neill, and the right reverend Prelate the Bishop of Manchester. I have taken down the five points of the noble Lord, Lord O’Neill, to pass on to my colleagues. We have also had speeches about the environment and nature, from the noble Baronesses, Lady Teather, Lady Bennett and Lady Jones of Moulsecoomb. I point out that the only leader of any G7 nation that went to the COP this year was from the UK. That is something we should feel proud of.
I will try not to make this too political. A scenario is being presented to us that everything in the country is gloomy. There is an Aunt Sally that the Government are not addressing the central question that faces the country and a further Aunt Sally that the Opposition Benches have the answer to that question. I will examine some of those points. Before I do, let me just answer the noble Lord, Lord Sherbourne, who was asking what this Budget was all about. It was about growth: growth in every postcode, good growth. That is what it is.
On these Aunt Sallys, the fiscal position of the country is not where we would like it to be. However, to suggest that there is some simple way where you slash welfare, cut taxes and pay off all the debt is just not realistic. By their deeds you shall know them. The Opposition were in power for 14 years. That is when the debt went up. We are addressing this. I have a great respect for the noble Lord, Lord Lamont, so I was rather disappointed that he dismissed so easily the IMF, which says that we stand out among G7 countries for our programme to reduce the debt and get it under control. However, I completely agree with him and the noble Baroness, Lady Moyo, in their concern over interest rates. Interest rates have risen around the world, but we now pay a premium over other countries on our interest rates.
In a debate in this House, the noble Baroness, Lady Neville-Rolfe, herself mentioned its slang name. It is called the “moron premium”, which refers to the authors of the September 2022 mini-Budget.
Lord Pitt-Watson (Lab)
I am quoting the noble Baroness, Lady Neville-Rolfe. We have the highest borrowing costs in the G7. Do noble Lords know how much we would save if we brought them back to the average? We would save £15 billion a year.
There is this notion that we could suddenly slash welfare. Just last month, George Osborne explained that the welfare bill exploded under Johnson and Sunak, in the last Parliament, by 0.7 percentage points as a share of GDP. The Conservative Party is suggesting that we should cut VAT for foreigners shopping. Their shadow Chancellor reckoned that that would cost £2 billion, which would be funded by welfare cuts. If we, in this Government, find £2 billion extra to spend, we will not be spending it on foreign shoppers; we will be spending it on the defence of the nation and the health of our citizens.
From this very Dispatch Box, one of my predecessors, the noble Lord, Lord Agnew, resigned. Do noble Lords remember what he said? The reason for his departure was “arrogance, indolence and ignorance” in the management of public finances.
I want to set aside political points, because we are at our best when we are together, but it is simply not credible to suggest that this Government are doing nothing and that the Conservative Party, with that record, has some magic-wand solution.
Lord Harper (Con)
The Minister has provoked me slightly. He said that he was not going to make political points, then went and made them all. He quoted George Osborne very selectively, referring to the period between 2019 and 2024, when—if I may just remind the Minister—there was a once-in-a-generation global pandemic that crashed the economy by about 10%, and there was the war in Ukraine. During the whole of the rest of the period of the Conservative Government, we were actually successful in reducing working-age welfare, in real terms. So I argue that we can be very proud of our record on welfare reform and can demonstrate that we could do it again.
Lord Pitt-Watson (Lab)
As I say, welfare spending increased by 0.7 percentage points as a share of GDP during the last Parliament. However, I do want to step back from that and address some of the questions that have been asked.
In many of my discussions and debates with noble Lords, there has been a great degree of consensus, in particular on the Financial Services and Markets Bill. We agreed where we wanted that legislation to go and it has just gone through the Second Reading in the Commons without a vote against it. I pick out in particular the work on child trust funds and—she is nodding—the noble Baroness, Lady Kramer, but also others from across the House. The Financial Services and Markets Bill will mean the release of more than £2,000 each for 60,000 to 120,000 young people, as a result of the Government having listened and found a way round the legal difficulties. This House should be rightly proud of what we have achieved by working together. I have done my political bit, so will see whether I can continue in that spirit.
We live in tough times. As one friend said to me, the only predictable thing about the future is its unpredictability. Even since the Budget, who would have guessed what has happened in Iran and in the midterms, and who would guess where we are going from here? Of course, we cannot wish those economic storms away, but the core of the Budget is sticking to the fiscal rules in full—as I said, for the first time since 2022, and in the third year of the forecast.
But, look, this is good news: more widely, Britain continues to show growth in productivity and investment in the face of these global pressures. We are a wonderful, resilient people, served in the most part by fantastic, honest, creative and caring businesses, growing in the year to date by 1.9%. That is impressive. We are in difficult times, we have fiscal discipline and we have a resilient people, and I think they deserve breathing space.
I was quite taken by the noble Lord, Lord Leigh, saying that he does not want people giving up their seat for him. I have always taught my kids that, when there is an older person there, you should give up your seat for them, and that that is how my grandchildren should be taught as well. Maybe we come from a different sort of background on all that.
The breathing space is in two places: for consumers and for businesses. The noble Earl, Lord Russell, was right in saying that there are lots of proposals here. To the noble Baroness, Lady Wheatcroft, I say that I really was not so sure that all was quite so gloomy. A lot of the things she was talking about, such as tax simplification, are good points, but there is lots in the Budget.
Maybe they are small things, but they matter to people: 20 million getting the household payment for electricity; VAT on domestic electricity still removed until July, as is the 5p on fuel duty; gas standing charges and levy costs on bills coming off; an increased national minimum wage and national living wage; and a higher mileage allowance. It is a small thing, but there is the removal of tariffs on imports of 100 food products. There is also the £2 cap on buses, the support for parental leave and ending the cliff edge for carer’s allowance. Those are not nothing.
Then we come to the measures for businesses. Some 20 million consumers and 70,000 businesses—70,000 small retail and hospitality properties—are being taken out of paying business rates. My noble friend Lord Walker, who said we need a larger high street strategy, is absolutely right; there is a larger high street strategy, which I would very much like to have him involved in. My noble friend Lady Gill also talked about how things would work locally.
For other businesses, there is the freezing of the duty on red diesel and reducing the bills by 25% on eligible businesses through the British industrial competitiveness scheme. My noble friend Lord McTague mentioned that 14 out of 15 deregulatory proposals had been agreed, the Federation of Small Businesses having helped with all that. Some of the things that the noble Lord, Lord Fox, mentioned may be covered in that agreement. My noble friend Lord Pitkeathley talked about business improvement districts, which I think have a huge future.
On tax, I think my noble friend Lord McTague and the noble Lord, Lord Mackinlay, are right: I think this is the right thing to do, but it needs to be introduced with very great care. There are two years to prepare for this, and we are working with stakeholders to think about how we do it. I would be delighted to continue the conversation later with both noble Lords.
We are building for the future, and not just by spending. I sometimes think that economists think that, unless it has a huge ticket by it—and some of the things we are talking about do have quite a big ticket by them—then it will not be significant, and they throw out Keynesian economics. But it is not Keynesian economics; it is institutional and behavioural economics. My noble friends Lady Gill and Lord Smith, and the noble Lord, Lord Docherty, had it: if you can devolve power, that is a potent economic catalyst for what you will be able to do. If you can create incentives for localities, that really will make a difference.
On energy systems, there is the buying and building of new projects when they lower bills and can connect to the grid, getting out of the grip of international gas prices, and ending the practice of putting levy costs on bills.
On entrepreneurship, there were a lot of excellent contributions. To my noble friend Lord Neri, I say that I can imagine, and I hope, some musical people will take advantage of the fact you can earn £3,000 on a side business. At the other end, to the noble Baroness, Lady Bottomley, on the unicorns, I say that that is what the capital gains founders’ relief is for. I think the noble Lord, Lord Bilimoria, mentioned that, and I know that the noble Lord, Lord Massey, had some questions about it. Again, I would be more than happy to talk about that.
On big numbers, to mobilise private investment there is £20 billion of capital for the National Wealth Fund and the British Business Bank. As the noble Lord, Lord Eatwell, said, this is not crowding out; this is crowding in. It is about primary investment, not secondary investment, and that is a key point. I would be more than happy to talk to the noble Lord and hear his further thoughts on that. It also speaks, I hope, a bit to the questions that were raised by the noble Viscount, Lord Stansgate, about scaling up science companies and keeping them in the UK. I hope that feels like it makes sense.
Before I finish, I will touch on some of the other points. We are funding defence. I do not know how often I need to make this speech. Let me give noble Lords the numbers: 2.7% in 2027, 3% in 2030 and 3.5% in 2035—that is what the Government intend to spend on defence. The point made by the noble Lord, Lord Doyle, about frozen assets and Russia was a good one. In answer to the noble Lord, Lord Howell of Guildford, the numbers, which I have certainly given to the House before, on the defence investment plan are known. This is a huge commitment; it is the biggest since the Cold War. We all agree that it is what we should do, so let us leave it there.
On housing, the right reverend Prelate the Bishop of Manchester talked about council tax bands A to D. There is a fund of £100 million for people who should get that allowance but are unable to get it. I hope that addresses to some extent the issue that he was thinking about. Housing has been disappointing, but we are certainly not giving up on it. I hope that reassures the noble Lord, Lord Jamieson, and the noble Baroness, Lady Nargund. The noble Baroness, Lady Warwick of Undercliffe, asked whether some of the £1.5 billion for social and affordable housing might be available to housing associations. I believe it can be. Again, let us have a conversation about that after we have finished this debate.
In reply to the noble Lord, Lord Altrincham, on welfare, the Prime Minister and the Chancellor have been clear that the bill needs to come down, but it is planned to do this in a sustainable way, following what we learn from the Milburn and Timms reviews. Saying that you have the answer now is just not good management; you need to have the facts in front of you before you make those decisions.
Lord Bridges of Headley (Con)
I want clarification on this point. On 29 October, the Chancellor said:
“It’s not correct to say that we’re going to bring this welfare bill down in this parliament”.
Is that statement correct?
Lord Pitt-Watson (Lab)
If the noble Lord had been listening to me, I said that we will get the evidence and then transform the welfare system, with the aim of getting the welfare bill down. Until we have the evidence, it is foolish to make those sorts of commitments. They will blow up in your face.
We are continuing to invest in public services. Since 2024, we have aimed to rebuild our public services. We are not there yet, but the investment has begun. The points made by the noble Lords, Lord Liddle, Lord Hollick and Lord Barber, about value for money and public value are critical to all this. It is vital that the Government are thinking about this. I happened to learn that the noble Lord, Lord Barber, was in the Treasury this very morning talking about this very topic—it is an important one. I hope that we have cross-party consensus that it is about not how much you spend but the value that is seen as a result of it. The point from the noble Lord, Lord Babudu, about systemic health and preventive health is a very good example of how money could be spent better.
I think I am allowed a couple more minutes—although the clock is flashing. I have missed lots of points—I apologise in particular to my noble friends Lord Davies, Lord Watson and Lord Sikka, and the noble Lords, Lord Leigh, and Lord Redwood—including on quantitative easing and quantitative tightening. I will be more than happy to try to address the questions that have been raised, either in a discussion or perhaps noble Lords might like to write to me where the issues are complicated, such as those raised by the noble Lord, Lord Redwood.
In conclusion, in the face of the global economic storms, the British economy has done well, with good news this morning: investment is up, productivity is up and there is 1.9% year-on-year growth. That is what the Chancellor meant when he talked about our resilient people and businesses. This Budget is just part of our programme: there is a 10-year plan and a spending review. The key things are that we will stick to the fiscal rules, fund defence and offer breathing space and the prospect of hope for the future. But its success rests not just on what this Government do but on what the British people, British workers and British businesses can do. I hope that, instead of being gloomy, we can add a little bit of realistic optimism to this. It is a Budget based on the belief that, working together, the British people can and will achieve more than they achieve alone.