Autumn Budget 2025

Baroness Shawcross-Wolfson Excerpts

Thursday 4th December 2025 Lords Chamber

[Baroness Shawcross-Wolfson (Con)]

My Lords, like many previous and much more illustrious speakers, I have had the privilege of being involved in numerous Budgets. As I am sure the Minister will want me to point out, some were more successful than others. I have never regained my taste for Cornish pasties.

Those experiences mean that I appreciate how difficult it is to pull together a Budget. I pay tribute to the incredibly talented and dedicated officials in the Treasury and the OBR who work so hard on these events. I also pay tribute to Treasury Ministers. Whatever you think of the choices made in any given Budget, the process forces Ministers to spell out their trade-offs in a way that very few others in government are required to do. It is an essential discipline. With that spirit of ministerial transparency in mind, and given the wide-ranging and insightful contributions already made on tax and growth, I will concentrate my remarks on the Government’s spending plans.

In the Budget last week, we saw specific policy decisions increase welfare spending by £9 billion and the overall forecast for welfare spending in 2029-30 revised up by £16 billion. Then, on Monday, the Prime Minister reaffirmed his moral commitment to go further on welfare reform and the Chief Secretary to the Prime Minister said the Government would cut unsustainable welfare spending. I welcome those commitments. I fear that demographics and disability—what the Resolution Foundation described as an “ageing and ailing population”—will put continued pressure on the welfare state. Can the Minister clarify whether these future welfare reforms will be designed to reduce overall spending, to reduce the growth rate in spending or simply to maintain the current trajectory? To put it another way: is welfare spending a forecast that the Chancellor wants to beat?

I turn to departmental spending. Previously, the Government planned 1% real-terms growth between 2028-29 and 2029-30. Now they assume no real growth in spending between those years. I am all for spending restraint, but I question whether they will be able to deliver it. The spending plans published in June had already baked in productivity improvements, so it would be helpful to know what has changed in the last few months to give the Government confidence to go further. According to the Resolution Foundation, these spending plans imply that unprotected departments will have their budgets cut by £6.4 billion in real terms, before taking into account the additional pressures identified by the OBR, including but not limited to £6 billion-worth of spending on SEND. These are sizeable figures. I fear I know how the party opposite would have described them were the situation reversed, so can the Minister confirm that he plans to deliver these cuts at the end of the Parliament?

As your Lordships know, sadly, productivity does not materialise because Ministers mandate it to be so. It is not enough to write the numbers in the Red Book or to publish a White Paper. Meaningful productivity improvements require painstaking work: consultation, legislation, capacity building—it all takes time and often comes with upfront costs. It would be reassuring if the Minister could tell us how departments are preparing to go from real-terms spending increases to real-terms cuts. Is the investment of the next few years earmarked to fund productivity improvement for future years? Will the Treasury oversee this work?

This Budget presents an opportunity to deliver on the Prime Minister’s commitment to “rewire” the British state. However, I have learned through bitter experience, as I imagine the Government have through their efforts to reform PIP and now SEND, that making the commitment is the easy bit. If these spending plans are meant to be implemented, we now need two years of sustained technical and political work to make good the Prime Minister’s promise to build a more innovative and efficient state. I very much hope that is what we will see.