Oral Answers to Questions
Nigel Huddleston Excerpts(6 days, 19 hours ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Nigel Huddleston (Droitwich and Evesham) (Con)
We on the Conservative Benches are deeply concerned about all those who will lose their winter fuel payments under Labour. Some pensioners will keep the winter fuel payment if they claim pension credit, but we know that some will not apply or will have difficulty applying. Can the Minister confirm how many people the Treasury assumes are eligible for pension credit but will not claim it, therefore losing their winter fuel payment, and what is the Treasury doing to close that gap?
Emma Reynolds
As the hon. Gentleman will understand, the estimates of how many people might be eligible for pension credit are an imperfect science—they are based on a survey. Means-testing what is a very complex benefit, as all means-tested benefits are, requires an assessment of not only people’s income but their savings; it is about pensioner household units, too, so it is a complex set of procedures. All I can say is that I am glad we are targeting support at those most in need, something that was outlined in the 2017 Conservative party manifesto, which stated:
“we will means-test Winter Fuel Payments, focusing assistance on the least well-off pensioners, who are most at risk of fuel poverty.”
Business Property Relief and Agricultural Property Relief
Nigel Huddleston Excerpts(2 weeks, 4 days ago)
Westminster HallRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Nigel Huddleston (Droitwich and Evesham) (Con)
It is a pleasure to serve under your chairmanship, Dr Huq. I congratulate my hon. Friend the Member for Gordon and Buchan (Harriet Cross) on securing this important debate. I thank all hon. Members for their thoughtful contributions: I was particularly entertained to hear everybody’s friend the hon. Member for Strangford (Jim Shannon) say that he does not give anybody a hard time. I warn the Minister that he can expect persistent, relentless and vigorous but polite nudging; it may not be defined as a hard time, but it certainly sometimes feels like that. It is very polite, I have to say.
A few other points were raised today, but I will not delve into all the issues. Under different circumstances, I would be happy to have a debate with the hon. Member for Hexham (Joe Morris) about international trade. Having negotiated some of the trade deals, I can reassure him that the NFU and others had a very strong voice and that we listened to them very carefully. Their opinions, views and points were very often made. We tried to put safeguards in place; that has not always been acknowledged, but that is a debate for another day. The Liberal Democrat spokesperson, the hon. Member for Woking (Mr Forster), raised a bunch of other issues—again, a debate for another day.
Just two weeks before the Government deliver the Budget, I am aware that the Minister will be unwilling—and, to be fair, unable—to comment in detail on the issues that have been raised today. Nevertheless, I think it important that he and the Treasury team hear and reflect on the concerns and fears that Members have expressed on behalf of their constituents and other stakeholders who could be considerably affected by any changes to inheritance tax relief and particularly to business property relief and agricultural property relief.
My party supports wealth creation, which is important and which helps to pay for our public services, but we also understand the importance of ensuring that wealthy individuals make a fair contribution and pay tax appropriately. Earlier this year, the Minister and I had a debate about the broader issues of inheritance tax in which we recognised that we do not have a wealth tax in this country, but that there are taxes on wealth. Inheritance tax is an important such tax: it brought in something like £7.6 billion last year.
We have a progressive tax system. The top 1% of income taxpayers pay 28% of all income tax, so they contribute a huge amount. The vast majority of estates do not pay inheritance tax: only about 5% do so, because there are so many exemptions and reliefs. It is important to recognise those reliefs as legitimate. There is abuse in the tax system—there are loopholes that need closing, and HM Revenue and Customs, the Treasury and others spend a lot of time closing them—but let us not forget that the reliefs are there for a reason. Business property relief and agricultural property relief are perfectly legitimate reliefs. Without them, many businesses, including farms, would cease to exist or would be broken up on the passing of their owner. The reliefs form a critical part of overall business planning and especially of succession planning.
Many businesses, particularly small businesses, have expressed anxiety about the prospect of changes to or the abolition of business property relief. Currently, business relief is applied at either 50% or 100% on qualifying businesses when working out how much inheritance tax should be paid. That allows businesses and business assets or shares to be passed on to the next generation without the need to jeopardise the viability or even existence of vital businesses. Without that relief, many more family-owned businesses would have to be sold or broken up to pay a big inheritance tax bill. Prior to the election, many businesses and business bodies, including the Federation of Small Businesses, believed that they had heard and received commitments and assurances on inheritance tax and BPR from the Labour party. Many small businesses in my constituency and across the country seek the reiteration of those assurances.
BPR also plays an important part in attracting and retaining certain investments, for example in the alternative investment market. According to some analysts, the removal of BPR from the alternative investment market could result in a loss of between £14 billion and £21 billion in value to UK shareholders and would permanently damage the AIM. Given the importance of inheritance tax relief to the AIM, they are also looking for the Government to confirm its continuation. Uncertainty and speculation around its continuation may already be jeopardising investment.
Many hon. Members’ speeches have focused on agricultural property relief, because it is vital to the continuation of our rural way of life and our countryside. The NFU, the Country Land and Business Association and others are concerned about the renewed uncertainty and the impact on farming, including on tenant farmers. Some fear that APR may be removed and that some form of BPR may be kept, but even that could deter landowners from letting their land to tenants; the right hon. Member for Orkney and Shetland (Mr Carmichael) spoke about some of the further considerations and concerns for tenant farmers in particular.
As many colleagues have said, many farms would simply not survive the imposition of inheritance tax. Families who have farmed the land for generations could be forced to give up their businesses, their farms and their homes, which could jeopardise the sustainability of the rural economy, as well as undermining efforts towards greater self-sufficiency in food production and compromising environmental goals broadly agreed by both the former Government and the current Government.
The Secretary of State for Environment, Food and Rural Affairs confirmed last year, when he was the shadow Secretary of State, that the Labour party had no plans to change inheritance tax, including APR, if Labour won the election. Sadly, speculation has since arisen, and I do not believe that further assurances have been given by the Secretary of State or the Treasury. If the Minister can provide any certainty or even an indication to provide additional confidence, I and many of my constituents will welcome it, as will many other hon. Members’ constituents, many farmers, many investors and many business owners across the country.
Labour did not mention APR or BPR in its manifesto, nor did it make statements about them during the election campaign, but it clearly stated that it would not increase taxes on working people. As we have heard today, farmers and family business owners are very clearly working people; my hon. Friend the Member for Chester South and Eddisbury (Aphra Brandreth) made that point very well.
Given all the comments we have heard from the Labour party, I hope the Minister agrees that it is perfectly reasonable to assume that there are no plans, and should be no plans, to change the inheritance tax relief system, especially because those reliefs play such an important part in investment decisions and business planning. I therefore look forward to the Minister’s speech providing at least some of the reassurances that we seek today.
VAT: Independent Schools
Nigel Huddleston Excerpts(3 weeks, 6 days ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Nigel Huddleston (Droitwich and Evesham) (Con)
It is an honour to follow Citizen Smith over there.
In the large number of contributions today, we have seen the importance of this issue and the alarm felt by many Members and their constituents about the Government’s proposal. I am sorry to say that we have also had a lot of 1970s politics of envy today. We believe in evidence-based decision making, and as many Members have pointed out, it is becoming increasingly clear that Labour’s planned education taxes—removing VAT and business rate exemptions from independent schools— will not do what is claimed.
I will move on to the details in a moment, but may I first congratulate those who have delivered their maiden speeches today? I thank them all for making gracious comments about their predecessors. I learned something about each of them today. The hon. Member for North East Derbyshire (Louise Jones) spoke eloquently and lovingly about her beautiful constituency, as did my hon. Friend the Member for Isle of Wight East (Joe Robertson), who brought back many holiday memories for me. The hon. Member for Glasgow East (John Grady) gave us all good advice on naming children in Glasgow. The hon. Member for Tipton and Wednesbury (Antonia Bance) may or may not be aware that we share something in common, as we were both student union sabbatical officers, although in my case a few years earlier. The hon. Member for Horsham (John Milne) gave perhaps the most eclectic speech today, mentioning Daleks, potholes and Ann Widdecombe all in one speech.
I am afraid that I will not be so gracious about some other comments we have heard today from Government Members, who still do not seem to realise that they are now in government and their job is to talk the country up. They have constantly talked down not only the country, but the education system. Let me remind them that when we left office, education standards were going up and per pupil funding was at record levels. In contrast, when Labour was in office, we were falling in the league tables. What a brass neck Labour Members have, when we look at Labour’s record in Wales. We have been backing our brilliant teachers, and I would hope that they would do the same.
The motivations behind this policy are clearly questionable. The impact assessment is non-existent and the savings illusory. There are so many potential unintended consequences and uncertainties around these policies that, at the very least, the Government need to postpone implementation, although it would be better to scrap the plans altogether. They are also moving away from a long-held principle that we used to agree on across the House that educational services are not taxed at all. It is a terrible thing that they are now bringing in.
We have five key categories of concern: the impact on state schools; the impact on Government finances; the timing of the proposals; the consideration of exemptions; and the impact on SEND and EHCPs. I will not repeat all my comments from the debate we had earlier, but it is so clear that this policy will not only have a detrimental impact on the independent schools sector, but negatively impact the state sector, because the imposition of a 20% VAT hike overnight will mean that some families will no longer be able to afford the fees. Inevitably that will mean children leaving the private sector and moving to the state system, putting an additional burden on many local state schools, some of which do not have the capacity. As I said this morning, it is not fearmongering or scaremongering; it is happening already and we are already seeing it in schools. According to some forecasts, instead of the predicted £1.5 billion saving, this policy could cost the taxpayer money.
How extraordinary to choose this policy area to try to eke out some cash when so many other options are available, if the Government were brave enough. Out of total Government spending of more than £1.2 trillion, is this really the policy that they want to prioritise?
On the topic of overall Government finances, we have not yet heard clearly whether the Department for Education will get more funding from the Treasury if the number of state school pupils exceeds expectations. Will they be expected to pay it out of existing budgets? Have the Government set aside capital for additional school spaces if it is needed?
Regarding the timing of the proposals, many Members have mentioned that it is beyond belief that the Government are bringing in this policy in the middle of the school year, when schools are simply not ready for it. It is not fair on the independent sector to expect schools to get their heads around new legislation, register for VAT and implement new systems and processes in literally a matter of weeks and before Christmas. That will not happen. We have also not heard whether the Government will create exemptions or special considerations for all these areas: military families, students on music and dance schemes, children attending small schools, language schools or religious schools, those paying low fees or on bursaries, and children in exam years who may have to move to another school that does not offer their curriculum.
What are the Government doing about pupils with special educational needs and those with an EHCP or in the process of gaining one? If, as many predict, there is a displacement of children with SEND and EHCPs into the state sector, is there the capacity for that? Is there adequate additional funding support planned for local authorities to deal with that predicted increase in demand?
I wish to make a couple of other brief points before concluding. As a Conservative, I believe in choice, and I will not criticise choices made by parents about their children’s education. I have no qualms, however, about criticising hypocrisy. The irony that I stand here as a proud product of a state comprehensive education defending independent schools while the Exchequer Secretary to the Treasury who spoke earlier, a product of a private education, is pursuing a policy that could undermine independent schools is not lost on me or others. Many Government Members attended independent schools or sent or are sending their own children to them, and yet they are determined to increase the costs on others, depriving many families of the choice they themselves had.
I am glad to see the Secretary of State for Education now in her place after being conspicuously absent. Perhaps she will take the opportunity to apologise for the tweet. Parents who send their children to independent schools pay twice for their children’s education and deserve better than to be treated with contempt by their Government’s Education Secretary. The divisive tweet that she put out last weekend was shockingly ill-judged and ill-informed, sneering and smirking about embossed paper and swimming pools. Does she really not understand or recognise that not every independent school is like Eton or Harrow? It betrays an incredible lack of awareness and poor knowledge of the facilities and financial status of many independent schools. It demonstrated that the policy is being promoted not on evidence but on envy and spite—ill-informed and misplaced envy at that.
Simon Hoare
I agree entirely with what my hon. Friend has said. Will he add to the indictment of the Secretary of State the fact that she failed signally to realise that she is the Secretary of State for all pupils, whether they are in the independent or the state sector? The divisive language that she used was a very rude signal of two digits to those families who take a decision that she does not like.
Nigel Huddleston
My hon. Friend puts it well. I do not have to add to his comments.
This is a rushed and ill-judged policy that will not raise the money the Government assumed it would, undermine the viability of many independent schools, put immense pressure on the state school system and put in jeopardy the education prospects of thousands of students, including many with special needs. We implore Ministers to reconsider.
Independent Schools: VAT and Business Rates Exemptions
Nigel Huddleston Excerpts(3 weeks, 6 days ago)
Westminster HallRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Nigel Huddleston (Droitwich and Evesham) (Con)
It is a pleasure to serve under your chairmanship today, Dame Caroline. May I first congratulate my hon. Friend and constituency neighbour, the Member for Bromsgrove (Bradley Thomas) on securing this important debate? I thank all those who have participated today; we have heard some very insightful contributions. I am also glad to have the shadow Secretary of State for Education, my right hon. Friend the Member for East Hampshire (Damian Hinds), sitting beside me today.
We can see from the large number of contributions, particularly from Opposition Members, how important this issue is to Members and their constituents, many of whom are greatly distressed by the Government’s proposals. We believe they are flawed in both design and execution, or at least planned execution, which is perhaps why so few Members from the Government party are here to defend them today. The policy will move away from a long-held principle that educational services are not taxed in this country, or in most developed economies. We have five broad categories of concern: the impact on state schools, the impact on overall Government finances, the timing of the proposals, consideration of exemptions, and the impact on SEND and EHCP provision. I shall turn to each of these briefly.
First, it is clear that the policy will have a detrimental impact not only on the independent sector, but on the state sector. The imposition of a 20% VAT tax hike overnight will clearly mean that some families will no longer be able to afford the fees. That is basic economics. In addition, the imposition of business rates will further disrupt the business model of independent schools and make less money available for bursaries and subsidies, which many parents rely on. Inevitably, that will mean children leaving the private sector and moving to the state system, putting an additional burden on many state schools, some of which do not have the capacity. It will also make fewer spaces available at good and outstanding local state schools where spaces would otherwise have been available, because more pupils would have taken the independent route. This is not a fear or scaremongering; this is reality. It is happening now.
According to the Independent Schools Council, more than 10,000 pupils have already been pulled from independent schools. One think-tank has estimated that far from bringing additional money into the Treasury, the policy could cost the taxpayer £1.6 billion, which brings me to my second point about the impact on overall Government finances.
Out of total Government spending of more than £1.2 trillion, is this policy really the top target of the new Government? It smacks of the politics of envy, not of careful deliberation and consideration of evidence. On the topic of overall Government finances, will the Department for Education get more funding from the Treasury if the number of state pupils exceeds expectations, or will they be expected to pay for it within existing budgets? Have the Government set aside capital for additional new school places if that is needed?
Regarding the timing of the proposals, it is unfathomable why the Government are considering introducing this policy in the middle of the school year. Why? It does not make any sense to cause so much mid-year disruption to so many schools, pupils and families.
Sir Alec Shelbrooke
This will clearly be open to legal challenge, which stands very little chance of being in the courts within the next three months. As it gets held up, will this policy not cause mass disruption by being introduced in the middle of the academic year?
Nigel Huddleston
My right hon. Friend raises another important point, and I believe some legal challenges are already in place. Regarding timing, is the Minister truly confident that the policy could be implemented within weeks? Is His Majesty’s Revenue and Customs adequately resourced and prepared for it? Is the legislation ready? Is the legislation and guidance sufficiently clear? Even if the answer to all of the above is yes, is it fair on independent schools to expect them to suddenly get their heads around new legislation, register for VAT, implement new systems and processes, and logistically carry out the execution of this policy, all before Christmas? The answer is clearly no. I implore the Minister at least to delay the implementation, and carefully consider some exemptions and special considerations, my fourth category of concerns, which have been raised by many hon. Members today.
The rushed policy appears not to have properly considered carve-outs for pupils from military families, students on the music and dance scheme, children attending small or small faith schools, those paying low fees or who are on bursaries, or children in exam years who may have to move to another school that does not offer their current subject, offers different syllabuses, or has different examination boards. I hope that when we finally see the impact assessment, we will see some consideration of those matters.
My fifth category of concern is what consideration has been given to pupils with special educational needs and those with an EHCP or who are in the process of getting an EHCP.
Ben Coleman
Given that the situation confronting the Government is entirely of the previous Government’s making, will the hon. Member apologise for the terrible state of the SEND system?
Nigel Huddleston
I applaud the hon. Gentleman for his bravery, given that 2,500 pupils attend independent schools in his constituency. I think they will have a different view from his.
Nigel Huddleston
As for provision, as my right hon. Friend will articulate this afternoon, more than 200,000 EHCPs were issued with SEND provision. We provided more support than the Labour Government ever did.
If, as many predict, there is displacement of children with SEND and EHCPs into the state sector, is there capacity? Is there adequate additional financial support for local authorities to deal with the predicted surge in demand? If the answer is no, or I do not know, to any of those questions, the Government must delay this policy.
Before I conclude, I ask the Minister to have the decency to recognise the apparent hypocrisy of so many Members on the Government Benches, including himself, who attended independent schools or send their children to one, yet are now determined to increase the costs on others, depriving many families of the choice that they benefited from.
I also ask him to apologise on behalf of the Secretary of State for Education for her appalling divisive tweet over the weekend, which betrays her lack of awareness of the realities of independent schools across the country. Headteachers, teachers and parents in both the state and independent sectors, unions, tax experts and think tanks are all appealing to the Government to think twice about this policy. I appeal to the Minister to listen and act accordingly.
Budget Responsibility Bill
Nigel Huddleston ExcerptsWednesday 4th September 2024
(2 months ago)
Commons ChamberRead Full debate Budget Responsibility Act 2024 View all Budget Responsibility Act 2024 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 4 September 2024 - (4 Sep 2024)
Nigel Huddleston (Droitwich and Evesham) (Con)
I beg to move amendment 9, page 1, line 14, at end insert—
“(c) or any changes to the government’s fiscal targets.”
This amendment requires the OBR to produce and publish a section 4(3) report at the time new fiscal rules are announced by the Treasury.
The Chairman
With this is will be convenient to take the following:
Amendment 2, page 1, line 25, at end insert—
“(2A) In any case where the Office has acted in accordance with subsection (2), it may notify the Independent Adviser on Ministers’ Interests of the circumstances in any case where it considers those circumstances may be relevant to—
(a) the Ministerial Code, or
(b) the functions of the Independent Adviser on Ministers’ Interests.”
This amendment enables the OBR to notify the Independent Adviser on Ministers’ Interests where the OBR considers that any instance where the Treasury had not requested a report under section 4A(1) in advance may give rise to consideration of compliance with the Ministerial Code.
Amendment 5, page 1, line 25, at end insert—
“(2A) Where the OBR prepares a report in accordance with subsection (1) or (2), it must take account of the impact of the measure or measures on—
(a) the UK’s compliance with, and
(b) the fiscal cost of meeting,
the UK’s net zero target as set in section 1(2) of the Climate Change Act 2008.”
This amendment requires the OBR to report on the impact of fiscally significant measures announced by Government on the UK’s statutory net zero target.
Amendment 1, page 2, line 4, at end insert “or
(b) the measure, or combination of measures, is likely to have an impact on—
(i) the cost of government borrowing,
(ii) interest rates, or
(iii) the rate of growth of gross domestic product.”
This amendment broadens the definition of fiscally significant measures to those which fall below the costing threshold, but have wider fiscal effects, by affecting either the cost of government borrowing, interest rates or rates of economic growth.
Amendment 6, page 2, line 4, at end insert
“or if the condition in subsection (3A) is met.”
See the statement for Amendment 7.
Amendment 7, page 2, line 6, at end insert—
“(3A) The condition in this subsection is that the measure, or combination of measures, forms part of category of measures with a cumulative impact on—
(a) public sector net debt,
(b) public sector contingent liabilities, or
(c) both,
that exceeds a specified percentage of the gross domestic product for a specified period.
“Specified” means specified in, or determined in accordance with, the Charter for Budget Responsibility”
The purpose of this amendment is to extend the definition of fiscally significant measures to include measures with a cumulative impact on public sector net debt or contingent liabilities when taken together with other measures in the same category, such as public projects with private sector partners.
Amendment 3, page 2, line 16, leave out “28” and insert “56”.
See the statement for Amendment 4.
Amendment 4, page 2, line 17, at end insert—
“(6A) After the publication of a draft under subsection (6), the Treasury must consult—
(a) the Office for Budget Responsibility,
(b) the Treasury Committee of the House of Commons, and
(c) such other persons as the Treasury considers appropriate.
(6B) When a modified Charter so as to include provision by virtue of this section is laid before Parliament, the Treasury must also lay before Parliament a report on the outcome of consultation under subsection (6A).”
The purpose of this amendment is to impose a requirement on the Treasury to undertake a full consultation and publish the outcome of that consultation prior to revision of the Charter for the purposes of the Bill.
Clause 1 stand part.
Clause 2 stand part.
Amendment 10, Title, after “measures” insert
“and of any changes to the government’s fiscal targets”.
This amendment is consequential to Amendment 9. It would amend the long title of the Bill.
Nigel Huddleston
Thank you very much, Madam Chair. May I first take the opportunity to congratulate you on your election? I promise to try not to try your patience over the coming weeks, years and so on, but we will see how things go.
I wish primarily to speak today to amendment 9 and, of course, consequential amendment 10, which effectively seek to ensure that the fiscal lock proposed in the Bill should also include any changes to the fiscal rules and would require the Office for Budget Responsibility to produce a report on their effect on public finances. The Office for Budget Responsibility was of course constructed by a Conservative Chancellor following the poor forecasting record of the previous Labour Government. Between 2000 and 2010, the then Labour Government’s forecasts for economic growth were out by an average of £13 billion, and their forecasts for the budget deficit three years ahead were out by an average of £40 billion. Their forecasts therefore lacked credibility, and to re-establish confidence and credibility the OBR was created by the Conservative Government.
Labour lacked economic credibility in the past, and I am afraid it still lacks it now. The facts simply do not stand up the false claim that the Government have inherited the worst economic circumstances since the second world war; they transparently have not. Contrary to the rewriting of history that the current Labour Government are attempting, when we took over from Labour back in 2010, inflation was 3.4%. When they took over from us, it was 2.2%. The annual deficit is half what we inherited in 2010, unemployment is about half what it was in 2010, and we handed Labour the fastest economic growth in the G7. The dominant political and economic narrative since the second world war is in fact, as has been widely commented on, that every single Labour Government end up with unemployment higher at the end of their time in power than when they took over from the Conservatives preceding them.
The British public should not be taken for fools. Just because Labour keeps claiming something, that does not mean that it suddenly becomes true, which is why clarity over plans and rules is so important. The fiscal rules are of course restrictions on fiscal policy set by the Government to constrain their own decisions on spending and taxes. The fiscal rules set by the previous Government said that the debt to GDP ratio should be falling within a five-year horizon, and that the ratio of the annual budget deficit to GDP should be below 3% by the end of the same period. Labour’s manifesto for the election proposed the following fiscal rules: balancing the current budget, so that day-to-day costs are met by revenues, and that debt must be falling as a share of the economy by the fifth year of the forecast. On the surface, therefore, the debt rules appear to be broadly the same under the new Government. The Government have even said that they have an “ironclad” commitment to reduce Government debt. It is therefore critical what definition of debt is used for the fiscal rules. Clearly, any changes to the fiscal rules are financially significant decisions because they affect how much the Government can borrow and spend.
On Second Reading, the Exchequer Secretary to the Treasury said:
“Our fiscal rules are non-negotiable.”—[Official Report, 30 July 2024; Vol. 752, c. 1263.]
Great, but why then has the Chancellor repeatedly failed to rule out that she will change the definition of debt in her fiscal rules to allow, presumably, for massive borrowing? The Government cannot run from the scrutiny that they should be subjected to if they are considering making such a change. We believe that our amendment requiring an OBR report on changes to the fiscal rules is entirely consistent with the Government’s stated policy intent, and should therefore be fairly uncontentious. After all, on Second Reading, the Chief Secretary to the Treasury said that
“the announcement of a fiscally significant measure should always be accompanied by an independent assessment of its economic and fiscal implications, in order to support transparency and accountability.”—[Official Report, 30 July 2024; Vol. 752, c. 1211.]
We agree, and not accepting our amendment would be contrary to those goals, because clearly changing the fiscal rules would be a fiscally significant measure in anybody’s book. Furthermore, the Chief Secretary said that
“fiscal discipline and sound money is the bedrock of our plans.”—[Official Report, 30 July 2024; Vol. 752, c. 1213.]
Well, changing the fiscal rules would be changing the foundations and that bedrock.
Transparency and clarity are important in relation to the public finances, because Ministers should never forget that it is not their money that they are spending; it is the public’s money. The public have a right to know how their money is being spent, and government is about making difficult choices with limited resources. With Government spending being above £1.2 trillion per year, the British public recognise that the Government clearly have choices. It is not an endless supply of money, but it is a very, very large amount. In the last few weeks, the new Labour Government chose to spend the public’s money on pay settlements for their union friends rather than on supporting pensioners. Those settlements are estimated to cost about £10 billion. They also chose to spend £8.3 billion on a public energy company and £7.3 billion on a national wealth fund, so far from inheriting a £22-billion black hole, they have actually just spent £25 billion creating one within their first few weeks of coming to power.
Andrew Griffith (Arundel and South Downs) (Con)
My hon. Friend is making a fantastic speech on the importance of being responsible with our public finances. Much of the Bill is concerned with responsibility and transparency. Does he know whether the Government published an impact assessment when they took away the winter fuel allowance?
Nigel Huddleston
I thank my hon. Friend for that point. My understanding is that the Government have not published an impact assessment, as would normally be the case for something with such a significant impact. I think that speaks to the whole narrative that we are hearing from the Government: claiming one thing when the facts speak differently. As I said, far from inheriting a £22 billion black hole, they have actually spent, or committed to spending, an additional £25 billion. That is a choice that they made, so the claim that the Labour Government are having to take the winter fuel allowance away from millions of pensioners as a response to unexpected financial constraints simply does not stack up against the facts, or indeed the words of the Chancellor herself, who on 25 March 2014—yes, a decade ago—said:
“We are the party who have said that we will cut the winter fuel allowance for the richest pensioners and means-test that benefit to save money”.—[Official Report, 25 March 2014; Vol. 578, c. 174.]
That is a direct quote in Hansard from the current Chancellor, so no, the Government’s restriction of winter fuel payments is not a response to financial circumstance; it is a long-established, clearly stated Labour policy intent—a deliberate policy choice, but a policy that they conveniently forgot to tell the public about in the run-up to the last election.
I hope, however, that the Government can be straight with the public on this point about the fiscal rules, accept the amendment that we are proposing, and provide assurance to all Members and the outside world that there is no sleight of hand here. We want the Bill to work as they say it is intended to, and to include financially significant decisions, such as on the levels of Government borrowing and the fiscal rules. I would therefore appreciate it if the Chief Secretary to the Treasury confirmed in his wind-up that the Government do not intend to change the definition of debt in their fiscal rules or practise some accounting trick to hide the level of Government borrowing, and that they do indeed wish to be clear and transparent about the public finances. If Labour Members vote against our amendment, it will merely prove that they are planning to change their fiscal rules in the Budget to borrow more money, increase debt, and run away from independent OBR scrutiny—the very opposite of the stated intent of the Bill.
Madam Deputy Speaker (Ms Ghani)
I call Dr Jeevun Sandher to make his maiden speech.
The Second Deputy Chairman of Ways and Means (Caroline Nokes)
I call shadow Minister Nigel Huddleston.
Nigel Huddleston
I will not detain the House long by repeating the arguments that I made in my opening comments, but I am disappointed by the Minister’s response, and in particular by his refusal to accept our amendments. It is alarming that he is refusing to do so because, as I outlined, I believe they are consistent with the goals of the Bill overall, and I think the credibility of the Bill will be seriously undermined if it does not include the fiscal rules. I like the Minister a lot. We go back a way and have always had civil conversations, but if he does not believe or consider the level, type and definition of debt to be “fiscally significant”, then with the greatest respect perhaps the Treasury is not the right home for him. They are transparently fiscally significant, and an important part of the consideration we are talking about today.
Darren Jones
I thank the hon. Gentleman for giving way, and for inviting me to suggest whether I should try to find a job in another Department. I just point out that, having arrived at the Treasury, I have seen the impact of fiscally significant levels of debt after 14 years of the Conservative Government. Has he got anything to say to the House on that matter?
Nigel Huddleston
Yes, I have indeed. As I outlined in my original statement, the arguments the right hon. Member is making do not stack up with the facts. The economic circumstances that Labour inherited are better in many areas than those we inherited from them back in 2010. The economy is the fastest growing in the G7. On unemployment, every Labour Government since the second world war has increased it while in power, for us to then clear up and reduce it when we take over. Inflation was lower when Labour took power then when we inherited it, and annual debt was higher when we took over in 2010.
Labour Members keep saying all those things, but the challenge is that it does not stack up with the facts. They make arguments about the level of debt, as I outlined earlier, but they have already announced £10 billion for inflation-busting salary increasing for their union mates, £8 billion on energy provisions, and £7 billion on the national wealth fund. That is £25 billion of additional money that they have spent. If there is a black hole in the finances, it is clearly one of their own making by the announcements they have made since coming into government. That £25 billion is a huge amount of money, but I will finish discussing those points, because we had this debate earlier.
Nigel Huddleston
I will not give way at the moment, because I want to move on to some more positive things.
The Comptroller of His Majesty’s Household (Chris Elmore)
There is loads of time.
Nigel Huddleston
We have Third Reading as well, so let us enjoy ourselves. Just because the Government keep repeating the narrative does not make it true. I am sure they will continue to do so, but the £25 billion of additional spending that I have just outlined is a choice they have made. The arguments they are having to make—that they are having to cut payments to pensioners in response to the circumstances they have inherited—are not true because, as I outlined in my opening speech, it is a deliberate, long-stated policy choice articulated by the current Chancellor a decade ago. It is not a response to circumstances, but deliberate Labour policy.
On a more positive note, I congratulate all those who have made their maiden speeches today: the hon. Members for Loughborough (Dr Sandher), for Portsmouth North (Amanda Martin), for Swindon North (Will Stone), for Chelmsford (Marie Goldman), for Southend East and Rochford (Mr Alaba), for Woking (Mr Forster), for Rother Valley (Jake Richards), for Wokingham (Clive Jones), for Dudley (Sonia Kumar), for Rochester and Strood (Lauren Edwards), for Plymouth Moor View (Fred Thomas), and for Northampton North (Lucy Rigby). They have made incredible contributions. The breadth of experience that they bring to this Parliament is astounding, and I am largely talking here about Government Members. I say it with a great degree of respect, because in many circumstances—in fact, in nearly every single circumstance—they have replaced good friends of mine who contributed significantly to this House. They all have big shoes to fill, but what they have said today was impressive. In particular, those who spoke without notes are a lesson to us all.
What a beautiful tour we had around the United Kingdom. Everyone who spoke today spoke eloquently about their constituencies and their constituents and showcased their rich heritage and rich history. It was incredibly impressive. I am sure their constituents will be proud of what they have said. With that, I will finish my comments, but the debate will continue.
Question put, That the amendment be made.
Oral Answers to Questions
Nigel Huddleston Excerpts(2 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Nigel Huddleston (Droitwich and Evesham) (Con)
I congratulate the Chancellor and the entire Treasury team on their appointments. We have always had civil, albeit occasionally robust, interactions, and I am sure that will continue, but it is now our job to hold them to account for the important decisions they make at the Treasury. During the election, Labour promised on more than 50 occasions not to increase taxes on working people. Does it now recognise that working people have pensions too, and can the Chancellor give those people, who are saving for the future, peace of mind by confirming that the Government will not increase taxes on pensions in the upcoming Budget?