Oral Answers to Questions

Alan Mak Excerpts

Tuesday 29th October 2024 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

[Alan Mak (Havant) (Con)]

Last Wednesday, in Washington, the Chancellor announced changes to the debt rules to allow Labour to borrow more. However, published Treasury advice says that increasing borrowing risks interest rates staying higher for longer. Does the Chancellor agree with her Treasury civil servants?

[Rachel Reeves]

Last week, when I was in Washington, I was very pleased to hear the International Monetary Fund say how important it is that countries, including the UK, borrow to invest in their capital infrastructure. Under the plans we inherited from the previous Government, capital spending as a share of GDP is due to fall from 2.6% to 1.7%. If those decisions were to go forward, it would mean plans delayed and cancelled. We will set out our plans tomorrow in the Budget, but it is crucial that we have rules ensuring that we pay for day-to-day spending through tax receipts, and that we borrow only to invest, unlike the previous Government.

Draft Insurance and Reinsurance Undertakings (Prudential Requirements) (Amendment and Miscellaneous Provisions) Regulations 2024

Alan Mak Excerpts

Tuesday 15th October 2024 General Committees

[Alan Mak (Havant) (Con)]

It is a pleasure to serve under your chairmanship, Mr Dowd. I am pleased to inform the Committee that we intend to support today’s statutory instrument, because it continues the essential reforms to Solvency II started by the previous Conservative Government, as the Minister said, of which I was a member.

The financial services industry employs more than 2 million people in the UK. While two thirds of the workforce operates outside of the south-east, financial services have made London the world’s largest international financial centre. Prudential regulation ensures that insurance firms act safely and reduces the chance of them getting into financial difficulty. It is therefore vital that Solvency II, the framework governing the prudential regulation of insurance firms, reflects the unique structural features of the UK insurance sector. The financial services sector must have the right architecture to provide the best possible security for investors and sufficient capital for businesses.

Following close engagement with industry, the Conservative Government developed detailed plans to reform Solvency II. These reforms were designed to ensure a vibrant and prosperous insurance sector, striking a careful balance between boosting growth and maintaining high standards of policyholder protection. They help ensure the safety and soundness of firms, requiring insurers to hold enough capital to withstand a one in 200-year shock, and could help spur a vibrant, innovative and internationally competitive insurance sector, unlocking £100 billion of productive investment to grow the economy over the next 10 years.

We on the Conservative Benches welcome the Government’s decision to continue our plans to reform Solvency II; we therefore support this statutory instrument and will not divide the Committee.

Budget Responsibility Bill

Alan Mak Excerpts

Committee of the whole House
Wednesday 4th September 2024 Commons Chamber

[Alan Mak (Havant) (Con)]

I thank everyone who has contributed to the debates on the Bill, both today and before the summer recess, especially new Members who have made their maiden speech: 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 all spoke incredibly well, with passion and eloquence, and we wish them well for their time in the House.

We Conservatives believe that sound public finances, fiscal responsibility and independent forecasts are the foundation of economic stability, which is why it was a Conservative Government who created the OBR more than a decade ago, and it is why today we tabled our amendments to improve the Bill and stop Labour moving the goalposts on the fiscal rule. By voting against our sensible proposal, Labour Members have shown they are not serious about our public finances. What are they trying to hide? It is clear that the purpose of the Bill is to distract everyone from Labour’s economic record and pave the way for tax rises in the autumn Budget.

Let us examine Labour’s economic record. The party has been in government for just nine weeks and has already carried out nine acts of economic vandalism. It has removed the winter fuel allowance from 10 million pensioners despite promising not to; caved in to its union paymasters by agreeing inflation-busting pay rises; failed to commit to investing 2.5% of national income on defence; cancelled vital infrastructure upgrades on the A27 and A303; cut funding for a vaccine manufacturing plant that would protect our health; imposed Whitehall diktats to concrete over our green spaces; stopped Conservative plans to build 40 new hospitals; scrapped funding for a next-generation supercomputer, undermining our status as a tech superpower; and appointed Labour donors to senior civil service jobs without open competition. Nine weeks, nine acts of economic vandalism.

We know there is more harm to come, with Labour’s autumn Budget set to raise taxes. During the election campaign, Labour promised over 50 times not to raise people’s taxes, but the Labour Government are planning to do just that. It will be hard-working people, pensioners and businesses who will pay the price. May I invite the Chief Secretary to the Treasury to return to the Dispatch Box to rule out raising taxes on working people, such as drivers, savers and business owners? At the same time, will he rule out changing the fiscal rules to allow for more Government borrowing and debt?

[Darren Jones]

I always welcome the opportunity to return to the Dispatch Box, and I thank the shadow Minister for inviting me to do so. Opposition provides an opportunity for reflection. While he is offering his thoughts on our two months in office—two months of great relief for the British people—does he have anything to say about his 14 years in office before the election?

[Alan Mak]

I think the answer from the Chief Secretary to the Treasury is no, which confirms everything we already knew. It means that the people can never trust Labour with our economy, that Labour will raise taxes and cut investment at every opportunity and that Labour’s honeymoon is well and truly over.

Question put and agreed to.

Bill accordingly read the Third time and passed.

House of Commons Commission

Resolved,

That

(1) in pursuance of section 1(2)(d) of the House of Commons (Administration) Act 1978, Rachel Blake be appointed to the House of Commons Commission, and

(2) in pursuance of section 1(2B) of that Act, the appointment of Shrinivas Honap as an external member of the Commission be extended to 30 September 2026.—(Lucy Powell.)

[Madam Deputy Speaker (Judith Cummins)]

I call Tim Farron to present a petition. The Member is not present.

Oral Answers to Questions

Alan Mak Excerpts

Tuesday 3rd September 2024 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

[Alan Mak (Havant) (Con)]

The Institute of Directors’ latest economic confidence index shows that optimism about the economy fell back to minus 12 last month, following a three-year high of plus 7 in July. Can the Chancellor explain how Labour’s tax rises on working people, businesses and pensioners will contribute to economic growth when the economy is already going backwards under this Labour Government?

Budget Responsibility Bill

Alan Mak Excerpts

2nd reading
Tuesday 30th July 2024 Commons Chamber

[Alan Mak (Havant) (Con)]

I begin, Madam Deputy Speaker, by congratulating you on your election and wishing you well in the Chair, as well as congratulating the new ministerial team, who I hope will enjoy their time at the Treasury as much as I did. I also congratulate all hon. Members across the House who made their maiden speech in today’s debate: the hon. Members for Glasgow North (Martin Rhodes), for East Renfrewshire (Blair McDougall), for Southend West and Leigh (David Burton-Sampson), for Carshalton and Wallington (Bobby Dean), for Chichester (Jess Brown-Fuller), for Falkirk (Euan Stainbank), for Peterborough (Andrew Pakes), for Maidenhead (Mr Reynolds), for West Ham and Beckton (James Asser), for Ynys Môn (Llinos Medi), for Kettering (Rosie Wrighting), for Wirral West (Matthew Patrick), and for Earley and Woodley (Yuan Yang). All spoke very well, with eloquence and passion, and we on the Conservative Benches wish them well for the rest of their time in this House.

In contrast to those positive, uplifting maiden speeches, we have also heard Labour Ministers talking the country down, claiming to have inherited the worst set of circumstances since the second world war. Frankly, Labour’s approach is more OTT than OBR. To prove Labour wrong, we do not have to go as far back as 1945: we only have to revisit 2010. When we took over from Labour, unemployment was at 8%; the Conservatives nearly halved it to 4.4%. In 2010, the deficit was 10.3% of GDP, thanks to Labour’s reckless borrowing; it is now 4.4%, and is forecast to fall to 1.2% in the coming years. In 2010, inflation was 3.4%; today, it is back at 2%, the Bank of England’s target. Let us not forget that the final years of the last Labour Government saw Britain experience the deepest recession since quarterly data started being published—in fact, Labour Britain was in recession for longer than any other G7 country at the time, and we were the last to exit. That is why in 2010, Labour left us with that infamous note saying, “There’s no money left”. In contrast, this month we left Labour with the fastest-growing economy in the G7, low inflation, low unemployment and 12 months of consecutive wage growth.

We Conservatives believe in sound public finances, fiscal responsibility and independent forecasts as the foundations of economic stability. That is why it was a Conservative Government who created the OBR in the first place, and it is why we are keen to safeguard its reputation for independence and focus. In that context, this Labour Bill feels more like gimmickry than government. It is clear that the Bill is really designed for one purpose and one purpose alone: to distract everyone ahead of Labour’s tax rises in the autumn Budget. Is it any wonder that the IFS says that Labour’s fiscal lock proposal is “largely performative”, or that even the Resolution Foundation describes the policy’s impact as “relatively small”?

When the Conservatives created the OBR, our legislation recognised that for it to be effective and respected, it had to maintain a delicate balance between independence and accountability. Independent forecasts, free from Treasury interference, would give the public more confidence in them, avoiding the scenario that happened under the last Labour Government where their growth forecasts were out by as much as £13 billion on average. At the same time, elected politicians accountable to this House would retain control over fiscal decisions, because those are ultimately political judgments that should not be delegated to unelected bodies.

However, today’s Bill challenges the delicate balance that we left in place. In fact, the most recent independent review of the OBR, carried out by the OECD, specifically warns against what it describes as “mission creep”. Presciently, the OECD says that attempts to expand the OBR’s current remit risk drawing the organisation into areas where it does not currently have sufficient capacity or expertise, creating confusion about its role, and diluting its effectiveness. We on the Conservative Benches agree: the OBR should not be dragged into making actual or perceived political judgments, giving unelected officials the ability to essentially veto or shape decisions that are in substance political.

Quite frankly, the Bill and Labour’s proposals are full of unanswered questions, which need answering today and throughout the Bill’s passage. For example, is the OBR really equipped to decide what counts as a spending emergency? Should the OBR really be empowered to reasonably disagree with Ministers, who are elected, ignore their opinions and strike out on its own? The Bill gives the OBR more powers; but what measures will the Government introduce to make the OBR more accountable to the House and its Members?

Can the Government explain why their fiscal lock completely ignores policies with large, indirect fiscal impacts but whose up-front costs do not reach the GDP threshold, such as Labour’s new open-door immigration policy, or their watering down of laws that protect us from French-style strikes? Why has the Chancellor announced over £25 billon of spending in 25 days without an OBR forecast? Despite claiming a black hole in the public finances, Labour has already spent £8.3 billion of taxpayers’ money on a public energy company, £7.3 billion on a national wealth fund and around £10 billion on inflation-busting public sector pay deals without asking for any improvements in productivity in return. Do they have a forecast for any of that spending, or has the fag packet been thrown away?

When the Minister gets to his feet, can he confirm that there will be no more tax rises beyond those already included in Labour’s manifesto? Having already taken away the winter fuel allowance from millions of pensioners, will he rule out tax rises on people’s pensions, capital gains and council tax?

It was a Conservative Government who created the OBR to end Labour’s culture of inaccurate, politicised forecasts. The OBR has established itself as a fixture of the economic and political landscape, and we support it. But we have significant concerns about the Bill, and believe it will benefit from further scrutiny and improvement by the whole House at its next stage, so we do not oppose that additional scrutiny.

The Bill reveals the true fears and underlying motives of this Labour Government. It is an admission, and a confirmation, that one of the first laws they bring forward, after 14 years in opposition, is designed to save Ministers from their own Back Benchers’ spending demands, and stop themselves from crashing the economy, as they have done on so many occasions before. The Bill shows that they have finally realised what everyone else already knew: this country can never trust Labour with our economy.