Income Tax (Charge)

Alex Burghart Excerpts

Tuesday 5th November 2024 Commons Chamber

[Alex Burghart (Brentwood and Ongar) (Con)]

Thank you very much, Madam Deputy Speaker. It is a great pleasure to play a part in bringing today’s interesting debate to a close.

I take this opportunity to welcome the Chief Secretary to the Treasury to his post—I know he has been in post for a few months, but we have not had the chance to get to know each other. I must say I have been very impressed him. He is a fluent speaker. He is good on detail. That is not sarcasm—I was once warned by Hansard that sarcasm did not come across well in the written record—but I know what it is to be sent out to defend the indefensible. I can see that he is developing a fine skill and that he is some way on his way to mastering it. I just gently say to your man starting out in his Front Bench career in government not to get too good at it, because you will find your party will give you ample opportunities to defend the indefensible in the years ahead.

[Madam Deputy Speaker]

Order. Shadow Minister, I do not think you are speaking to me when you say “you”. You are obviously speaking to the Minister.

[Alex Burghart]

It has been a long day, Madam Deputy Speaker. I hope you will forgive me.

But enough of such pleasantries. This is a bad Budget. It is as bad as bad can be. At its heart is a decision to tax businesses hard—very hard—and through them to tax workers until the pips scream. It is a Budget that sees the total effective tax rate on low-earning roles increase to its highest level since 2010, hitting working people hard, as the Chief Secretary to the Treasury admitted on Sky television on Friday. We know that taxing business is a bad idea. As my right hon. Friend the Member for Tatton (Esther McVey) said earlier, businesses and working people are the dynamo of the economy. If we denude and degrade them, there is nothing for public services to feed on.

But we discover, as this Budget unravels, that it is not just businesses that are being taxed. It is GPs, it is care homes, it is hospices—as the hon. Member for Poole (Neil Duncan-Jordan) pointed out—and it is dentists, charities, childcare, higher education and school support staff. I understand that Labour Members will want to support big tax rises in the Budget, but before they vote on them, I ask them to consider whether they want to vote for tax rises on those services. In response to an intervention from my hon. Friend the Member for Hinckley and Bosworth (Dr Evans), who is sitting behind me, the Health Secretary said that he would listen to GPs, but either the money from the national insurance contributions is in the Budget, or it is not. Either it is in the envelope, or it is not. Has the thinking been done on this? At present, it would seem that all those services are in limbo. Yesterday, during Education questions, the Education Secretary was asked by both the shadow Secretary of State, my right hon. Friend the Member for Sevenoaks (Laura Trott), and the shadow Minister, my hon. Friend the Member for Harborough, Oadby and Wigston (Neil O’Brien), whether school support staff would be affected. She could not answer.

These are serious questions, and the Government must know the answers. His Majesty’s Treasury must have the data, and it must publish that data. So let me first ask the Chief Secretary if he will publish figures showing who will be hit by his national insurance contribution tax rises, what the costs will be to the services concerned, and whether they will receive compensation. As I said, the Treasury must have the data, and if the Chief Secretary does not have it at his fingertips, I ask him to put it in the Library of the House of Commons as soon as possible. We all want better public services; the question is, do we think we can get them if the services that I have mentioned are being taxed? As the Chief Secretary said on television the other day, without reform more generally, money will just follow money out of the door.

We are told that Labour has a plan for improving the NHS. We know that, because the Prime Minister told us in a speech on 11 September that in the spring he would have a plan. That plan, he said, would contain a transition to a digital NHS, moving more care from hospitals to communities, and focusing efforts on prevention over sickness. Who could argue with those sensible measures? It was good to read in the Red Book at a time of the Budget that His Majesty’s Government intend to:

“Invest more than £2 billion in NHS technology and digital to run essential services and drive NHS productivity improvements”,

which

“will deliver 2% productivity next year.”

That is very sensible, but it gives rise to a strange sense of déjà vu—and then one remembers that in the spring Budget this year the then Chancellor, my right hon. Friend the Member for Godalming and Ash (Jeremy Hunt), announced £3.4 billion in additional funding for the NHS to deliver 2% annual increases in productivity through new technology and digital across the health service in England.

So part 1 of Labour’s three-point plan is not new at all. It is a Conservative initiative, already accounted for by a Conservative Chancellor. Let us proceed to part 2, moving more care to communities. On that, the Red Book says absolutely nothing. As for part 3, prevention, there is a small increase in tobacco duty and a vaping products duty. Not content with taxing us into growth, the Chancellor intends to tax us into health—but it is all right, because apparently the Prime Minister has a plan to have a plan in the spring.

I will tell you a funny story about the spring, Madam Deputy Speaker. When I was first working as a parliamentary researcher, there was some long-forgotten report that the Department for Children, Schools and Families was producing. We asked when it would be published, and we were told, “In the spring.” We asked, “When does spring end?” The Department told us, “When summer begins.” In that tale is an insight into the way in which Labour Governments think. It is tomorrow and tomorrow and tomorrow, and never does reform come.

That is the plan for the NHS. It is relatively well developed, next to the non-existent plan for welfare reform. My right hon. Friend the Member for Central Devon (Mel Stride), who is now the shadow Chancellor, started that work, but silence has now descended. More workers are needed to grow the economy—the OBR was quite clear on that. The Chancellor has chosen tax over employment, which will not deliver growth.

The Government’s plan has been to tax, to spend, to think a bit, to set up a website, to get told to serve waffles for every meal, and to think a bit more. Then they will see whether any money is left, they will discover that there is not, and they will need to increase taxes again. What is becoming painfully apparent is that Labour wasted its time in opposition. It had 14 years to come up with a plan for the NHS, but it did not, and now it is scrabbling to find one. By the time we see the Prime Minister’s fabled plan, more than 10% of this Parliament will have passed, and very little will have been done that was not already being done before.

The Prime Minister said there would be no extra money without reform, but that is precisely what he has given the country. That is the price of political complacency. It is the price of thinking that governing is easy. It is the price of believing your own hype, and of failing to be honest with yourselves.

Some people said that the Labour party was trying to pull the wool over people’s eyes, and I was one of them. I thought that behind the great ambiguities of the Labour manifesto there would be a game plan, but game plan has come there none. We have £140 billion of extra borrowing, and £10 billion more in higher debt repayments. Mortgage payments are up, and there is austerity for employers and workers. A loveless landslide has become a loveless tax rise for the British people, and they will not wear it.

--- Later in debate ---

[Darren Jones]

It is the greatest real-terms increase in funding since devolution began. If the devolved Government wish to take responsibility for devolved matters, they should do so. If they do not wish to do so, Labour will happily take over at the next election to deliver better services for the people of Scotland.

Many Members have asked me to comment on the new hospitals programme. As the Secretary of State for Health and Social Care has confirmed, this Government are committed to delivering a realistic and deliverable plan, and we will deliver the outcomes of the review to the House in due course.

Many Members have also asked me about the difficult decision to increase employer national insurance contributions, in the context of Labour honouring its promise to working people not to increase employee national insurance contributions or income tax in their payslips. It is right that the Government are not legislating to exempt non-public sector organisations from these changes but, as the Secretary of State said, we pay for these services and it will be reflected in their settlements. To answer the shadow Chancellor of the Duchy of Lancaster, whether now or in the spring at the conclusion of the spending review, those departmental settlements will be published in the normal way.

[Alex Burghart]

Does the Minister not think that it is important that hon. Members see those figures, to see how much the services I mentioned will be taxed, before they vote on this Budget? Would that not be transparent?

[Darren Jones]

The hon. Gentleman perhaps forgets that the vote is tomorrow. No doubt he will come to the House to vote to support the allocation of £22 billion of extra funding so that the national health service can cover the cost of the doctors and nurses who, under his Administration, were striking on the picket line while Ministers refused to talk to them. Under this Government, they are back on the wards and in the theatres delivering for the people of this country.

The Government recognise the need to reform the social care system, and we thank those who work in the system for the work they do to help those in need. That is why we agreed a £600 million funding increase for 2025-26, and we will return to this issue in the second phase of the spending review.

I politely say to Members that I understand the temptation to ask for more spending, as I often did in opposition, but Ministers have to explain how they will pay for it. If Opposition Members want more spending or, indeed, fewer tax rises, they will have the opportunity tomorrow to set out to the House what they would do differently. Would they increase income tax and national insurance on workers once again? Would they increase VAT on people who go to the shops? Would they increase corporation tax for businesses, which we have pledged not to do? Would they reject the investment in schools, hospitals, the police service and the future of our country? Given their behaviour under the last Administration, do they wish just to borrow money every single month to pay the bills, month after month, increasing the national debt and increasing the cost of the national debt, but not investing in the fabric of this country, as this Government will do?