Autumn Budget 2025

Baroness Carberry of Muswell Hill Excerpts

Thursday 4th December 2025 Lords Chamber

[Baroness Carberry of Muswell Hill (Lab)]

My Lords, this Budget continues to build the foundations for a more stable, more resilient and ultimately more productive economy. Some noble Lords in this debate have questioned whether this was a Budget for growth. I remind noble Lords that restoring fiscal credibility is a precondition for growth, and that is what this Chancellor has done.

The Chancellor made the right choices, not least because measures she announced will particularly benefit households on low and average incomes. Several of my noble friends today have noted all the ways in which the Budget helps families battling with the cost of living and the poorest households. I will not run through the list again, but I emphasise that the lowest-paid are going to get a real-terms pay increase next April.

That follows the Low Pay Commission’s recommendations for national living wage and minimum wage upratings. This continues an unbroken record since 1998 of Chancellors accepting or going further than the Low Pay Commission’s recommendations. Like my noble friend Lord Hannett, I served on the Low Pay Commission for many years. The independent, tripartite Low Pay Commission methodology has demonstrably stood the test of time, and that is why I ask the Minister to disregard some of the voices off that are questioning how the UK sets the pay floor.

Next April’s uprating meets the Government’s aim to see the wage floor not drop below two-thirds of median earnings, and this target was set by a Conservative Government in 2020. This year, the commission, chaired very ably by the noble Baroness, Lady Stroud, comprehensively considered the available evidence and judged that the recommendations would not damage the labour market or the economy.

Noble Lords will know that most minimum wage workers are in small and medium-sized businesses; some of these businesses are struggling, and for some the minimum wage rises will be challenging. The Government must support these businesses, and they have done so. The Budget supports our high streets. Our pubs, restaurants and leisure properties will see new lower tax rates. For the smallest businesses in those sectors, rates will be the lowest in more than 30 years; these discounts will be permanent and will benefit over 750,000 properties.

At the same time, I acknowledge that some small businesses will be hit in April by increased property valuations because of post-Covid revaluations. These revaluations are independent of the Government, who are stepping in to cap bills. I welcome the £4 billion support package for small businesses. Most small businesses with property values of under £100,000 will have increases capped at 15% or less, or at £800 for the smallest. All of this builds on measures introduced last year to help small firms grow, access finance and survive economic pressures. Pubs, cafés and shops are the heart of our high streets and provide employment for some of our lowest-paid workers, so will my noble friend the Minister ensure that the effectiveness of support for small businesses is kept under review?