Backing Business to Create Economic Growth

Caroline Nokes Excerpts

Monday 18th May 2026 Commons Chamber

[Gregory Stafford (Farnham and Bordon) (Con)]

I agree with my right hon. Friends the Members for New Forest West (Sir Desmond Swayne) and for Tonbridge (Tom Tugendhat) that there seems to be a complete lack of understanding from those on the Government Benches of the absolute disaster they are presiding over when it comes to the economy and, most importantly, growth. The evidence is hard to ignore. The hon. Member for Exeter (Steve Race) talked about a battle of ideas—

[Madam Deputy Speaker (Caroline Nokes)]

Order. I remind Members that if they have intervened in a debate, they might like to have the courtesy to wait a while before departing the Chamber.

[Gregory Stafford]

Thank you, Madam Deputy Speaker.

The hon. Member for Exeter talked about a battle of ideas, but those on the Government Benches seem to be totally devoid of any ideas that will actually get this country moving again. The ITEM Club forecasts around 160,000 job losses this year alone, with manufacturing, retail and construction expected to be hit the hardest. Unemployment has risen month after month and now stands at 5.2%. His Majesty’s Revenue and Customs payroll data shows 110,000 fewer people in employment than when Labour took office.

In my constituency of Farnham and Bordon, in Haslemere, Liphook and the surrounding villages, there has been a 28% increase in the number of young people claiming unemployment-related benefits in a single year. This is the reality behind the rhetoric that comes from the Government: young people unable to get a foothold in work, businesses pausing recruitment, families feeling the squeeze in their bills, and high streets losing momentum.

The reason is not difficult to identify, and businesses across the country are telling us the same thing: Labour has increased the cost of employment, raised taxes and layered on regulation that is undermining confidence. The Employment Rights Act alone introduced more than 330 pages of additional obligations on employers. The Government’s own assessment acknowledged a cost of around £1 billion a year. Both the Federation of Small Businesses and the Institute of Directors warned that the legislation would reduce hiring and investment, which is exactly what we are seeing. What is the Government’s response? A regulating for growth Bill. It is like asking a vegetarian how they would like their steak cooked. The reality is that this is not the way to get growth.

At a recent hospitality roundtable in my constituency, one publican told me that there is now “no incentive to hire someone under 25”. That should concern every single Member of this House, but Labour Members simply parrot the Government’s talking points. They are totally detached from what is going on in the real world. The unemployment rate is now close to one in six among 16 to 24-year-olds, and I cannot believe that Labour Members are not being told this by their constituents. For many young people, their first job is the foundation for everything that follows—skills, confidence, independence and ambition—but too many are now finding the door closed.

--- Later in debate ---

[Ben Coleman]

I am most grateful for that intervention, but it does not in any way even attempt to address the point I was making about the loss of money to this country through trade and the fact that so many businesses have gone under.

On state aid and product procurement, I will accept that one of the most unpalatable things that civil servants have always said, along with “commercial in confidence”, is, “No, we can’t do that because of EU procurement rules.” After the changes to EU procurement rules there was, even while we were in the European Union, a huge amount that you could do to prefer small and local firms, as I knew when I was deputy leader of my local council and got officials to do that. The civil servants you were dealing with perhaps should have looked again—

[Madam Deputy Speaker (Caroline Nokes)]

Order. We have been here for two years; you have to stop using “you” and “your”, because it refers to me. It was not me who was dealing with civil servants.

[Ben Coleman]

I am most grateful, Madam Deputy Speaker. Such officials as gave that information could have looked again.

--- Later in debate ---

[George Freeman]

My right hon. Friend makes an important point. I will make a slightly different point, which is that there are huge opportunities for good growth in this country. Speaking as someone who has had a 16-year career backing the industries of tomorrow, whether it is in fusion, SMR nuclear technologies, agritech, bioscience, the bioeconomy on Teesside, or the satellite economy in Glasgow, we have an opportunity to turn these into the industries of tomorrow. I welcome the Government’s industrial strategy commitment to do it, but it is at 50,000 feet; we need to drop down to some more tangible and bolder policies to back those industries.

I know the Secretary of State gave a tub-thumping speech about the 1980s, but the truth is we have made a lot of progress over the last 20 years. I was doing my work as the Minister for Life Sciences, for agritech and for Science and Technology following in the footsteps of Paul Drayson and David Sainsbury. In life science, fusion, AI and quantum, we have built an unbelievably competitive economy, but other countries are moving fast. Our competitors are more agile. We are terrible at adopting technology in the public services. Our scale-ups are not getting the finance they need in the city. Kate Bingham in The Times today is right.

How do we unlock this? I want to suggest a ten-point plan for renewal. I support the Government’s ambition. I say this because if all of us fail, the Benches to my left of pub populists who are promising everything will win, and we will see even deeper disillusionment. I am calling in this speech for, first, real honesty of a 1979 scale about the extent of the emergency; secondly, bold devolution to the people, cities and mayors who know how to do it better—frankly, they could not do worse than Whitehall—thirdly, serious Whitehall reforms, so that we end the juvenile process of His Majesty’s Treasury playing Departments off against each other for funding, which in the end comes very late and is taken back; and fourthly, a serious backing for the innovation economy. I welcome the £20 billion of R&D, but how we allocate it is key. We need to allocate it in a way that attracts private investment. Fifthly, we need a bold revolution of tax incentives for enterprises—a new deal for new business. There should be no national insurance or VAT for a couple of years for someone starting a company and growing it. Sixthly, we need regulation for innovation. That is not just cutting regulations, but leading in setting the regulation. I welcome the Government’s work in setting up the Regulatory Innovation Office. We then have skills and patriotic capitalism. I do not think it is communism to get the city investing in British business. Boldness—

[Madam Deputy Speaker]

Order.