Budget Responsibility Bill

Debate between Caroline Nokes and Luke Charters

2nd reading
Tuesday 30th July 2024 Commons Chamber

[Mr Luke Charters (York Outer) (Lab)]

Thank you, Madam Deputy Speaker, and congratulations on your elevation to the Chair.

I am proud to stand here as part of a changed Labour party that won the public’s trust on the economy. I am so glad that we did, because we would otherwise still be at the behest of those on the Opposition Benches, who did so much to damage the public’s finances. My constituents paid the economic price for their economic incompetence—the £22 billion black hole uncovered yesterday is just one example. Ultimately, that is why the Opposition paid the price at the ballot box. The people of York Outer and this country resoundingly sent a message at the general election: never again!

If anyone needs reminding why, they should take themselves back to 23 September 2022, when we had £45 billion of unfunded tax cuts, with no consultation with the OBR. The pound fell below $1.09 for the first time since 1985. The central bank had to undertake emergency liquidity operations by purchasing long-dated gilts. Banks and building societies entered into a chaotic spin, with fixed-rate mortgage products being pulled—at one point, over 1,000 products were withdrawn in a single day. As the former Member for South West Norfolk once said, that is a disgrace.

Amidst all the chaos, there is a simple point: the mini-Budget did not meet the needs of the British people. Let us take some of the businesses that closed in the dying embers of the last Government. A music shop believed to be the oldest in the UK closed only a few months after the mini-Budget. Banks Musicroom had been in York since 1756, but ultimately market conditions saw it shut down in early 2023. The stationery company Thomas Dick, in Clifton Moor, which closed earlier this year, had been open 90 years but faced chaos and supply chain issues that left it no longer viable.

The decisions we make in this place have real consequences, and the impact we can have on people is very real. Before my election to this new role, my friend the Mayor of York and North Yorkshire ran a small business on our high street. I remember him talking just before the mini-Budget about what the impacts might be; he warned just how dangerous the mini-Budget would be, and he was right.

But it is not just about the impact on businesses. Last weekend, I visited Hoping Street Kitchen, a fantastic volunteer-run project that helps homeless people and those facing poverty across York. I was deeply inspired by its volunteers, sense of community and unwavering commitment to improving the lives of others. A volunteer told me first hand how crumbling public services, a lack of affordable housing and long mental health lists have created an unimaginable crisis. The project has gone from providing 30 to 40 meals a week during 2021 to providing 100 a week in 2024.

That is why it is critical that we implement our national mission to rebuild public services, build more homes and offer more NHS appointments. But it is also why I am speaking in this debate: this Bill is so important because it is the only way we can grow those public services with a stable economy. We saw yesterday just how difficult that challenge will be, which is why we must protect our economy now.

The Bill respects our institutions, rather than undermining them, and a prime example is how it gives real oversight to the Office for Budget Responsibility. It also includes provisions for the Treasury Committee to have a greater say in key fiscal moments. However, with the heightened responsibilities that the Bill gives the OBR, we need to think about the most effective ways in which the OBR could be properly scrutinised by Parliament, and the Bill could make more specific provisions on the Treasury Committee’s scrutiny role of the OBR. This week, I met the team from the Institute for Government that authored a report earlier this year on how Select Committees can better hold regulators to account. I commend that report, and I would welcome a debate on how this place best scrutinises the OBR.

What the Bill really protects against, however, is knee-jerk reactions and fantasy Budgets. If we are to get the growth we so badly need, we must behave like an established economy, not an emerging one that came out of the mini-Budget. That is why the Chancellor’s presence at the G20 over the weekend and her warm words about Britain being open for business are so important. If we can fix the lamentable legacy that the Conservative party left, we will have real cause for optimism. I was pleased that the right hon. Member for Godalming and Ash (Jeremy Hunt) commended the work of the OBR in his first speech as shadow Chancellor, but it felt somewhat jarring for him to flippantly suggest:

“We all understand the politics of a Bill that allows the Government to make endless references to the mini Budget”.—[Official Report, 22 July 2024; Vol. 752, c. 408.]

George Orwell once said:

“The secret of rulership is to combine a belief in one’s own infallibility with a power to learn from past mistakes.”

The Conservative party clearly has some way to go in that regard, but under this Government the green shoots of economic recovery are already starting to show. We may have inherited a particularly difficult situation, but the evidence of stable markets and an increase in the pound show the confidence in the security that this Government bring. After all, I made it clear in my maiden speech how welcome it is that the country has some good Yorkshire representation in No. 11, embodying the value of frugality.

We know there are tough decisions to make, and we are not hiding that from the British people: just take yesterday as a prime example of our approach. This Bill seeks only to offer greater transparency over decision making and it treats taxpayers’ money with respect. That is why I am proud to sit on the Government Benches, and it is why the people of York Outer can be confident that this is a Government that will serve them well.

[Madam Deputy Speaker (Caroline Nokes)]

I call Yuan Yang to make her maiden speech.