Budget Resolutions

Dehenna Davison Excerpts

Tuesday 2nd November 2021 Commons Chamber

[Dehenna Davison (Bishop Auckland) (Con)]

I want to start by paying tribute to my right hon. Friend the Member for Gainsborough (Sir Edward Leigh), who is no longer in his place, for making the strong case for why low-tax conservatism is the right way forward. Everyone on this side of the House can definitely agree with that, but we obviously have to face the reality that we are living in unprecedented times and that covid has had an enormous impact. On those grounds, I think that the Budget that was announced on Wednesday was really fantastic, and I want to go through some of the really positive things that were announced.

The first, which was also raised by my hon. Friend the Member for Plymouth, Moor View (Johnny Mercer), is the universal credit taper. Changing that to the 55% limit that it was originally destined to be is a really positive step forward in terms of not just the buzzwords of making work pay, which we Conservatives always talk about, but what that actually means for the single mum who knows that she can pick up a few more hours at work without losing a high proportion of her benefit. This has real-world implications for people, and it is a really positive step that this Conservative Government are taking.

I also want to focus on criminal justice, which is an area incredibly close to my heart—

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Will the hon. Lady give way?

[Dehenna Davison]

I will not, because I have moved on from that point.

I particularly want to look at what the Conservative Government are doing to tackle the courts backlog. The courts have been really damaged by covid and it is absolutely right that we are putting so much emphasis on this: not just on the courts backlog in and of itself but on extra funding for rehabilitation and for our prison services, as well as for victim support, which again is an area close to my heart.

Another area that is close to my heart, colleagues across the House will not be surprised to hear, is the hospitality sector, which has faced a crippling 18 months so far. It has had unprecedented support from the Government through business grants and the VAT reduction, and one of the things that is going to do wonders for the sector as it bounces back is the further reduction in business rates to be rolled out over the next 12 months. That is a really positive step that I am incredibly pleased to support today.

Something that I know caused vast cheers on Wednesday was the fact that we are finally seeing substantial changes to the alcohol duty system. This is long overdue, not just because it is going to help the brewing sector and the hospitality sector but because it is a form of tax simplification, which is something that I, as a low-tax Conservative, am wholeheartedly for. My inner low- tax Tory let out a massive cheer when I learned that fruit ciders were going to see a reduction in duty as well.

[Carol Monaghan]

Does the hon. Lady not recognise that fruit ciders have been linked to alcoholism in children, and that it is not necessarily a good thing to cut the tax on them?

[Dehenna Davison]

I would say that it is a good thing to be cutting tax in general, but that has to be alongside a proper public health strategy to ensure that we are tackling issues associated with alcohol abuse across the board and, in particular, among young people.

My being low tax does not mean that I do not think spending is necessary, because spending in the right areas absolutely is necessary. There are two key things we can focus on. The first is spending on places, by which I mean some of the areas that have been left behind for far too long—for generations. I am thinking of places in Bishop Auckland. One thing I was delighted to see in the Budget on Wednesday was the levelling-up fund, which is going to see three key projects delivered in my area: we will be connecting communities through the Toft Hill bypass; we will be connecting communities through the repairs to the historic Whorlton bridge; and we will have the extra works for Locomotion in Shildon to improve heritage and tourism in my area and create jobs for the future.

My hon. Friend the Member for Milton Keynes North (Ben Everitt) stole a bit of my speech, because he talked about the importance of investment in people and I could not agree with him more on that. For me, that investment takes two forms. The first is investment in good-quality healthcare, and the settlement the NHS is getting thanks to this Budget is astonishing. However, one thing I hope I can work with Treasury and Health Ministers on is finally getting the accident and emergency reinstated at Bishop Auckland Hospital. I have been campaigning on that for two years solid and I have no intention of stopping now. However, the billions of pounds to tackle the backlog in elective surgery is the right step forward, as is the emphasis on early diagnostics through 100 new community diagnostic centres. Those are positive things coming out of this Budget.

Investment in people also means investment in skills, and we are seeing £4.8 billion being invested in them. This is also about policy, and things such as university technical colleges and the move to T-levels. I must say that I agree with the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy) that we need to slightly rethink our policy on BTECs. We need to make sure that our young people have the skills they need, but we also need to make sure that BTECs are phased out in the most proactive and positive way, so that that will not have a negative impact on the education of our young people.

One thing I am passionate about is the lifetime skills guarantee, which is making sure that as our economy changes and we have become more technologically focused, people have the skills they need to get on in any future career, not just the one they are in now. Excuse my enthusiasm, but I used to work in research and development and one thing I am really enthused by is the Government’s focus on that. This is not just about R&D spending, finally introducing the Advanced Research and Invention Agency and R&D tax credits; it is also about the super-deduction scheme. The Government get slagged off all the time for supposedly reducing taxes on business when it is not the right time to do so, but this is incentivising investment in R&D. It is incentivising businesses to improve their productivity, and not just to create good, high-quality, skilled jobs which all our constituents can take up to give them a better life, but to grow our economy. As Conservatives, we know that the best way out of any economic crisis is growth, not spend, spend, spend—it is all about growth. The Chancellor has put a lot of emphasis on our future growth statistics. He also highlighted the fact that he remains a low-tax Tory. I am really trusting in him to stick to his word as we move out of this crisis.

--- Later in debate ---

[Mr Clarke]

The Government stand fully behind our youth budget. From the National Citizen Service to youth hubs, our wider work is clear. We are fully committed to ensuring that young people benefit as part of the Budget and spending review.

Meanwhile, we are spending record sums on improving connectivity and have allocated £5.7 billion to eight city regions to transform their transport systems. There is also the £4.8 billion levelling-up fund. We are taking on the criminals who make too many people’s lives a misery by recruiting 20,000 new police, providing an extra £2.2 billion for the courts, prisons and probation services, and committing £3.8 billion to the largest prison-building programme in a generation.

World-class public services are made possible only by the hard work of the private sector and the genius of the free market—a point made brilliantly by my neighbour, my hon. Friend the Member for Redcar (Jacob Young). That is why we are choosing to ignite even greater public sector success by investing in our economic infrastructure, improving skills and supporting innovation, with commitments to boost R&D funding and access to early stage equity finance.

To make sure that work pays, we are increasing the national living wage, cutting the universal credit taper rate and increasing the universal credit work allowance by £500 a year. That was the subject of a powerful speech by my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) and likewise by my hon. Friend the Member for Isle of Wight (Bob Seely).

[Dehenna Davison]

I reiterate my right hon. Friend’s point about research and development, which is important. Does he agree that investing in R&D and introducing tax incentives for it is the right way to get our economy growing in a future-proof way?

[Mr Clarke]

My hon. Friend is absolutely right. We are investing smart so that we seed the growth of the future. That is what we need to do. Ultimately, it is all about unlocking the dynamism of industry and making sure that we can compete in a way that matches some of the competitor economies that do so much more in that space.

I have outlined some of the bold policy initiatives that the Government are bringing forward, which represent a transformative investment in our economy and the country. There is one final promise that I want to address, which is our pledge to safeguard the nation’s finances. I reassure my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) and my hon. Friend the Member for South Dorset (Richard Drax), who gave robust Thatcherite speeches, that this Chief Secretary will never bequeath his successor a note saying “I’m afraid there is no money.”

Make no mistake, however, that although the economic picture is improving, we are still vulnerable. As the Chancellor said, a 1% increase in inflation and interest rates would increase spending on debt interest by nearly £23 billion. That is over £6 billion more than the total Home Office net budget will be in ’24-’25, so we must continue to build a stronger economy with the headroom to withstand shocks, which will mean making difficult decisions in the national interest.

That is why we have announced a new charter for budget responsibility, with two new fiscal rules that will keep the Government on the path of discipline and responsibility. The whole House will be asked to vote on it, which will give Members the choice between unfunded pledges and fiscal sustainability. It is the easiest thing in the world to say yes to everything, but as everyone on the Government Benches knows, reckless promises are the luxury of the Opposition and tough choices are the responsibility of the Government. Members can rest assured that the Conservatives will always do the right thing to protect our economy and our citizens’ future.

Our record spending on public services, huge investment to fund growth and unrelenting focus on building a stronger economy stand in stark contrast to the Opposition. If there is one idea that the debate has dispelled, it is that there is a credible plan on the Opposition Benches. There were so many negative speeches and unfunded pledges, and so many people, such as the hon. Member for Leeds East (Richard Burgon), who ridiculed an age of optimism. I think, and I know Conservative Members believe, that we should be optimistic about the future. We have come through the shadow of the pandemic as one country, stronger together, and we have come forward with a plan for investment, growth and levelling up. We should be proud of that.

Churchill talked about Budgets having an heir. I believe that this Budget will leave a long-lasting legacy for the UK in the shape of transformed lives, new opportunities and the strong foundations that will transform our country for decades to come. I commend the Budget and spending review to the House.

Question put and agreed to.

Resolved,

That income tax is charged for the tax year 2022-23.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.