Oral Answers to Questions

Drew Hendry Excerpts

Tuesday 19th December 2023 Commons Chamber

[Mr Speaker]

I call the SNP spokesperson.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

May I echo your comments, Mr Speaker, with Christmas wishes for all the House staff, your staff and Members? The UK Government’s attempt to overhaul the EU subsidy scheme has left English farmers 50% worse off in cash terms than in 2020. While the Scottish Government have sought to protect our farmers’ payments, can the Minister guarantee that the UK Government will not try to undermine their payments and devolution by back-door use of the United Kingdom Internal Market Act 2020?

[Laura Trott]

I note that the hon. Member did not answer my question, nor that of the right hon. Member for Orkney and Shetland (Mr Carmichael) about when the ringfenced money will be returned.

[Laura Trott]

Very good point, but I still maintain that the hon. Member needs to clarify that matter. It is up to the Scottish Government if they would like at any point to top up the amount that goes to Scottish farming. I encourage them to do so this afternoon at the Budget.

[Drew Hendry]

I do not think any Scottish farmer will be reassured by what the Minister has just said. I just said that the Scottish Government are protecting those farmers’ payments, while English farmers are losing out, as we know. What we do not have from the UK Government is detail on what they will be doing after 2025. If we had remained in the European Union, we would know that figure for farming subsidies so that the Scottish Government could make plans to help farmers plan ahead. Can the Minister apologise for that situation and guarantee that in the early months of next year we will have clarity on farming payments?

[Laura Trott]

The UK Government have laid out plans for the agriculture transition in England that go beyond the current spending review, giving farmers increased certainty over policy and spending intent for years to come. The Scottish Government could decide to provide farmers in Scotland with similar certainty if they chose to do so.

Finance Bill

Drew Hendry Excerpts

2nd reading
Wednesday 13th December 2023 Commons Chamber

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

I beg to move an amendment, to leave out from “That” to the end of the Question and add:

“this House, while approving the changes to taxation of tobacco in the Finance Bill and full expensing being made permanent, declines to give the Bill a Second Reading because it fails to make a much-needed reduction in VAT for the hospitality and tourism sectors, and fails to introduce measures through the tax system that would help alleviate poverty.”

It is a pleasure to follow the Chair of the Treasury Committee, on which I serve, even though she is at odds with the London School of Economics and the University of Warwick on non-dom status—we might return to that later.

The problem with this Bill is not so much what is in it but what is not in it. For example, full expensing is being made permanent, which is laudable and is to be supported, but the Minister and, indeed, the hon. Member for Ealing North (James Murray) did not mention that choices are being made that fail to support families, that make people poorer and that reduce community resilience and sustainability, which is no way to grow an economy. There was no mention of tackling the growing cost of living crisis that people face every day. There was nothing on rents, mortgages, food bills and, most of all, energy costs, as we go deeper into winter. The Minister is an affable person, but he has a brass neck as wide as the Dispatch Box to say that the Government are looking to invest in public services—I will come back to that in a moment.

Today, the Bank of England has told us that the proportion of mortgage balances in which the borrower is behind on payments is the largest in six years. The SNP asked for direct help for people: a £400 energy bill rebate, a social tariff on energy, a lower price cap, mortgage interest tax relief and help for tourism businesses through VAT adjustments. Of course, there could have been much more, but we got none of that from the Chancellor or from this place.

Instead, the Government turned a deaf ear to the inflationary costs for households, in addition to starving the public sector of funds. Councils in England are already going bust: Labour-controlled Birmingham, Hackney, Croydon and Slough; Conservative-controlled Northamptonshire and Thurrock; and Lib Dem-controlled Woking. The Local Government Association says that one in five councils—60 of them—is at risk of issuing a section 114 notice, but the Chancellor, while doing nothing to help families, is slashing public sector spending. Richard Hughes, from the Office for Budget Responsibility, has pointed out that there are £19 billion of public sector cuts coming:

“the real spending power of Government departments in England goes down by about £19bn over the forecast period”.

The Chancellor has also frozen capital spending, which has a direct negative impact on the spending available in Scotland. When Labour is asked what it would do differently, we hear only silence. There is no attempt by this place to protect public services. Scotland’s block grant has, over the past few years, been cut by 17% in real terms compared with 2010—the House of Commons Scrutiny Unit has given those figures. We all know that inflation running at 4.7%—do not forget that it was much higher last year, at 11.1%—means that any increase is dwarfed by inflation, so when Scotland’s block grant increases by just 1.4% next year, it is wiped out before it touches the sides. This is a savage real-terms cut for Scotland.

The Office for Budget Responsibility has said that living standards will be 3% lower in 2024-25 than they were before the pandemic, which is the largest reduction in living standards and the highest tax burden since the 1950s. There is zero growth forecast for the economy. The GDP figures from the Office for National Statistics show that for the three months to October 2023 there was no growth, and the economy actually contracted in October.

David Bharier from the British Chambers of Commerce says that this

“confirms the low-to-no growth cycle the UK economy is in.”

That, of course, takes us directly to the choices that this Government and this place have taken since Brexit. Labour, the Conservatives and the Lib Dems support Brexit, so the self-harm continues to cause difficulties.

The UK suffered a broad-based fall in both openness and competitiveness between 2019 and 2021. UK trade fell by 8%, compared with 2% in France. That is not my description; it comes from the London School of Economics. Our industries face severe challenges due to the Westminster-inflicted harm of Brexit, yet this place cannot point to a single benefit, beyond a made-up line about vaccines. Workforce shortages in tourism, hospitality, the NHS and care have all dramatically increased since Brexit—a Brexit that Scotland rejected and continues to reject. Yet for the people of Scotland, Westminster continues to show indifference.

The Institute for Fiscal Studies has pointed out that the 2p cut to national insurance in the National Insurance Contributions (Reduction in Rates) Bill is almost entirely eaten up by frozen tax thresholds, due to what is known as fiscal drag. Basically, this Government are giving with one hand and taking away with the other.

We have seen nothing on energy bills, which are due to rise again in January; nothing on food bills, while countries such as France and Canada take action; nothing on mortgages, on which the Government could have delivered some relief; and nothing to reduce VAT in a range of areas, where the Government could have taken action to help people and to ease inflation at the same time.

Although certain measures, such as full expensing being made permanent, are welcome, the biggest problem with this Bill is what it fails to address, and that is to help millions of households that are struggling with the cost of living. This place should have introduced a UK-wide version of the Scottish child payment to help families. It should have introduced a £400 energy bill rebate and a social tariff, and it should have provided for a household essentials guarantee.

The Government could have addressed unfair tax loopholes by abolishing the non-dom tax status. As I said, the University of Warwick and the London School of Economics reckon that would raise £3.6 billion per year. The Government could have done that and they could have decided to put a tax on share buy-backs, but instead they decided to set their sights on ill and disabled people, telling them to get back to work. It is worth remembering that, according to research in 2015 by the University of Liverpool and the University of Oxford, old-style incapacity assessments were “associated with” an extra 590 suicides across England between 2010 and 2013. This is a scandalous thing to bring to people at this time. Positive Money has noted that a windfall tax on the profits of the big four banks could have raised £20 billion in the first six months of this year, but the Government chose to do nothing.

The autumn statement delivered the worst-case scenario for Scotland and for our people. We needed proper funding for public services, but instead we face massive cuts—the health funding announced represents just 0.01% of the budget for 2024-25. We needed immediate help for people in our energy-rich country to pay for some of the highest energy bills across the nations of the UK.

By contrast, the SNP Scottish Government have ensured that people in Scotland pay less council tax than those in England, and we have frozen council tax for the next year in order to assist with the cost of living crisis. At the moment, people do not have to pay prescription charges or tuition fees, and they do not have to pay for eye tests. Under-22s and over-60s do not pay for bus travel. We also have the Scottish child payment and much more. In Scotland, we have used the limited social security powers we have to provide dignity, respect and support for people. Those are manifestations of the values of a progressive Government looking at every opportunity to help people who are struggling.

Imagine what would happen to all of that for the people of Scotland if this place had control of all of those issues, as Labour and Conservative Members want to happen. The Scottish Government are using all the levers at their disposal to help people through this cost of living crisis, but the implications of this Westminster fiscal event are clear; with the current reliance on Westminster for our capital grant allowances and limited borrowing powers, this place is stamping its austerity on Scotland. The path for Scotland is ever clearer: we need to be an independent country, to rejoin the EU and to have the ability to look after our own people.

--- Later in debate ---

[Tulip Siddiq (Hampstead and Kilburn) (Lab)]

This afternoon, we have been told that the measures in the Finance Bill and the wider autumn statement will deliver the growth that our economy urgently needs. Unfortunately, our leading economic institutions and economists do not seem to agree. Despite the Conservatives’ attempts to distract attention with headline figures, the independent Institute for Fiscal Studies has described their numbers as “sort of made up”. The Chancellor wants us to believe he is cutting taxes to give people back more of their pay packets, but the reality—as my hon. Friend the Member for Ealing North (James Murray) helpfully clarified for the Government—is an average tax rise for working people of £1,200, with nearly everyone who pays national insurance left with a bigger tax bill next year.

The Chancellor may want gratitude and praise for his recent interventions, but the reality is that growth forecasts have been cut for next year, the year after and the year after that. Meanwhile, the Bank of England is forecasting zero growth before 2025. The Conservative party might want us to believe that that is due to events outside its control and that things are starting to improve, but we learned just today from the latest GDP figures that growth fell in October, demonstrating that our economy is still going backwards despite all the warm words we have heard from Ministers. Taxes up, debt skyrocketing and the biggest hit to living standards ever recorded—that is the legacy of 13 years of Conservative government, however much they try to escape from the reality of their record. Only the Labour party has a clear plan to grow our economy by boosting wages, bringing down bills and making working people in all parts of the country better off.

As we have set out, there are a number of specific measures in the Bill that we support and, indeed, have long called for, so we will not oppose the Bill’s Second Reading. For example, we welcome the Government’s decision to heed the calls of industry and make full expensing for businesses permanent, because we know that if the UK is to turn a corner and we are to drive growth in the economy, we need to address our chronic lack of business investment.

While we wait for Committee stage to examine in great detail the decision to consolidate research and development tax relief schemes, it is worth noting that that is the latest of eight separate changes to the R&D regime that this Government have made since the last election. My hon. Friend the Member for Ealing North took us on a comprehensive tour of the constantly shifting tax policy we have seen from the Tories during this Parliament. It is now clear that by chopping and changing their business taxation and reliefs, from the annual investment allowance to the short-lived super-deduction, the Government have kept businesses guessing and not given them the confidence they need to grow.

The measures set out today do not scratch the surface when it comes to undoing the years of uncertainty for business and investors, while industry is crying out for stability and a long-term plan. The truth is that, despite the words of Conservative Members, the UK is now lagging behind our international competitors when it comes to private sector investment as a share of GDP, at a time when we cannot afford to drag our feet. It is Labour who will address this head-on with a comprehensive plan to boost business investment, working with our businesses to expand and compete with rivals in the US, Europe and Asia.

It is clear from this Finance Bill and the recent autumn statement that this Government lack the imagination, leadership and appetite to transform our economy after 13 years in power. Without that stability, certainty and long-term plan, our businesses will be left unequipped to deliver the growth that we so urgently need at this time. If we do not deliver that growth, the poorest in our society will pay the price as their living standards stagnate. The Government may want us to believe that our economy is turning a corner, but back in reality, millions of people are struggling to make ends meet.

The hon. Member for Ruislip, Northwood and Pinner (David Simmonds) asked what the greatest achievement of this Government is. Frankly, I think that is quite a dangerous question, but I will try to answer it for him anyway. Was it crashing the economy, or producing the shortest serving Prime Minister in the history of our country? Was it the tax burden being at its highest since the war, household incomes that will be 3.5% lower next year than before the pandemic or, my personal favourite, the latest growth forecasts showing us plummeting and plummeting even further? Was it—shall I turn to my own constituency—people having to make the choice between turning on the heating and eating? That is the reality facing people in the country after 13 years of a Conservative Government.

[Drew Hendry]

Will the hon. Lady give way?

[Tulip Siddiq]

I have one line of my speech left, but I will give way.

[Drew Hendry]

If, as the shadow Minister says, and I agree, the Bill is this bad, why is she voting for it?

[Tulip Siddiq]

We are not actually voting. [Interruption.] I think the hon. Member is slightly misguided, as we are not voting.

There are specific measures that we support, but, overall, we do not support the economic plan of this Government. If the Government are so sure about their economic plan, why do they not take their opinions to the public? Why do they not call a general election, and we will see who is smiling and smirking after that?

[The Exchequer Secretary to the Treasury (Gareth Davies)]

What a great pleasure it is to close this debate on the Finance Bill on behalf of the Government. I want to thank my hon. Friend the Financial Secretary, who is new in post, and to recognise the work of his predecessor and my constituency neighbour in Lincolnshire, my right hon. Friend the Member for Louth and Horncastle (Victoria Atkins), who carried out a great deal of work on this Finance Bill in the run-up to the autumn statement.

I will address a number of the points raised in this very good debate—it was lacking on quantity, but high on quality from a number of sources—but before I reflect on the comments, let me reflect on the Bill. Be in no doubt but that this Finance Bill will mean that companies will pay less tax if they invest more. It will simplify and strengthen tax reliefs to bolster innovation, and it makes the tax system fairer and more secure. Taken together, the measures contained in it will strengthen our economy and create more opportunities for more rewarding work in every corner of this country.

I will now turn to the comments made by a number of colleagues. I will start with my hon. Friend the Member for West Worcestershire (Harriett Baldwin), the Chair of the Treasury Committee, who has carried out significant work on the tax simplification programme with her Committee. The Government are clear that we want the tax system to be simpler and fairer, and to support growth. As she mentioned, the Financial Secretary has written to her just this week setting out the progress we are making on simplification. This autumn statement, and the Finance Bill in particular, has a number of measures, not least the capital allowances and the R&D expenditure credit consolidation. This a step in the right direction, but we are not complacent and we will continue to go further.

I was heartened to hear cross-party support for full expensing. That is in the context of the lowest headline rate of corporation tax in the G7, but the autumn statement announcement, and the provision in the Bill, is a £10 billion-a-year effective tax cut, called for by the IFS, the CBI, the IOD, Make UK, and many other businesses across the country. It is also in conjunction—this is not in the Bill—with a business rates package that will see a freeze for more than 90% of rate payers in this country.

The hon. Member for Richmond Park (Sarah Olney) made a comment about the oil and gas sector. Let me be clear: this Government have resolute support for our domestic oil and gas sector, and its 210,000 jobs. She called for a “proper tax” on oil and gas companies, and I can tell her that we already have one of the highest rates of windfall tax in the world. The energy price levy strikes the right balance between providing support for families and businesses through an energy crisis—namely through the energy price guarantee, which effectively paid 50% of people’s energy bills—while also encouraging investment to bolster our energy security. Conservative Members want to see the sector’s profits reinvested to support our domestic economy, our jobs, and our domestic energy security. Investment allowances within the EPL help to do that, and the energy security investment mechanism, which I announced in June, will help to provide banks with certainty in their modelling as they provide financing to the oil and gas sector, and as they are part of the transition to net zero.

Along with SNP Members, the hon. Member also said that she would like an increase in tax on banks, but she failed to mention that tax on banks has increased in recent times from 27% to 28%. She failed to mention that the tax revenue contribution from banks has increased significantly from £17 billion in 2010, to more than £33 billion today. That helps to pay for our NHS, our education, our defence, and many other public services that we all rely on. We want our banking system to be internationally competitive, and to keep the 1 million jobs that it employs stable and secure.

Many Opposition colleagues have mentioned living standards, and they are right. Conservative Members care deeply about that issue. That is why as part of the autumn statement, we increased the state pension by 8.5% as part of the triple lock which, by the way, has brought 200,000 pensioners out of poverty since it was introduced by a Conservative Prime Minister. We have also uprated benefits by 6.7%, and uprated the local housing allowance, which will benefit 1.6 million households across the country. That was on the back of a £289 billion welfare budget. Under this Government 400,000 children have been brought out of absolute poverty, and we have seen the Government step in with significant support through two global shocks of covid and the energy price spike, with £500 billion of support to get people through.

[Drew Hendry]

Will the Minister give way?

[Gareth Davies]

I will not give way. We are going to proceed I’m afraid; the hon. Gentleman has had his chance.

I pay tribute to my right hon. Friend the Member for Witham (Priti Patel) who has great consistency when it comes to reducing the tax burden. She has made clear her views on our tax system, and we agree with her. We have a keenness to bring taxes down, but we will do it in a responsible way that is in line with sustainable public finances. She also made clear her consistent campaign on pillar 2, and we are very alive to her concerns. I am pleased that the Chancellor recently met and wrote to her, following the two fiscal statements. I understand her concerns about sovereignty, and I assure her that the pillar 2 provisions do not impact on sovereignty or indeed on competitiveness. The provisions in the Bill are technical amendments that we will discuss in more detail as it goes into Committee.

Finally I thank, as always, my hon. Friend the Member for Poole (Sir Robert Syms) for his positivity about our economy, which does not always get reported. For me, his critical point was about looking at the long-term performance of the economy, not just at the provisions we are putting in place. Instead of looking month by month by month, we should look at long-term provision.

In conclusion, in January this year, the Prime Minister set out his priorities for the Government. Three of them were economic and, since then, we have seen our inflation cut in half and our economy is expected to grow in every year of the OBR’s forecast period. That is half a decade of uninterrupted growth. Because we are reducing borrowing, debt is now forecast to fall. Put simply, we have turned a corner, and it is because of the actions of this Government, this Prime Minister and this Chancellor.

This is a Conservative approach through supply-side reform, and it is in stark contrast to the Labour party’s debt-driven ambitions. We know that its plans to borrow some £28 billion every year for green initiatives will put at risk the great progress that we and the British public have achieved. The independent Institute for Fiscal Studies has issued a stark warning for Labour’s plans. It said they will increase inflation and drive up interest rates, leading to more debt, higher rates, higher inflation, fewer jobs and more tax. That is the Labour party’s playbook. We cannot let that happen, and we will not.

We want an economy driven by enterprise, and by workers and by businesses throughout this country who push and strive, making us more competitive abroad and resilient at home. We want a tax system that pushes up businesses and workers who want to succeed, not that pulls them down when they do succeed. The autumn statement was a statement for growth, investment, work and reward. The measures in the Bill will deliver much of that, so I strongly commend the Bill to the House.

Question put, That the amendment be made.

National Insurance Contributions (Reduction in Rates) Bill

Drew Hendry Excerpts

2nd reading
Thursday 30th November 2023 Commons Chamber

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

We have heard an awful lot about choices at the start of this debate. What is abundantly clear for families in Scotland and across the nations of the UK is that the Government have chosen to ignore the burning cost of living crisis that they put in place for families.

Let me be unequivocally clear from the outset that the Chancellor’s attempt to masquerade the Bill as meaningful support for people is nothing short of a farce. I said to him at the statement that it would not bear scrutiny and it has not borne scrutiny. Families in Scotland already grappling with the harsh realities of the soaring cost of living are acutely aware of the UK Government’s role in their deteriorating financial situation. No amount of Tory spin can disguise the stark truth of their policies, or the fact that those families are faced with a future of perma-austerity under Westminster.

The autumn statement was a critical opportunity for meaningful intervention. It was, to say the least, a profound disappointment. It offered scant relief to households across Scotland—households already beleaguered by the catastrophic decisions of this UK Government. The audacity of the Chancellor in trying to package the reduction in national insurance rates as a major tax cut is an insult to the intelligence of the Scottish people. We are witnessing funding for public services pushed to breaking point due to years of real-terms cuts to the Scottish budget. The Scottish Government have sought to protect workers and services, and are having to do that with diminishing resources, yet the UK Government have shamefully neglected to prioritise investment in the NHS and other public services, which will, according to the OBR, see a cut of £19 billion in the coming years.

The Bill, in legislating for the changes to national insurance outlined in the autumn statement, is a glaring example of the Government’s disconnect from the realities on the ground. The changes announced by the Chancellor, some to take effect from January onwards, are a mere drop in the ocean of what is urgently needed now by families struggling with rampant food price increases, punishing increases in rents and mortgages, and the dreaded prospect of another winter with soaring energy bills. The Government could have listened to our pleas to provide a £400 energy bill rebate, to reduce the price cap and more. Instead, they will preside over a 5% increase in the energy price cap to land on 1 January—hardly a happy new year for those who cannot afford now to switch on the heating.

Let us dissect the facts. The main rate of NICs for employees is to be cut from 12% to 10%, a change affecting those earning between £12,571 and £50,271. For the self-employed, the rate drops from 9% to 8%, with the flat-rate NIC charge also being scrapped for some. On paper, those changes might appear beneficial, but in reality they are superficial. The Resolution Foundation’s Torsten Bell aptly noted that

“taxes are up not down”.

This is no generous gift to the public; it is a thinly veiled attempt at distraction. The Institute for Fiscal Studies highlighted a concerning trend: despite these nominal cuts, we are facing the most significant rise in taxes in recent memory. The tax threshold freezes since 2021 will largely, if not entirely, counteract any benefits of the Chancellor’s 2p cut to NICs next year. For someone with average full-time earnings, that means a saving of £449 in NI contributions, but an increase of £413 due to the unchanged tax thresholds. The Chancellor’s so-called giveaway then amounts to a paltry £36 for the average earner—a far cry from the over £450 boasted about today.

From the detrimental effects of austerity to the chaos of Brexit and now the mismanagement of the cost of living crisis, it is abundantly clear that the Westminster Government are a liability for the working people of Scotland. They are left to shoulder the burden of Westminster’s disastrous decisions. Our public services, the very foundation of our society, are under threat. The Chancellor’s spending plans, particularly his silence on them post March 2025, signal a disturbing turbo-boost of austerity. The OBR’s report rings alarm bells. The UK Government’s fiscal strategies are shrouded in uncertainty and wishful thinking.

The Scottish Government are handed a real-terms reduction in the block grant, yet are expected, miraculously, to maintain public services with, for example, a health budget increase of less than 0.01% for 2024-25. Inflation sits, even today, at 4.7%, so that NHS money equates to only £10.8 million blown away by inflation before it arrives, leaving only the cold sting of a sharp cut in reality.

The autumn statement and the Bill will serve as stark reminders that Westminster Governments are fundamentally misaligned with the values and needs of the people of Scotland. Our aspirations for a fair, just and prosperous society cannot be realised under such governance. Independence remains the only viable path to ensuring the wellbeing and prosperity of the Scottish people.

In conclusion, it is imperative that the Government acknowledge their failings, even at this late stage, and take decisive steps to truly support households and public services across the nations and in Scotland. Until such time, we in the SNP will remain unwavering in calling for real help for people struggling with rising rents and mortgages, struggling to pay for their shopping, and terrified of the cost of their energy bills this winter. Our values are to champion the interests of the Scottish people to safeguard our communities and the families who live in them. We will continue to call for the real power of independence to deliver on them.

National Insurance Contributions (Reduction in Rates) Bill

Drew Hendry Excerpts

Committee of the whole House
Thursday 30th November 2023 Commons Chamber

[The First Deputy Chairman]

I call the SNP spokesperson.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Before I come to my point, may I add my own condolences and those of my party to the family and friends of the former Chancellor, Alistair Darling? Clearly, we were on very different sides of the fence, particularly on independence, which was heavily contested nine years ago, but he was a towering intellect and a very important figure in Scottish public life. As I say, we pass on our condolences to his family and friends.

My question is also on the operation of clause 1. HMRC has stated to the Treasury Committee that it is unable to cope with inquiries either in writing or by phone at the moment, and that it is under severe pressure. I, too, would like to know how the clause will be given effect by 6 January, and what measures the Government are taking to ensure that that happens.

[Nigel Huddleston]

I thank hon. Members for their questions. I can assure them that HMRC is engaging with industry and providing relevant guidance to support it to deliver the changes on time. We expect the majority of companies to be able to do so, particularly in this era, when many of the changes can be made on various systems. The Government are confident that the majority of software developers will be able to make changes to their payroll software in time for the 6 January deadline.

Question put and agreed to.

Clause 1 accordingly ordered to stand part of the Bill.

Clauses 2 to 5 ordered to stand part of the Bill.

New Clause 1

Review of effects of Act

“(1) The Treasury must lay before the House of Commons on the day on which this Act is passed a report which sets out forecasts of—

(a) the changes to the amount of national insurance contributions deducted from the annual income of a full-time worker earning the national living wage as a result of the measures in this Act over the period 2023/24 to 2027/28, and

(b) a comparison with the changes to the amount of national insurance contributions deducted from the annual income of a full-time worker earning the national living wage as a result of the thresholds for payment of national insurance remaining frozen over the period 2023/24 to 2027/28, rather than rising in line with CPI.

(2) The report in subsection (1) should also set out the costs to (i) businesses, and (ii) government , of implementing the changes in this Act, and compare them to the costs of—

(a) implementing a 1.25% point increase in national insurance contributions in April 2022, and

(b) implementing the reversal of the increase in paragraph(a) in November 2022.”—(James Murray.)

This new clause would require a review of the effects of the Bill if enacted over the period 2023/24 to 2027/28, on someone earning the national living wage, compared with the effect of national insurance thresholds being frozen, and a comparison of the expected implementation costs of this Bill with those of implementing and repealing the Health and Social Care Levy Act 2021.

Brought up, and read the First time.

--- Later in debate ---

[Drew Hendry]

As we have pointed out, the Bill does not go nearly far enough to help people facing a bitter cost of living crisis. We urge the Government, after introducing this tiny measure, to go back and consider those people who are suffering from high food costs, seeing their mortgages and rents increase, and—most tellingly, as temperatures plummet—facing a winter with higher energy bills than last year. This is a hard time for families across the nations of the UK, and in Scotland they deserve better. They should get that through the powers of independence being returned to Scotland.

Question put and agreed to.

Bill accordingly read the Third time and passed.

Autumn Statement

Drew Hendry Excerpts

Wednesday 22nd November 2023 Commons Chamber

[Madam Deputy Speaker]

I call the SNP spokesman.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

I thank the Chancellor for advance sight of his redactions.

Madam Deputy Speaker, the Chancellor wants you to think he has pulled a rabbit out of the hat, but all he has done is pull the wool over many people’s eyes. Things are still getting worse for people. Inflation is still more than double the target, which means prices and costs for people in their homes are still going up day by day. The cost of living crisis goes on and people need help now. The economy, far from the cry of the Chancellor, is stagnating. On his watch, it is growing by nothing more than a sliver of a percentage. The Chancellor tries to take credit for things that he should be doing anyway and that the Government promised, or things they have already done and that they are now taking backwards steps on. I will come on to that in more detail.

The energy price cap goes up tomorrow and it is scheduled to go up again in January. Costs will continue to increase for people. I welcome some small measures—support for veterans, the national insurance class 2 abolition and the significant measure for business to make full expensing permanent—but the rest do not bear the scrutiny that I hope they will get from proper analysts over the next few days.

The burden is still high for people. The tax burden in the UK is still the highest it has been for seven years. As the Institute for Fiscal Studies has pointed out, even after the Chancellor’s measures, tax is higher than it was three years ago. In reality, the measures go nowhere near covering the cost of living crisis faced by people across the nations of the UK who are struggling with mortgages and rents, food bills and energy bills. We asked for mortgage interest tax relief to help those seeing their monthly bills go up and for measures to help renters. Why has the Chancellor ignored those people who are struggling? On food bills, we asked for action to help people at the checkout and reduce their costs, as France, Canada and Greece have done. Why has he chosen not to intervene on food and help people? We asked for a range of measures this winter to help people who will be facing even higher bills than they had last year, such as a £400 energy bill rebate, a lower price cap and a social tariff. Why has he chosen not to help those who will not be able to afford to heat their homes this winter? Will he at least rule out the planned increase in the cap in January?

We asked the Chancellor to commit to increasing working-age benefits in line with inflation next year. Will he commit to doing that? Once again he has chosen to punish the most vulnerable with his welfare changes. The nasty party is back in business for good. Not supporting people is a choice and we all know what that choice is for this Government. This Government are on the record as working to the principle, “Let people die”. We wanted to hear about VAT cuts for tourism and hospitality, and how to get skilled workers to fill our vacancies, but he has chosen to ignore those stresses on our sectors. We asked him to lay off the Scotch whisky industry, and it is good that he has frozen the duty, but—enormous pause—he has frozen it at the rate he already increased it to, so the Scotch whisky industry is still paying 75% in tax under this Tory UK Government. Isn’t it funny how Scotland is always told it is too poor until the Government need to raise money from our exports and natural resources? Then, miraculously, riches are found!

We asked the Chancellor to invest in net zero. He made some announcements, but when we work down all his green investment plans and what he calls “green energy” we will find most of the money going into nuclear, the white elephant of the energy sector. [Interruption.] As my hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown) says, it is an absolute shambles. We asked the Chancellor to match the £500 million energy transition fund for the north-east of Scotland, but he has chosen to ignore those opportunities, highlighting again why we need the full powers of independence in Scotland.

We asked the Chancellor to deliver, across the UK, additional funding for public services to allow us to help councils, the NHS and more, and he has chosen to ignore that call. As I have said, he has chosen not to help people who are struggling with the cost of living crisis. He could have helped mortgage and rent payers, he could have helped those who are struggling to pay for food, and he could have helped people with their energy bills.

In the Scottish National party, our values lead us to want to alleviate poverty and strive to get rid of it altogether. We seek measures—now and in the future—to help people, and we are acting now, freezing council tax, investing in childcare and saying no to tuition fees. We are using limited powers to mitigate this nasty Tory Government’s cruel policies, such as the rape clause and the bedroom tax. We are keeping our water, our rail services and our NHS in public hands. We are not, like the Tories and Labour, holding the door open for private companies to rush in. We have previously stepped in where Westminster has failed to boost broadband coverage, to increase our renewables, and to champion the just transition.

We choose to put our people first. Those are our values—values that build a fairer, more prosperous Scotland. The Scottish Government have taken the steps that they can take to help to alleviate the worst impacts of poverty, offering people a degree of stability through the council tax freeze and a cap on rent increases. We would do more, but the fiscal powers that are needed are currently in the Chancellor’s hands. We would choose to help. Today the Chancellor had the power to help people, to lift a finger to right some of the wrongs of this Government that he has inflicted on them, but people are not this Government’s priority. We know who goes through their priority lanes.

Why are this UK Government fixated on tents when they should be worried about rents? They have little to offer Scotland. Our route out of the chaos that Westminster has created, and the perma-austerity of the cost of living nightmare that people are having to endure, is through independence and rejoining the EU. We must have that choice.

Autumn Statement Resolutions

Drew Hendry Excerpts

Wednesday 22nd November 2023 Commons Chamber

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

It is a pleasure to follow the hon. Member for West Worcestershire (Harriett Baldwin), the Chair of the Treasury Committee, which I have recently joined.

I shall concentrate on the choices the Chancellor and his Government have made. Government is about choices; it is about choosing priorities and who to help, and choosing the future we want to create. Today the Chancellor chose his priorities, and he chose to ignore the millions struggling with the cost of living crisis. The OBR has confirmed this afternoon that the UK is still on course for the largest reduction in living standards since the 1950s. Of all those struggling or who cannot pay their bills or are worried about heating their homes, the decision today was pretty much to ignore them. The Chancellor is either offering no comfort or cold comfort. The BMJ warned last month that the cost of living crisis “will cut lives short”. The Chancellor’s choices mean the Government are saying to millions of people, “We don’t care.”

The Chancellor could have looked at VAT cuts, especially in tourism and hospitality, to boost spending and lower inflation. He could have taken action to reduce the level of the energy price cap or introduced an energy social tariff; he has not done so. The national insurance measures announced today will not make up for the inflationary price increases in mortgages, rents and food and energy bills, which will still be higher than last year. I misspoke earlier when I said that the UK is still paying the highest tax for seven years; it is paying the highest tax for 70 years. No action today on people’s housing costs, no action on food prices, no action on energy costs, but never mind—at least bankers’ bonuses are now unlimited.

Let us start with food costs. Food prices in the UK are still climbing at an alarming rate and the trend of increasing costs remains. The UK’s food price inflation is double that of Ireland and Estonia, for example. The Centre for Inclusive Trade Policy notes Brexit’s role in increasing UK import prices by 11% and analysis by the London School of Economics earlier this year showed that the UK had the highest food price inflation in the industrialised world. It remains sky-high.

The Chancellor’s inaction on food prices is glaring. As people worry at the checkout, companies such as Marks & Spencer are reporting record profits on food sales. Consumer rights organisation Which? has expressed concerns over dodgy pricing and loyalty card practices, yet the Government remain silent on discussing food bills with supermarkets. There is nothing from Labour either; when Labour goes shopping at Sainsbury’s, it is for millions in donations. The SNP is left to fight for families over food costs.

The Joseph Rowntree Foundation paints a grim picture of the impact of those inflated costs, with many struggling to afford basic food items. The foundation’s chief economist emphasises the severity of the situation for lower-income households, with essential goods unaffordable for millions. That unaffordability is creeping upwards, with those who previously saw themselves as relatively comfortable now also feeling the squeeze.

The Chancellor had a choice. The Government could have heeded the Bank of England’s warnings about skyrocketing food inflation and they did not do so. France got companies to commit to freezing or cutting prices on 5,000 everyday products. In Canada, the five largest grocery chains made an initial commitment to help to stabilise food prices and say that that is just the beginning of their work. For six months, the Greek Government covered 10% of food expenses for households, funded by a windfall tax on two oil refineries.

Here in the UK, we have the Joseph Rowntree Foundation’s stark warning that millions cannot afford basic food items. Food bank use has grown a further 10%, according to the Trussell Trust, and donations to food banks, usually collected at supermarkets, are also dramatically down. We have a situation where not only do more people need food, but fewer people have the spare money to donate food. Unlike the Chancellor, people using food banks do not have choices.

The Chancellor could have made some choices on energy costs this winter. Before his speech today, one in four social housing households had already reduced their heating to save costs. He decided not to reinstate the energy bill rebate. It is not enough. Before his speech today, energy bills still remained double what they were in 2021, and Cornwall Insight predicts that energy prices will remain high until the 2030s. Where does the Chancellor think folk are getting the money from? It is not coming from any long-term measures today—there is no social tariff, he has not decoupled gas prices from renewables, and the SNP’s call for the reinstatement of the £400 energy bill rebate, which would have gone a long way to help in the short term, has been ignored.

The Chancellor could have chosen to act on that and he chose not to. He chose not to help the two thirds of people who live in a household where someone is suffering from a pre-existing health condition or is disabled and worried about being cold this winter. He should have committed to increasing working-age benefits in line with inflation next year as well and legislated for an essentials guarantee, giving basic necessities to those who need them most. Instead, as we heard, he intends to punish the sick. People who are sick and unable to work are already regularly being referred to work coaches. I have had constituents of mine, who were listed as having cancer or indeed as being terminally ill, being told to report to a work coach. This is just another step further to the right for the nasty party.

The Chancellor chose not to help the more than one third of households with children under five, the pregnant, or people over 65 with pre-existing health conditions who think they will not or may not be able to afford to put the heating on at all this winter. He chose not to help the millions of people already struggling with mounting energy debts. Citizens Advice expects that the number of people unable to top up their prepayment meters will be nearly half as high again as it was in 2022. Meanwhile, National Energy Action found that more than one third of adults are expected to struggle to afford to pay their heating bills this winter.

The Chancellor did not even listen to the pleas of charities. Ofgem has reported that energy debt has reached £2.6 billion—its highest level ever. A quarter of people are now behind on at least one bill, and we are not even in the heart of winter. Does anybody think that that figure is going to be lower come January? Energy bills and council tax arrears are the most commonly encountered debts for households.

What does that mean for the Scottish people? According to Ofgem, northern and southern Scotland, which are colder, rural areas, pay two of the four highest standing rates of all the regions of the UK.

[Ian Blackford]

One of the inequities we suffer from is the regional distribution market, which means that people in the highlands—the coldest, wettest and windiest part of the United Kingdom—pay the highest prices. The real scandal is the fact that the highlands is a net exporter of energy, and we get charged to export the energy from the highlands. That is the reality of Westminster control over Scotland’s energy. We have the energy, they have the power and we pay the price.

[Drew Hendry]

I could not agree more with my right hon. Friend. According to the House of Commons Library, in energy-rich, energy-exporting Scotland, energy costs make up 5.3% of total spending, while in England they make up only 4.4%. We have an energy-rich country, a centre of excellence for renewables where many people can literally look out of their windows and see the energy being generated, yet some of them cannot even afford to put on the heating. It is unacceptable. Reinstating the energy bill rebate was a necessary short-term policy that the Chancellor chose to ignore. He should go back and reconsider that decision. In independent Ireland, the Government will introduce €450 in energy bills support to all households to help them through the winter.

Now let us look at housing. More than 300,000 Scottish homeowners have seen their mortgage payments skyrocket, soaring by an average of £2,500 per year. That is a direct result of the choices of this Chancellor’s predecessor—choices that drove interest rates to punishing heights. Nor does the pain stop with homeowners; despite what has been announced today to help renters, they are equally trapped, as rents will continue to surge despite those measures. Today’s measures are a drop in the ocean compared with the pressure they face.

The majority of buy-to-let landlords, grappling with those interest hikes, have no choice but to pass the costs on. The result is rent increases that outpace inflation, squeezing every last penny from tenants. Of course, the Chancellor is no stranger to hiking rents for his own tenants well above inflation rates, as has been reported this week. If he had delivered the extra funding across the UK to fund public services and fair public sector pay awards, we could all do a bit more to help—but, of course, he chose not to. That will not change the fact that UK households now spend a fifth of their disposable income on housing, surpassing the EU average of 17.4%. For renters, the figure is even more alarming: it is almost a quarter of their income. Yet while other European countries similar in size or smaller than Scotland implement welfare policies to reduce poverty, the UK Government’s response, as we have heard today, is to punish the most vulnerable.

The statement should have been about helping people to survive and helping our economy towards proper growth. Instead, growth is barely above zero and is not expected to climb by more than fractions—if indeed it does not decline. The Chancellor could have increased the Scottish Government’s capital budget in line with inflation, which would have helped us to build even more social housing and vital infrastructure. He chose not to.

Costs for insurance, mobile phone bills and other household basic requirements are also ballooning at the moment. A House of Commons Library report found that since January 2022, UK car insurance inflation grew exponentially, peaking at 43.1% in May this year. Before the Conservatives tell us that that is not down to their Brexit fixation, let me add that our European neighbours saw either no rise, or limited rises of only up to 6%, while car insurance inflation in both Belgium and Ireland has actually reduced. Here, households face cost rise after cost rise after cost rise, and people are begging for it to stop.

The Chancellor still wants us to believe that we are on the path to sound fiscal management. How many times will the Conservatives tell us that there is no money to support people with the cost of living—that there is no money tree—while they find room for what they want to do? Let us have a look at some of the priorities they have managed to fund while they have been in office. The infamous mini-Budget managed to overshadow some staggering stories of fiscal mismanagement. It is a showcase for how not to spend taxpayer money.

First, there was High Speed 2, which started as a £32 billion rail project, exploded into an eye-watering £100 billion project, and then, in a twist, was cancelled—from a dream to a debt nightmare for taxpayers. Despite cutting the project, the Government somehow lost £2.3 billion on a Manchester to Birmingham line that leads nowhere. There was the £5.6 billion on tanks that are 12 years late and not in service; the £2 billion supposedly for aircraft carriers, but which turned out to be £6 billion when one of them had to be stripped for parts for the others; and let us not overlook the £105.6 million splurged on now redundant architectural plans for Euston station—those plans are now as useful as a chocolate teapot. The Elizabeth line is a classic case of too little, too late—five years delayed and £4 billion over budget. And who can forget the covid supplies fiasco? A staggering £15 billion was spent on unusable personal protective equipment, tests and the rest—a fast-track to profits for a few, including an infamous inhabitant of the House of Lords, and a financial burden for our people to share.

The Ministry of Justice was not far behind with its £98 million electronic tagging misadventure. There was the £900,000 paint job for the Prime Minister’s aeroplane, because fiscal responsibility means flying in style, obviously; the £5 million spent to confirm what we already knew, that MPs must vacate the Palace of Westminster for renovations—paying double for the privilege of checking; and the £120 million spent on the Brexit festival. I have no words to add to that. Finally, let us not forget the £100,000 spent on a fake bell-bonging mechanism for Big Ben—try saying that, let alone paying £100,000 for it. Those are choices that those in Westminster make time and again—choices that speak volumes about their priorities—while our constituents struggle with the cost of living. They are disconnected from the harsh realities faced by the public. They do not just misspend money; they throw it out of the plane they have just repainted.

What of choices for a better future? Where is the ambition on net zero? The Conservatives have chucked it. It is utterly bizarre that, as other advanced economies invest in net zero and jobs, the UK goes backwards. Instead of grasping the gold rush of renewables, they dither and delay, just as they did for carbon capture at Peterhead. UK business investment has grown by just under 1% a year since 2016, and 6% overall; by comparison, it has grown 25% in the US. Right now in the US, the Inflation Reduction Act is helping businesses and communities to grow through radical plans to invest in renewables and hydrogen. Are the UK Government looking to maximise the supply chain benefits for Scotland and elsewhere? No. They are focused on their climate change culture war, costing Scotland millions, if not billions, in potential investment.

The SNP Scottish Government choose differently. We value investing in our future—in green energy, in a fairer society. That is another reason why the UK Government should have focused on funding net zero, at the very least matched the Scottish Government’s £500 million fund for a just transition in the north-east of Scotland, and included funding for offshore wind projects in Scotland. Our values lead us to want to alleviate poverty. We seek measures now and in the future to help people with that: a council tax freeze, investment in childcare, no tuition fees, and using our limited powers to mitigate the cruel policies from this place, such as the rape clause and the bedroom tax. We choose to put people first; those are our values—values that build a fairer, more prosperous Scotland.

The Scottish Government have taken the steps that they can to help alleviate the worst impacts of poverty, offering people a degree of stability through the council tax freeze and a cap on rent increases. We would do more, but the fiscal powers needed are here. If we had the power to help people today, we would. The Chancellor has the power to help people, but he refused to lift a finger to right some of the wrongs that his Government have inflicted on people. People are not this Government’s priority—we see who goes through their priority lanes.

The UK Government have little to offer Scotland. Our route out of the chaos that Westminster has created—perma-austerity and the cost of living nightmare that people are having to endure—is through independence and re-joining the European Union.

--- Later in debate ---

[Dr Fox]

Unsurprisingly, the hon. Lady was both incapable of answering the question and unable to do so. The question was, “What was the cause of inflation?” It was inflation that drove up interest rates. I reiterate the point that my hon. Friend the Member for Torbay (Kevin Foster) made: the Fed rate is 5.5%, while the Bank of England rate is 5.25%. I presume the hon. Lady thinks that—in her words—my right hon. Friend the Member for South West Norfolk (Elizabeth Truss) crashed the American economy too. It is complete nonsense; it is a bogus economic analysis.

We all know the impact that inflation has. We know that it hits the poorest people in our society hardest, which is why the Government, along with the Bank of England, were willing to see the pain of higher interest rates applied. Inflation does not help anyone. What I wanted to know, which I did not get from the hon. Lady or from her Front Benchers—surprise, surprise—was what they thought was the external responsibility for that inflation. We do not have an answer from Labour, and therefore we have an Opposition who have no credibility on one of the most basic questions: what causes inflation? If they do not know the answer, they cannot possibly be trusted to be in charge of this country’s finances.

One of the other things that I welcomed today is that we are moving slowly—still a little too slowly, I would argue—towards a lower-tax economy. The Chancellor set out the reasons why a lower-tax economy is a good thing. It is not just an abstract economic argument; it fits with Conservative ideas of individual responsibility, reducing the size of government, giving individuals greater choice, and providing incentives for those who will generate the wealth on which our future public services will depend. By emphasising the importance of creating prosperity, rather than the sterile debate about whether we should spend less or tax more, we are getting back into the right territory for a Conservative Government.

I was especially pleased to hear the measures for small businesses. My hon. Friend the Member for Sevenoaks (Laura Trott) recently had to endure my previous speech on this subject recently, in which I pointed out that, unlike what you would believe if you listened to the Labour party, public sector and private sector jobs in our economy are not in balance. The public sector produces only about 17% of the jobs in our economy; it is the small businesses and the private sector that produce the jobs and prosperity on which our country depends. We have had too high a tax burden on small businesses as they have come out of the pandemic, so I welcome the measures today.

I still have trouble with this term “growth” that goes around. I do not believe that growth as measured by the standard definitions is appropriate for a UK economy so highly geared towards services compared with goods. I know that it is the accepted norm, but I think we need to find better ways of describing it.

I welcome some of the moves towards improving capital availability, because if our businesses face one real problem, it is the lack of capital available for growth in our economy compared, for example, with the United States. That is because our economy is still too heavily geared towards the banks, and not enough towards private equity. We need to look at the breadth and depth of the private equity or venture capital industry in the United States and find out how we can replicate that in the United Kingdom if we are to give even more help to our small businesses.

I very much welcome the incentives to work that the Chancellor announced. Again, getting people back into work is not just an economic exercise; it is what I would regard as a moral imperative. If the only value people know they have is what the state gives them to do nothing, how can they possibly know what value they could be to themselves, their families and their communities if they were allowed to realise their full potential? Getting 200,000 more people back into work is a socially progressive thing to do, and if we are able to get more disabled people back into the workplace, so much the better for them, not just for the economy. I welcome what the Government have announced, because the best way to tackle poverty is to get people into work, and it is not just financial poverty but poverty of aspiration and poverty of hope that we are addressing by making this important social change.

There were one or two other elements on which I would have liked to have had some more detail from the Chancellor. I hope my hon. Friend the Minister might be able to provide that in responding to the debate. One of the problems right across the economy, particularly for small businesses, as the Chancellor stated, is late payment. However, one of the most important culprits in late payment is local government. Local authorities are spending the taxes that we in this House have to raise, in addition to the taxes they raise themselves, and surely it is not acceptable to us that the taxes we raise are spent in a way that actually adds an extra burden to small businesses. It should be a requirement on local authorities that they pay all their bills to small businesses on time. I hope the Government will look at that, because I believe there would be widespread support across this House for measures that compelled local government to do so.

I very much welcome the additional £20 billion investment over the next decade. That will help to address the one problem that has bedevilled our economy more, I think, than any other factor: productivity falling behind that of our competitors. Improving the horizon for freeports by up to 10 years will give additional stability, and again I hope we can look at how we can have a deregulatory exercise in those areas. That could test exactly how much we would get were we to expand the concept of freeports. I hope we can look more at the experience of countries such as the United States, where freeports have greater freedoms than they have in the United Kingdom. The Government are moving in exactly the right direction, but let us move further and faster on that.

The Chancellor talked about other supply-side reforms to the economy, one of them being the speeding up of improvements to the grid so that we can take advantage of the investments that have been made, for example, in renewables. I do not expect a response to that in the wind-up today, but I introduced a private Member’s Bill exactly to ensure that individuals impacted by the speeding up of improvements to the grid would have access to an independent arbitration programme, and not have National Grid deciding whether they should get compensation and how much they should get. That was an unacceptable position. We have not yet seen the regulations that will produce that independent arbitration, and we need to see them quickly. If we are to see the roll-out of an improved grid, it will impact more people, and we have to see a fair, equitable and affordable system where individuals can seek redress if they feel they have been dealt with unfairly.

I will briefly mention the continuing whinging victimhood of the nationalists. When they were talking about the ridiculous position that they are put in by being part of the Union, they just forgot to mention—I am sure it was an omission—that the block grant has now risen to the highest level since devolution began, at £41 billion this year. For every £100 that the UK Government spend in England, the Scottish Government receive £126 per person in Scotland.

[Drew Hendry]

rose—

[Dr Fox]

The hon. Member gave his side of the case. I am just pointing to the fact that individuals in Scotland do extremely well out of their membership of the Union. If SNP Members want to see a crash, they know exactly which way to go about it, although I fear that the electors of Scotland at the general election will ensure that they do not get the opportunity to test their mad theories to destruction.

I was glad that we had a Conservative financial statement today that sets course for the spring Budget and the chance to set out genuine differences of ideology when we get to a general election. We believe that we should have a smaller state; we believe in lower taxes, public sector reform, and getting better value for money for the taxpayer. The Labour party will want to increase spending, increase borrowing and pass it on to the next generation. As with all things, the primal difference between socialists and Conservatives is that we believe in equality of opportunity; they believe in equality of outcome and equal mediocrity for all. What we want to see is the betterment of the United Kingdom for the sake of all its people.

Economic Growth

Drew Hendry Excerpts

Tuesday 14th November 2023 Commons Chamber

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Thank you, Mr Deputy Speaker. I did not hold out much hope of enlightenment from this debate, and it is fair to say that I am underwhelmed. This is a truly zombie Government, so bereft of ideas and talent that they have scoured the sheds of Chipping Norton to find a former Prime Minister who, along with his Liberal Democrat coalition partners, set most of the economic woes on their way for Scotland and the other nations of the UK, and resurrected him into their Cabinet. What a signal; what a shambles.

It is to the shame of Westminster that the Government spend so much time reliving past failures, continuing to do the same thing over and over—culture war rhetoric, punishing the vulnerable, and ignoring the suffering of the most vulnerable and the poorest. One of the many former Prime Ministers of this failing Government—although, to be fair, an elected one—used to talk about those people “just about managing”. I have news for her and for this place: they ain’t just about managing any more. They are struggling. Many more each day are failing to get by. Food bills, energy bills, mortgages and rents are crushing them.

Given the misery that the Government have wrought through austerity, the infamous mini-Budget and everything else, they should have put the cost of living at the forefront of the King’s Speech. They should have listened to those struggling to pay their electricity bills, put food on the table and keep a roof over their heads. Instead of talking about tents, they should have been talking about rents. While they pound the slogans of division by saying “stop the boats”, I trust the public will ensure that all they do for this terrible Government is stop the votes. Of course, being accountable and elected is not an issue for this place. The Tories and Labour will always simply create another Lord to do their bidding if they need to do so.

In a time so obviously marked by escalating living costs, the No. 1 concern on the doorsteps of Scotland—and, I contest, the other nations of the UK—is the cost of living. The King’s Speech glaringly overlooked the need for policies to assist households grappling with food and energy costs, mortgages and rents. While the Scottish Government have made a concerted and targeted effort to shield Scots from the brunt of Westminster policies, the omnipresent shadow of these often cruel Westminster directives remains inescapable.

The King’s Speech starkly underscored the unreliability of Westminster Governments in serving Scotland’s interests, with both the Tories and Labour wedded to a low-growth, Brexit-anchored economy. Independence and a return to the European Union, where all partners are treated as equals, is the only viable path for the prosperity of Scotland. The Scottish Government, within their limited capacity, strive to cushion Scots from Westminster’s harshest policies, yet Scotland’s full potential remains constantly stifled under the UK’s policy regime—a theme I will return to shortly.

[Dr Liam Fox (North Somerset) (Con)]

On the hon. Gentleman’s logic, if Brexit is the impediment to growth, why is it that since pre-pandemic times Britain has grown faster than either France or Germany?

[Drew Hendry]

Tory Members keep peddling this line, but what they know, and what everybody else knows, is that they started from a lower base because they tanked the economy in the first place. They have to live up to that responsibility. They claim higher growth from a lower point of entry. [Interruption.] They can try to shout me down, but I will make progress.

The King’s Speech, which was alarmingly brief on tackling the cost of living crisis, was a missed opportunity to offer concrete measures for relief. It paid lip service to reducing inflation and easing living costs, but lacked substantive policy proposals. Labour, too, is offering little on the cost of living crisis. Where are the measures that could be taken now to help people in their homes? Completely absent. Of course, that is just part of Labour’s “don’t scare the Tory voters” approach to securing office. The UK’s economic stagnation, which is evidenced by recent data, underscores a systemic failure to foster growth, post financial crisis. There is nothing in the King’s Speech to help support people, our food and drink industry, or our tourism and hospitality sector. That is something the Chancellor will need to correct before next week.

In a UK battling—unlike what the Government claim—rampant destitution, the failure of the King’s Speech to prioritise poverty reduction is indefensible, with millions, including a shocking number of children, unable to meet their basic needs. The situation in the UK is dire. Scotland’s lower destitution rate is a testament to SNP policies such as the Scottish child payment, but there is no attempt to replicate that anywhere in this House or to suggest that we do so. The eradication of poverty remains a more distant prospect under the current Westminster regime. Labour’s stance, echoing Tory rhetoric and policies, leaves independence as Scotland’s only hope for a fair and dynamic economy.

[Paul Holmes (Eastleigh) (Con)]

The SNP spokesman is outlining to the Chamber his utopian world under an SNP Government. Can he outline why under the SNP Government education standards in Scotland have fallen at record levels and NHS standards in Scotland have fallen at record levels, and why his Government have failed the people of Scotland on the delivery of public services?

[Drew Hendry]

That is what the hon. Gentleman has in his prepared statement, but when we look at the facts, we see that that is not correct. Scotland’s accident and emergency departments, for example, have outperformed the rest of the UK for the past eight years. We have more doctors and nurses per head of population than anywhere else in the UK. On public services, the Tories are pushing councils to bankruptcy in England. In Scotland, we are managing to negotiate with unions to avoid strikes and keep the economy moving, which is not being replicated by this Tory Government down here.

Despite constraints, the Scottish SNP Government have implemented significant policies to alleviate the cost of living crisis. We have frozen council tax, introduced the Scottish child payment, supported disabled children, offered free school meals and provided free bus travel. Those are just a few examples of the Scottish Government’s proactive steps. Those measures, though effective, highlight the limitations of devolution under the Westminster system, underscoring the urgent need for greater powers in Scotland, for Scotland, to support its citizens fully.

Despite being a nation rich in energy resources, our people still face the pressing challenges of fuel poverty and high energy costs. Current UK energy policies and management continue to fail the people of Scotland. The fact that our energy wealth is significant is not open to challenge. Despite numerous attempts to tell the people of Scotland that their oil and gas resources are running out, the UK Government now say that they will grant new licences every year. Scotland is producing six times more gas than it consumes. However, that abundance contrasts sharply with the high prices they are expected to pay and the increasing fuel poverty faced by our elderly in particular. In just two years, the fuel poverty rates among pensioners are a concerning trend that highlights another disconnect between resource richness and public benefit. Westminster policies have continually failed to translate Scotland’s natural energy wealth into tangible benefits for its populace—they have done quite the opposite. They have resulted in an oppressively toxic cost of living and inflationary effect for Scottish households.

The lack of targeted measures in the King’s Speech to address energy bill support further underscores that. Critics from various sectors have voiced their disappointment, emphasising the need for far more action on prices, investment and insulation, and many more renewable energy sources. The SNP has said we should have a £400 energy bill rebate and action on basic costs. We should have mortgage interest rate tax relief and there should be action on food costs, but of course we have not heard that from anywhere else in this Chamber.

In response to the challenges posed by Westminster’s policies, the Scottish Government have been proactive in implementing measures to mitigate the impact on its residents. Those actions include, as I mentioned, freezing council tax and providing additional support for heating costs for the most severely disabled children and young people during winter. Furthermore, the Scottish Government’s commitment to renewable energy and sustainability aligns with the broader goal of transitioning to a cleaner, more self-sufficient energy future. Westminster has singly failed to invest, most notably over a decade of dither and delay on the Peterhead carbon capture opportunity and subsequent potential hydrogen bonanza, and in its abject failure to meet the Scottish Government’s £500 million investment in the just transition—incidentally another area where the Scottish Government have had to step in to plug the gap on reserved Westminster inaction.

The transfer of energy, employment, welfare and economic powers to the Scottish Parliament is essential. With those powers, the Scottish Government could implement more effective policies to support their citizens through the ongoing energy and cost of living crisis.

Looking globally, nations comparable in size to Scotland boast vibrant economies that benefit their citizens. Countries such as Iceland, Norway and Denmark exhibit lower income inequality and poverty rates, and higher social mobility compared with the UK. That comparison raises a crucial question: why should Scotland remain tethered to a Westminster system that fails to resonate with its values and hinders its potential to be fairer, wealthier and happier?

The King’s Speech was a stark reminder of Westminster’s detachment from Scotland’s needs and the UK’s broader societal challenges. It highlighted the necessity of independence for Scotland—the only path that leads towards a more equitable, prosperous future in line with the aspirations and values of the Scottish people.

Oral Answers to Questions

Drew Hendry Excerpts

Tuesday 14th November 2023 Commons Chamber

[Mr Speaker]

I call the SNP spokesperson.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

It is good to be addressing an elected Minister this morning. The consumer organisation Which? has described Tesco and Sainsbury’s as committing “dodgy” practices over food prices and loyalty schemes, and Marks & Spencer has just posted record profits on food sales, yet people up and down the nations of the UK are struggling to pay their food bills. Will the Chancellor tell us which supermarkets he has held to account over rising food prices?

[Jeremy Hunt]

I can tell the hon. Gentleman that we had the supermarkets in over the summer to make sure that they were doing everything they could to bear down on food price inflation. However, the correct way for politicians to look at this is at arm’s length. We have the independent Competition and Markets Authority, which does a rigorous job and often does things that politicians disagree with, and it is looking at the issue right now.

[Drew Hendry]

In Canada, Ministers met the five largest grocery chains to get commitments on stabilising food prices. Other Governments are doing similar things. France’s Finance Minister held extensive talks with the food industry to get it to commit to freezing or cutting prices on 5,000 everyday products. Is it not the case that, for people facing crushing food bills in Scotland and across the nations of the UK, this Westminster Government are doing absolutely nothing?

[Jeremy Hunt]

I think £94 billion of support to help families up and down the country, including with food prices and energy prices, is a rather different answer from saying that we are doing nothing.

Oral Answers to Questions

Drew Hendry Excerpts

Tuesday 5th September 2023 Commons Chamber

[Mr Speaker]

I welcome the Scottish National party spokesperson to his place.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Thank you, Mr Speaker. The Chancellor claims that it is a success that inflation in the UK has risen higher and remains more stubbornly so than in the EU. Adam Posen, formerly of the Bank of England, has underlined that up to 80% of the UK’s additional inflation woes can be laid at the door of Brexit—something the Tories and Labour are united on. All the while, food price inflation is crushing household budgets. So why have this Government done nothing? Why have this Government learned nothing from countries such as France, which has worked with food suppliers to keep food prices capped to help those most in need?

[Jeremy Hunt]

I welcome the hon. Gentleman to his position. His constituency predecessor served as a Minister in the Treasury—whatever greatness the hon. Gentleman goes on to, I am sure he will not sully himself with that role. When it comes to inflation, we have a high level of imported food, like Germany; a high level of imported gas, like Italy; and low unemployment, like the United States. These factors have come together to give us the inflation rate we have. When it comes to growth, the hon. Gentleman will have noted last week’s numbers, which show that we have recovered better from the pandemic than France, Italy or Germany, and we are doing extremely well, despite all the pressures we face.

[Drew Hendry]

I notice that the Chancellor did not say anything about food inflation hurting families. Well, Tory and Labour “little Britain” attitudes do not stop at food price inaction. Energy costs are a key driver of inflation and costs for families. Energy bills are too high. The Spanish have taken bold steps by cutting VAT and introducing a social tariff to help their people. This Government plan to do nothing for this winter, which is particularly galling for people in Scotland who will continue to pay more for their energy than elsewhere in the UK. Will the Chancellor act on our demands for a £400 energy price grant to be introduced this winter?

[Jeremy Hunt]

Let me tell the hon. Gentleman what we are doing for his constituents, and indeed all the people of Scotland: around £3,000 of support for the average family up and down the country, including in Scotland; paying half people’s energy bills, on average; and a huge amount of support through the benefits system. Nearly £100 billion of support shows that we are stronger together.

Local Bank Branch Closures

Drew Hendry Excerpts

Tuesday 5th September 2023 Commons Chamber

[Amy Callaghan]

I welcome my hon. Friend’s intervention and throw my full weight behind the campaign of the people of Dunoon. We know good folk come from Argyll and Bute, so I am very happy to support that campaign.

My constituents in East Dunbartonshire have suffered from this trend, watching bank after bank close its doors. Seven local banks have closed since 2020, most recently Barclays in Kirkintilloch and the Bank of Scotland in Bearsden—similar to my hon. Friend’s experience. Fortunately, a Bank of Scotland branch remains in Milngavie, but for how long? I will continue to set out the need for action and Government intervention as I progress my case for the continued need for high street banks, but I will start with a couple of questions for the Minister. I would appreciate some comment from him on them when he gives his response.

What are the Government doing to incentivise banks to maintain a high street presence? Do the Government recognise why that is important and necessary, and if they do, why the hesitance to intervene? That hesitancy is to the detriment of our constituents, particularly those who are vulnerable.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

I am grateful to my hon. Friend for giving way. It is about eight weeks since I introduced my ten-minute rule Bill, the Banking and Postal Services (Rural Areas) Bill, to Parliament and the Government have done nothing. They talk about banking hubs as some kind of solution, but there are a handful of them only and delivery is absolutely glacial. The point my hon. Friend is making in her excellent speech is that these facilities for local people will be closed down, especially in rural areas, before there is any substitute for them to provide the services that people need. Does she not agree?

[Amy Callaghan]

I completely agree with my hon. Friend, and I welcome that intervention. It is to the detriment of our constituents, because the banks and the Government are not stepping up quickly enough or at all to support those who need these vital services.

Many constituents have been in touch with me in the run-up to this debate flagging up the particular impact local bank branch closures have on those who are vulnerable. Elderly people and those with physical or mental disabilities may struggle with online banking, and will be particularly affected by having to travel greater distances to access in-person banking services.

--- Later in debate ---

[Andrew Griffith]

The hon. Gentleman is working his way towards one of the potential answers. Colleagues have mentioned the banking hubs. When a bank seeks to close a branch, the FCA process normally includes consultation with the local Member of Parliament. The financial sector now has a consumer duty to think about putting customers’ needs first, which is one of their weighty duties. As we deal with this significant change, a number of alternatives are in place. One is the local post office, and I believe there are still nine post offices in East Dunbartonshire. As the banks’ business traffic coalesces, they can help to support the economics of a post office in a particular area. That is one opportunity. Some 99% of personal banking customers can transact in their local post office, and there are over 11,000 post offices across the United Kingdom.

[Drew Hendry]

A few moments ago, the Minister mentioned the Government’s move to protect the right to use cash. What is the point of that right if people cannot access cash in their community?

[Andrew Griffith]

I do not know whether the hon. Gentleman is deliberately failing to understand, but the protection of access to cash and the ability to deposit cash—that is important if we want businesses to continue to use and accept cash—has a requirement that people will have easy, convenient access to a free ATM within 3 miles in rural areas and within 1 mile in urban areas. That is the guidance we issued a matter of weeks ago.