(2 years, 3 months ago)
Commons ChamberI beg to move an amendment, at the end of the Question to add:
“but respectfully regret that the Gracious Speech fails to announce a windfall tax on the profits of oil and gas producers, in order to provide much-needed relief from energy price increases for households.”
The cost of living crisis is the biggest issue facing our country, which is why we have chosen it as the subject of today’s debate, and I welcome the Chancellor’s participation. We should start by being sober about the unprecedented social emergency our country faces. According to a report that has just been published by the Food Foundation, 2 million of our fellow citizens went without food for a whole day in the past month because they could not afford to eat; 7 million families had to skip a meal, and that was true of nearly half of those on universal credit. This is not just about families out of work; it is about families in work too. This is a social emergency and it is also a looming economic threat, depriving our economy of the spending power it needs. The question at the heart of this debate is whether this Gracious Speech, this Government and, yes, this Chancellor are up to the challenge this emergency represents.
The Chancellor wants us to believe that his measures in response are the best we can do, but they are not—not by a long shot. The cost of living crisis is driven most of all by what is happening to energy bills, so let us look at the three chances he has had in the past seven months to act on energy bills. Last August, nine months ago, the first energy price rise was announced—this was a £139 increase in the price cap. So way back then he knew what was happening. Then in October he delivered the Budget. Wholesale energy prices were rocketing and the warning signals were flashing, but the Chancellor did nothing. He should re-read that Budget speech, because I think it would make even him wince. It is a model of complacency. He had drunk his own Kool-Aid. He told the country back then that “wages are rising”, that we have “growth up” and that on inflation we have
“a Government...ready and willing to act”—[Official Report, 27 October 2021; Vol. 702, c. 275.]
He said that the “plan is working”.
Where are we now? On wages, the Office for Budget Responsibility is this year forecasting the biggest fall in living standards for 45 years. Growth turned negative in March, with the Bank of England suggesting that the economy is going to shrink through the winter. We are now set for the highest level of inflation for 40 years. The plan is not working; it is failing.
I will make some progress but then give way later.
The Chancellor did not act when he could have done. In February he had another chance, as the largest energy price rise in our history, at 52%, was announced. He could have responded in a way commensurate with the crisis—[Interruption.] Members say that he did, but let us look at this. What was his grand offer to the country? It was a £150 council tax discount based on outdated property values, which missed out hundreds of thousands of the poorest families, and of course there was his £200 “buy now, pay later” loan scheme. This is a loan scheme that he risibly claims is not a loan, although it has to be paid back, and it does not even come in until October. What are families supposed to do in the meantime while they wait for his loan? It is almost as though the Chancellor is so out of touch that he does not realise that 10 million families in our country have no savings at all.
The £150 that was given out by Newcastle-under-Lyme Borough Council was gratefully received on the doorsteps, as was the money given out by Westminster City Council. Perhaps the right hon. Gentleman should speak to his council leaders in Barrow, Hyndburn, South Derbyshire and Bassetlaw, all councils that failed to get that £150 out into people’s bank accounts. If he is so concerned about the cost of living, why are his council leaders holding that money in their bank accounts instead of returning it to the people?
The hon. Gentleman anticipates a later part of my speech. That is the Conservative party today: it will blame anyone else and never take responsibility. The hon. Gentleman should have been supporting our measures, because in his constituency 11,353 people would get our combination of a VAT cut and the warm home discount of £600. If he votes against us tonight, he will have to explain to them why he is denying them the help they need.
The right hon. Gentleman is making a powerful speech. I wonder whether he shares my anger at the news this week that the Government have underspent their net zero budget by a staggering quarter of a billion pounds, at exactly the same time as our constituents are struggling to keep their homes warm and deal with accelerating fuel poverty.
I completely agree with the hon. Lady. At every step of the way, the Government have had the chance to act, and they have not done so.
The figures for Northern Ireland are very interesting: 241,000 people—13% of people—in Northern Ireland are in poverty. Some 17% of all children, 14% of all pensioners and 11% of the whole working-age population are in poverty. Those figures scare me; do they scare the right hon. Gentleman?
The hon. Gentleman is absolutely right. I have been around politics for a long time, as the House knows, but I cannot remember—nobody in the House can remember—facing the kind of emergency that we do currently.
The spring statement was the most recent chance for the Chancellor to redeem himself; it was just days before the April energy price rise came into effect. It was apparent to everyone across this House and in the country that what he had offered was woefully inadequate. People were literally pleading with him to do more on energy bills, but he just doubled down on his failure. He has had three chances in the past seven months, and none of his responses has been equal to the emergency. The truth about this Chancellor is that at every step of the way he has been in denial, slow to act and wholly out of touch in his response.
It is right that we debate what more we can do, but does the right hon. Gentleman accept that the measures that we have put forward on the national living wage and universal credit, and the national insurance threshold changes, add up to more than he is suggesting?
No, I do not accept that, and I can tell the hon. Lady that 8,014 families in her constituency will benefit from the changes we are suggesting if she votes for them tonight. Let me tell her and the House what the Chancellor’s failure means in reality. This year, the basic level of universal credit for a single person aged over 25 is £334 a month. The Chancellor’s measures this April were so feeble that someone on that benefit will be expected to find as much as £50 or more a month simply to cover the increase in their energy bills. That is leaving aside the soaring costs of food and other goods. That £50 is around 15% of their income, so what are they going to do? They will not be able to afford to pay their bills, they will get deeply into debt and they will go without food. It is already happening to millions.
On Friday, in the citizens advice bureau in my constituency, I met someone who is in circumstances similar to those I described. Let me be honest: I have no idea how I would cope in those circumstances. Does any Member of this House? Maybe the Chancellor can tell us what somebody in those circumstances is supposed to do. If he cannot answer that question, it should tell him something—that he is failing in his duty to the people of this country who most need his help.
What makes the Chancellor even more culpable is that something that could help is staring him right in the face. It is something on which the case has become unanswerable, and on which the Government have run out of excuses, while oil and gas producers are making billions: a windfall tax. It is so hard to keep track of the Government’s position on a windfall tax that I have given up, but I think the Chancellor has said he is prepared to look at the idea. Honestly, the British people cannot afford to wait for him and his dithering anymore, or for his hopeless excuses.
I want to go through the hopeless excuses, because this is an important argument that this House and this country need to have. What are the Government’s excuses for not applying a windfall tax? First, they said in January that the oil and gas companies were, in the words of the Education Secretary, “struggling”. BP has its highest profits for a decade, Shell has its highest profits ever, and the boss of BP, Bernard Looney, describes the price hike as a “cash machine”—and these people say the companies are struggling. Perhaps we can have a show of hands: does anyone on the Government Benches still believe that those companies are struggling? What is the Government’s next excuse? They argue that a windfall tax will hurt investment—
Oh, it will, says the hon. Gentleman from a sedentary position. Right, here we go. The problem is that the companies themselves say that is nonsense. BP’s chief executive officer, Bernard Looney—whom I take as more of an authority than the hon. Gentleman—was asked two weeks ago which investments he would not proceed with if a windfall tax was levied. What was his answer?
“There are none that we wouldn’t do.”
Even BP does not buy the Tory arguments against a windfall tax on BP.
No; I will make some progress. The final excuse—[Interruption.] I want to come to this because it is important, and I am perhaps anticipating the Chancellor. The final excuse is that it is somehow anti-business to levy a windfall tax. Let us dispose of that argument, too. I strongly recommend that Members who believe that argument read an article that I have with me—I am happy to put a copy in the Library of the House—by Mr Irwin Stelzer, a long-time confidant of Rupert Murdoch. This is the first time I have quoted him in the House. A few days ago, in an article entitled, “Now is the time for a windfall profits tax”, he wrote:
“People who believe in capitalism believe that private sector companies should be rewarded for taking risks…not be rewarded for happening to be around when some disruption drives up prices, producing windfalls.”
That is the point: these profits are unearned and unexpected, and the British people are paying for that windfall. These companies are profiting not from decisions they have made, risks they have taken or wealth they have created, but from a global spike in prices to which Britain is badly exposed—a spike exacerbated by Putin’s invasion of Ukraine.
What is the principle that the Government are defending here? What is their hill to die on? Is the principle that they really wish to defend that oil and gas companies should pocket any profits, however bad the geopolitical instability? Is that however large the crisis and however gigantic the windfall, taxation must not change? That proposition was rejected by Margaret Thatcher, Geoffrey Howe and George Osborne—remember him?—all of whom levied windfall taxes. Who else do we see supporting a windfall tax today? I have to say, it is a pretty big tent: John Allan, the guy who runs Tesco; Sharon White, the woman who runs John Lewis; Lord Browne, the guy who used to run BP; and Lord Hague, the guy who used to run the Conservative party—the usual leftie suspects.
The truth is that the Government have run out of excuses and, amid the chaos and confusion about their position, I think a massive U-turn is lumbering slowly over the hill. I say this to the Chancellor: “Swallow your pride and get on with it.” Every day he delays is another day when the British people are denied the help they need. Millions of families are having sleepless nights because the Chancellor will not act. What is he waiting for? As proposed by the shadow Chancellor, my hon. Friend the Member for Leeds West (Rachel Reeves), the Chancellor should come to the House with an emergency Budget that has a windfall tax, gets rid of VAT on energy bills, increases the warm home discount to £400, includes an emergency plan to insulate 2 million homes this year, and cuts business rates.
Will the right hon. Gentleman give way on that point?
I will not for the moment. The Government’s position on the windfall tax is part of a wider problem with this Chancellor and this Government. Just look at the political choices he is making: he leaves non-doms shielding their millions while millions of families and pensioners face a cut in their incomes; he whacks up taxes on tenants and lets landlords off the hook; and he makes young people at work pay more, but those getting money from capital gains pay not a penny extra. Wrong, unfair, unjust, out of touch—that is who he is.
I will not give way. Of course, being this Government, they always try to blame someone else, as we heard earlier. It is hard to keep track, but this is the roll call of people who the Conservative party have tried to frame in just the past few days: the Bank of England; civil servants working from home; and, shamefully, the British people for being unable to cook properly. That, apparently, is the cause of food banks. Yesterday, there was also the ludicrous suggestion from a Minister that people were not working enough hours. The Chancellor, of all people, is also at it. Who does he blame for the massive cut to benefits? He blames the IT system—the dude from Silicon Valley. Who is he trying to kid? If he had got his act together early enough, of course he could have raised benefits properly. The thing I do not get is this: he found it perfectly possible to cut universal credit by £20 in the middle of the year—in September. It is not a case of “Computer says no”; it is “Chancellor says no.” It is not that a computer system is not up to it; the Chancellor is not up to it.
The story of the past few months is this: crypto has crashed, and so has the Chancellor—and how similar they are. The Chancellor and cryptocurrency came out of nowhere. The value surged, and it looked like the future, but it has all turned out to be one giant Ponzi scheme. The Chancellor has just been found out. He has been rumbled. Let us be honest, his colleagues all know it. He is out of touch with what is happening in the country. He is out of ideas when it comes to doing the right thing. He is out of his depth when it comes to the challenges that this country faces.
The problem, of course, is that today’s cost of living crisis does not stand alone; it comes on top of a decade of failure. That is why families and our economy are so vulnerable. Over the past 12 years, growth has averaged just 1.4%—the worst record of any Government since the second world war. This is the worst decade for living standards since the 1920s, according to the Institute for Fiscal Studies. Indeed, wages would be £7,000 higher on average if wage growth under this Government had matched the rate of growth under the last Labour Government. Taxes are at their highest level since the 1950s. Public services are struggling. Never have so many paid so much for so little. Twelve years of Tory economics have failed, and what does the Chancellor offer in the future? More of the same: anaemic growth at just 1.7%, and squeezed wages as far as the eye can see.
This is the plan for growth that we need: we should tackle the cost of living crisis, so that people have more money in their pockets. We need to put in place an industrial strategy, so that we have good jobs in the industries of the future; that is what Governments all around the world are doing. We need a plan to give people proper rights, to boost wages at work, and to make our economy fair. Where is the employment Bill? It was promised in 2019, but it is still not here. When it comes to being on the side of the workers, Conservatives may mouth the words, but their actions tell the real story.
I am glad that the right hon. Gentleman mentioned jobs, particularly as today unemployment has fallen to its lowest level. The number of people out of work is now lower than the number of vacancies in the economy. He has just made an extraordinary number of unfunded spending commitments at the Dispatch Box. I want to highlight the big difference between the Labour party and the Chancellor. I remember the spring statement; the shadow Chancellor made a commitment to raising benefits early, because, she said, it would cost no money. It would actually have cost £24 billion across the spending period. There was no sense of how to pay for it. That is Labour from start to finish.
It is good to see that the right hon. Gentleman has clambered back onto the career bandwagon. I thought that he was no longer a loyalist. The truth is that it was the Resolution Foundation that pointed that out, and I can give him the reference.
I will wind up now. I have mentioned the basics of a modern economy, and this Government are failing on all of them; they have no cost of living plan, no growth plan, and no plan for rights at work. They have not learned from the mistakes of the past decade, and they are condemned to repeat them. The truth is that this Gracious Speech does not remotely rise to the short or long-term challenges that the British people face, but this House can make a difference tonight. I say this to Conservative MPs directly: we have all heard from our constituencies what families are facing. This is an emergency for millions of people. A windfall tax could make a difference.
No, I will not. Conservative Members should use this opportunity to tell the Chancellor to act. It is the right and fair thing to do. The case is unanswerable. If they do not act, they will have to explain to their constituents why they refused to support help that could make a difference now. I urge Members to vote for our amendment tonight to help tackle the social emergency that our country is facing.
I thank my right hon. Friend for his advice and support, and I will come on to both of his points momentarily. He is right to remind the House that so far we have provided £22 billion of direct support. That is not a trivial figure; it is £22 billion of support to help families up and down our country at a time of challenge. We have taken action, as we heard, to cut people’s bills, starting with fuel duty—I commend him for his campaigns on that. It has been cut by 5p a litre, which is worth £100 this year together with the freeze, and council tax, cut by £150.
What the right hon. Member for Doncaster North did not mention was that that £150 of support, which, as we heard from my right hon. Friend the Member for Harlow (Robert Halfon), has made a huge difference to families, came faster than any support the Labour party was offering in its proposal, and it went to a far broader group of people than their proposal, because we wanted to support those on middle incomes as well.
VAT would have been worth about, I think, £8 a month at the time. This is £150 in people’s bank accounts in April.
We also cut the taper rate on universal credit, giving an extra £1,000 to the average household. The warm home discount increased to £150, the national living wage increased, giving low-paid workers a pay rise of £1,000, and we will go further.
(2 years, 7 months ago)
Commons ChamberI want to thank all hon. Members who have spoken in this debate. I particularly thank my hon. Friend the shadow Chancellor, my hon. Friends the Members for Tooting (Dr Allin-Khan), for Sheffield, Brightside and Hillsborough (Gill Furniss), for Merthyr Tydfil and Rhymney (Gerald Jones), for Batley and Spen (Kim Leadbeater), for Bradford West (Naz Shah), for Brighton, Kemptown (Lloyd Russell-Moyle), for Newport West (Ruth Jones), for Bedford (Mohammad Yasin), for City of Durham (Mary Kelly Foy), for Salford and Eccles (Rebecca Long Bailey), for Warwick and Leamington (Matt Western) and for Birkenhead (Mick Whitley), and my hon. Friend the Member for Easington (Grahame Morris) for his just-a-minute speech, which was excellent.
There are three questions at the heart of this debate. How did we get here? What short-term action should we take? And, what is the long-term plan to stop it happening again? First, on the crisis, there is no question but that there is a global dimension to this crisis. Many countries are facing strains as a result of what has happened to wholesale energy prices, but there are some undeniable facts about how badly we have been hit. No other country has seen 28 energy companies go under. They are failures that we already know will cost consumers £100 on bills. No other major European country has gas storage equivalent to just 2% of its energy demand. No other country in western Europe performs as badly on fuel poverty and insulation as the UK. These undeniable facts are symptoms of Government failure over the past decade. There were failures of regulation. They were warned repeatedly about the regulation of the sector, and did not act—in fact they loosened regulations. As the recent Citizens Advice report said:
“From 2010 onwards, dozens of companies entered the market with limited checks. Some offered good services to consumers, but others were poorly prepared.”
It went on to say that the regulatory system
“allowed unfit and unsustainable energy companies to trade with little penalty.”
It is consumers and businesses that are paying the price. There were failures of strategic decision-making, too, such as the closure of the Rough storage facility, which my hon. Friend the Member for Leeds West (Rachel Reeves) warned about when she was Chair of the Business, Energy and Industrial Strategy Committee.
Let me get to the heart of this debate, and I say this to the anti-net zero tendency in the Conservative party. We can reach two different views. Some Conservative Members say that it is because we have gone too fast on the green transition. I say that they are dead wrong; it is because we have gone too slowly. It is continued dependence on fossil fuels that makes us more vulnerable and less resilient. Let us take energy efficiency. A 2014 study showed that a comprehensive programme of energy efficiency could cut gas imports by a quarter, but what have we seen? We have seen the abolition of the zero carbon home standard, the fiasco of the green deal and the fiasco of the green homes grant. That is why emissions from buildings are now as high today as they were in 2015, and it is not just about energy efficiency. Before this debate, I looked up the number of onshore wind turbines being constructed each year in the past four years—it is because I am a nerd. I will not do a guessing game in the House as I do not have the time. The answer is that just four turbines a year were granted planning permission in the past four years. It makes no sense, because onshore wind is the cheapest power at our disposal—so much for being the Saudi Arabia of wind power; it is just hot air.
I come now to what short-term action should be taken. There is a divide in this House between a party that has some proposals and a party that does not. Fundamentally, that is it. Conservative Members can talk all they like about the Order Paper and all that stuff, but they do not have an answer. We have come forward with an answer. What is the principle of the answer? It is this: we help all families, and we give most to those who need it most. I want to explain this to the House. We have said that we want to increase the warm home discount from £140—£150 from April—to £400. We want not just to increase it, but to extend it from 2.2 million households to 9 million households, or one third of families. That is the right decision to help the poorest people in our society who are going to be so badly hit. But we all face a dilemma, and we need to be honest about this. It is right to help the poorest, but it is not just the poorest who are facing tough times as a result of this crisis; it is those in the middle as well, and the swiftest, most direct way of helping those families is to get rid of VAT on energy bills.
Perhaps I am a bit naive in thinking it surprising that this idea is controversial, because this is a Government whose Prime Minister and Home Secretary, along with 26 Conservative MPs, used to think that it was the bee’s knees. They thought it was a great idea. It was not some random, chance remark made by the Prime Minister; it was a promise made over and over. Given the Prime Minister’s long and distinguished record of integrity, demonstrated again today, surely the British people were entitled to take him at his word when he said that
“we will be able to scrap this unfair and damaging tax”,
and again, just two years ago, when he said:
“Not only will we be able to reduce VAT in the UK, but we will be able to do it in Northern Ireland as well.”
As Conservative Members consider how they will vote in a few minutes’ time, instead of making arguments about the Order Paper, why do they not look at the substance of the motion? Labour Members say, “Let us take action”; their Government have nothing to say. That is the difference, and they should join with us. The problem is not just that the Government have nothing to say. I think we got to the heart of where they really stand on Sunday when we heard what the Education Secretary said when he was sent out to comment. It is not great being a Government Minister going out there at the moment, to be honest; I remember times like that in the Labour Government too. The Education Secretary—I had to double and triple-check this quote—said:
“A windfall tax on oil and gas companies, who are already struggling in the North Sea, is never going to cut it.”
“Already struggling”? As my hon. Friend the Member for Leeds West said, the chief executive of BP, Bernard Looney, said that the price rises were a “cash machine” for his business. It is not putting that money into investment; it is putting it into dividend share buy-backs from its shareholders. Who is filling up that cash machine? It is working people. All we are suggesting is something quite simple, which is a one-off windfall tax for a year to get some of that money back and help families right across this country.
Short-term action is essential, but we need long-term action as well. There is a very big difference we could make to families, and that is a national mission to retrofit homes in this country. It is the closest thing there is to a no-brainer with regard to energy policy. We could cut bills by up to £400. We could make ourselves much less dependent on volatile fossil fuels. That is why we put forward a plan for a £6 billion a year retrofit and zero-carbon energy programme to insulate 19 million badly insulated homes. But the Government refuse to act. They offer piecemeal privatised programmes that do not work, and they are still short of their very inadequate manifesto promise on this. We can get a sense of where the Government stand. When they had the fiasco of the green homes grant—I do not blame them for thinking it was not going very well—they did not plough the money saved back into retrofit but simply cut £1.5 billion of investment. We need to go faster on energy efficiency. We need to invest in our ports and grid so that we can meet and exceed 40 GW of offshore wind. We need to end the effective moratorium on onshore wind, embrace tidal power and other forms of renewable energy, drive forward our nuclear programme and invest in clean energy storage.
There needs to be a proper inquiry into how we ended up with the disastrous regulation system under this Government and a root-and-branch reform of that system so that we never again have a situation where so many companies go bust and it is the British people who are left to pay the price, with such a dramatic impact on their bills. I am afraid to say that the culpability lies directly at the Government’s door: they were warned and they did not act.
This debate has been revealing in very many ways.
I will not.
We have a Government who got us into this mess and have no clue how to help the British people out of it. They are paralysed in the face of this cost-of-living crisis. They do not have any answers for the British people, either now or in the future. That is why we are acting. I urge Members from all parties to join us in a few minutes and vote for relief for hard-working families across this country.
(3 years, 3 months ago)
Commons ChamberWe have had an excellent debate with noteworthy contributions on all sides. I particularly want to congratulate my hon. Friend the new shadow Chancellor, who made an excellent speech and will do a brilliant job in her new role. I also want to commend the excellent speeches of my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne) and my hon. Friends the Members for Harrow West (Gareth Thomas), for Barnsley Central (Dan Jarvis), for Easington (Grahame Morris), for Chesterfield (Mr Perkins), for Newport East (Jessica Morden), for City of Chester (Christian Matheson), for Aberavon (Stephen Kinnock), for Ellesmere Port and Neston (Justin Madders), for Kingston upon Hull West and Hessle (Emma Hardy), for Swansea West (Geraint Davies), for Bristol South (Karin Smyth), for Warrington North (Charlotte Nichols), for Cambridge (Daniel Zeichner), for Merthyr Tydfil and Rhymney (Gerald Jones), for Hornsey and Wood Green (Catherine West), for Liverpool, Wavertree (Paula Barker), for Luton South (Rachel Hopkins), for Liverpool, Riverside (Kim Johnson), for Jarrow (Kate Osborne) and for Birkenhead (Mick Whitley). I also congratulate all other hon. Members who spoke in this debate.
The central question facing this Gracious Speech is whether it can rise to the moment in which we find ourselves because, while life is starting to return to a semblance of normality, and we are all thankful that that is happening, we cannot just go back to business as usual. Exposed in this pandemic we see millions of workers in deeply insecure jobs, the key workers in our country underpaid and undervalued, public services under deep strain, and an economy not working for too many people in our country and characterised by deep inequalities of wealth, income, power and place. And on top of that we face the challenge of economic recovery from covid and the climate emergency.
I welcome the fact that after 10 years in power some of the issues I have mentioned are at least being recognised by the Conservative party finally; I am old enough to remember when it was controversial to do so. But acknowledging the problems is not the same as solving them, so the test of Government and this Gracious Speech is whether they can address them. Last October, the Prime Minister said they would. Indeed, he invoked the spirit of the post-war Labour Government:
“In the depths of the second world war…when just about everything had gone wrong, the Government sketched out a vision of the post-war new Jerusalem…And that is what we are doing”.
Let us be absolutely clear, therefore, about the scale of change that the Prime Minister is claiming he can deliver: a new economic and social settlement for our country. We agree this is necessary. The question is: will the Government deliver?
What would that mean as a start? It would mean five things: tackling insecurity at work with a new deal for workers; responding to the climate emergency with a genuine green industrial revolution; supporting our businesses to recover from the pandemic; rewriting the rules of our economy to shift wealth and power towards ordinary people and their communities; and rebuilding our public services. On those five issues, the British public deserved a Queen’s Speech that met the moment, but on each of those tests the Gracious Speech failed to deliver.
Let us start with the insecurity that millions of workers face. There is no greater symbol of this than the scourge of fire and rehire tactics—at British Airways, at British Gas and at many other employers—now spreading through our economy. We would never want this for ourselves or our families, so why should we ask the British people to put up with it? The Prime Minister says it is unacceptable, so where is the legislation to outlaw fire and rehire?
In the 2019 Queen’s Speech, we were promised an employment Bill. What about this Gracious Speech? No employment Bill. The Government have sufficient legislative time to seek to disenfranchise millions of voters with a voter ID system, but they do not have sufficient legislative time to tackle the insecurity that millions of workers face. It is shameful. Never mind a new economic and social settlement—a Government committed to basic rights at work would have brought forward this legislation. The obvious conclusion is this: the problem is not a lack of legislative time; it is that they have not changed their minds about how an economy succeeds. They still believe that insecurity masquerading as flexibility is the route to economic success: treat people worse, give them fewer rights and they will work harder. The rhetoric is changed, but the reality is more of the same.
Let us consider the climate emergency. There has been lots of talk about jobs and skills in this debate—lots of good rhetoric. What do we see in the United States? President Biden has a $1 trillion green stimulus over the next decade. We have called for a £30 billion stimulus over the next 18 months to create 400,000 green jobs. What do this Government offer? Investment that, even on their own dodgy analysis, is one 60th the level of Biden’s stimulus.
This has real consequences for our manufacturers. There was talk of the automotive sector, and that is the litmus test for any green recovery. Germany is investing billions and France the same, in a global race to build the new gigafactories of the future. We need to start financing three additional gigafactories in this Parliament, public and private together. Where are the resources from Government? Nowhere near the scale required. It is the same in aerospace and in steel. We have a new clean steel fund that is hopelessly inadequate and will not even come on stream until 2023.
This illustrates a wider truth about industrial policy. In the Gracious Speech, there are new measures on subsidies—what was called state aid—as part of our post-Brexit arrangements, and there are some sensible changes to the old EU regime, but let us understand the truth here. What was holding back Government from giving industry the support it needed was not the previous rules but their prevailing ideology. In 2019, under the old system, Denmark invested 1.5% of GDP in industrial support and Germany 1.4%. The UK invested 0.38%—among the lowest in Europe. The real fear is that this will not change.
What about our businesses? Businesses can breathe a sigh of relief as our society reopens, but many face a long road to recovery. The hon. Member for Strangford (Jim Shannon) raised the real issue of the unmanageable debt facing businesses. We have been calling for months for that debt to be restructured. I do not think that the Chancellor has done enough. At the end of June, the moratorium on evictions from commercial properties will be lifted, and I really worry about the issue of rent. It is often the largest cost for a small business, and commercial tenants in the UK have paid just a fifth of the rent they owe in the last quarter. We needed a comprehensive plan for British business, including meaningful debt restructuring. The Gracious Speech failed to deliver.
Rebuilding in a fairer way for business is not just about cash. Too many of our rules favour anti-competitive monopolies. Nowhere is that clearer—and I think there is agreement on this on both sides of the House—than in relation to big tech. It is good that a Digital Markets Unit has been established in the Competition and Markets Authority, but it needs new legislation; where is it? We need a new competition Act that establishes a statutory code of conduct for tech giants and gives the CMA real powers to act on behalf of consumers and small businesses. My hon. Friend the shadow Chancellor spoke very well on the issue of online retailers versus the high street. Again, there have been years of promises but no action. It is another missed opportunity to build a new economic and social settlement.
As we rewrite the rules of our economy, we also need to change our vision of what a successful economic future looks like. Industrial policy is about manufacturing, but it is also about what my hon. Friend has called the everyday economy in which so many people work. Nowhere is that more true than in relation to care. We need to get away from the idea that care is somehow a burden and understand that it is a crucial part of our economic infrastructure. That is true of care for the young —one of the best economic investments we can make and in which we still lag way behind other countries—and care for older generations. We are now two years on from the Prime Minister saying that he had a plan to fix social care “once and for all” and 10 years on from the Dilnot report on social care. It is shameful that the Government are still not making any concrete proposals in the Queen’s Speech and are letting down our care workers.
We cannot ignore the wider context of the Gracious Speech in terms of public spending. The Chancellor has acted in the pandemic to help businesses and individuals, as it is right to do, and we have welcomed the furlough, but let us be clear about the truth of the plans for public spending in future years. In the so-called unprotected Departments—in other words, the majority of Government Departments—there are cuts programmed in from April 2022. There will be further cuts to local government on top of the 50% cut that some parts of the country have already seen, cuts to the justice system, cuts to transport and cuts to the majority of Departments after 10 years of austerity. There can be no greater sign that they have not learned the lessons. We cannot build a new economic social settlement with these kinds of cuts after 10 years of austerity.
This Gracious Speech fails to meet the challenge of this moment. The Government claim to have changed and to want to offer something different. The truth is that it is a very thin Queen’s Speech from a Government in power for more than a decade. There are no measures on insecurity at work; they are not stepping up on the climate challenge; there is inadequate support for British businesses and industries; there is no plan for social care; and there is continued austerity in many areas. The country demands a Government who meet the moment, but the Gracious Speech does not remotely measure up. It has failed in the task at hand.
(4 years, 5 months ago)
Commons ChamberMy right hon. Friend knows better than most the value of making sure that people have the security of a good job, and I commend him for all his work in that regard. I agree with him wholeheartedly. My right hon. Friend the Communities Secretary is talking already to the voluntary sector and we stand ready to provide the support that may be required.
I recognise, as I am sure the whole House does, the Chancellor’s wish to get any employment support scheme right, but he will recognise, as the shadow Chancellor said from the Front Bench, that people are facing redundancy right now. May I suggest two things that he can say tonight to help ward off those redundancies? The first is that he accepts the principle that Government should cover a substantial proportion of people’s wages, because it is in their interests and those of the economy and their businesses. The second is that he undertakes to come back not next week but by Friday of this week with a clear plan developed with unions and businesses.
(7 years, 1 month ago)
Commons ChamberIt is a privilege to follow the right hon. Member for Meriden (Dame Caroline Spelman).
The Queen’s Speech debate after a general election is a chance to reflect on what we heard during the election. That is particularly important given the result we have just seen. Let us be honest across the House—we were all a bit gobsmacked by the result. Jon Snow went on television the day after the election and said, “I know nothing”, and I think that probably applies to many of us.
Having heard the Chancellor of the Exchequer, who has departed, I am bound to ask, “If it is all going so well, why did it go so badly?” In other words, the result did not exactly meet Conservative expectations. I believe that there is a deeper explanation. It has been said that many people have
“a sense—deep, profound and let’s face it often justified—that…the world works well for a privileged few, but not for them.”
Those are not my words but the words of the Prime Minister in her party conference speech.
If we look at the remarkable turnaround that took place during the election campaign, we can blame the social care policy, we can blame the Prime Minister, but I think it is deeper than that. The tide is going out on a certain way of running the country—large inequality, the next generation seeing their chances diminish, and permanent austerity. The crucial point about the campaign—I think Conservative Members know this—is that the Prime Minister who stood on the steps of Downing Street as the agent of change became the agent of the status quo. The reality is that my right hon. Friend the leader of the Labour party became the agent of change. That is why we saw the change that we did in this election.
The question about this Gracious Speech is whether it shows that the Government understand the lessons of the election campaign. Listening to the Chancellor, one would think that it had all gone brilliantly and the Conservatives had got a landslide majority, as they had planned. They did not. I look at the Gracious Speech and I ask this question. Does it include an attack on the burning injustices that the Prime Minister promised in her words in Downing Street? Is there the transformation in life chances that she promised? Is there a determination to stand up to the most powerful as she promised? The answer, to coin a phrase, is no, no, no. We do not see any of that in this speech.
I want to make some positive suggestions about how Members across the House, working together, can rectify the gaps in the Queen’s Speech, and I will make three in the time I have. The first—it will not surprise hon. Members to hear me talk about this—is on energy prices. I do not normally read The Sun—people might recognise that, but on 9 May I read something that caught my eye. It said:
“I am making this promise: if I am re-elected on June 8, I will take action…by introducing a cap on unfair energy price rises…It will protect around 17 million families.”
That is brilliant, I thought. That is my policy, more or less. It was from the Prime Minister. Then I look at the Queen’s Speech—where has it gone? Where is the price cap legislation? All we have is a consultation and a letter to Ofcom—a U-turn on the U-turn, which happened yesterday as well.
Let me put it this way: 84% of people supported parties with a price cap in their manifesto. Not a soft cap but a hard cap. It was proposed by the Labour party and the Conservative party. So let us do it. I welcome the intervention by the hon. Member for Weston-super-Mare (John Penrose) in the Queen’s Speech debate when the Prime Minister spoke.
Secondly, the Prime Minister says that she cares about insecurity. Zero-hours contracts may have started under the last Labour Government, but let us be honest about the situation. The number has gone from 168,000 in December 2010 to 900,000 by the end of last year. If we care about insecurity, it is unfathomable that we are not acting on this. We heard it from our constituents on the doorsteps. We heard that sense of insecurity; it is part of the explanation for the result of the general election.
Thirdly, the Chancellor of the Exchequer talked about corporation tax. We have cuts in corporation tax still to come that will cost £5 billion over the next few years. If there is no magic money tree, is it really the priority that Apple, Starbucks and other companies should pay 17% tax when ordinary families in Britain pay 20%? Why? Where is the fairness in that? Where is the sense of tackling the burning injustice that the Prime Minister talked about?
I want to end on this thought. Ever since 2015 I have stopped believing opinion polls—people will not be surprised to learn that. I make an exception in the following case, which is not about voting intention. I was reading the newspapers on 9 May, and people were asked by Ipsos MORI whether they thought that the country was rigged to the advantage of the rich and powerful—76% of people in Britain agreed and just 16% disagreed. The question for all of us, whether we like it or not, left and right, is what is our answer to that. For my money, the next election will be decided by who has the compelling vision to meet that desire for change. On the evidence of this Queen’s Speech, the Government have no answers and it will be up to Labour to provide them.
(7 years, 9 months ago)
Commons ChamberI am extremely grateful to my right hon. Friend. He is absolutely right to say that those principles will guide the actions of this Government—as they should guide the actions of any sensible Government —as we try to future-proof our economy in a time of extraordinary political and technological change. We are facing a period of 20 or 30 years in which the way we work, the way we live and the way we do business will change fundamentally, and unless we invest now in our infrastructure, our science and technology base and our innovation capability, we risk being left behind. That would not deliver the economy and the country that works for everyone that we are committed to.
I welcome the fact that the Chancellor of the Exchequer has adopted the fiscal rules that his predecessor described as the single biggest risk to economic recovery. They are the ones that we proposed in 2015. I want to ask him about Brexit. He said at the Tory party conference that the British people did not vote to become poorer. However, on page 19 of the Office for Budget Responsibility’s report, we see that £58 billion of the worsening in the public finances is due to the Brexit decision. Is this not a salutary warning to us about the decisions that we will take over the coming months and years? Is it not also a strong argument for us to remain as close as possible to our largest trading area, the single market, and inside rather than outside the customs union?
The Prime Minister has said many times—I shall undoubtedly repeat this many times today—that it remains our objective to try to get the closest possible trading arrangement with the European Union and the greatest possible access for our goods and services to be sold into European markets after we leave the European Union. In response to the right hon. Gentleman’s question, I think we have to disaggregate two effects. There is of course going to be a period of uncertainty as we go through the process of exiting the European Union, and that has had a dampening effect on business investment, as the OBR has identified. However, we have to rise to the challenge of getting ourselves match-fit to seize the opportunities that this country will have after we complete that process, and I would urge him to think about that longer-term challenge as well as the short-term issues.
(9 years, 2 months ago)
Commons ChamberMay I start by thanking the Chancellor for his gracious words about me in his speech? It is an achievement to survive five years as Chancellor of the Exchequer and, indeed, to be reappointed, and I congratulate him on that.
I rise to speak from the Back Benches for the first time in nine years. I do so obviously deeply disappointed at Labour’s election defeat, for which I take full responsibility. I believe it is right that my party comprehensively examines the reasons for that defeat and does the hard and painful thinking necessary. On the day after the general election I rang the Prime Minister to congratulate him. I said, as the Chancellor said in his speech, that he had defied the pollsters and the pundits—and indeed that is true. I repeat those congratulations to the Conservative party.
In the time since the general election, I can report to the House that I have found some small consolations of losing, including spending time with my two boys, who feel that they have their dad back. However, I confess that my eldest, who has just turned six, did bring me further down to earth last week. He suddenly turned to me out of the blue and said, “Dad, if there is a fire in our house, I think we’ll be okay.” I said, “Why’s that, Daniel?” He said, “Because if we ring the fire brigade they’ll recognise your name because you used to be famous.” “Thanks very much,” I said. From my used-to-be-famous position on the Back Benches, I look forward to helping to play my part in holding the Government to account, as it is the job of the Opposition to do, and the occasion of the Queen’s Speech is the right place to start.
Whatever our profound differences over the years, I welcome the Prime Minister’s commitment in the days after the election, and repeated in the Gracious Speech, to govern for one nation. I welcome this because it speaks in historical terms to what I see as an admirable side of Conservatism, represented by Disraeli and Macmillan. It is worth reminding ourselves of the historical lineage that suggests. This is what Disraeli said in his novel “Sybil, or The Two Nations”, published 170 years ago this year, about what he was fighting against:
“Two nations between whom there is no intercourse and no sympathy; who are as ignorant of each other’s habits, thoughts, and feelings, as if they were dwellers in different zones, or inhabitants of different planets”.
For many people, that will sound like the description, in old-fashioned language, of some of what afflicts our country today: a divide between the top 1%, or even the top 0.1%, and everyone else. Facing up to that is a challenge for any Government of any colour, but particularly, if I may suggest, for one claiming the mantle of one nation.
A huge question facing all western democracies in the next five, 10, 20 years is whether we are comfortable with the huge disparities that exist, whether we are fated to have them and whether we want to even try to confront them. Personally, I believe we will have to, and I believe this is an issue for right and left.
What has changed in the debate about inequality is that, internationally and across the political spectrum, there is growing recognition that these gaps are not just bad for the poor, as we always used to believe, but bad—
No, thanks very much.
These gaps are not just bad for the poor, but bad for all of us. Last month, the OECD joined the International Monetary Fund in saying that inequality was definitively a problem. The secretary-general of the OECD said there was
“compelling evidence that high inequality harms economic growth”
and social mobility. Simply put, if the rungs of the ladder grow too far apart, it is much harder to climb them.
The old idea was that inequality was necessary for economic growth. In fact, we now know that the deep structural challenges in our economy of low productivity—which, to be fair, the Chancellor and, indeed, my hon. Friend the shadow Chancellor referred to—are bound up with high inequality. More unequal societies tend to use the talents of fewer people, and they suffer as a result.
It is not just internationally that the debate has shifted, and I applaud those on the right—some of whom are sitting on the Government Benches—who have focused on this issue. I was intrigued the other day to hear Steve Hilton, the Prime Minister’s former adviser, say that it was time to impose a maximum wage for the bankers. As you would expect from me, Mr Speaker, I see that proposal as anti-aspiration and anti-business, and I have no truck with it. [Laughter.] The serious point is that this issue will not go away and needs to be confronted.
I hope that we can move on—maybe the Government’s emphasis on one nation presages this—from discussing whether inequality is a problem to what the solutions are. There are no easy solutions in the context of a global economy, but progress can be made in the way we shape our economy and the way we approach tax and benefits. As a starting point, I urge the Government and the Chancellor, in the spirit of one nation, to look at the OECD recommendations—not just those about the pursuit of equal opportunity and skills, but those about tackling insecure work in our economy, which it specifically identifies as part of the problem, and progressive taxation, which it says is part of the answer. Perhaps that will all be in a one nation Budget in July. I wait with interest.
Within the profound and growing challenge of inequality lies the specific problem of in-work poverty. I would say that it is the modern scourge of our time. For the first time, as many people in Britain who are in poverty are in work as out of work. I believe that the left and right can agree that it should be a basic principle that if you go out to work, you should not be living in poverty. But we are very far from that in Britain today.
The minimum wage has played its part in countering the worst exploitation, but I believe it needs to do more. In Doncaster, which I represent, 28% of men and more than a third of women workers are paid less than the living wage of £7.65 an hour. The UK is one of the low-pay capitals of western Europe. There is an irony here: the Low Pay Commission is a great success, and indeed a lasting achievement, of the 1997 Labour Government—to be fair, the last Government continued to operate with the Low Pay Commission—but I fear that the way it operates has become too much a recipe for the lowest common denominator.
Countries around the world are confronting similar issues and seeking to act. There is a live debate in the United States about raising the minimum wage. Los Angeles has just passed a plan to raise the minimum wage to $15 an hour from $9 an hour over five years. I say to the Chancellor that if we are to make progress here at home, it will require us to strengthen and guide the Low Pay Commission much more explicitly. That is something that its previous chair, George Bain, has called for. Without it, I do not believe it we will be equal to the challenge of low pay.
Just as one nation requires the right approach to those who work, so it requires the right approach to those who cannot. The origin of one nation for Disraeli was rooted in the lives of the rich and the poor. Responsibility is absolutely part of a successful welfare system, but so too is protection of the most vulnerable. We will never be one nation without a social security system that supports those who need it.
I think it would repay Ministers to read some of the early speeches by the Prime Minister when he became leader of the Conservative party. On the 25th anniversary of the Scarman report in 2006, he said:
“In the past we used to think of poverty in absolute terms—meaning straightforward material deprivation. That’s not enough. We need to think of poverty in relative terms—the fact that some people lack those things which others in society take for granted.”
He continued:
“I want this message to go out loud and clear—the Conservative Party recognises, will measure and will act on relative poverty.”
That was seen as a radical departure from the tenets of Thatcherism, and it was. If the approach in the Queen’s Speech is indeed meant to be a return to the earlier incarnation of the Prime Minister’s approach, which I welcome, Ministers need to prove it and to square the circle with the Government’s proposals for deficit reduction.
Can one nation really be consistent with making those on welfare shoulder £12 billion of the burden for deficit reduction and those at the top nothing at all? Can one nation really be squared with cuts to tax credits, with their impact on working people? Can one nation be squared with a welfare system that is so often harsh, brutal and brutalising? Can one nation be squared with a country where a million people go to food banks? Those tests on inequality, low pay and a compassionate social security system are appropriate tests for a Government claiming the mantle of one nation. There are many more besides, including, of course, keeping our United Kingdom together.
Let me make this final point about the situation facing the Prime Minister. Fighting an election and winning is some achievement; how he seeks to use the mandate is what will really define his legacy. He is in an unusual position in that he has fought his last election. He is able, if he wishes, to return to what he said when he first became Leader of the Opposition and not worry about an election round the corner, with all the pressures that entails. I urge him, perhaps through the Chancellor, to follow through on his one nation rhetoric. Opposition Members will hold the Government to account at every turn for whether they are living up to their own test: one nation in spirit and deed. If that is where the battleground of politics lies in the years ahead, I welcome it and look forward to playing my part.
(10 years, 5 months ago)
Commons ChamberThe Chancellor spoke for nearly an hour, but he did not mention one central fact—[Interruption.]
Order. I think that the deputy Chief Whip knows better. We have not even got started. I hope that he will calm down.
The Chancellor spoke for nearly an hour, but he did not mention one central fact: the working people of Britain are worse off under the Tories. Living standards are down, month after month, year after year. In 2011, living standards, down; 2012, living standards, down; 2013, living standards, down. Since the election, working people’s living standards are £1,600 a year down. You are worse off under the Tories—[Interruption.]
Order. To be quite honest, I thought that the House was doing really well today. Courtesy was quite rightly shown to the Chancellor of the Exchequer. I expect the same courtesy to be shown to the Leader of the Opposition. I want to hear it, and your constituents want to hear it.
They do not want to talk about the falling living standards of people across this country, Mr Deputy Speaker.
The 2010 Tory manifesto promised an economy where people’s
“standard of living… rises steadily and sustainably”
but they have delivered exactly the opposite: standards of living falling sharply and steeply. Today the Chancellor simply reminded people of the gap between his rhetoric and the reality of people’s lives. Living standards have been falling for 44 out of 45 months under this Prime Minister, unmatched since records began. No amount of smoke and mirrors today can hide it. We already know the answer to the question that millions of people will be asking in 2015: “Are we better off now than we were five years ago?” The answer is no. They are worse off, much worse off—worse off under the Tories.
The Chancellor trumpeted the tax allowance today, but what he did not tell us is that it is the same old Tory trick. He did not tell us the rest of the story. He did not mention the 24 tax rises introduced since he became Chancellor. He forgot to mention that he put up VAT, taxed away child benefit, raised insurance tax and gave us the granny tax. It is a classic Tory con: give with one hand and take away far more with the other—same old Tories.
The Chancellor painted a picture of the country today that millions of people will simply not recognise. This is Cameron’s Britain 2014, with 350,000 people going to food banks, 400,000 disabled people paying the bedroom tax, 1 million more people paying 40p tax and 4.6 million families facing cuts to tax credits. But there is one group that is better off—much better off. We all know who they are: the Chancellor’s chums, the Prime Minister’s friends—[Interruption.] The Prime Minister rolls his eyes, because he does not want to talk about the millionaires’ tax cut. There was no mention of it in the Budget speech. They are the beneficiaries of this year’s millionaires’ tax cut.
If you are a City banker earning £5 million and feeling the squeeze, do not worry, because they feel your pain. This year that City banker was given a tax cut, and not just any tax cut. It is a tax cut worth £664 a day, £20,000 a month and more than £200,000 a year. So the Prime Minister chooses to afford a tax cut worth more than £200,000 a year for that banker, but he cannot afford a pay rise of £250 a year for a nurse. And these are the people who have the nerve to tell us that we are all in this together. It is Tory values and Tory choices—same old Tories. Of course, the leader of the Liberal Democrats is with them every step of the way. Day after day he claims that he does not support Tory policy, but day after day he votes for Tory policy.
Now, to listen to the Chancellor today, for a recovery that arrived three years later than he promised, he expects the country to be grateful. Back in 2010 he told us that by the end of 2014 the economy would have grown by nearly 12%. Today the figures show that it has been barely half that, and he wants the country to be grateful. Back in 2010 he said that the Government would clear the deficit in this Parliament, by 2014-15. Today he wants the country to be grateful because he says that he can do it by 2018-19. Three years ago he told us, in his 2011 Budget speech, that he would deliver an economy
“carried aloft by the march of the makers.”—[Official Report, 23 March 2011; Vol. 525, c. 966.]
But what has actually happened since then to the rebalancing he promised? Manufacturing output has fallen by 1.3%, construction output has fallen by 4.2% and infrastructure investment is down by 11.3%. Every time he comes to this House he promises a rebalancing, and every time he fails. The Chancellor talked about housing today, but what has he actually delivered? The Government have overseen the lowest level of house building since the 1920s and rents have risen twice as fast as wages.
At the heart of the argument we will have over the next 14 months is this question: whose recovery is it under the Tories? Under them, it is a recovery for the few, not the many. Bankers’ pay in London is rising five times faster than that of the average worker. This recovery is not working for working people whose living standards are falling. It is not working for the millions of women who see the gap between men and women’s pay rising. It is not working for the low-paid people promised by the Chancellor—[Interruption.]
Order. Mr Williamson, you are in danger of exploding, which would be good neither for you, nor for the Chamber. Come on. Let us listen.
They do not want to talk about the low-paid workers promised a £7 minimum wage by the Chancellor but given just 19p more an hour. Under this Government it is an economy of the privileged, by the privileged and for the privileged.
Instead of admitting the truth about what is happening in most people’s lives today, the Government want to tell them the opposite. They tell people that their wages are rising when they are falling, just like they tell people that their energy bills are falling when they are rising. They tell people that they are better off, but everyone knows the truth. They can change the shape of the pound—it does not matter if it is square, round or oval—but if you are £1,600 a year worse off, you are still £1,600 a year worse off. You are worse off under the Tories.
They cannot deliver because of what they believe. His global race is a race to the bottom. It means people being forced to do two or even three jobs to make ends meet, not knowing how many hours they will get from one week to the next, and with no idea what the future holds for their kids. Low wages, low skills, insecure work—that is how they think Britain succeeds. That is why they are not the solution to the cost of living crisis. They are the problem.
We needed a Budget today that would have made the long-term changes that our economy needs, in housing, banking and energy. But they cannot do it. They will not stand up to the vested interests. They will not tackle developers sitting on land, even though they cannot solve the housing crisis without that. They will not force the banks to improve competition even though small businesses say they need it. They will not stand up to the energy companies and freeze energy bills, even though the public support it. Same old Tories. We know what their long-term plan is: more tax cuts for the richest, while everyone else gets squeezed. [Interruption.]
Order. This is getting totally out of hand and we certainly do not want any more pointing. I am worrying about the danger to Anne Milton’s hearing; the way she is shouting is not good for her or the Chamber. I want to hear the rest of the speech in peace. I certainly do not want all the muttering and challenges that have been running along the Benches. I will take it more seriously if I have to get up next time.
We know what their long-term plan is: more tax cuts for the richest while everyone else gets squeezed. What does the Chancellor say about the people dragged into paying 40p tax? He says that they should be happy and that it is good news for them. So this is the new Osborne tax theory: if you are in the middle, paying 40p, you should be pleased to pay more, but if you are at the top, paying 50p, you should be helped to pay less. Same old Tories.
It is no wonder that even their own side think they are totally out of touch. Even now, after all the embarrassment of the millionaires’ tax cut, they will not rule out going further. Maybe today we can get the straight answer that we have not had so far. Will the Chancellor rule out a further tax cut for millionaires to 40p? Just nod your head if you will rule it out. Come on, come on. Just nod your head. Maybe the Prime Minister would like to. Just nod your head. [Interruption.]
Order. There may be an influence of the wolves and the pack running around. That can be used in the zoo, but it will not be used in this Chamber.
It is very simple—all the Prime Minister needs to do is to nod his head if he is going to rule out cutting the 45p tax to 40p in the next Parliament. Just nod your head. Come on. There we have it. There they go again—they will not rule it out. Does that not say it all about them? They really do believe that the way you make the rich work harder is to make them richer and the way you make everyone else work harder is by making them poorer.
Just as they paint a picture of the country that working people will not recognise, so, too, themselves. The Prime Minister is an expert in rebranding. Remember the huskies, the bike and the tree? That was before they said, “Cut the green crap.” What is the latest rebranding from the Bullingdon club? It is beyond parody. What do this lot now call themselves? [Interruption.]
Order. Mr Williamson, I will not tell you again. I am sure your roast beef is ready for you—you might be better off eating a little raw meat than giving us the noise that we are getting in here.
What do this lot now call themselves? They call themselves the workers’ party. Who is writing the manifesto for this workers’ party? We have a helpful answer from one Conservative MP:
“There are six people writing the manifesto…five…went to Eton”.
By my count, more Etonians are writing the manifesto than there are women in the Cabinet—no girls allowed. This week, we have heard it right from the top. Here is what the Prime Minister’s former best friend—[Interruption.] They do not like to hear it do they, Mr Deputy Speaker? Here is what his best friend—[Interruption.]
Order. If Members wish to go outside and show people, they can do so by all means. I certainly do not need you to hold up papers all the way through. Quite seriously, respect is due to the Leader of the Opposition the same way it was given to the Chancellor. I want to hear him; if you do not, there is the door—please leave.
Here is what the Prime Minister’s former best friend, his closest ally, the Education Secretary, had to say about the Prime Minister’s inner circle. He said it was ridiculous, preposterous, unlike anywhere else in the world. They know they are in trouble when even the Education Secretary calls them a bunch of out-of-touch elitists. Where is the Education Secretary? I think he has been banished. Ah—he is hiding! He has been consigned to the naughty step by the Prime Minister. It is time we listened to Baroness Warsi and took the whole Eton mess out of Downing street.
We do not need a party for the privileged few; we need a party for the many. That is why a Labour Government will freeze energy bills, guarantee jobs for unemployed young people, cut business rates, reform the banks, get 200,000 homes built a year and abolish the bedroom tax. This is the Budget that confirms that people are worse off under the Tories—a worse-off Budget from an out-of-touch Chancellor. Britain can do better than them. Britain needs a Labour Government.
(11 years, 8 months ago)
Commons ChamberThere is only one person in the Chamber who is drowning, and it is the shadow Chancellor. That was the worst reply to an autumn statement I have ever heard in this House. If one thing changes as a result of this statement, it might be a shadow Cabinet reshuffle.
The shadow Chancellor said one thing that was true. He said it right at the beginning—he said that the national deficit was not rising. It was a Freudian slip, but it betrayed the fact that he had written his response before he heard my autumn statement and before he looked at the OBR forecast. Let me tell him that we do not fiddle the numbers in the Treasury any more—that is what happened when he was there. We have an independent Office for Budgetary Responsibility, and that is the problem he has. His whole policy was about complaining that borrowing and the deficit were going up, but that is not what the OBR forecasts show. Indeed, his prescription is to borrow even more. He complains about debt, but he wants to put it up. It is completely hopeless.
The shadow Chancellor talked about the substance of policies. Here are some simple questions that the Labour party will have to answer. If it is against the cut in the income tax rate from 50p to 45p, will it reverse it? It is the simplest possible question. [Interruption.] The Leader of the Opposition says it has not come in yet. It is coming in—it has been legislated for—so, if he is so against it and thinks it a moral outrage, will he commit to reverse it? Yes or no? That is hopeless position No. 1.
The shadow Chancellor railed at welfare benefits. I have another simple question. Will the Opposition support us or vote against a welfare uprating Bill? What are they going to do? Will they vote for or against the Bill? It is a simple question. For the first time, we have spending plans for 2015-16. He said nothing about whether he supported those plans, even though he hopes to be Chancellor that year. Does he support those spending plans? He talked about 3G. [Interruption.] They are shouting at me.
The 4G licence, yes. We are using the 4G licence. [Interruption.] May I say something about the 4G licence? The shadow Chancellor had 20 minutes to make his points, but he did not make any at all. We are using the 4G money, in part, for new capital spending, including building further education colleges, one of which is called the Leeds city college, in a town called Morley in west Yorkshire. I am not sure what the local MP would make of the shadow Chancellor’s decision that that is not the best use of the money, but he can look at himself in the mirror and ask that question.
The shadow Chancellor cannot answer these basic questions. He tries to claim that all the problems in Britain began in May 2010 and that they are all the fault of this Government. Literally only the people in the Brownite cabal claim that; there is not a single other person in the Labour party, in any business organisation or in any of the international bodies who believes that. The reason he has to maintain this completely incredible position is that if he admitted that the previous Government were responsible for the problems in our country, he would have to admit that he was responsible for them.
Out of necessity not choice, therefore, the Labour party leader has a shadow Chancellor who is more associated with the economic mismanagement that led to Britain’s problems than anyone else in Britain. He will not let his party move on. He is a man trapped in the past. The one thing the Opposition need to say is: “We’re sorry. We spent too much and we borrowed too much, but we won’t do it again”, but that is the one thing the shadow Chancellor cannot say. Until he does, though, the British public will never trust him or the Labour party with the public finances again.
(12 years, 5 months ago)
Commons ChamberThe Chancellor spoke for an hour, but one of his usual phrases was missing; there was one thing that he did not say. Today marks the end of “We’re all in it together”, because after today’s Budget—[Interruption.]
Order. Mr Gummer, I do not think we need you to lead the cheerleading. We have given respect to the Chancellor of the Exchequer, and I expect the same respect to be given to the Leader of the Opposition.
After today’s Budget, millions will be paying more while millionaires pay less. A year ago, the Chancellor said in his Budget speech that
“now would not be the right time to remove”
the 50p tax rate
“when we are asking others in our society”—[Interruption.]
Is the Chancellor saying that he did not say it? He said that
“now would not be the right time to remove”
the 50p tax rate
“when we are asking others in our society on much lower incomes to make sacrifices”.—[Official Report, 23 March 2011; Vol. 525, c. 957.]
That is exactly what he has done. With tax credits cut, child benefit taken away, and fuel duty rising, what has he chosen to make a priority? For Britain’s millionaires, a massive income tax cut each and every year. The fairness test for this Budget was whether the Chancellor used every penny he could to help middle-income families who are squeezed. He has failed that test. Anyone who listened to him will be asking the same question: what planet are he and the Prime Minister living on? There are 1 million young people out of work and 50 businesses going bust every day, and there is a cost of living crisis for families. They promised change, but things have got worse, not better.
What did the Chancellor promise us in last year’s Budget? He said that he would
“put fuel into the tank of the British economy.”—[Official Report, 23 March 2011; Vol. 525, c. 966.]
He promised growth of 2.5% in 2012, but today he comes to the House and tells us that it will be just 0.8%: growth down last year, growth down this year, and growth down next year. Every time he comes to the House, he offers a different excuse, but the reality is that his plan has failed. Last year, he told us that unemployment would peak in 2011, and what has he delivered? We are into 2012, and unemployment is rising month upon month upon month. His plan has failed. He promised us last year that the deficit would be gone by the end of the Parliament, but today he admits that he is borrowing over £150 billion more than he said he would. His plan has failed.
In the face of failure, what does the Chancellor offer? Not a change in economic strategy, not a guarantee of jobs for the young unemployed, not targeting every penny he can at working families. We know that for the Chancellor the driving ambition of this Budget was to deliver a tax cut for people earning over £150,000 a year. There are 30 million taxpayers in this country; this policy will do absolutely nothing for 29,700,000 of them. How can the priority for our country be an income tax cut for the richest 1% at a time when the squeezed middle are facing rising petrol prices, higher energy bills, and cuts in tax credits and child benefit?
Let us think of what the Chancellor could have done with the money. He could have reversed his cuts to tax credits. He could have done something for pensioners; in fact, I think there is a tax rise for pensioners hidden in the detail of this Budget. He could have done more to undo the damage to child benefit, but he claims he cannot afford it. Let me tell him this: every time in future he tries to justify an unfair decision by saying that times are tough, we will remind him that he is the man who chose to spend hundreds of millions of pounds on those who need it least. Wrong choices, wrong priorities, wrong values; out of touch, same old Tories.
Let me come to his claims on stamp duty. There are 300,000 people benefiting each and every year from his top rate tax cut, and there are 4,000 houses sold each year for more than £2 million. So 99% of those who gain from his millionaires’ tax cut will be totally unaffected by the rise in stamp duty and will get a massive windfall from this Chancellor. He did not tell us what this meant in pounds and pence—[Interruption.] Oh, the Prime Minister thinks that the Chancellor did say how much each person is getting as a result of the top rate tax cut. He did not, and I am going to tell him the figure. There are 14,000 people earning over £1 million in Britain. The Chancellor’s decision today means that each of them will get a tax cut—not of £1,000, not of £5,000, not of £10,000, but of over £40,000—[Interruption.]
Order. It is not good if the Leader of the Opposition is not allowed to speak.
That tax cut is not just for this year but for every year. What happens to families who earn in one year half what the Chancellor has so casually given away to the richest in the last hour—families on £20,000 a year, perhaps those of a nurse or a lorry driver? Even after the personal allowance change, they are not going to be better off; they are going to be worse off. Putting aside the VAT rise and all the other tax rises that have happened, from this April alone they will be a further £253 a year worse off. All he is doing for ordinary families is giving with one hand and taking far more away with the other. This is a millionaire’s Budget that squeezes the middle. Wrong choices, wrong priorities, wrong values, out of touch—same old Tories.
Under the Chancellor’s tax cut, a banker earning £5 million will get an extra £240,000 a year. Let us call it what it really is: the Government’s very own bankers’ bonus. Presumably, he wants us to believe that the £240,000 tax cut is necessary to make the bankers work harder. It is one rule for them and another rule for everyone else. This April, the Chancellor will be telling a family working for 16 hours on the minimum wage that, if they do not work more hours, they will lose nearly £4,000 in tax credits. That tells people everything they need to know about the values of the Chancellor and the Prime Minister: the poor will work harder only if they are made poorer; the rich will work harder only if they are made richer. Wrong choices, wrong values, wrong priorities—same old Tories.
While everybody else is squeezed, what is the Chancellor’s priority? It is a massive tax cut for those on his Christmas card list. The Chancellor talked a lot about tax transparency. Let us have some—[Interruption.]
Order. Mr Hands, I think that you need to calm down. What you are doing is not good for the House.
Let us have some tax transparency. Hands up in the Cabinet if you are going to benefit from the income tax cut. Come on. Come on. Come on. [Interruption.]
Order. Mr Shelbrooke—[Interruption.] Order. Mr Shelbrooke, I have looked at you twice and I do not want to continue to do so. We need a bit of silence from you. If not, you might be better off leaving the Chamber. I think that we understand each other.
The Prime Minister is the man who said that
“sunlight is the best disinfectant”.
Here is the challenge. Just nod if you are going to benefit from the income tax cut or shake your head if you are not. Come on. Come on. Come on. Come on, we have plenty of time. [Interruption.]
Order. Members on both sides of the House will come to order. The Leader of the Opposition will be heard with the same courtesy that was given to the Chancellor. I do not want to have to rule further, because I will have to get firmer. It is only right that the country hears what the Opposition have to say. [Interruption.] I do not need any examples from hon. Members.
One more chance. Nod or shake your head. Are you going to benefit? I have one thing to say to the Prime Minister: let sunshine win the day. I hear that this is good news for him, because now he will be able to buy his own horse. [Interruption.]
Order. We will not have any clapping in the Chamber. Seriously, it does not do this House or its reputation any good when we cannot hear the Leader of the Opposition. Members on both sides must show courtesy.
What about the hapless accomplice, the Deputy Prime Minister? Only the Liberal Democrats could be dumb enough to think that a George Osborne Budget is a Robin Hood Budget. Calamity Clegg strikes again! A few months ago, the Deputy Prime Minister said of the 50p tax rate, with no ifs and no buts:
“I do not believe that the priority…is to give a tax cut to a tiny, tiny number of people who are much, much better off than anybody else.”
The party that once followed Lloyd George is now reduced to following George Osborne. The party that delivered the people’s Budget of 1909 is supporting the millionaire’s Budget of 2012. The Liberal Democrats should be ashamed. For all the talk and all the briefings, the Deputy Prime Minister has done what he has done on every big issue, from tuition fees to the betrayal on the NHS—he has rolled over and said, “Yes, Prime Minister.”
The truth is that for ordinary families, it is hurting, but it is not working. We know why that is. This Government have been cutting too far and too fast. What did the Chancellor say last August about America’s more balanced deficit reduction plan? He said:
“Those who spent the whole of the past year telling us to follow the American example…need to answer this simple question: why has the US economy grown more slowly than the UK economy”?—[Official Report, 11 August 2011; Vol. 531, c. 1108.]
The numbers are in. The Chancellor is plain wrong. The US economy grew by 1.7% last year—twice the rate of ours. The Government have run out of excuses. It is their mistakes and the failure of their plan that are damaging our future.
Today we have heard about more schemes from the Chancellor, but why should we believe him? Every scheme that he has put forward so far has failed. What was the big idea of his first Budget? The national insurance holiday. We did not hear much about the national insurance holiday today, and it is no wonder. He told us in his June 2010 Budget that it would help 400,000 firms. He has missed his target by 97%. The Chancellor’s plan has failed. What was the centrepiece of last year’s Budget? It is easy to forget now, but it was called the “Budget for growth”. This scheme is my favourite. It is called the business growth fund. Six regional offices have been opened and how many businesses are benefiting? Six. [Laughter.] It is true. One business for each office. The Chancellor’s plan has failed. We needed a plan for growth that would work. We needed a guarantee on youth jobs. We needed a British investment bank to help small business. On growth, jobs and how we pay our way in the world, this Chancellor has failed.
On the film tax relief proposal, it is great to support great British success stories such as “Downton Abbey”.
Indeed, and Wallace and Gromit. It is important to support “Downton Abbey”, the tale of a group of out-of-touch millionaires who act like they were born to rule, but turn out not to be very good at it. It sounds familiar, does it not? We all know that it is a costume drama; the Cabinet think it is a fly-on-the-wall documentary.
This Budget will be remembered for the Chancellor’s failure on growth and jobs, and for the top rate tax cut. That is not just a bad policy or a misjudgment. It destroys the claims that the Prime Minister made about who he was and what he believed. He said personally in the aims and values document that he sent to every Conservative party member:
“The right test for our policies is how they help the most disadvantaged in society, not the rich.”
The document was called “Built to Last”. That was his test. It is a test that this Budget fails spectacularly. This is the death knell of his project and of his compassionate conservatism. He and the Chancellor have shown their true colours. They promised change, but they have failed on growth, on jobs, on borrowing and on fairness. It is unfair, out of touch, and for the few, not the many—an unfair Budget built on economic failure; an unfair Budget from the same old Tories.