Autumn Statement Resolutions

Giles Watling Excerpts

Monday 27th November 2023 Commons Chamber

[Giles Watling (Clacton) (Con)]

First, I applaud the Ministers in His Majesty’s Treasury. Sticking to electorally hard positions goes against the natural political grain, but doing so has halved inflation. The autumn statement has done a great deal for every man, woman and child in Clacton and the wider nation. Despite this all-consuming effort to tame the tiger of inflation, which is working, we have still managed to protect the £78 million that is being invested in Clacton. I thank the Government for listening to my repeated pleas to look after coastal communities. That is levelling up.

I welcome a number of the measures, but I do so in a cautious manner. First, I welcome the fact that we have protected and fulfilled our manifesto pledge to keep the pension triple lock in place. I have fought for the past three months to keep our commitment to pensioners, and I am thrilled that the effort has won out in the end.

The tax reliefs for the English freeports are being extended from five to 10 years, with an additional £150 million investment opportunity fund. That potentially is great news for the Harwich freeport, but serious connectivity issues need to be dealt with in Clacton. If the people from Jaywick in Clacton do not see the benefit of this economic expansion, I will regard the whole freeport thing as a failure. Economic growth, particularly when backed by the state, cannot come without societal good.

I would also like to have a word regarding the banks. I thought our central bank was painfully slow to respond to the blatantly obvious inflationary bubble post-covid. Our current rate of 5.25% is a result of the backdrop of being too low for too long, and the subsequent climb was far too incremental, starting in December 2021. Our high levels of interest at a time of falling inflation could well represent the banking sector profiting out of the Bank of England’s tardiness, and that cannot be right. The Bank of England needs to respond in a reasonable way or risk the ire of the business community and of this House. We need to lower interest rates as soon as possible, to save some of the businesses in my constituency that are on the brink.

The bulk of my comments, however, come directly from and relate to our wonderful sunshine coast in Clacton. I reached out to a number of businesses and promised to be their voice, fulfilling my pledge to be Clacton’s man in this place. Here is what they had to say. Gavin Smith of Hedingham and Chambers buses—a firm doing amazing work, and I want to help it do better—wanted me to tell the Treasury that the £2 billion for development of zero-emission buses technology is great news, and it wants to work with that.

Of course, employees will welcome the 2% NI cut, but the massive 25% corporation tax rate hits business hard. The Cameron-Osborne years, which were just referred to, proved that lower and competitive taxes yield more for the Treasury due to the stimulus that gives to investment in the private sector. We must return to that fact of life that we as Conservatives all know.

There is one clear voice of concern from the sunshine coast, and it is one that I support. The minimum wage increase to £11.44 is excellent for so many, but for more than two decades Governments have been using a disingenuous term. They say, “We are increasing pay”, but let us be clear that they are not increasing pay but telling others to increase pay. What does that mean in real terms? For Amazon, a firm that saw profits explode thanks to covid spurring online sales and which had $513 billion of global revenue in 2022, it means little. For leisure businesses such as the Lifehouse in Weeley, it is devastating. Peter Murphy, its chief executive officer, told me that it expected its fixed costs to increase by £500,000. The company is a model business—it employs locally, gives to charity, has regenerated historic grounds, and even its restaurant menus show where produce has been sourced from in the immediate area—but it faces extinction unless something is done.

Hospitality and social care are the mainstay of our economy in Clacton, and they are not like Amazon, which measures profits in tens and hundreds of millions or billions and can pay more without a second thought. These businesses have high human resource headcounts and have to live with very tight margins. We need to protect them from increasing costs.

In this day and age, to treat all private entities as if they have the same capacity is madness. The mandates should be like tax on profit—they should fall heavier on the broadest shoulders. I am fine with the idea of special taxation on certain giants to retire the covid debt, the interest on which is a millstone around the national neck, but we cannot pretend that wages are Government money. They are businesses’ money, and that is not inexhaustible.

With falling inflation and key investments, we are well on the way to recovery. However, the message from Clacton is that that recovery is led by businesses, not by Whitehall. That means we need get the costs off their backs and let them do what they do and know best.