Budget Resolutions and Economic Situation

Helen Hayes Excerpts

Monday 20th March 2023 Commons Chamber

[Helen Hayes (Dulwich and West Norwood) (Lab)]

In his Budget speech, the Chancellor explained that the economic outlook is not quite as bad as it might have been and heralded that as a cause for celebration. He claimed that his plan is delivering the country from the difficulties we are facing, as if those difficulties were nothing to do with him or the Government of which he is a part. We must be clear: the current situation is dire, and responsibility for it rests squarely with the party that has been in power for the past 13 years.

According to the OECD, we have the weakest economy in the G7; we are the only country that will see negative growth. We are seeing the biggest decline in living standards since records began. The covid-19 pandemic and the war in Ukraine have had global impacts, but here in the UK they have exposed the underlying weaknesses in our economy and public services, which are the consequences of more than a decade of government by the Conservative party.

Along the way, this Government have inflicted entirely new damage of their own making. It was Conservative Members who voted for a Prime Minister who was content to send inflation and mortgage bills spiralling and the economy into freefall, completely unnecessarily, in pursuit of her right-wing economic dogma. This Government have neglected public servants, so many of whom have been at the frontline of the covid-19 pandemic—nurses, doctors, railway workers, teachers, paramedics, postal workers—who are now so demoralised, underpaid and burned out that we are seeing the biggest wave of industrial action since the 1980s.

The challenges we face are the result of the Conservatives’ political decisions and priorities. The state of our country is their record—and it is a shameful record of crumbling public services, struggling high streets, falling wages, increasing poverty and deprivation, and declining mental and physical health. This Budget tells us that the Conservatives’ priorities are all wrong and they do not know how to fix what they have broken.

The state of our economy is deeply linked to our response to the climate crisis. Household energy bills have increased because of our dependence on fossil fuels. Yet the Conservatives have wasted a decade failing to invest in onshore wind, crashing the market for domestic solar, and comprehensively failing to deliver a retrofit programme to insulate homes and decarbonise domestic heat.

A fair taxation system is another foundation of a strong economy, yet this Chancellor’s priority, in the context of a biting cost of living crisis, is a £1 billion tax cut for fewer than the richest 1% of earners—not a specific fix to incentivise doctors to remain in work longer, but a tax giveaway in which someone with a pension pot of £2 million will get a tax cut of almost a quarter of a million pounds. The Government have implemented a poorly designed windfall tax that fails to maximise funding to protect households from the energy crisis.

We have the most expensive childcare in Europe, with some families across the country paying far more than their rent or mortgage, and parents, especially women, increasingly deciding that work does not pay. Yet for all the Chancellor’s fanfare about childcare, there is no acceptance by the Government that the current system is broken. Nurseries and childminders are leaving in their droves and staff are leaving. Additional funding is welcome, but without a plan to expand the early years education workforce and reform the complex and confusing hours-based model of funding, it will not make the critical difference that families need.

The Budget ignored completely the biggest issue facing my constituents in Dulwich and West Norwood: the shortage of genuinely affordable social housing. There was not a single commitment to boost the supply of social housing or to improve the quality of existing housing. The rabbit in the Chancellor’s hat could have been the investment to retrofit 19 million homes, or to end non-dom tax status to double the number of training places for doctors and fund free breakfast clubs for every primary school in the country. It could have been a pledge to reform business rates to level the playing field for struggling town centre businesses. It could have been investment in onshore wind and solar. Instead, the Chancellor chose a tax cut for the rich and a packet of sticking plasters for the gaping wounds his party has inflicted on our country.

The Conservatives are out of touch and out of ideas. It is clear from the Budget that it is time for them to make way for a Labour Government who can begin the process of rebuilding our country, investing in green skills for a strong economy, building the childcare system families need, tackling the housing crisis, supporting small businesses and investing in an NHS workforce for the 21st century. The next general election cannot come soon enough.