Income Tax (Charge)

John Milne Excerpts

Monday 4th November 2024 Commons Chamber

[John Milne (Horsham) (LD)]

This Budget was strongly promoted as a blueprint for growth, so it has come as a considerable surprise to find that the growth forecast for the second half of this Parliament has actually gone down. Somewhere hiding here is a much better Budget trying to get out. The Government have tried to target what are supposed to be bastions of wealth and privilege, but caught in the crossfire are all kinds of people they never meant to touch. The winter fuel payment cut is supposed to fall on wealthy pensioners who do not really need the money, but it will also hit vulnerable people on a basic £11,500 state pension. VAT on private schooling is supposed to tax the Etons and Harrows of the world, but it also hits hundreds of small schools such as Pennthorpe preparatory school in my constituency, which plays a key role in providing for SEND children, and Christ’s Hospital, a remarkable school that takes 70% of its pupils from disadvantaged backgrounds. The changes in inheritance tax are aimed at wealthy farmers, but also threaten to wipe out a fantastic tradition of family farming that has literally shaped our countryside over generations.

Wherever we look, there is just too much collateral damage, but the biggest rise, the one that is doing all the heavy lifting, is the jump in employers’ national insurance. Surely it was not the Chancellor’s intention to undermine GP surgeries, hospices, independent care homes and growing businesses, yet that is exactly what is set to happen. I realise that the last Government left so many public services in crisis that it would be impossible to fix everything at once. They raided vital investment funds for day-to-day spending. They never understood that strong public services are just as essential to economic growth as business-friendly regulations. The last Chancellor, the right hon. Member for Godalming and Ash (Jeremy Hunt), behaved recklessly when he twice cut employee national insurance rates in the teeth of warnings from the International Monetary Fund. He dug the hole, and now the country has slid gently into it.

However, swinging from one ideological extreme to another is not the solution. This Budget feels suspiciously like Labour circa 2000, but at that time the country was in better shape, and the same plan will not work twice. This Budget is a serious attempt to deal with the crisis in public services, and I respect that, but the original vision has been lost in translation. This is a growth Budget, but without the growth. I urge the Chancellor to refocus around her original first principle: growth.