Oral Answers to Questions

Kemi Badenoch Excerpts

Wednesday 2nd September 2026 Commons Chamber

[Mrs Kemi Badenoch (North West Essex) (Con)]

May I congratulate the Prime Minister on his stamina? Three hours! [Laughter.] Yesterday, he faced 125 questions from MPs across the House. Of course, Labour and the Lib Dems just wanted more Government spending—that is, taxpayers’ money—but can he name a single spending request to which he answered no?

[The Prime Minister]

What I can say to the right hon. Lady is that I was quite clear in my statement about the need to get the welfare bill down. I do not want to be a Prime Minister who sees a situation where we have so many people in their 20s not in education, employment or training. I cannot defend that, and I want to change it by giving more support to young people, so that we start investing in their success rather than paying for failure, as we have done for many years under successive Governments. This seems to me to be one area where both of us can engage in problem solving rather than point scoring, and I hope that the right hon. Lady will take up my offer on that.

[Mrs Badenoch]

The Prime Minister avoided the question. He did not say no to a single spending request. Personally, I think it is delightful that he wants to make everyone happy, but a Prime Minister needs to be a leader, not a people pleaser. He is talking about working together on welfare. I already made that offer, but it does mean cuts—he wants to bring the welfare bill down by spending more money. Yesterday, the Prime Minister told the House that his summer of promises would be paid for by “reprioritising within Government”, so what exactly has he cut?

[The Prime Minister]

In terms of “what has he cut?”, tax is the simple answer to that question. Within days of taking office, I indicated that we would remove VAT from electricity bills. That will help people with the cost of living. Then, days later, with the support of my right hon. Friend the Chancellor, we said that there would be a cut in business rates for pubs, social clubs and live music venues. This Government are lowering the cost of living and lowering the cost of business, and that is what we will continue to do. I say to the right hon. Lady that that has to be fully funded, and those commitments are fully funded. We made an early decision to be clear about our priorities. Digital ID is not a priority for me or for this Government. We reallocated the funding, and we made those commitments as a result.

[Mrs Badenoch]

I asked what the Prime Minister cut. He says tax cuts. He has not said where the money is coming from. He talks about digital ID—[Interruption.] Yes, I know he said digital ID, but the Chief Secretary to the former Prime Minister, the right hon. Member for Bristol North West (Darren Jones), said that there was no money allocated to digital ID. You cannot cut something that never existed in the first place.

Lord O’Neill, a close friend of the Prime Minister, said yesterday’s statement in the Commons was

“the last thing investors wanted to hear”.

Lord O’Neill is a serious economist. He knows what he is talking about. Sure enough, yesterday the cost of Government borrowing rose to its highest in 18 years. How does the Prime Minister plan to tackle the Government’s rising debt costs?

[The Prime Minister]

I say to the right hon. Lady that I have worked with Jim O’Neill for 10 years. Jim O’Neill always gives me candid advice. We do not always agree, but he and I worked together to turn Greater Manchester from a former industrial heartland to the fastest-growing city region in the country. [Interruption.] Conservative Members complain, but where are their ideas about growth? When they were in government, we saw 14 years of stagnant growth. We saw 14 years of debt rising as a percentage of GDP. I say to the right hon. Lady that the turbulence on global markets is because of that exposure that they left behind. We are turning the corner. In the first half of this year, we have had the fastest growth in the G7. Borrowing fell to its lowest level in six years. We are cutting the deficit faster than any other G7 country. I say to the Conservative party and particularly to the right hon. Lady: that is problem solving rather than point scoring.

[Mrs Badenoch]

I do not know what any of that has to do with tackling the cost of increasing debt. Collaborating with Jim O’Neill is not how we are going to get debt costs down, and he said yesterday that the markets would be worried. The markets are clearly worried that we now have a spendthrift Prime Minister who wants to say yes to everyone but cannot tell us where the money is coming from. He needs to pay for all his new promises, and he has a choice: higher taxes, more borrowing or spending cuts. Yesterday he said, “Change begins with honesty”, so will he be honest and tell us: is he preparing to raise taxes again—yes or no?

[The Prime Minister]

I say to the right hon. Lady that I have already indicated that my first moves were to cut tax, but like any Prime Minister, I am not going to write the Budget here. That will be a matter for my right hon. Friend the Chancellor. I also say to her that he and I took a deliberate decision to set an early date for the Budget, so that we reduced the period for prolonged speculation of the kind that she wants us to indulge in today.

I also say this to the right hon. Lady and, indeed, the whole of her new shadow Cabinet, the majority of whom were part of a Government that lasted for 49 days—a short-lived Government that crashed confidence in the economy and hammered people’s mortgages. She took a decision at the weekend: she removed a shadow Chancellor who said that the Truss mini-Budget was a mistake and replaced him with one who helped to write the Truss mini-Budget. Dare I remind the House that the Leader of the Opposition herself is on record as saying that Liz Truss was “100% right”? What else can I say in response to all that, other than, “God help us!”?

[Mrs Badenoch]

The whole House will have heard that the Prime Minister did not rule out tax rises. Instead, what he did was lots of point scoring. He says he wants a new politics; he says he wants honestly, so why is he pretending that a junior Minister wrote that Budget? The fact is that gilt yields now, the cost of borrowing now—[Interruption.] Labour Members are laughing; I do not know why they are laughing. The cost of borrowing now is far more than it ever was under Liz Truss. The reason why that Budget failed is that spending was announced before the money to pay for it, which is exactly what the Prime Minister is doing right now. He says it is the new politics; it is the same old Labour politics—tax and spend. He did not rule out tax rises, and what markets see is a Government that cannot control their spending, so the markets will charge us more to borrow. That means higher mortgage rates for families. It makes life more difficult for businesses, and that pushes up the cost of living for everyone. Higher borrowing costs are the biggest threat to family finances, so will he rule out any more borrowing that will make people poorer?

[The Prime Minister]

May I say to the right hon. Lady something I said earlier? Debt was rising as a percentage of GDP under the Government that she, and her new shadow Chancellor, served in. He was hardly some PPS to the DEFRA Secretary, with all respect to my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs; he was a senior Minister in the Treasury on the day of the Truss Budget. The right hon. Lady mentions mortgage rates, and that was the day they spiked; that was the day the British public were hammered by the previous Government. We are taking the action needed to get debt down. This will be a Government grounded in fiscal responsibility. We will stick to the fiscal rules, but at the same time we will help to reduce cost of living pressure on our constituents. That is the approach we will take, and that is the approach that I suggest the Conservative party should follow, too.

[Mrs Badenoch]

The right hon. Gentleman is the Prime Minister now and he needs to answer the questions, instead of spending time attacking someone who has more private sector experience than his entire Cabinet. I asked him whether he would rule out more borrowing. He did not do so. We spend more servicing our debt than we do on defence—almost double. There is war in Europe. Yesterday, Germany confirmed that Russia was behind the attack on Leipzig airport. Tensions are so high that the director of the CIA flew to Moscow. We need the plan to hit 3% of GDP on defence now, but the armed forces will not know what they will be getting until next July’s spending review. There is a simple answer to this: cut welfare spending and invest that money in our defence now. Mr Speaker, the honeymoon is over. Isn’t it time for the Prime Minister to ditch the vibes and get serious about defending our nation?

[The Prime Minister]

I will start with the serious point made by the right hon. Lady, which is the announcement by the German Government yesterday in relation to the attack in Leipzig. That should unite the House in sending complete condemnation of that attack by Russia, and complete solidarity to support both Germany and Ukraine, and that position will not change.

That takes me to defence. The very reason I appointed this Chancellor to his position is because of his strong commitment to the defence of our country and to defence spending. We will fully fund the defence investment plan. At the spending review we will set out a plan to meet our NATO commitments by 2035. There is no problem with our commitment to defence. More broadly, the right hon. Lady has made a lot of accusations about what went wrong, but I go back to the position that she left. The country was not heading in the right direction. Now, we are heading in the right direction. Yesterday, I laid out a clear, coherent, credible plan for growth, based on 10 years of delivering it myself. This is grounded in reality. I want to take it to all parts of the country. It is all about bringing back a sense of positivity, a sense of possibility, with growth in every postcode. Let this country believe in itself again; let people have some hope. That is what this Government will do.