Spring Forecast

Debate between Liam Byrne and Rachel Reeves

Tuesday 3rd March 2026 Commons Chamber

[Rachel Reeves]

I have huge respect for the right hon. Gentleman, but he left a massive black hole in the public finances. There had not been a spending review for years, and during that time inflation went through the roof because the Conservatives lost control of the public finances. We had to find the money to properly fund our national health service. It is a bit rich for the Conservative party to say that we should bring welfare spending down when it presided over a huge increase in welfare spending.

On the burden of taxation, our choices ensured that those with the broadest shoulders pay higher taxes. We got rid of the non-dom tax status and we are introducing the higher value council tax, VAT on private school fees and the energy profits levy. We are ensuring that those with the broadest shoulders pay the higher prices, rather than allowing the increases in inflation and interest rates in the last Parliament, which hit working people.

[Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)]

The plan that the Chancellor has set out this afternoon shows that inflation, debt and bills are down, and that headroom, growth and living standards are up. That is testament to a plan for stability that is working, but that stability would be undermined if she surrendered to the idea of the £47 billion-worth of unfunded tax cuts set out by the Conservatives, so will she resist those calls? As fiscal headroom opens up, will she look again at what can be done to drive down energy costs for small business and genuinely reform business rates, so that we are backing our wealth creators, and not gambling with the public finances, as the Conservatives did?

[Rachel Reeves]

We are backing the innovators through the reforms that we made in the Budget last year to make it easier to list in London, and easier to raise finance in the UK. We have permanently changed business rates, so that we have a lower multiplier for high-street businesses and smaller businesses, particularly in the retail, hospitality and leisure sector. We did that by putting £4.3 billion into the system. All of that money would have been withdrawn by the Conservatives.

Spending Review 2025

Debate between Liam Byrne and Rachel Reeves

Wednesday 11th June 2025 Commons Chamber

[Rachel Reeves]

The hon. Lady knows that we increased money for flood defences in the spending review in autumn last year, because we knew that there was no time to waste. We have already increased that flood defence spending, in addition to what the previous Government were spending.

[Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)]

This spending review is good for Britain’s business, because it invests in the things that British business needs: it invests in skills, infrastructure and innovation, cuts red tape and supports small firms. Can the Chancellor clarify that this spending review will also open a new era of energy abundance for our country? The Business and Trade Committee heard directly from the International Monetary Fund in Washington yesterday that high energy costs are holding back growth. That is a consequence of the dither and delay from the Conservatives, who left us with the highest industrial energy costs in Europe. Will the Chancellor confirm to the House that we are consigning that era to history?

[Rachel Reeves]

My right hon. Friend is right. We are backing innovation, skills and infrastructure, because we are backing British business. We are also cutting red tape, as we did yesterday, when we took the Planning and Infrastructure Bill through the House, making it easier to get things built in Britain again. As we make the investments, we want those jobs to come to Britain, including in the energy sector, whether it is investment in small modular reactors, Sizewell C, carbon capture and storage or floating offshore wind. We will set out the industrial strategy in the next couple of weeks, in which we will have more to say about energy costs for business.