Inflation

Lord Bilimoria Excerpts

Monday 23rd May 2022 Lords Chamber

[Baroness Penn (Con)]

The Government are putting in place support now. It is worth remembering that the household support fund is open, it is ready, it is there for people to access. It is also worth remembering that national insurance thresholds will increase in July, putting more money back into the pockets of the lowest-income households. It is also worth remembering that the rebate on people’s energy bills, worth £200, is yet to come—it will come in October. We are keeping the situation under review, we are standing ready to do more, but more action is already committed to by the Government that will flow through to people’s pockets over the coming weeks and months.

[Lord Bilimoria (CB)]

My Lords, in my role as president of the CBI, I remember asking the Chancellor in February 2021 whether he was worried about inflation. Since then, we have had galloping inflation, and businesses and consumers are suffering hugely as the noble Lord, Lord Howarth, said. Are the Government concerned that we are now entering stagflation, and should not they be doing all they can to incentivise investment for growth, for example, by reducing the highest tax burden in 71 years, by bringing back a temporary cut in VAT of 12.5% and by having a permanent 100% tax reduction on capital investment by business?

[Baroness Penn (Con)]

My Lords, I absolutely agree with the noble Lord on supporting investment and putting our efforts towards growing the economy. He will know that we have cut business rates by 50% for eligible retail, hospitality and leisure businesses this year. We have increased the employment allowance from £4,000 to £5,000, cutting the cost of employment for 495,000 small businesses, and we have increased the annual investment allowance to £1 million. I know that there is more to do, but I agree with the sentiment in terms of increasing investment in our economy.