Economy: The Growth Plan 2022

Lord Howard of Rising Excerpts

Monday 10th October 2022 Lords Chamber

[Lord Howard of Rising (Con)]

My Lords, I find it difficult to understand the fuss over the Chancellor of the Exchequer’s plan for growth. With the start of money printing in 2008, inflation and the higher interest rates were built into the system before there was a Conservative Government. The 40% rate of tax was in place up until the last days of the previous Labour Government. Most major currencies have fallen against the dollar, with the yen down 50% and the Japanese authorities intervening. The Government can hardly be blamed for the invasion of Ukraine and the resulting fuel crisis. They can take credit for acting promptly to help people.

Instead of applauding the outstanding plan for growth, which will result in greater prosperity, we hear a cacophony of unjustified abuse from the anti-growth coalition, made up of those who believe that if nothing changes and the handouts are kept going, all will be well. I tell them to face up to reality. You have to create wealth to spend it, and that is what this Budget is about. The other complainers are the metropolitan elites and the bien pensants who believe they can decide better what to do with other people’s money than those people can decide for themselves. That just does not work either morally or economically. People should be entitled to the fruits of their labour and to get what they work for, not have it confiscated for fashionable projects.

Economically, high taxation and redistribution by government is inherently inefficient and results in massive waste. Everyone wants better roads, a better health service and other essential services. These cannot be achieved by living in the cloud-cuckoo-land of believing that all you have to do is tax more to be able to spend more. You cannot. It does not work; the tax take shrinks. By lowering taxes and removing stultifying regulations, a framework is created that will allow the genius of the people of Great Britain to deliver growth in the economy. This will permit government debt to be repaid and public services to be enhanced. It will inevitably take time, but the reality is that if the top-class public services we would all like to see are to be delivered, there is no other choice.

Taxes are at their highest level for many years and must be reduced for the economy to grow. Money left in people’s hands grows; they do things with it. Governments consume wealth; they do not create it.