Replacement of the Chancellor of the Exchequer

Lord True Excerpts

Tuesday 18th October 2022 Lords Chamber

[The Lord Privy Seal (Lord True) (Con)]

My Lords, I think this was originally a Question asked of the Prime Minister. There has not been a Prime Minister in your Lordships’ House since 1963. I am not travelling in hope.

I will venture to make a comment on the matter. It is a central responsibility for any Government to do what is necessary for economic stability and the Prime Minister took the decision to appoint my right honourable friend Mr Jeremy Hunt, who is one of the longest-serving and most experienced parliamentarians and, I think, widely respected on all sides of your Lordships’ House, as her Chancellor. His overriding priority is to restore financial stability in the face of volatile global conditions.

[Baroness Smith of Basildon (Lab)]

My Lords, the Minister gave a much shorter answer than the one given in the House of Commons. I entirely agree with the first paragraph of his full Answer, which may surprise noble Lords. He said that,

“it is a central responsibility of any Government to do what is necessary for economic stability”.

Yet in the last few weeks this Government announced the biggest tax cuts since 1972 and then, within a matter of weeks, the biggest tax increases since 1993—hardly stability. The answer to this fiasco is apparently to have the fourth Chancellor of the Exchequer in under a year, with a threat of—and I quote the Chancellor—“eye-watering” further tax rises and public service cuts. Given that mortgage rates are higher today than they were yesterday, what does the noble Lord say to those who, because of the instability largely created by the Government, now face monthly mortgage increases of hundreds of pounds?

[Lord True (Con)]

My Lords, on the question of mortgages, everyone will be sensible to the position of those seeking to buy—I have a son seeking a mortgage at the moment—in conditions where interest rates are rising, which they are internationally. On the more general question, the Chancellor is clear that the Government will need to take some very difficult decisions on spending and tax to place the public finances on a sustainable footing. Sound public finances are the bedrock on which future economic growth will be built. There is no trade-off here; the mini-Budget moved further and faster than the market expected, but this Government remain committed to growth and supporting families and the most vulnerable in society. We will continue to seek to perform that duty.

[Baroness Kramer (LD)]

My Lords, the change of Chancellor may have mollified the financial markets slightly and temporarily but ordinary people, frankly, are on the verge of being utterly distraught. In addition to soaring food prices, mortgages and rents, they have no idea at all what their energy costs will be after April next year. When will people know what the cost of energy will be after next spring, because they have to plan and think it through? It is also crucial for businesses to know as they sign contracts. Also, how much will the typical individual be paying in bills and additional public service cuts to cover the costs of the permanent scarring and damage that the Government’s appalling handling of the last few weeks has caused to the UK economy?

[Lord True (Con)]

My Lords, apart from the rhetoric, the main part of the noble Baroness’s question was on energy prices. I hope that your Lordships have heard with delight that a Bill, for which I expect the support of both parties opposite, has been presented to the House on which we will debate these matters in some detail.

On the specifics, I say that continuing with the planned level of support between now and 2023 will remain a landmark policy. It will support millions of people through a difficult winter and means that they will not have to face bills as high as they would have been. A Treasury-led review has been announced into how we support energy bills beyond April next year; its objective is to design a new approach that will cost the taxpayer significantly less than planned while ensuring enough support for those in need, which I think all noble Lords would like to see. Equally, any support for businesses will be targeted to those most affected. This new approach will better incentivise energy efficiency. However, it is important to underline that the support with energy bills that my right honourable friend the Prime Minister so swiftly announced is going ahead, and what is being provided between now and next April will not change.

[Lord Forsyth of Drumlean (Con)]

My Lords, does my noble friend not think that this is a moment for Members of Parliament to pull together? We are facing a global crisis caused by living on printed money on an immense scale—£450 billion—to deal with Covid. Frankly, it does not matter which Benches are in power; interest rates will go up very considerably as a result. Therefore, it is necessary for us to focus on the policy changes needed to protect those who will be unable to pay their bills. Playing politics with this does no credit to Parliament and nothing to help those who will be affected.

[Lord True (Con)]

My Lords, my noble friend, with his enormous and widely respected knowledge as a former chairman of your Lordships’ Economic Affairs Committee, makes a very strong point about the international situation. However, His Majesty’s Government must deal with what they can do here at home. In offering protection, as we have discussed, we will also continue to seek to promote growth. We will launch investment zones—I hope that they will be widely supported by your Lordships—and shortly introduce minimum service levels for transport services in Great Britain, ensuring that militant strike action cannot derail economic growth and union bosses cannot hold working people to ransom.

[The Lord Bishop of Oxford]

My Lords, I welcome the new Chancellor, many of the measures announced yesterday, and the increased prospect of greater stability. I noticed that in his Statement yesterday he used the phrase “compassionate conservatism” several times. I wonder if the Minister would unpack that phrase a little, particularly on how the Chancellor will navigate to privilege the needs of the very poorest in society, perhaps especially in the outworking of the increase in benefits in line with price inflation, and in looking to see a decrease in the use of foodbanks in the coming years, which has escalated in major ways in the last decade.

[Lord True (Con)]

I welcome the opportunity to follow the right reverend Prelate on that point. As I tried to say in my earlier answers, the position of those in need will be at the forefront of the Government’s consideration. We know that people across the United Kingdom are worried about the cost of living; that is why the Government have announced £37 billion of support for the cost of living this financial year. In addition, the energy price guarantee and energy bill relief scheme are supporting households and businesses. We are also supporting millions of the most vulnerable households with £1,200 of on-off support. So far as specific decisions on benefits are concerned, they will have to wait for my right honourable friend’s Statement.

[Lord Anderson of Swansea (Lab)]

Is not the word “replacement” in the Question a euphemism for being ignominiously and publicly sacked? Was it really fair, just and moral to sack someone who was simply carrying out a jointly agreed policy with the Prime Minister?

[Lord True (Con)]

My Lords, I explained the reasons for the appointment of my right honourable friend, and I believe that it was a good appointment.

[Lord Walney (CB)]

Has not the Chancellor effectively announced a comprehensive spending review? Would it not be helpful and transparent to treat it as such across Parliament?

[Lord True (Con)]

There will be a Statement by my right honourable friend; I believe that 31 October is still the date suggested. Work is proceeding at pace and I assure your Lordships that they will receive full information on that in the same way as the other House.

[Lord Cormack (Con)]

My Lords, does my noble friend agree that we now have a wholly credible Chancellor who fully deserves our support, and that it is important that we have a wholly credible Government as well?

[Lord True (Con)]

My Lords, I believe that we have such a Government.

[Lord Hain (Lab)]

My Lords, was not the Chancellor’s Statement yesterday just a bonfire of Truss economic insanities?

--- Later in debate ---

[Lord True (Con)]

No. A number of very important steps have been taken by my right honourable friend the Prime Minister to which your Lordships are invited to assent. Yesterday, for example, I was very grateful for your Lordships’ support for the Bill that was passed that concerned reversing the national insurance levy, and I am hoping for equal support for my right honourable friend’s initiative in relation to the Energy Prices Bill.

[Lord Sikka (Lab)]

My Lords, the Government’s austerity policies have already caused over 334,000 deaths. Why is the Government looking for further cuts in public spending?

[Lord True (Con)]

My Lords, I realise the economic stable from which the noble Lord came, but the central responsibility for any Government is to do what is necessary for economic stability, and that means that there will need to be reflection on levels of both spending and taxation. As my right honourable friend has made clear, there will be difficult decisions, there will need to be spending restraint, and departments will need to find further efficiencies, but more details will be set out in the medium-term fiscal plan, as I said earlier.