The Economy

Louie French Excerpts

Wednesday 22nd May 2024 Commons Chamber

[Bim Afolami]

I am afraid I disagree with the hon. Lady. It is very important that this House recognises and admits that, because there was a once-in-a-generation pandemic that cost the Government over £400 billion in supporting people, it was necessary for the tax burden to rise for a time to help pay for that. That was a difficult and responsible decision. Now that we have moved into a period of relative calm, there is choice about what we want the economy and our fiscal position to look like over the medium term. On this side of the House, we choose high business investment, high growth and lower taxes on working people, whereas the Opposition choose more union power, higher borrowing and higher taxes. I think the British public are going to stick with us.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

The latest UK economic data is welcome news, with inflation falling again, real wages rising and the UK forecast to grow faster than many of its peers. The International Monetary Fund is now recommending that the Bank of England cut interest rates, and I agree. What does the Minister think of the IMF’s view?

[Bim Afolami]

As my hon. Friend knows, it is for the Monetary Policy Committee of the Bank of England to determine the policy on interest rates, but we hope that working in partnership with the Bank of England to cut inflation will mean that at some point later in the year interest rates will start to come down, as the IMF has suggested, as a result of inflation being at target.

National Insurance Contributions (Reduction in Rates) (No.2) Bill

Louie French Excerpts

2nd reading
Wednesday 13th March 2024 Commons Chamber

[The Exchequer Secretary to the Treasury (Gareth Davies)]

I beg to move, That the Bill be now read a Second time.

For the second time this year, we are cutting taxes for 29 million working people across the country—something that is particularly remarkable in the aftermath of the worst pandemic in 100 years, the worst war in mainland Europe since 1945, and the highest energy spike since the 1970s. The Government have had to take difficult decisions to restore the public finances, and those decisions are starting to pay off. Our economy is growing, and debt is forecast to reduce. Inflation is down significantly, unemployment is at near-record lows, and wages are rising. As the outlook improves, our priority is to return money to working taxpayers while keeping the public finances on track.

We believe that the tax system should be fair and simple, and should reward hard work, yet the way we tax people’s income is particularly unfair. People who get their income from having a job pay two types of tax: national insurance contributions and income tax. People who get it from other sources pay only one. The result is a complicated system that does not support work as best it could. For that reason, the Bill will build on the changes to national insurance contributions in the autumn statement.

The Bill contains two measures: a reduction in the NICs employee class 1 main rate, and a reduction in the NICs class 4 main rate. Both measures are important. Allowing working families to keep as much of their hard-earned money as possible is a priority for the Government. The Chancellor has always been clear that when we can cut taxes, we will.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

My hon. Friend is making a great speech, and I fully support the Government’s efforts to reduce the taxes of working people, alongside the pledge to increase the money going to pensioners through the triple lock. Does he agree that it is disgraceful that, while the Conservatives are working hard to cut taxes and help working people, Labour is increasing the share of council tax for all Londoners, and hitting drivers with charges of up to £12.50 per day thanks to the ultra low emission zone?

[Gareth Davies]

My hon. Friend is consistent in holding the administration in London to account. He is right: as we are still not out of the woods when it comes to the cost of living crisis, the Conservative party has made it clear that we disagree with the Mayor of London’s approach of making motorists poorer.

As I said, building on the changes in the autumn statement, we will once again be supporting working families by reducing the main rate of employee class 1 NICs by two percentage points to 8% on earnings between £12,570 and £50,270 from 6 April 2024. That will cut taxes for over 27 million employees. The average worker on £35,400 a year will save £450 a year, and the majority will see the benefit in their payslips at the start of the new tax year. Taken together with the cuts to NICs in the autumn statement, this tax cut is worth some £900 a year to the average worker.

In addition, we are implementing a further reduction in the main rate of class 4 NICs for the self-employed. The Chancellor announced in the autumn statement that the main rate of class 4 will be reduced from 9% to 8% from 6 April. Today, we are cutting the rate by an additional two percentage points from 8% to 6% from April 2024. That is a total cut of three percentage points in just six months. Combined with the abolition of the requirement to pay class 2, which was announced in the autumn statement, that will save an average self-employed person £650 a year, and benefit over 2 million people across the country.

Together with the autumn statement cuts, this is an overall tax cut worth some £20 billion per year—the largest-ever cut to employee and self-employed national insurance. Because of the action that we have taken, the average earner in the UK now has the lowest effective personal tax rate since 1975. The Government are committed to tax cuts that reward and incentivise work and that grow our economy sustainably and boost productivity. The Office for Budget Responsibility has said that the national insurance cuts announced in the spring Budget will increase the total hours worked by the equivalent of almost 100,000 full-time workers by 2028-29. Because of the cuts, just over 30,000 people will move into work. These reductions in tax will drive more people to seek employment. This is our plan for a simpler, fairer tax system that makes work pay.

Oral Answers to Questions

Louie French Excerpts

Tuesday 19th December 2023 Commons Chamber

[Nigel Huddleston]

As I mentioned, we are well aware of the issue of late payments, and we are in constant dialogue with the key stakeholders in this area, as well as colleagues at the Department for Business and Trade. We will always keep an eye on the measures, but the moves we have already made to tackle late payments, as announced recently, will make a big difference.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

5. What steps his Department is taking to reduce taxes.

[Caroline Ansell (Eastbourne) (Con)]

6. What steps his Department is taking to reduce taxes.

--- Later in debate ---

[The Chancellor of the Exchequer (Jeremy Hunt)]

Thanks to the difficult decisions the Government have taken on inflation and debt, the autumn statement this year was able to deliver the biggest package of tax cuts to be scored since 1988.

[Mr French]

I very much welcome the tax cuts recently announced by the Chancellor and hope to see more announced soon, especially a rise in the higher rate threshold. As the Conservatives look to reduce the tax burden on working people, does the Chancellor share my concern that £28 billion-a-year unfunded spending commitments would likely see taxes rise and lead to higher interest rates if Labour were ever in government?

[Jeremy Hunt]

It is not just me but Paul Johnson of the Institute for Fiscal Studies who, when talking about Labour’s plan, has said that

“additional borrowing…drives up interest rates”,

which is, of course, a back-door tax rise on families with mortgages. But as it is Christmas, perhaps I could explain it this way: if Santa borrowed £28 billion, he might have more toys to give out this year, but he would also have debt interest to pay and fewer toys to give out next year.

Mortgage Market

Louie French Excerpts

Tuesday 13th June 2023 Commons Chamber

[Andrew Griffith]

I did not hear fully what the Member for Richmond Park aligned with Mid Bedfordshire was saying, but I am sure that residents in Mid Bedfordshire have welcomed the stability that we have brought to the economy and the fact that we have supported householders through the past two difficult years, making tough decisions and supporting households to the tune of about £3,300. They will also have welcomed the fact that we have the sort of responsible stewardship of the economy that means that we are not a Government who have historically left power with unemployment higher than when we arrived, leaving notes saying, “There is no money left.”

[Mr Louie French (Old Bexley and Sidcup) (Con)]

My hon. Friend is correct to highlight that we are facing international challenges and that monetary policy is the responsibility of the independent Bank of England. However, does he agree that Labour’s £90 billion-worth of unfunded spending commitments would make inflation and the cost of borrowing even worse?

[Andrew Griffith]

I thank my hon. Friend the Member for wonderful Old Bexley and Sidcup (Mr French) for that. I recall that last October Opposition Members were never shy of citing the Institute for Fiscal Studies, but they do so much less today, because the IFS has said that Labour’s £28 billion borrowing plan would cause both interest rates and inflation to rise. I do not see how that would help the nation’s mortgage holders.

Oral Answers to Questions

Louie French Excerpts

Tuesday 9th May 2023 Commons Chamber

[Mr Philip Hollobone (Kettering) (Con)]

5. What recent steps he has taken to reduce the rate of inflation.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

9. What progress he has made on reducing the rate of inflation.

--- Later in debate ---

[Andrew Griffith]

My hon. Friend is a doughty champion for his constituents. The Office for Budget Responsibility this year does expect food, tobacco and alcohol inflation to fall significantly, and that is not all. The Government recognise the challenges facing households due to the elevated cost of living in general, including food, so we took action at the spring statement to support struggling families. Taken together with previous action, support to households to help with bills is worth an average of £3,300 a year across this year and next.

[Mr French]

The Government are absolutely right to prioritise reducing inflation given the significant impact it is having on families and businesses across the country. I welcome the support that the Minister has just outlined for families in my constituency of Old Bexley and Sidcup. Can he confirm what assessment has been made by the Treasury of the impact of more than a decade of abnormal monetary policy following the global financial crisis?

[Andrew Griffith]

As my hon. Friend knows, monetary policy is the responsibility of the independent Monetary Policy Committee and the Bank of England. We will continue to work closely with them to ensure that monetary and fiscal policy are well co-ordinated. The Chancellor reconfirmed the inflation target of 2% at the autumn statement and confirmed that this Government will not change the target.

Silicon Valley Bank

Louie French Excerpts

Monday 13th March 2023 Commons Chamber

[Andrew Griffith]

The Government are always committed to steadying the ship. That is why we take a prudent approach to running the economy and why the Prime Minister’s priorities are to reduce inflation, to pay down debt and to grow. To grow requires capital. That is why we have a long-term commitment to good regulation, which will minimise the prospect of events like this happening again. It is also why, with the expertise on the Government Benches, we are so focused on ensuring that we have the right ecosystem to allow our brilliant entrepreneurs, our scientists and our innovators the fertile capital with which to grow to their potential.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

For transparency, I draw hon. Members’ attention to my former career in the City, as per my entry in the Register of Members’ Financial Interests. I welcome the swift and decisive action by His Majesty’s Government in solving this issue and in reducing the risk of potential contagion to the wider economy. Will my hon. Friend ensure that sufficient regulatory work is taking place to stress-test the liquidity of UK banks and the Government bond markets, given the clear risk highlighted by this case and by the leverage in recent liability-driven investment cases?

[Andrew Griffith]

Yes, I can give my hon. Friend and the House that commitment. We will learn lessons if there are lessons that need to be learned, but we should not look past the fact that today we have protected customers, protected the taxpayer and protected the security of the financial system. That is so important to our businesses. Many, many people will go home from work today much more confident, with the jeopardy of the weekend having been removed as a result of the decisive action that this Government have taken.

Financial Statement

Louie French Excerpts

Wednesday 23rd March 2022 Commons Chamber

[Rishi Sunak]

We have programmes in place to support our energy-intensive industries, and we remain in close dialogue with all companies in all sectors. Our track record on supporting industry is strong, and we continue to create jobs and make sure that British workers are well supported.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

I welcome the Chancellor’s announcements today, which will help people across Old Bexley and Sidcup with the cost of living, and support local businesses as our local economy recovers. However, in stark contrast to these announcements, people in outer-London areas such as Bexley are facing an eye-watering 8.8% increase in the Labour Mayor of London’s council tax precept, which we continue to see little benefit from. Even worse, drivers and local businesses face the prospect of paying more than £4,000 a year as a result of the ultra low emission zone expansion. That is clearly a tax raid that will have little proven environmental impact on outer London. Does he agree that this tax raid by Sadiq Khan on hard-working people across Bexley should be stopped?

[Rishi Sunak]

My hon. Friend makes an excellent point. Even if the Labour Mayor of London is not standing up for his constituents, I know my hon. Friend will stand up for his hard-working constituents in Bexley and Sidcup. He will have seen today that we are on their side; we are cutting their taxes.

Public Service Pensions and Judicial Offices Bill [ Lords ] (First sitting)

Louie French Excerpts

Committee stage
Thursday 27th January 2022 Public Bill Committees

[Tulip Siddiq]

I am grateful for the explanation given by the Minister. We support the changes to the local government pension scheme and the other technical amendments, in particular those that aim to broaden the scope of members’ eligibility for the proposed remedy.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

I rise to declare an interest. Although I have no financial interest in the local government pension scheme, I am still a sitting councillor until May this year, and I sit on the pensions committee. I apologise if I should have made my declaration sooner.