Fiscal Rules

Luke Charters Excerpts

Monday 28th October 2024 Commons Chamber

[Darren Jones]

My hon. Friend will know, from speaking to his constituents during his campaign to be elected and since, that people’s experience of public services across the country shows the fact of the matter: after 14 years of failure from the Conservatives, our public services are on their knees. That is why they need a Government who will bring stability back to our economy, invest in public services and improve outcomes for people who rely on them and work in them.

[Mr Luke Charters (York Outer) (Lab)]

Following the disastrous mini-Budget, the Bank of England was forced to undertake emergency liquidity operations to reduce volatility in markets. Does my right hon. Friend agree that the investment summit’s record £63 billion shows that this Government are creating stable conditions for long-term investment, after years of political chaos from the Conservative party?

[Darren Jones]

I thank my hon. Friend for his excellent question, and I agree that £63 billion invested in this country was a sign of confidence, because investors around the world know that Britain is back after years of chaos.

Budget Responsibility Bill

Luke Charters Excerpts

2nd reading
Tuesday 30th July 2024 Commons Chamber

[Mr Luke Charters (York Outer) (Lab)]

Thank you, Madam Deputy Speaker, and congratulations on your elevation to the Chair.

I am proud to stand here as part of a changed Labour party that won the public’s trust on the economy. I am so glad that we did, because we would otherwise still be at the behest of those on the Opposition Benches, who did so much to damage the public’s finances. My constituents paid the economic price for their economic incompetence—the £22 billion black hole uncovered yesterday is just one example. Ultimately, that is why the Opposition paid the price at the ballot box. The people of York Outer and this country resoundingly sent a message at the general election: never again!

If anyone needs reminding why, they should take themselves back to 23 September 2022, when we had £45 billion of unfunded tax cuts, with no consultation with the OBR. The pound fell below $1.09 for the first time since 1985. The central bank had to undertake emergency liquidity operations by purchasing long-dated gilts. Banks and building societies entered into a chaotic spin, with fixed-rate mortgage products being pulled—at one point, over 1,000 products were withdrawn in a single day. As the former Member for South West Norfolk once said, that is a disgrace.

Amidst all the chaos, there is a simple point: the mini-Budget did not meet the needs of the British people. Let us take some of the businesses that closed in the dying embers of the last Government. A music shop believed to be the oldest in the UK closed only a few months after the mini-Budget. Banks Musicroom had been in York since 1756, but ultimately market conditions saw it shut down in early 2023. The stationery company Thomas Dick, in Clifton Moor, which closed earlier this year, had been open 90 years but faced chaos and supply chain issues that left it no longer viable.

The decisions we make in this place have real consequences, and the impact we can have on people is very real. Before my election to this new role, my friend the Mayor of York and North Yorkshire ran a small business on our high street. I remember him talking just before the mini-Budget about what the impacts might be; he warned just how dangerous the mini-Budget would be, and he was right.

But it is not just about the impact on businesses. Last weekend, I visited Hoping Street Kitchen, a fantastic volunteer-run project that helps homeless people and those facing poverty across York. I was deeply inspired by its volunteers, sense of community and unwavering commitment to improving the lives of others. A volunteer told me first hand how crumbling public services, a lack of affordable housing and long mental health lists have created an unimaginable crisis. The project has gone from providing 30 to 40 meals a week during 2021 to providing 100 a week in 2024.

That is why it is critical that we implement our national mission to rebuild public services, build more homes and offer more NHS appointments. But it is also why I am speaking in this debate: this Bill is so important because it is the only way we can grow those public services with a stable economy. We saw yesterday just how difficult that challenge will be, which is why we must protect our economy now.

The Bill respects our institutions, rather than undermining them, and a prime example is how it gives real oversight to the Office for Budget Responsibility. It also includes provisions for the Treasury Committee to have a greater say in key fiscal moments. However, with the heightened responsibilities that the Bill gives the OBR, we need to think about the most effective ways in which the OBR could be properly scrutinised by Parliament, and the Bill could make more specific provisions on the Treasury Committee’s scrutiny role of the OBR. This week, I met the team from the Institute for Government that authored a report earlier this year on how Select Committees can better hold regulators to account. I commend that report, and I would welcome a debate on how this place best scrutinises the OBR.

What the Bill really protects against, however, is knee-jerk reactions and fantasy Budgets. If we are to get the growth we so badly need, we must behave like an established economy, not an emerging one that came out of the mini-Budget. That is why the Chancellor’s presence at the G20 over the weekend and her warm words about Britain being open for business are so important. If we can fix the lamentable legacy that the Conservative party left, we will have real cause for optimism. I was pleased that the right hon. Member for Godalming and Ash (Jeremy Hunt) commended the work of the OBR in his first speech as shadow Chancellor, but it felt somewhat jarring for him to flippantly suggest:

“We all understand the politics of a Bill that allows the Government to make endless references to the mini Budget”.—[Official Report, 22 July 2024; Vol. 752, c. 408.]

George Orwell once said:

“The secret of rulership is to combine a belief in one’s own infallibility with a power to learn from past mistakes.”

The Conservative party clearly has some way to go in that regard, but under this Government the green shoots of economic recovery are already starting to show. We may have inherited a particularly difficult situation, but the evidence of stable markets and an increase in the pound show the confidence in the security that this Government bring. After all, I made it clear in my maiden speech how welcome it is that the country has some good Yorkshire representation in No. 11, embodying the value of frugality.

We know there are tough decisions to make, and we are not hiding that from the British people: just take yesterday as a prime example of our approach. This Bill seeks only to offer greater transparency over decision making and it treats taxpayers’ money with respect. That is why I am proud to sit on the Government Benches, and it is why the people of York Outer can be confident that this is a Government that will serve them well.

[Madam Deputy Speaker (Caroline Nokes)]

I call Yuan Yang to make her maiden speech.

Public Spending: Inheritance

Luke Charters Excerpts

Monday 29th July 2024 Commons Chamber

[Mr Luke Charters (York Outer) (Lab)]

The OBR chair’s letter referenced earlier suggests that we could now be facing one of the largest ever year-ahead expenditures outside of a pandemic. This level of cover-up would never be tolerated in the private sector. Does my right hon. Friend agree that this is exactly why my constituents deserve transparency about the state of the public finances?

[Rachel Reeves]

My hon. Friend speaks powerfully on behalf of his constituents in York Outer. They voted for change because they were sick and tired of unfunded commitments, broken public services and the deterioration in living standards after 14 years of Conservative Government. Today, they found the legacy the previous Government left is even worse than we could have anticipated, with a £22 billion black hole in the public finances.

Economy, Welfare and Public Services

Luke Charters Excerpts

Monday 22nd July 2024 Commons Chamber

[Rachel Reeves]

The Treasury Committee, as the right hon. Gentleman knows, can call in the chair and other members of the Office for Budget Responsibility, but his comments show exactly why we need this Bill: so that never again can we have a repeat of the mini Budget. The Bill will require every announcement that makes significant permanent changes to tax and spending to be subject to an independent assessment by the Office for Budget Responsibility. Why? Because unfunded, reckless commitments do not just threaten our public finances; they threaten people’s incomes and they threaten people’s mortgages. We saw that in the wake of the mini-Budget presided over by the former Member for South West Norfolk. I understand that she has taken umbrage in recent days at the idea that that episode was disastrous. Well, if any Conservative Member would like to dispute that fact today, I would be more than happy to give way. [Hon. Members: “Come on then!”] They cheered it at the time, but they are not cheering it now, and I do not imagine that they would put it on their leaflets.

The Conservatives should be ashamed of what they did because people up and down the country are still paying the price for the chaos that they caused. We say: never again. The Budget Responsibility Bill will enshrine that commitment in law.

[Mr Luke Charters (York Outer) (Lab)]

During the pandemic, the friends and family of Conservatives were awarded contracts for work that were never fulfilled. My constituents would love to know how we can get their money back, perhaps through the covid corruption commissioner.

[Rachel Reeves]

I enjoyed campaigning for my hon. Friend in York Outer, and it is great to see him in his place today. Stability means a tough set of fiscal rules, but it also means spending public money wisely, as he says. The last Government hiked taxes while allowing waste and inefficiency to spiral out of control. At no time was that more evident than during the pandemic, especially when it came to personal protective equipment. The former Prime Minister, when he was Chancellor, signed cheque after cheque after cheque for billions of pounds-worth of contracts that did not deliver for the NHS when it needed it—that is simply unacceptable.

Today, I can announce that I am beginning the process of appointing a covid corruption commissioner to get back what is owed to the British people. That money, which is today in the hands of fraudsters, belongs in our public services, and we want it back. The commissioner will report to me, working with the Secretary of State for Health and Social Care, and their report will be presented to Parliament for all Members to see. I will not tolerate waste. I will treat taxpayers’ money with respect and return stability to our public finances.

The second Bill I will speak to is the national wealth fund Bill. We know that economic stability is vital for investors and for business—the small business looking to grow; the global business looking to expand in the UK; the entrepreneur looking to take their first steps. To support them, stability must sit alongside investment.