Luke Evans
Main Page: Luke Evans (Conservative - Hinckley and Bosworth)Department Debates - View all Luke Evans's debates with the Ministry of Defence
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Mr Joshua Reynolds (Maidenhead) (LD)
After years of government chaos and failure we can only end the brutal cost of living crisis and fix our broken public services if we get the economy growing. We need a real growth plan with Europe at its heart, so Labour must fix the Conservatives’ botched Brexit deal by joining the single market, negotiating a new customs union and using the billions of pounds that that raises to cut people’s taxes and bills.
Mr Reynolds
I thank the hon. Gentleman for his intervention. He should have listened to what I said in the previous 30 seconds. What I said was that we need to join the single market and negotiate a new customs union. I did not say that we need to rejoin the European Union.
First, Liberal Democrats would fix the biggest brake on our economy: the botched Brexit deal. It has put up barriers for every business that trades with our largest market. Small firms in Maidenhead tell me that they now spend more time filling in forms than filling in orders. Some have simply given up trading with Europe altogether. That is lost trade, lost jobs and lost revenue. We would rip up the Government’s red lines and build a new growth and defence partnership with Europe, including the single market and a new customs union.
We would grow our economy. According to independent research, those measures would bring in £27 billion a year in extra tax revenue by the end of the Parliament. We would give those proceeds back to the people who earned it by raising the tax-free personal allowance to £15,000 and raising the higher rate threshold to £56,000, taking 2.5 million of the lowest paid out of income tax altogether and putting £650 back in people’s pockets. It was the Liberal Democrats who raised the personal allowance before. We can do it again. That is how to cut taxes responsibly—we grow our way there.
Sir Geoffrey Clifton-Brown (North Cotswolds) (Con)
Thank you, Madam Deputy Speaker, for allowing me to catch your eye in this important Budget debate. I listened to the Defence Secretary, and thought he absolutely embedded his comedic skills. Some of what he was saying would have been better said on “Have I Got News for You” than in this Chamber.
This Budget was a tragic lost opportunity to fix the fundamentals of the economy. Our debt is at a record level. The tragedy is that we are paying a higher interest rate than Greece on that debt—5.31%. That will add additional interest of £14 billion, just on that debt. If the amount that we are paying to service that debt were a Department, it would be the third largest. The budget for the Department for Work and Pensions is around £344 billion. That does not even cover the amount of income tax we raise in this country in total, which is £330 billion. In other words, income tax does not pay all our DWP bills. The second highest-spending Department has a budget of £226 billion. I welcome the Chancellor saying that he will meet his fiscal rules by the end of this Parliament, but that involves the national debt falling by the end of the Parliament. If I were a betting man, I would doubt very much that he will meet that rule.
One of the saddest things about our economy is that inflation is going up. Before Labour Members start to scoff at that, it is one of the most important measures of the lot, because it affects everything; it affects all our cost of living. Everything from our fuel costs to our energy and mortgage costs are affected by inflation, so the one thing we ought to be doing is trying to get the rate of inflation down. One of the saddest things about inflation is that my constituents, many of whom live off the gas grid, have to pay for heating oil, which has gone up by 75% in the last year. Imagine that for someone on benefits. In this Budget, they are getting very little help with meeting those costs.
Sir Geoffrey Clifton-Brown
My hon. Friend has made his point well. Let us hope that is read into the record. Currently, 13% of 16 to 24-year-olds are not in employment, education or training. We should be focusing relentlessly on creating opportunities for young people and supporting businesses that employ them. Sadly, this Budget does not do that. When sickness benefits pay more than the minimum wage, what is the incentive to work? Sectors such as tourism and hospitality that provide opportunities in every part of the country and in every constituency, but especially in rural areas, face significant economic pressure, and nationally, at least one pub is closing a week. The rates relief offered by the Chancellor in this Budget may help by a minuscule amount, but that is unfortunately offset by the increase in the minimum wage, and the VAT costs that those businesses face.
I want to turn to the kernel of what the Defence Secretary was saying, and to defence. It was solemnly promised by this Prime Minister and the previous Prime Minister that we would not only quickly get to spending 2.7% of GDP on defence, but would have a path to 3%. There is no path to 3%. The only path I can see is that departmental budgets will be cut, and it has not yet been tied down what services will be cut to pay for that 2.3% real cut in Departments. There was no clarity on this in the Budget yesterday. Surely if the Labour party and the Government keep boasting that they will go to 3%, the least they owe the British people is a path to get there—and it is not only the 3%, but the 3.5% in the following Parliament, which is a great deal of money.
Importantly, as General Sir Richard Barrons said recently, we do not own the clock. In other words, we do not know when our adversaries are likely to launch some form of attack on us, and we know that the Ministry of Defence is not able to place the orders it needs. To take the bigger equipment, when will the F-35s come? The Defence Secretary shakes his head. They are still in the queue; they cannot be manufactured for us because we have not given a solid commitment on when we want them. Those delays in procurement particularly affect some of our smaller defence companies, because they do not have the cash flow.
I mentioned artificial intelligence in an intervention yesterday. One of the most important things the Chancellor could have done for this country yesterday was provide a proper path to how every single Department will operate digital and AI more effectively, so that he could increase productivity. The machinery of government changes that the Government have undertaken in the last year do not give the Public Accounts Committee, which I chair, any confidence that the Government have a real policy on digital and AI, and how they will produce mechanisms for using this technology properly.
A year ago, digital policy was in the Cabinet Office. It was then transferred to the Department for Science, Innovation and Technology, but DSIT was abolished. Now it is in the Department for Digital, Culture, Media and Sport—the Department which historically has been used to dealing with sport and culture, not the important matter of AI. Without this priority, it is difficult to see how the Government will make this digital policy work.
When my right hon. Friend the Member for Godalming and Ash (Sir Jeremy Hunt), as I said in an intervention yesterday, gave in his Budget a significant sum of £3 billion to the Department of Health and Social Care—the Defence Secretary’s former Department—to transform their digital equipment, that was the start of what we should have been doing for every single Department. I do not know how the Government will meet their efficiency targets unless they start to introduce proper AI and get rid of some of our legacy equipment, which, as the Defence Secretary knows only too well, is more vulnerable to cyber-attacks.
I turn to local government reform. I was pleased by the announcement this morning that Gloucestershire will be one unitary authority—that is good news—but our local authority will only get any increase in finances if we can come up with devolution. There was no link to how Gloucestershire will move from local government reorganisation into a strategy authority, and we need to have that. Otherwise, we will not be able to take advantage of some of those financial benefits.
On the civil service pension scheme, there is a good news story for which I praise the Government. We have had five hearings on the Public Accounts Committee into the dreadful mess that Capita has left that scheme in—five hearings where every single deadline has been missed. That is not good enough for the poor 1.7 million members of that scheme. The Government have done a good thing. Last week, I wrote to the Pensions Minister about a problem: if Capita did not pay out a lump sum within two years, scheme members would be taxed on that sum at the highest rate. The Minister met me fairly quickly, I raised it on the Floor of the House on Monday and—bingo!—I got a letter yesterday saying that the law was going to be changed in the Budget. I pay tribute to the Government and the Pensions Minister for that quick action. That was the just thing to do. Those pension scheme members will not have to keep worrying about whether they will get their full lump sum.
In conclusion, this is sadly a wasted opportunity, and we look forward to future Budgets actually giving us a path to a better economic future. One of the economic forecasts we had in the Budget yesterday was growth of 1.2%, which all the Government and the Chancellor are crowing about, but historically 1.2% is not enough to keep spending at the rate the Government are. We need more measures to help business and a proper taxation policy, and then this country will start to grow.
Dr Zubir Ahmed (Glasgow South West) (Lab)
When I was first elected to this place as the proud Member for Glasgow South West, many of my constituents lived in great financial uncertainty: the more than 6,000 kids in my constituency who live in relative poverty; the many constituents who have not had a decent wage rise for over 10 years; and the proud shipyards of Govan that are unable to fill their order books. I am proud that I was part of a Government, and a friend of a Chancellor, my right hon. Friend the Member for Leeds West and Pudsey (Rachel Reeves), who helped to eliminate some of that uncertainty by ensuring the fastest wage growth in a year—it was much greater than any wage growth that happened in the previous 10 years —and by lifting the two-child benefit cap. That took thousands of kids in my constituency out of poverty, and probably benefited the local economy to the tune of £4 million. We also secured the Type 26 frigate contract, which will give certainty to Govan shipyard workers for generations to come.
It is not only in the large policy areas that this Labour movement does its work. It is at its best when, at the ground level, it feels the pain of ordinary people who are trying to get by and are not able to live the life that they were promised by their forefathers. In that regard, I am very proud of the Budget, and the direction that my right hon. Friend the Chancellor has taken, particularly in relation to energy bills. Through this Budget, we are committed to immediately ensuring that 90% of my constituents will feel the benefit of £100 off their energy bills; and 100% of my constituents will be absolved from the need to pay standing charges on their energy bills.
All my constituents will also have VAT eliminated from their electricity bills. No country or Government can insulate their citizens from the pressures of global markets and global conflict, but we can do as much as we can. I believe that we are doing as much as we can on energy bills, and creating the space for people to live more comfortably.
Dr Ahmed
The hon. Gentleman will know that there is a quasi-judicial process, and it would be remiss of me to make undertakings on an issue for which my right hon. Friend the Secretary of State for Energy Security and Net Zero is responsible. I gently remind the hon. Gentleman that those calculations have been baked in for many years. This is not some new reference to the assumptions in this year’s OBR report, and he knows that very well; I think he is being a little mischievous in his questioning.
Let me return to my principal point about giving breathing space. It is not only families and individuals who need breathing space; it is businesses, including small businesses on the high street. I am really proud that before and in this Budget, we have been lifting many more businesses on the high street out of the need to pay business rates. As hon. Members may be aware, in Scotland, that will not be automatic; it is at the discretion of the Scottish Government. I plead with them to ensure that the Barnett consequentials of that decision translate into savings on business rates for ordinary high-street businesses, including pubs.
My right hon. Friend the Prime Minister made an undertaking during the summer to reduce business rates for music clubs and pubs. As far as I know, that has not yet translated into a similar policy statement in Scotland. I know that pubs in my constituency, which are around many of the underground stations in Glasgow—students and others like to do a Clockwork Orange pub crawl—crave and would benefit from those savings. I urge the Scottish Government to pass them on with immediate effect.
Those interventions all make life a little more bearable and easier. I know that some Members think that there is a binary choice to be made between social and personal economic security on the one hand, and our national security on the other, but there is not; one is very much reliant on the other. That is why we are committed to ensuring that our defence spending hits the 2030 and 2035 targets that our NATO allies expect it to. I am proud that my constituency is contributing to the defence of our nation, whether it is through the shipyards and building the Type 26 frigates that will patrol our seas, or through more novel technologies, and drones being designed in my constituency.
Labour Members are proud of investing in defence. Investing in defence is not taboo, contrary to the view that the Scottish Green party and the Scottish National party have sometimes espoused; we in Scotland should be proud that we are at the forefront of defending our nation, and we will always invest in that. I am grateful to the SNP for finally relenting and matching our funding for two defence technical excellence colleges in Scotland, enabling us to defend our nation.
In closing, I will just say that when I speak to this Prime Minister and this Chancellor, I find that they understand Scotland, and they feel the needs of Glasgow South West. The Budget that they have delivered will give us breathing space for today, but also—more importantly—hope for tomorrow.
Dr Luke Evans (Hinckley and Bosworth) (Con)
I had to check that the Chancellor had said what I thought he had, and it was referred to again today by the Defence Secretary. They said that this is the first 100 days of a Government, with a new 10-year plan. By my calculation, the Government have been in for 847 days, with their third Budget being delivered yesterday, and we are over a quarter of the way through the last 10-year plan. Rather than this being a baby Budget and a fledgling Government, they are more an adolescent Government, and this really is a bum-fluff Budget. It has got wispy bits and patchy bits, but no one really knows what they are, where they are going or even if they should be there. We can see that by the fact that we have 98 announcements within the Budget, which is a record, but the value per project is one of the lowest on record.
When I saw the Budget, I was pleased that there were some bits that I have been working on that have finally come to fruition. First, pensioners are being taken out of paying tax on their state pension. There is also the freeze on fuel duty. Those are in response to things that were warned about, but put in by a Labour Government. The hole was dug by a Labour Government, and they have now had to half-fill it. That is exactly what we see with the NEETs situation.
We have record unemployment of young people, certainly when compared with the EU average, with more than a million people not able to get through into jobs, so what do the Government do? They put on that toxic concoction of tax increases and red tape, and now they turn around and say, “We will give you £3,000 to take someone on.” The Government should get out the way. It would be far simpler to let businesses take on people and grow as they need. The same applies to the hospitality industry and the leisure industry. It is welcome that the Government have made some changes to their rates, but we should remember that the Government took away the support in the first place, put up the rates and added the toxic concoction on top. It is a hole that has been half-filled, and we see that time and again.
We often hear about the money that went into the NHS, but we should remember it was taken away with the jobs tax that hit hospices, care homes, GPs and pharmacies, which are all feeling it. With energy, £100 has been given, but we know that Ofgem says the cap will see a more than £400 increase. We should remember that Labour promised £300 lower bills when it came into office. I hope that we see this beard grow into a full bushy shape. Whether it is Keir Starmer’s continuation or Andy Burnham’s new direction—
Madam Deputy Speaker (Caroline Nokes)
Order. The hon. Gentleman knows better than to refer to the Prime Minister by name.
Mr Mark Francois (Rayleigh and Wickford) (Con)
It is a pleasure to sum up for His Majesty’s Opposition this afternoon. Perhaps I can begin on a consensual note by pointing out that yet again, as we are debating these important economic matters, including the defence of the realm, there is no Member of Parliament from the Reform party present. They have taken no part in this debate at all. We know that they do not do Thursday afternoons, and they certainly do not do defence either.
Mr Francois
No, I think it is because they are desperately trying to find someone—anyone—to go to one of their press conferences.
Now, according to the Red Book, working-age welfare spending will increase to £221.5 billion in 2031-32. That is almost a quarter of a trillion pounds and an increase of over £57 billion since 2024-25. The Prime Minister famously said at the Dispatch Box just a few weeks ago that
“national security…cannot come at the expense of social security.”—[Official Report, 9 September 2026; Vol. 790, c. 1036.]
That really is a segue to what I principally want to say this afternoon.
What the Chancellor announced yesterday was not a detailed programme for how to spend 3% of GDP on defence, but just a plan to have a plan—which is not really a plan at all. He promised to “begin work”—his words—on how this would be achieved by the time of the spending review next year. The Labour Government have already had two years to answer this question, so why do they need a further year now?
When Labour published the strategic defence review in June 2025, all three authors of the review, led by Lord Robertson, a respected former Secretary-General of NATO, were absolutely adamant that the bill for implementing their recommendations was a minimum of 3% of GDP on defence. Unless and until the Government definitively commit to spending that money, it is very difficult for our armed forces realistically to deter a war with any aggressor, and in particular the Russians—not the Trussians!
At the time of the SDR, we were told that that level of detail would be provided in the subsequent defence investment plan. The House was promised this in the autumn, then by Christmas, then by the new year, then in the spring, and it was finally published only in late June 2026. Nevertheless, when the DIP was eventually published, the Government kicked the can down the road for a second time and still failed to provide a definitive date for when, and crucially how, this country would spend 3% of GDP on defence. Indeed, the then Defence Secretary, now the Chancellor, famously resigned, seemingly on a point of honour, because the Government had failed to give a date for 3%. I have here his resignation letter, dated 11 June, and I quote from it directly:
“After explaining to you that I would not be able to accept a DIP settlement that does not give our Forces the resources they need, I am now left with no other option than to submit my resignation as your Defence Secretary.”
It is also worth recalling that the then Veterans Minister, the hon. and gallant Member for Birmingham Selly Oak (Al Carns), resigned in company with him, partly over this and also because of his very severe reservations about the Northern Ireland Troubles Bill—a wicked Bill—which he famously described as “unfit for purpose”.
Once the previous Prime Minister then fell, miraculously, having resigned as Defence Secretary, the right hon. Member for Rawmarsh and Conisbrough (John Healey) was immediately reincarnated as the Chancellor of the Exchequer. However, he then found himself with the boot very much on the other foot. Given his understanding of defence, and the solemn terms in which he wrote his letter, it was not unreasonable to assume that, having now seized control of the bridge at the Treasury, he would be ideally placed to meet his own request to name the date for 3% and how to finance it. Otherwise, why did he resign? I am therefore genuinely deeply saddened to see that, yesterday, he failed his own test. All we were given was an offer to produce a plan for 3% in the Government spending review, which will take place next year. In other words, a man who seemingly resigned on a point of honour, when he had the perfect chance to put that problem right, completely ducked it. All that Labour has done is kick the can down the road for a third time.
Our armed forces therefore cannot realistically plan because they do not know how much money they will really have to spend on this nation’s defence, and they are now going to have to wait at least another year before they do. The House need not take it from me; Chris Mason, the political editor of the BBC, in summarising the Budget on the 6 o’clock news last night, said, “The biggest questions this Government still faces, such as the long-term funding of defence, this Budget didn’t answer.”
In fact, it is even worse than that. When the Defence Secretary agreed the SDR, he also signed up with the Treasury for almost £11 billion of efficiency savings. This was a Labour deal—a Faustian pact—between two warring Government Departments, but the effect of those in-year efficiency savings, or “spending cuts” in pub English, is now proving debilitating for our armed forces. The in-year cuts were some £2.5 billion in the previous financial year and £3.5 billion this year, 2026-27.
One of the reasons it took nearly a month to get HMS Dragon to sea was that maintenance cuts occurred under the efficiency savings programme. We now see the vast bulk of the Royal Navy tied up alongside the quayside, partly because of maintenance issues but also to save money. For many months, we had a period in which not a single one of our nuclear attack submarines was at sea. The Minister might intervene and chide me for discussing submarine movements on the Floor of the House, but I am not—I am discussing the absence of submarine movements on the Floor of the House.
We have also seen Army exercises cancelled on Salisbury plain and flying hours reduced for some of our RAF pilots. These are exactly the wrong things to be doing if we are trying to send messages to Vladimir Putin, a former KGB colonel, to deter him from further adventurism—for instance, in the Baltic states. Yesterday, the Labour Chair of the Defence Committee—I am afraid I am going to quote him again—excellently summed it up by saying that
“some of the key decisions on defence spending have lamentably been delayed until next year’s spending review. There is a cost to inaction. Investment in our nation’s defence and security cannot be kicked into the long grass. Our adversaries are not bound by fiscal years and spending cycles.”
He should know.
Yesterday we even learned from the depths of the Budget Red Book that the Chancellor has effectively cut the overall MOD budget by £1 billion in each of the next two years by pocketing reduced spending estimates on MOD pensions for the Treasury, rather than allowing the MOD to retain the cash and spend it on bolstering our defences. The Treasury has described these two £1 billion cuts in the defence budget as an “accounting adjustment”. Well, it is Enron accounting. It is smoke and mirrors, and it only helps our adversaries, not our armed forces.
On defence housing, there is a similar story. I served for some five months on the Armed Forces Bill Committee, and we were told repeatedly that the money for housing would not be raided for short-term efficiency savings. In fact, the hon. and gallant Member for Birmingham Selly Oak told us in the Select Committee on the Armed Forces Bill on 18 March:
“The £9 billion has been ringfenced; it has absolutely been secured for defence housing. Nothing in the DIP process will stop us getting on with the job of making these improvements and getting the job done. We have made that commitment to not just the armed forces community but the nation. We have said it in the House, and we will see it through.”
That is completely unambiguous, so imagine our anger when we then saw a letter from the permanent secretary to the Chair of the Public Accounts Committee, dated 25 September, which said not only that some £850 million of that money will be deferred to the next Parliament, but that an additional £1 billion of upgrades to single living accommodation for soldiers will be deferred as well. What the Government have done is cut nearly £2 billion of that investment in this Parliament, in a desperate attempt to meet exactly the Treasury-imposed efficiency savings target that, for five months, they swore blind to us they would not do.
The Defence Secretary, who opened this debate, neglected to mention the MOD’s £3.5 billion efficiency savings target for this year. He talks about being ready for war within 1,000 days, while at the same time imposing crippling cuts on the operations and training of our armed forces, who are there to deter war in the first place—si vis pacem, para bellum. The Budget totally failed to answer the question of how the Government will actually spend 3% of GDP on defence, and they are listening in Moscow, Beijing, Tehran and Pyongyang. This is a dereliction of duty by a Government who will the ends but do not will the means, who talk tough but act weak, who have let down the people of this country and will not defend them properly, and who must be held to account at the ballot box for their abject failure in defence of the realm.
The Economic Secretary to the Treasury (Lucy Rigby)
I thank all right hon. and hon. Members for their contributions to this Budget debate. It is an honour to respond on behalf of the Government.
Yesterday, the Chancellor delivered a Budget that will steer Britain through a period of global volatility and the economic storm that has increased pressures on families and firms across this country. It is a Budget that doubles down on our fiscal discipline, and that strengthens our economic resilience and national security, making responsible choices in an uncertain world. It is a Budget that offers households and businesses breathing space from cost pressures in the here and now, and one that makes critical structural changes that will drive our future prosperity.
Over the course of the debate, the Defence Secretary and Labour Members, including my hon. Friends the Members for Buckingham and Bletchley (Callum Anderson) and for Blaydon and Consett (Liz Twist), have rightly emphasised the importance of our commitment to fiscal responsibility, which underwrites every promise this Government make to the British people. As was made clear yesterday, in this Budget the Chancellor has met his fiscal rules, and for the first time this Government are meeting them in the third year of the forecast. The headroom against the stability rule is £15 billion, rising to £22 billion in 2030-31. Last year, we cut borrowing to its lowest level in six years, and the OBR’s economic and fiscal outlook confirms that borrowing will fall over the forecast.
Madam Deputy Speaker, you will forgive Government Members for taking the advice of the shadow Chancellor, the hon. Member for Arundel and South Downs (Andrew Griffith), with not so much a pinch of salt, but a whole bucket of it, because not only is he the architect of the mini-Budget, but he maintained just a few weeks ago that the mini-Budget, as the Defence Secretary said, contained lots of good things. Perhaps the shadow Chancellor would like to tell us what those good things were. Were those good things the sky-high mortgages for millions of people right across this country, including in my constituency, the disastrous market impact, or the cratering of our international reputation?
Britain’s economic reputation was so badly damaged under the Conservatives that the IMF publicly warned them to change course. [Interruption.] You can tell that they do not like to be reminded of it, Madam Deputy Speaker. The shadow Armed Forces Minister, the right hon. Member for Rayleigh and Wickford (Mr Francois), does not like that either, because he was one of the mini-Budget’s chief architects and, indeed, one of its most ardent fans. The reality is that the contrast between their approach and ours could not be clearer.
Dr Luke Evans
Talking about structural problems and difficulties, a press release has just come out from the Labour party that says: “Exclusive. Chancellor tells Krishnan Guru-Murthy that Labour will not bring welfare bills down in this Parliament”. Does the Minister stand by that?
Lucy Rigby
We are reforming welfare, and the Prime Minister has made it clear today—[Interruption.] The welfare Budget ballooned under the Conservative party. The Prime Minister has been very clear today that the welfare bill will come down.
As I have said, the contrast between our approach and the Conservatives’ could not be clearer. The IMF forecast earlier this month that our deficit would be the lowest in the G7 by 2029. Fiscal strength matters because our economic security and our national security are inseparable. That is why this Budget strengthens Britain’s capacity to withstand global volatility. It funds the defence investment plan by reprioritising capital budgets, so that Britain can respond to a more dangerous world. It also strengthens our defence industrial base and supports skilled jobs across the country. As has been pointed out by the right hon. Member for Maldon (Sir John Whittingdale) and the hon. Member for Edinburgh West (Christine Jardine), it also—