Finance (No. 2) Bill

Luke Evans Excerpts

Committee of the whole House
Tuesday 13th January 2026 Commons Chamber

[James Wild]

That is very clearly the risk.

The British Beer and Pub Association has said that the proposed increases will be damaging to the sector, and we may well see more closures as a result. New clause 26 would shine a light on the real impact that these decisions will have on rural pubs, jobs and businesses. I hope the Minister will consider the new clause and not simply dismiss it by referring to the tax and information impact note, as she did with an earlier group of amendments. That is a prediction of what will happen; it is not a review of what the actuality is.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

This new clause is even more important given the fact that the Government, the Chancellor and the Prime Minister understand the impact that the Bill will have on pubs. They have said that they will bring forward measures to help and support pubs, yet we have not seen those measures, because they are not in this Bill. We therefore need to have some form of accountability to be able to understand the impact of not only the measures before us, which we can vote on, but the proposed ones that will come in to support the measures that the Government are already looking to put in this Bill, which will have an impact. Does that make sense? Does my hon. Friend agree?

[James Wild]

I think that makes sense, and I certainly agree with my hon. Friend.

The Government are having to try to put in place solutions to deal with problems that they have created. If Labour MPs were welcome in pubs across the country, they would hear quite how difficult—

--- Later in debate ---

[Daisy Cooper]

I hope so very much that he is not, but I understand why he said that, and I hear the same from many hospitality owners and pub landlords on my own patch.

It is because we Liberal Democrats care so deeply for hospitality, and recognise the vital role that it plays in every community in the land, that we were campaigning ahead of the Budget for an emergency VAT cut for hospitality accommodation and attractions until April 2027 —a measure that would have brought growth into every corner of our country, saved jobs and our high streets, and given a real boost to consumer confidence. That is why, since the Budget, we have been fighting tirelessly against the Government’s devastating business rates hikes, and pressing Ministers to implement the full 20p discount for which they legislated last year.

[Dr Luke Evans]

The hon. Member rightly points to the cumulative effect, but I am interested to see that her new clause 9 does not mention the Employment Rights Bill or the impact of the national living wage increase. Is it by design that the Liberal Democrats have not put those in, because they do not agree that they will have an impact on hospitality, or was it an oversight, and they are other cumulative effects that need to be considered when holding the Government to account?

[Daisy Cooper]

I am grateful for that question, but if the hon. Member reads the explanatory statement closely, he will see that it says “alongside wider fiscal changes”. The Government could of course widen that to other legislative changes, if they chose to do so. However, on that basis, I hope the hon. Member and his colleague will be supporting the new clause when we push it to a vote later.

--- Later in debate ---

[Dave Doogan]

I reflect on the fact that, following the Cabinet Secretary for Finance and Local Government’s Budget today in Scotland, 93% of hospitality, retail and leisure businesses in Scotland will be paying no rates or reduced rates. That is because the SNP is responsive and closer to people in Scotland.

Further to that, not wishing to shoot the hon. Gentleman’s fox again, he spoke about the taxation rates for people in work in Scotland. I am sure his constituents will be grateful to know that 55% of taxpayers in Scotland are paying less tax than they would if they were part of the fiscal regime in the rest of the United Kingdom.

The problem with the figure for unemployment, which is a scandal—352,000 people are unemployed who were not unemployed before Labour came into power—is that unemployed people cannot afford to go to the pub or go out for a meal. It is against that backdrop that the Minister seeks to defend this latest hike in alcohol duty. That is totally unforgiveable.

I do not think the Minister believes a word that I am saying, and she certainly will not refer to anything I say in her winding-up speech, which I take as a kind of contrarian compliment. I do not know whether she has a local that she goes to; if she does, she can take my list of 12 life-threatening headwinds for pubs, all caused by the UK Government—mostly by Labour—and see if the landlord and landlady in her pub disagree with my analysis. She should do that before she introduces the 13th headwind—unlucky for pubs—with clause 86.

The SNP will back new clause 9, because, as many Members have said, we really need to review the way in which alcohol is purchased and consumed in the United Kingdom and the fiscal burden that follows that. Off-sales are getting far too easy a run of it, and on-sales will disappear before our eyes. I also support new clause 26.

It is too late today, as we have not been able to stop Labour coming to assault our pubs, but I look forward to standing up for Scotland’s hospitality sector again on Report. I hope the Minister will then have had a change of heart, or at the very least be in possession of a revised cost-benefit analysis that stacks up for hospitality.

[Dr Luke Evans]

I have come here to talk about duty, but not duty in the conventional sense. I feel that I owe a duty to the cafés, restaurants and pubs in my constituency to tell the Government just how poor their impact is and to hold them accountable. That is why I support new clauses 9 and 26.

Let me start with new clause 9, on the review of the cumulative impact. I agree with the Liberal Democrat spokesperson that there is a cumulative impact, but I would go further, as I have done, and call it a toxic concoction. It is true that the Conservative Government raised taxes, and I can imagine that in the future another Conservative Government may need to do the same, but the toxic concoction that this Government have set out on, with the Employment Rights Bill, raising the minimum wage and the reduction in support on hospitality exemption all at the same time, is compounding the problem. I am here to use my voice and do my duty to ask the Government to be accountable and able to show their workings, and these two new clauses are an attempt to do that.

We saw the Government come forward in their first Budget and say that they did not need to raise any further taxes, yet the subsequent Budget in 2025, which we are debating now, brought taxes further forward by £26 billion. The Chancellor said that the slate was wiped clean, by her own admission, but it seems that she has hospitality in her sights, and it is not clear why. What does she have against cafés, hotels and restaurants? She seems to be softening, because she has heard from her Back Benchers about the impact that all this is having on pubs.

[Graham Stuart (Beverley and Holderness) (Con)]

To come to the rescue of the Chancellor, it turns out that she simply did not understand the impact, according to the Business Secretary. Perhaps the Minister, in her winding-up speech, will be able to confirm that the Chancellor literally did not know what the impact of her own policies would be on hospitality businesses. The Minister may be able to tell us whether the Business Secretary was right to identify that failing of understanding by the Chancellor.

[Dr Evans]

My right hon. Friend is very charitable, because the Chancellor has said that she does not know. However, we also know that the documentation released in the Budget says that the Treasury did know. What has gone wrong?

As we have heard today in Committee, the rateable value of 5,100 pubs will double, but the Lib Dem spokesman missed the other point: one in eight pubs will see an increase of more than 100% in their rateable value. The Government have a question to answer. Did they wilfully ignore that and choose to impact hospitality, or were they mistaken and not competent in seeing that there was a problem?

[Steve Barclay (North East Cambridgeshire) (Con)]

Does my hon. Friend agree that new clause 9 would actually be helpful to Government Back Benchers? Given how frequently No. 10 is U-turning, including yet another U-turn on digital ID just today, having an assessment of the cumulative impacts will help them when they come to their next potential U-turn in this area.

[Dr Evans]

My right hon. Friend has served in government, so he understands why it is important to have a fixed point that all of us in this House can reference, as well as—most importantly—his constituents who own a pub, a café or a hotel and are going to be impacted. That is why I want to see new clause 9 passed, because it will go a long way towards helping us understand the impacts those people are facing. If the Government are going to do something for pubs, as is rumoured, I simply pose the question, “Why pubs, and not cafés, restaurants or hotels?”

Turning to new clause 26, if my memory serves me right, the biggest cheer that the 2024 Budget got from Labour Members was when the 1p reduction in the pint was announced. What do we see this time around in the Budget? A 2p increase—that did not get cheered. Again, maybe Labour Members did not see it, or maybe it was hidden in the detail, which brings us to where we are today. This seems to be the problem: whether we are debating thresholds, as we did last night, or pubs, rateable values and duty today, either the Government do not know what they are doing, or they are wilfully pulling the wool over our constituents’ eyes. Fortunately, though, the Opposition are here to point out the wrong that is happening—to do our duty as an Opposition and hold the Government to account by tabling amendments such as new clause 26. That is why I will be supporting new clauses 9 and 26. Until we see some support for pubs, this is the only way that we in this House can hold the Government accountable and apply transparency to what is actually going on in the Treasury, in No. 10, and in the country.

[Calum Miller (Bicester and Woodstock) (LD)]

I would like to place clause 86 in the wider context of the Budget’s impact on the hospitality sector and, in particular, the village pub. I was very grateful to the Under-Secretary of State for Business and Trade, the hon. Member for Halifax (Kate Dearden), for agreeing to meet two landladies from my constituency in December. The Minister heard from Becky, who runs the Red Lion and the White Hart in Eynsham, and from Donna, who runs the Oxfordshire Yeoman in Freeland.

As other Members have highlighted, village pubs are at the heart of their communities, but Becky and Donna described how hard it is to make the books balance. Donna gave the example of the work she does in her community. She has a number of regulars, and when one of them does not come in on a given day, she will give them a call to check he is all right and suggest he comes in—not because he is a big drinker, but because it is somewhere to be warm and sociable, and she knows that he has mental health challenges. In other ways, these two publicans are contributing to the lives of their communities.

Becky put in front of the Minister some of the cost increases she has faced. A fillet of fish cost her £2.30 in June 2023; when she saw the Minister in December 2025, the latest cost was £4.90. As well as these food prices more than doubling, energy prices have rocketed, but the greatest anxiety for these two publicans came from tax and regulation. Labour costs have increased with employer NICs—Becky gave the example of her employer NICs, which in gross terms have increased by more than four times over three years. Both publicans have had to release staff, with Donna now working more than 80 hours a week, serving as both the pub’s chef and general manager. She places orders on Mondays and Tuesdays when covers are lower, and she is in the kitchen Wednesday through Sunday.

Meanwhile, business rates represent a bombshell. Becky faces an increase in business rates at the Red Lion of nearly 120%, but she is outdone in my constituency by the 223% increase at the Lion in Wendlebury. Finally, Becky highlighted the impact of VAT on the hot food sold in her pub. Before the Budget, Liberal Democrats called for a 5% cut in VAT to offer some relief to the hospitality sector. Take that fillet of fish that has gone up by over 100% over two and a half years. Over the same period, the Treasury’s VAT take on that food has gone up by the same amount, an incredible increase in revenue with no relief for publicans.

The Minister asserted earlier that the Government were backing British pubs, despite the many hits to their bottom line. She also said that the structure of duty increases and reliefs is intended to support pubs by raising the relative price of alcohol consumed at home, compared with that consumed in a pub. Other Members from all parties have made proposals to go further, but many pubs have sought to diversify and increase the share of income and profit from food. Those that have tried are now being hobbled by the impact of VAT, which is another multiplier of costs. Becky and Donna are but two examples of the many publicans across my constituency who are holding on by their fingertips.

[Dr Luke Evans]

Does the hon. Member share my concern that often the only way that publicans can get around this issue is to either reduce their hours, reduce their staffing or take on more themselves, when they are already working 24/7 to try to deal with the costs? With this kind of change, the impact will be irreconcilable.

[Calum Miller]

I wholeheartedly agree with the hon. Member. Both the publicans I am talking about are working in excess of 70 hours a week. They have laid off staff, meaning fewer jobs for those who might be able to engage in entry-level occupations. It is hitting employment as well as other aspects of the economy.

Too many local pubs in my constituency, as in so many others, have shut, and other publicans are considering leaving the sector. When they go, communities lose a key institution that brings people together at the heart of their villages. That is why I strongly support the Liberal Democrats’ new clause 9, which would ensure an assessment of the cumulative effect of this Government’s careless assault on the hospitality sector.

--- Later in debate ---

[Lucy Rigby]

I am going to make some progress. Based on HMRC’s ready reckoner, freezing alcohol duty would cost the Exchequer around £400 million a year. That money, despite the Opposition’s best efforts to pretend otherwise, would have to be found elsewhere. This is one of the measures that assists in ensuring that our economy is strengthened and our future prosperity more secure. Indeed, it does that without taking the axe to public services or to investment. Those policies from the Conservatives had catastrophic consequences for all our constituents.

[Dr Luke Evans]

Will the Minister give way?

[Lucy Rigby]

I am going to make a bit more progress.

New clauses 8, 9 and 26 would require the Government to publish reports on the impacts of alcohol duty. The shadow Exchequer Secretary, the hon. Member for North West Norfolk (James Wild), invited me to refer to our tax information and impact note, and I will take him up on that invitation. As is usual practice, our note was published at the Budget. It outlined the anticipated impacts of this measure for alcohol producers and the hospitality sector. Because this uprating maintains the current real-terms value of the duty, the Government do not expect it to have significant macroeconomic impacts, including to the employment rate or hospitality businesses’ costs, where a duty on drinks will have comparable relative bearing as now.

--- Later in debate ---

[Lucy Rigby]

No, I will make some progress.

The hon. Member for Keighley and Ilkley (Robbie Moore)—he represents a wonderful place in the world, which is where I was between Christmas and new year—referred to the difference between CPI and RPI. As he knows, we are uprating alcohol duty by RPI, as with many other taxes expressed in cash terms. He will know that RPI is widely used, and moving away from it is fraught with difficulty.

I want to address the important points about business rates and employer national insurance contributions. We have discussed this already and, as Members will know, the Bill does not contain measures on either of those subjects, so I will not accept an amendment relating to them. I reiterate, however, that pubs are at the heart of our communities and we want them to thrive. As I have said, today we have heard some heartfelt references to particular pubs and the role that they have played in each of our lives. I could tell my own stories in that regard, but none of us would get home in time.

As Members know, in the Budget the Chancellor introduced a £4.3 billion support package to give relief to those seeing increases in their business rates bills. As I said earlier, we have made it clear that we are continuing to work with and talk to the sector about that support, and about what further support we can provide and what action we can take.

[Dr Luke Evans]

rose—

[Lucy Rigby]

I want to make this point. The Liberal Democrat spokesperson, the hon. Member for St Albans (Daisy Cooper), asked several questions. We will come forward with a support package—any further support that we will make available—when we are able to do so. As for her point about VAT, I know that an answer has been given to the parliamentary question asked by one of her colleagues about exactly that point, but I gently say to her—as, indeed, I have said to other Members during the debate—that if we want to cut taxes, the money has to come from somewhere. That has not been acknowledged at all.

I therefore propose that new clauses 8, 9 and 26 should be rejected and that clause 86 should stand part of the Bill.

Question put, That the clause stand part of the Bill.

Clause 1

Luke Evans Excerpts

Monday 12th January 2026 Commons Chamber

On that point, a tax information and impact note has also been published in the standard way for UK-wide changes to the tax system The Government keep tax changes under review—[Interruption.] I am not sure whether the hon. Member for Hinckley and Bosworth (Dr Evans) would like to intervene; I would welcome that.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

indicated dissent.

[Dan Tomlinson]

Maybe later.

I turn to the contribution of my hon. Friend the Member for Loughborough. His speech—I had hoped it would be even longer; I am somewhat disappointed not to have heard more from him—provided a clear exposition of the benefits of the modest changes the Government are setting out in this group of clauses, which are being considered by the Committee of the whole House.

--- Later in debate ---

[Dan Tomlinson]

In opening debate on this second group of clauses, I want to reflect on why we are making changes to the tax system. I am looking forward to no interventions at all on this speech from Opposition Members—their interventions seemed to dry up in my last speech, so maybe they have now finished with them. Of course, we make these changes to modernise the tax system, to make it fair and fit for purpose and to adapt to a changing world, but we also make these changes so that we can raise the revenue to fund our public services. Yes, the Bill holds thresholds constant till the end of the decade, but in doing so contributes to our being able to renew our public services while maintaining the highest levels of public investment in four decades to stimulate economic growth and ensure that those with the broadest shoulders pay their fair share.

[Dr Evans]

Will the Minister give way?

[Dan Tomlinson]

I will; it is good to see that the interventions are back on.

[Dr Evans]

When the Chancellor looked at these measures for her first Budget, she said that they would breach her manifesto commitments. Does the Minister believe that they breach the manifesto commitments?

[Dan Tomlinson]

This Government have stuck to their manifesto commitments. We were very clear about not wanting to change the rates of income tax. I have been in discussions with Opposition Members about the wording of our manifesto; I am glad that Conservative Members have taken such interest in it. We are sticking to our commitments. The tax changes that we are discussing now, and others, will allow us to do things such as lift 550,000 children out of poverty this Parliament, by removing the two-child limit and expanding free breakfast clubs and free school meal eligibility. They allow us to cut waiting lists and cut the cost of living by delivering £150 off energy bills. All that would be threatened by Opposition Members, who do not support the taxes needed to fund decent public services.

--- Later in debate ---

Clause 10 maintains the income tax thresholds for three years from April 2028 to April 2031. As we have already discussed, the Government are freezing the thresholds to maintain funding for our NHS and to enable us to reduce debt, and we are doing that, in part through this decision.

[Dr Luke Evans]

Will the Minister give way?

[Dan Tomlinson]

I will make a little progress, if I may. I have already taken two interventions on this exact point.

We know that there will be a broad-based effect, but as I have said, we are making other changes so that we ask as little as possible of those who will be affected by the change. We are making lots of changes to ensure that those with the broadest shoulders pay their fair share. I think that that is a fair and necessary decision to raise tax revenue in order to fund public services and restore economic stability.

--- Later in debate ---

[Gareth Davies]

I understand the points that the hon. Gentleman makes, but as the spokesperson for the official Opposition, I speak on behalf of millions of people who were told that this would not happen, and who voted for a party that told them that it would not be increasing taxes on working people. The Chancellor repeated that claim at the Dispatch Box just a year ago, but then went back on it, which is unacceptable. Whether I agree with it does not matter; we have to represent the millions of people who were frankly let down and misled by this Government. That is our job—to hold the Government to account for breaking that promise, and for where the money is going. I ask the Government: what is this about? Is it about giving up sovereignty—giving up the Chagos islands—or paying off public sector unions, only for them to go on strike once again? There are two issues here. First, the public were told that this would not happen. Secondly, now that it is happening, the Labour party—the Government—is spending that money recklessly. That is unacceptable, and it is the job of the official Opposition to hold the Government to account.

Finally, there is an elephant in the room. From April 2026, the state pension rises by 4.8%. The new state pension will sit below the personal allowance next year, but that changes in 2027-28, when, for the first time, people whose only income is the state pension will be dragged into paying income tax. The Chancellor, when challenged on this after the Budget, said that she will protect pensioners from paying small amounts of tax, and the Minister just repeated that. Fine, but where is it? It is not in the Bill. It is not in clause 10, or anywhere in the 535 pages of the Bill. As far as I can see, it has not even been costed. I have two straightforward questions for the Minister: what is the Treasury’s assessed cost of that promise, and how will it be delivered in practice?

[Dr Evans]

The other point is: what is a small tax? What is the definition? Are we talking about £100, or £1,000? The Government have not even set that out. The Chancellor has just come up with a term that we have no reference for, no use for, and no understanding of when setting tax policy for this country.

[Gareth Davies]

My hon. Friend is absolutely right. That is why I want to ask the Minister, as he does, how this will be delivered. What is the definition of what the Chancellor has described, albeit to the media? How will this work, and why is it not in the Bill? We know that when the Government have spoken before, they have not stuck to it.

--- Later in debate ---

[Sir Ashley Fox]

My hon. Friend makes a valuable point, which anticipates my next point. Teachers in my constituency have written to me saying that they will be pushed into the higher rate tax bracket by 2030, paying 40% on any extra work that they do—marking exams during the summer, for example—and that doing such work is not worth it any more.

Many pensioners in my constituency, who have worked and saved all their lives, and who have done the right thing, are now set to be punished too. Clause 10 will drag more pensioners with modest private pensions into the tax system. Freezing allowances will mean more pensioners paying tax on their income from savings. Anyone with income from a private pension or income from savings will now face having to fill out a tax return, and that number will grow when clause 10 takes effect. Unlike those in work, pensioners cannot put in more hours or ask for a pay rise. They are victims of this Government’s failure to control public expenditure.

Where is all the extra money that clause 10 will raise going to go? Rises in welfare spending. With the uprating of universal credit, the rise in the amount of people claiming health-related benefits and now the scrapping of the two-child benefit cap, more and more families are finding it less beneficial to work. Clause 10 is perverse. It discourages work and entrenches dependency. Labour says it is all about fairness and compassion, but in truth it is the opposite. The best way to alleviate poverty is through work, and that is exactly what Labour’s Budget seeks to discourage.

There is another choice. Had the Chancellor chosen to control public expenditure, then clause 10 would not be necessary. She could have chosen to make work pay. She could have chosen to reduce our welfare bill, to increase productivity in the public sector, and used savings to reduce debt and protect taxpayers, but she chose not to because when faced with difficult decisions, this Government’s guiding principle is their own survival: surviving the next vote, the next headline and the next rebellion by Labour Back Benchers.

This Government have now U-turned on headline policies 12 times. By the Prime Minister’s own admission, that meets the definition of serial incompetence. The people paying for the price for this incompetence are working people, pensioners, and everyone who has ever worked hard and done the right thing to provide for themselves and their families. It is no wonder that my constituents are so livid with this Government, and that is why I shall oppose clause 10, which is the cornerstone of this Budget for “Benefits Street”.

[Dr Luke Evans]

It is a shame that the hon. Member for Poole (Neil Duncan-Jordan) is not still in the Chamber, because he hit the nail on the head. He asked the question that I am keen to get answered and that is the reason why I have come to this debate. It is about the freezing of the thresholds and what the impacts will be on pensioners. I too am worried about pensioners suddenly being brought in to pay tax and having to do a tax return.

I am glad that the Minister saw the interview with Martin Lewis, because the Chancellor was very clear, so he has to try to answer the questions. When Martin Lewis put this case to the Chancellor, she said:

“If you just have a state pension…we are not going to make you fill in a tax return”

at any time. That is great, but how does that work? What does it look like? Where is that written down? The Chancellor went on to say:

“In this parliament, they won’t have to pay the tax…we’re looking at a simple workaround at the moment.”

That was back in November, so my curiosity was pricked to think, “Maybe it will be in the Finance (No. 2) Bill in Committee.” Yet, as pointed out by the Opposition Front-Bench spokesman, my hon. Friend the Member for Grantham and Bourne (Gareth Davies), the Bill has 535 pages, and there is no answer. I am pleased to have the opportunity to ask the Minister on behalf of my constituents how he will answer that question.

What is the workaround in play? If it is there, we should like to see it. Is there an impact assessment that goes with it to help us to understand whether people will have to do a tax return? How many people will have to do a tax return? If they will not have to do a tax return, how will we know whether they need to pay the tax? Will it simply be part of PAYE? That is a solution; it could be moved, and adjustments are already made. Will we simply say that it is an easement and write it off?

We then get to the problem of the Chancellor talking about small tax. We have no definition of what small tax looks like. This Government’s definition of it is as close to a definition as their definition of “working people” is, and we all know what the definition of “working people” is under this Government—well, actually, we do not, and that is the problem.

I am here asking the question on behalf of my constituents: what does the workaround look like? How will it take place? How will it affect my constituents? That is why I support new clause 15, which would go at least part of the way to understanding the assessment of this decision taken by the Government, but I appreciate that that is outside of the Bill. If the Government turn around and say that they do not need to do primary legislation—the best protection for my pensioners—the Minister can find another way to do it, but I look forward to hearing what that will look like in statements to the House.

[Sir Edward Leigh]

I will not make myself very popular by asking this question, but I will do it anyway. The Minister took me to task earlier because I talked about the total increase in the Department for Work and Pensions budget, which includes pensions. I think all three main political parties are traipsing around the issue of the triple lock. Frankly, if we did not have the triple lock—if there was a serious debate and we could get consensus in this House—we would not have to freeze income tax thresholds, and we could divert more resources to those really, truly vulnerable pensioners. I know that that is not a very popular point, but it is a question that we all seriously have to debate in a rapidly ageing population.

[Dr Evans]

I know that my right hon. Friend has been a stalwart in making that point. That leads on to the wider point of thinking about social care and how we will fund it. These sticky points are really important, so we need to ensure that we have this debate. The fact is that we are dealing with the Finance (No. 2) Bill in Committee. When the Government are making these choices, I am really keen to try to understand the direct impact they will have on my constituents.

At the last general election, the last Government—now the Opposition—had a solution in our manifesto to deal with this issue, which was the “triple lock plus”. That would have negated the issue at source. There is a ready-made solution if the Government would like to go for it, but I understand the difficulties of the associated cost, as my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) has pointed out.

That brings us full circle to where the hon. Member for Poole started. How exactly are we going to solve this issue for pensioners? Do the Government just need to be up front with them and say that they will have to do a tax return? Will they be pulled into this tax? If they will not, how?

[Vikki Slade (Mid Dorset and North Poole) (LD)]

I completely recognise that the extension of the frozen tax threshold will not be felt immediately. We are all here worrying about it, but most of our residents will not see the difference probably until the next general election. However, it is on us to resolve this issue once and for all.

In the Minister’s opening speech, he talked about asking those with the broadest shoulders to pay more. Let me speak briefly about three groups of people—apprentices, graduates and pensioners—who do not have the broadest shoulders and instead feel completely targeted.

--- Later in debate ---

Time and again, young adults who have invested in their futures, done everything right and tried to make the world a better place are being targeted by successive Governments. I am the parent of two recent graduates and an undergraduate, so I see those daily struggles. I see many young people saying, “What is the point of going to university?”

[Dr Luke Evans]

Is the hon. Lady as concerned as I am about the fact that plan 2 student loans seem to be particularly impacted by the thresholds? I am concerned about the impact that that will have on the way in which people will have to make their repayments.

[Vikki Slade]

I will be honest and say that, not having been to university, I do not know the details of the different groups. My students are all very recent graduates, so they went in knowing that they would have enormous debt and recognising that they would be more than £50,000 in debt, with probably no prospect of ever paying it off. I do not think they went in realising that they would get such a bad deal when they were at university, with eight hours of contact time a week and PhD students doing their lectures, rather than actual lecturers, some of whom cannot even speak English and are here only for their visas. Students are having a really rough time, and this measure is just rubbing salt into the wound.

--- Later in debate ---

[Sammy Wilson]

Tonight’s debate is not just an opportunity for the Opposition to have a go at the Government. Many people who are getting cynical about politics will say, “Well, of course you would expect them to have a go about taxation and the Government’s behaviour on that issue.” However, this debate goes far beyond that, because the implications of what we are discussing tonight are very serious.

First, there are the macroeconomic impacts of the decision not to make work pay, because of higher taxation. The Government have hung a lot of their predictions of economic success on obtaining economic growth, but one thing we will not do is tax our way to growth. This will be an anti-growth measure, which will have implications not just for this year but future years and future Budgets. Secondly, it will have personal consequences for many people facing the current cost of living crisis and finding it difficult to stretch their income to meet their needs.

Lastly, the decision will have an impact on people’s confidence in the democratic system. The Government will get this Bill through tonight. They will get it through because they have a massive majority, and they have a massive majority because they made massive promises. They promised that people would not face income tax increases, and I have no doubt that that influenced how many working people voted. However, the Minister has accepted tonight that by the end of this period, £28 billion will have been raised. One reason I support new clauses 3, 13 and 14 is that they at least give people an opportunity to realise what the Government are doing to them, and they show that politicians in this House want there to be honesty with the people. If there was not honesty when the manifesto was written and presented, let us ensure that there is honesty when the implications of the decisions that this Government are making become clear to the citizens of this country. These are confidence measures.

Let us just remind ourselves of what the Government promised—we have been around this a number of times tonight. They promised that they would not increase taxes on working people. They then went on to define “working people” as people who go to work every day, yet we know that by freezing the thresholds, people who go to work every day and are therefore subject to income tax being charged on the money they earn will pay more. Working people know that a promise to them has been broken.

[Dr Luke Evans]

I think the Chancellor knows that, given her statement at the first Budget that changing the thresholds would be a tax on working people.

[Sammy Wilson]

Of course she does. That is one reason why I believe that the new clauses are important—they recognise the need for people to be made aware of the consequences, and the impact on them, of decisions that are being made in this House by a majority Government who got there by making promises that are not being kept.

What is that impact? The Minister has already told us: £23 billion more tax will be paid. He justifies that by saying—I think he mentioned this twice—that the Government have sought to be fair, and to place the burden on those with the broadest shoulders. When 750,000 people who are currently earning £12,500 per year are dragged into the tax system, that does not strike me as fair. It strikes me as placing a burden on people who go out to work every day, do not earn a great deal of money or have a great reward for it, and now find themselves having to pay tax when they never thought they would have to.

As I said in an earlier intervention, people might be willing to pay taxes if they thought it would lead to things that would improve their lives. We had that promise at the first Budget—that the Government were putting up taxes by £40 billion, or whatever it was at that stage, to improve public services. Have public services improved? No, they have not. Has the money been spent on public services? No, it has not. Yes, wage increases have been given, but as the OBR has said, there have been no productivity increases as a result of the extra money that has been spent. If taxpayers thought they were going to get some benefit from these changes, they might have been willing to accept them, but of course, they are not getting that benefit.

What are we getting? We are getting wasteful expenditure. As has already been mentioned, £5 billion will be spent on taking money from those who go out to work and paying it to those who do not go out to work. That is not fair, and it does not make any economic sense, either. Then, of course, there is all the other wasteful expenditure that the Government have engaged in, such as the Chagos deal. We had the Chagos islands—we had our bases there and so on. We are now going to pay somewhere between £38 billion and £47 billion to the Government of Mauritius to give the islands back and then lease them back again. You can understand why people ask, “Is that what I want my taxes to be spent on?” Of course it is not.

The Government estimate that their ID cards system will cost £1.8 billion, while the London School of Economics says that the cost could be £10.7 billion. The Government say that it is to stop illegal immigration, when we know full well that it would not matter if we had six ID cards—those who come into this country illegally will seek to work illegally, and there are other means of checking up on them anyway. There are also the new bureaucracies that the Government have set up. One of their first actions was to set up a huge bureaucracy, Great British Energy, at a cost of £9 billion. Again, what benefit will we get from that? The Government have said that it will deliver their net zero policies, but is it necessary to have a bureaucracy of that nature? I know that many Members do not agree with me on this issue, but we are spending billions of pounds on restructuring our economy to meet net zero targets when many other countries are saying, “We are not prepared to damage our economy in that way.”

Given the proposals we are debating tonight, the new clauses I have spoken to are not all that demanding. All they say is, “Let’s have some transparency about what all this means to the people who are having to pay the money.” That is not too much to ask. I hope that people will consider that when they cast their vote tonight.

The one thing I say in conclusion is that we seem to have a Government who, as their first choice, will spend taxpayers’ money, rather than looking at how the money they already take from taxpayers can be used more effectively.

Agricultural Property Relief and Business Property Relief

Luke Evans Excerpts

Monday 5th January 2026 Commons Chamber

[Dan Tomlinson]

I cannot update my hon. Friend at this moment, but I would be happy to write to him on that point.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

The Government say they have been listening carefully, but they had 14 months and four votes to listen to the Opposition and the farming community. One question is: what changed the Government’s mind? The second question is: who made the decision—the Environment, Food and Rural Affairs Secretary, the Prime Minister or the Chancellor—and how long did they take to persuade the others to make that right decision?

[Dan Tomlinson]

Government decisions are made collectively. Yes, the Government have listened to farming communities and farming businesses, and to representatives of family businesses that would also have been affected by the £1 million BPR threshold, which was the same as the APR threshold.

Conduct of the Chancellor of the Exchequer

Luke Evans Excerpts

Wednesday 10th December 2025 Commons Chamber

[Sir Mel Stride]

The hon. Gentleman makes excellent points, and I will come to the issue of the market-moving effects of some of the comments made by the Chancellor. On the point that he rightly raises about the impact on people’s lives, these are real jobs. These are people struggling with real businesses. These are farmers getting up early in the morning, going out, working and doing what they know to be right, yet they are weighed down by the decisions taken by the Government.

Labour said that it had no intention of means-testing the winter fuel payment. There was no mention of it in its manifesto during the last general election, yet within a very short period of time, that is precisely what it did. Before Labour Members get excited about excluding millionaires and multimillionaires from those payments, the reality is that about 80% of pensioners living below the poverty line were impacted by that decision, which would have only entrenched and driven up poverty.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

One concern that I have is the repeated pattern seen with the Budget. At the time, the Government sat on an impact assessment that showed that 100,000 pensioners would be pushed into poverty and 50,000 into absolute poverty. That was the Government’s own assessment, but they did not release it to the House or the country before pushing through the policy, which we have now seen in the Budget. Does my right hon. Friend agree that this is a pattern of behaviour rather than a one-off mistake?

[Sir Mel Stride]

My hon. Friend is absolutely right. The Government talk a good game on poverty, but when it comes down to what they do, we see something entirely different.

--- Later in debate ---

[Sir Mel Stride]

I will in a moment.

It should be pointed out, of course, that that is a fiddled fiscal target. It is not the fiscal target that we were working to—the same definition of debt. It is not net public sector debt at all; it is something different. In fact, if we were to apply the targets that we were running to, which were much more stringent, to the figures in the forecast that we see from the recent Budget, those targets would be underwater in every single year of that forecast.

We should acknowledge that there is now real risk to the stability of our economy, even with an apparently doubled fiscal headroom. The first risk is in defence spending. Although within the numbers, there is the ambition to reach 2.7% of GDP by 2027, there is nothing beyond that. Of course, the Government know that they will have to spend more on defence, and that every increase of 1% of GDP in defence spending is about £25 billion—more than the entire fiscal headroom that the Chancellor has set aside.

The Chancellor knows that part of the problem she had with the forecast—although other things moved strongly and positively in her direction—was the productivity growth downgrade by the OBR from 1.3% to 1%. The trend for productivity over the past 15 years has been just 0.5%. If the OBR decides in a couple of years’ time to return to an assumption of trend growth in productivity, that will wipe out £28 billion of headroom. It will destroy all the headroom and more.

Similarly, on the path of interest rates, a 1% increase in interest rates across the forecast would cost £16 billion. In relation to particular spending pressures, such as special educational needs and disabilities, there is of course a £6 billion cost pressure, because that spending will be taken from local authorities and put on to the Government’s books in 2028. How that additional cost will be met is not in any way accounted for. Similarly, apparent efficiency savings of £4 billion in 2029-30—the target year—are very handy if one is trying to hit a fiscal target, but there is no explanation whatsoever of where or how those efficiency savings will be found.

My final point is that the tax increases set out by the Chancellor are all back-ended. That is when the frozen thresholds kick in. We are expected to believe that, in the run-up to a general election, a party that has shown no resolve, backbone or capacity to take difficult decisions will suddenly find some backbone, stick to its guns and deliver those tax increases. That simply will not happen.

[Dr Luke Evans]

Nowhere is that more evident than in health, with the abolitions and redundancies in integrated care boards. Given that those redundancies cover 50% of ICB staff, we now understand that the funding is just being reprofiled into later spending in 2028-29. Is that not exactly the kind of example that my right hon. Friend is talking about? Labour will encounter real problems in the next couple of years as it tries to drive through its agenda.

[Sir Mel Stride]

The reality is that back-loading tax-paying and squeezing spending, as the Government are doing, simply pushes off the inevitable. The evidence shows that, despite its huge majority, Labour does not have the backbone or a plan to control spending and take difficult decisions, even on tax.

The Chancellor is like Mr Micawber in Charles Dickens’s “David Copperfield”, who was just waiting all the time for something to turn up. Mr Micawber, as those who are familiar with the story will recall, not only ruined himself through his inability to manage his own finances, but ended up ruining another person, too. The Chancellor, with her inability to manage the public finances, will, I am afraid, be the ruin of our nation. For most of us, Christmas will be not so much a question of “Great Expectations”, but one of “Bleak House”. I give way to the hon. Member for Southend West and Leigh (David Burton-Sampson), who has been very patient.

Office for Budget Responsibility Forecasts

Luke Evans Excerpts

Monday 1st December 2025 Commons Chamber

[James Murray]

Events are moving quickly, and I understand that the chair of the OBR has resigned. That is what I understand from messages passed to me.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

Through the morass of leaks, one thing is crystal clear: this Labour Government broke their manifesto commitment. The Chancellor said:

“I am asking everyone to make a contribution”,—[Official Report, 26 November 2025; Vol. 776, c. 393.]

then went around the studios at the weekend saying,

“I am asking ordinary people to pay a little bit more”.

She is not asking; she is telling the public. Will the Minister come to the Dispatch Box and confirm that if my constituents say they will not pay their taxes, they will not face any criminal or financial repercussions?

[James Murray]

The Chancellor was clear at the Budget last week that we were taking the fair and necessary taxation decisions to ensure that everyone makes a contribution, but that the contribution of working people is kept as low as possible thanks to the other choices made. Increasing tax on property income, increasing tax on properties worth more than £2 million and reforming gambling taxation all mean that we can keep taxes on working people as low as possible.

Budget: Press Briefings

Luke Evans Excerpts

Monday 17th November 2025 Commons Chamber

[James Murray]

While the hon. Gentleman would not expect me to speculate on details, I can reassure him that our Budget will support growth by enabling businesses to create jobs, innovate, invest and grow.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

This urgent question is about Budget press briefings. The Minister has repeatedly said that he takes his responsibilities very seriously. He was asked by the shadow Chancellor whether he could rule out any of the ministerial team or special advisers having leaked any of the information out to the press. Will he do so from this Dispatch Box in honour of what he has been saying in his answers this afternoon?

[James Murray]

I did not say just that I take my responsibility to this House very seriously; I said that every Minister in this Government takes their responsibility to this House very seriously. I am not going to engage in further speculation ahead of the Budget.

Taxes

Luke Evans Excerpts

Wednesday 12th November 2025 Commons Chamber

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

To put it in simple terms for those listening at home, the Chancellor raised taxes by £40 billion, she spent £30 billion and she borrowed £70 billion. Cumulatively, that will make people think, “How am I going to get the return on that investment if we are not growing the economy? How do I ensure that the interest will be paid?” That is why interest payments go up and we as a country end up paying more debt—because of the decisions the Chancellor has made.

[Sir Mel Stride]

My hon. Friend is absolutely right. If we borrow more money, we pay more for that borrowing. Of course, that has fed through to inflation. We know that inflation this year, according to the International Monetary Fund, will be the highest in the G7. The IMF also says it will be the highest in the G7 next year. The consequence of that in monetary policy is interest rates being higher for longer. Of course, if we have a mountain of debt and add to it ruinously, the cost of servicing that debt goes through the roof. It now stands at about £100 billion a year, rising to £130 billion at the end of the scorecard. That is more than twice what we spend on defence every year.

--- Later in debate ---

[Sir Mel Stride]

My right hon. Friend is entirely right. The conclusion that one must draw on the mess that this Government have made of our economy is that it has become brittle, fragile and vulnerable to the kind of external shocks that it was able to withstand when the Conservatives were stewards of it.

While per capita growth is almost on the floor, unemployment is at a five-year high; as we know, every Labour Government in history have left unemployment higher on leaving office than it was on entering office. Inflation is high and business confidence is at rock bottom. In a recent survey, the Institute of Directors found that business confidence among its members was the lowest in history. My right hon. Friend the Member for South West Wiltshire (Dr Murrison) refers to covid—according to the IoD, business confidence is even lower now than it was during covid, when the economy contracted by more than 10% overnight. That is how bad business sentiment is out there.

[Dr Evans]

Was my right hon. Friend as surprised as I was to hear the Prime Minister say again today at Prime Minister’s questions that his No. 1 goal is growth, when all the evidence is pointing against it?

[Sir Mel Stride]

To be fair, I think the Prime Minister was referring to facial hair growth, rather than growth in the economy. They are distinctly different things.

[Dr Evans]

He is struggling on both.

[Sir Mel Stride]

Well, he may or may not be—it remains to be seen.

What all this ends up with, of course, is lost fiscal headroom. That is the story so far. We had a Budget last October with about £10 billion against the debt target; that vanishes, with 50% on top as well. It is rebuilt in the spring, and now it has all disappeared, and we are waiting to find out how deep that black hole is. We have entered something of a doom loop, with higher taxes destroying growth, leading to a loss of fiscal headroom, requiring—in the Chancellor’s terms at least—further tax increases, leading to further destruction of growth, and around and around we go.

--- Later in debate ---

[Sir Mel Stride]

Madam Deputy Speaker, that is a great shame. The hon. Gentleman has not been here for any of the debate, but that does not mean that he might not have given the best possible intervention from the Labour Benches so far. Perhaps he may like to come in a little later.

We have a Government who are engaged in serial breaches, who have no backbone to take the right decisions, and who will always fold to pressure, including from their own Back Benchers—and all at the expense of businesses and hard-working people up and down our country.

[Dr Evans]

The Chancellor set out in a speech only last year an absolute commitment not to raise taxes. She said, “We’ve set the spending envelope for this Parliament, we don’t need to increase taxes”. Yet here we are on the cusp of taxes going up. Is not the crux of this the fact that she cannot even stick to what she promised?

[Sir Mel Stride]

My hon. Friend is absolutely right. He will have heard the various quotations at the beginning of my contribution exactly to that effect.

The motion on the Order Paper asks a simple question. It is essentially this: even at this late stage, will the Government stand by their word, or will they dragoon those on the Benches behind them through the wrong Lobby tonight? If they vote with us, millions will heave a huge sigh of relief. If they vote against, the people will have their answer, and they will never forget.

--- Later in debate ---

[James Murray]

We are back to questions about what will be in the Budget. The answer, again, is very straightforward. The Chancellor set out the values that will guide her in taking the decisions at the Budget on 26 November. She set out the challenges that we face, being straight with the British people about that. The details will all be announced by the Chancellor on Budget day in the normal way.

We know that there is much more for us to do as a Government, but we can see the tough choices we made last year showing early signs of progress. We are set to deliver the largest primary deficit reduction in both the G7 and the G20 over the next five years. Our stewardship of the economy has helped the Bank of England cut interest rates five times, meaning lower mortgage payments and cheaper borrowing for families and businesses; real wages rose more in the first 10 months since the election than in the first 10 years of the previous Government; and the average person’s disposable income is now £800 higher in real terms than just before the election, meaning living standards have begun to rise. We have increased public capital investment by £120 billion over the Parliament and supported the NHS to achieve a reduction in the total elective waiting list of more than 206,000 since July 2024.

[Dr Luke Evans]

We on the Conservative Benches have been struggling to get an answer on the question of the 50% reduction in integrated care boards, for which the expected redundancy bill is about £1 billion. Today, the Government have issued a press release that says that they have dealt with that. Yet in response to my written question on the subject, the Health Department said that it could not provide an answer because it does not know the numbers, so I have received a holding answer. How much will the redundancy payments cost, and will it come from the Health budget or the Treasury budget?

[James Murray]

It is for the Health Department to set out the details in response to any questions that the hon. Gentleman has tabled. The point about the merger between NHS England and the Department of Health and Social Care is that it is a way of cutting costs and ensuring that that money is reinvested in frontline services. Rather than having duplicative structures within our system, we want to ensure that we are merging NHS England and the Department of Health to make those savings, which we can reinvest in patient care.

As I said, there are still many challenges ahead and we are impatient to see things improve. Globally, inflation remains high and confidence is low, deterring investment and hindering growth. As geopolitical uncertainty grows, we are also faced with a critical need to invest in our defence spending. Domestically, we must continue to cut NHS waiting lists, lower the cost of living and improve our country’s productivity. We must invest in our roads, transport, housing, infrastructure, public services, towns and cities and the businesses for which the last Government failed so completely to provide.

Conservative Members will see the Budget two weeks from today. They will have plenty of opportunity to scrutinise it and participate in a serious debate about it later this month. We will, of course, oppose today’s motion, which speculates on what the Budget might contain. The effort of rebuilding a country requires the contributions of everyone in that country. Together, we can renew the UK and build an economy that is fair and thriving. That is what this Government were elected to do and that is what the Budget in two weeks’ time will play its crucial part in achieving.

--- Later in debate ---

[Charlie Maynard]

They are interested in what costs them money, and their mortgages are more expensive because of the decisions the Conservatives took three years ago—[Interruption.] Well, read the Financial Times.

Moving on, I suggest that the digital services tax is another way we should be looking at to raise revenues. We would increase it from 2% to 10%, which would raise roughly £4 billion a year and get some of the biggest and wealthiest corporations in the world to finally contribute their fair share of tax here in the UK. We would also increase gambling taxes, because gambling really beggars some of the most vulnerable in society. Of course, the biggest one of all is that we should rejoin the customs union with the EU. Nobody voted to leave the customs union, but we are now in a market that is more than seven times smaller than the one we used to be in. As somebody who founded and ran a business for 24 years, I know that that hurts. It has done huge damage to small, medium-sized and big businesses and we are living with that loss. The quickest thing we could do is to negotiate a new, bespoke customs union with the EU. This would unleash the potential of British business.

With every month and year that goes by, it becomes clearer just how economically damaging the previous Government’s Brexit deal has been. The OBR has forecast that it will harm economic growth, reducing long-term GDP by 4%. However, according to Frontier Economics, a much closer trading relationship with Europe—not even a customs union—could boost UK GDP by 2.2%. These are enormous numbers, so when we are looking around for solutions, there is one right in front of us. It stands to reason that a new customs union would probably raise more than £25 billion a year for the Exchequer. There it is. Grab it, please. With the autumn Budget just two weeks away, the Liberal Democrats’ message to the Chancellor is clear. Instead of asking hard-working households and struggling small businesses to pay even more tax, she must take growth seriously and repair our broken trading relationship with Europe.

[Dr Luke Evans]

The hon. Gentleman talks about the trading union, but if we were to go back into the EU, one of the things we would have to take is freedom of movement. How does that tally with the Lib Dems’ position on dealing with immigration?

[Charlie Maynard]

I think we should have all the economic benefits of Europe while controlling our borders and controlling movement—[Interruption.] Well, look at Norway, Switzerland and Turkey. There are lots of options out there. Let’s go and negotiate something that makes sense for us.

My final point is that we need an office for value for money—an effective regulator with proper scrutiny and proper teeth that really looks into our Budget. I ask the Government to take inspiration from the Swedish model of tax scrutiny. I understand that after introducing these changes 30 years ago, and aided by strong economic growth, Sweden has reduced its national debt from nearly 80% of debt to GDP to 32%. Meanwhile, our public debt is around 95%, which means that billions that we could be spending on our public services are instead going towards servicing our debt.

A key component is significantly strengthening the scrutiny powers of this Chamber when it comes to the Government’s financial management. The Chancellor’s practice of keeping the Budget secret until the day, at which point everyone else has to scramble to assess the detail and has no time to provide a proper, meaningful critique, is far from the best way to scrutinise the Government’s economic policy. This is not how many of our international peers go about their economic policy. Proper, detailed scrutiny of the Budget, as opposed to the wave-through regime we currently have, with no proper transparency before approval, needs to be addressed—

--- Later in debate ---

[Sam Rushworth]

I have confidence in the Chancellor to produce a Budget that will do the things that my constituents need it to. What my constituents are asking for, and what they voted for at the general election, is change.

Look what the Conservatives did to our justice system: prisons are 99.9% full, and we have a court backlog that makes victims wait years for justice. We all know that our surgeries are crammed with these cases. Look at what they did to the asylum system, which has an enormous backlog. Whoever negotiated the contract on asylum hotels must have been the person who did the dodgy covid contracts, given the amount that they wasted. Millions a day were spent on hotels.

Look at what the Conservatives did to childhood. Contrary to what was said earlier, child poverty in our country has increased. The Institute for Fiscal Studies said that both relative and absolute poverty have increased. The pattern between 1997-98 and 2022-23 can be described as a U-curve; poverty fell under the 13 years of the last Labour Government, and then relative and absolute child poverty increased. Look at what that means for the communities I represent: 16 Sure Start centres closed; primary school budgets are below their 2010 levels; transport for college students is expensive, and their education maintenance allowance was cut; youth services, boxing gyms and swimming pools have closed; and social infrastructure has disappeared from our communities over the last 15 years.

These are real challenges, but the problem is not just with our public services. Because the Conservatives robbed the capital budget to pay for day-to-day spending, they left Britain in the slow lane. Cancelling Labour’s Building Schools for the Future project left our schools and public buildings infested with reinforced autoclaved aerated concrete. Cancelling nuclear projects left us reliant on expensive fossil fuels, which led to 11% inflation at one point under the Conservatives. Cancelling High Speed 2 to secure a media headline on the eve of a conference has left us without the critical transport infrastructure we need.

All these problems come with a higher social cost. When His Majesty’s Revenue and Customs staff are sacked, we get more tax avoidance and fraud. When people have to wait two years for a routine operation, businesses have a bigger sick bill. When prisons are not built and the police are cut, there is more crime. When civil servants were cut, the previous Government had to spend £3 billion on agency staff.

[Dr Luke Evans]

The hon. Gentleman has missed something from his list: the Government’s own assessment shows that when winter fuel payments are cut, it puts 50,000 people into absolute poverty and 100,000 people into relative poverty. A 2017 report by the hon. Member for Chipping Barnet (Dan Tomlinson), now the Exchequer Secretary to the Treasury, said that cuts to the payment would kill 4,000 people. Was that factored into the hon. Gentleman’s assessment when he went through the Lobby to vote on the measure?

[Sam Rushworth]

The only vote we ever had on the issue was a vote for or against an Opposition day motion. I was always clear that the original threshold that the Government set was far too low. I do not think that millionaires and asset-rich, wealthy pensioners should receive the payment. The policy, as it now stands, and as it will be for pensioners in my community this winter, is as it should be.

--- Later in debate ---

[Stuart Anderson (South Shropshire) (Con)]

It is interesting to follow the hon. Member for Bishop Auckland (Sam Rushworth), who clearly has an ideology that he believes.

As a Conservative, I believe in lower taxes, and that people have a better understanding than Governments of how to spend their own money. I want to see more South Shropshire constituents keep more of what they earn. Last year’s Halloween Budget hoicked taxes by £40 billion a year. It included a hugely damaging rise in employer national insurance contributions, which has added almost £1,000 to the cost of employing someone. We are stunting the wealth creators, and that is not acceptable. The Chancellor did that with one hand, and withdrew support from our suffering high streets with the other. Pubs will have to pay an extra £3,000 on average because of the changes to business rates, and they are feeling it.

The latest statistics have confirmed that economic growth has flatlined, despite the Chancellor’s promise to

“lead the most pro-growth, pro-business Treasury our country has ever seen, with a laser focus on delivering for the working people”.

How is that going? Since last year’s Budget, a huge number of people—the figure is approaching 180,000—are out of work. Jobs have been lost, and unemployment is up to 5%.

A year ago, the Chancellor told the country that she would not come back with any more tax hikes. The slate had been wiped clean. She clearly said on TV: “This is what I will be doing, and I will not have to come back.” No matter what reason they come up with, if the Government break that manifesto promise, I believe it will hurt them beyond what they believe possible. They have run out of road in their continual blaming of the previous Government. However, it seems almost certain that that is what will happen, so pensions, savings, cars and houses are all sadly in the frame for Labour’s Budget.

South Shropshire is a big rural constituency, so let us consider rural prosperity. The Chancellor’s policies have killed growth, fuelled inflation and reduced opportunities for South Shropshire residents. On average, productivity, earnings and ease of access to further education are all lower in rural than in urban areas. Closing those gaps could add billions to England’s economy. A stronger economy is needed to enhance public services. I agree with the hon. Member for Bishop Auckland that we need strong public services, but we cannot stifle private industry and businesses to get them.

The shadow Chancellor, my right hon. Friend the Member for Central Devon (Sir Mel Stride), has shown how huge savings can be made at the same time as cutting taxes for working people. If the shadow Chancellor and shadow Treasury team set out clear objectives, we should put party politics behind us and adopt some of them for the good of the country.

The family farms tax is crippling farmers in South Shropshire. I have a huge rural constituency—25% of my constituents work in the agriculture industry—and the tax is really hurting it. The Budget must reverse the cruel family farm tax, which needs to change. Farmer confidence has dropped to its lowest-ever level on record. More than 6,000 farms have already closed under this Government. That is concerning, and it is a threat to food security.

The Budget must also reverse some measures to release the stranglehold on the high street. Every Member would struggle to find a business in their constituency that says, “I am enjoying the measures that have been put in.” More than a thousand pubs and restaurants on our high streets have already gone—that is the equivalent to two every single day. That is an issue. I welcome the fact that a future Conservative Government would abolish business rates for thousands of retail, hospitality and leisure businesses. That would stimulate growth, and we could then invest in the areas where we need to.

[Dr Luke Evans]

This toxic concoction creates a cumulative cycle. The pubs that do survive have to reduce staffing and hours. In rural areas, that might increase loneliness and reduce opportunities for young people to get jobs. That cyclical nature means a spiral into decline. I am concerned about that in my area. Does my hon. Friend share that concern for his area?

[Stuart Anderson]

I certainly do. You raise a huge point—

--- Later in debate ---

[Dame Caroline Dinenage (Gosport) (Con)]

It is a pleasure to follow the hon. Member for Harlow (Chris Vince). I thank him for cantering us through his mother’s career at HMRC—on behalf of the whole House, I thank her for her service, and I ask him to pass on our very best wishes.

Madam Deputy Speaker, as a near neighbour to my constituency, I am sure that you will know that the history of Gosport has always been umbilically linked to the fortunes of our armed forces. The town was effectively nationalised by the Royal Navy two or three centuries ago. As the size and structure of our defence base changed, with that, over many decades, went many of the jobs and livelihoods that depended on it. Job density on the Gosport peninsula is almost 50% lower than in the wider south-east region, which is an issue that I have spent 15 years as an MP trying to help drive solutions for. There is nothing more important to an area like mine than maintaining the conditions that give businesses the confidence to invest, employ and grow, but the overwhelming foundation stone for growth, and for the innovation and investment that will solve the productivity puzzle that the UK is facing, is that businesses need to be able to make long-term decisions and plan for the future.

Employers in my constituency, both large ones like StandardAero, QinetiQ and STS Defence and the numerous small and growing businesses, need to be able to rely on stable borrowing costs and to know that the cost of materials will not rise unsustainably in order to have the confidence to take on new staff and start apprenticeship programmes. Investors like those who took the plunge and moved to the Solent enterprise zone at Daedalus airfield, creating hundreds of local jobs in the process, need to know that if they put their capital at risk by investing, the Government will not reach in on a whim to take a large slice of any reward. The fact is that employer tax rises put all of that at risk. That is what we have seen since last year’s Budget and why local people are nervous about this year’s Budget too.

Tax fulfils two purposes: one, which the Chancellor knows well, is to raise revenue for the Government, but I am not convinced that she has given much thought to the other, which is influencing changes in behaviour. The pessimism and growth downgrades in our economy over the past year have provided hard and fast evidence that changes to the tax regime are at least as powerful at achieving the second goal as the first. Some £40 billion of tax rises very effectively mowed down those green shoots of post-pandemic recovery, but worse than that, they incentivised businesses in my Gosport constituency to make decisions that run in direct contrast to what our area needs. There are fewer employment opportunities and fewer chances for young people to build good-quality careers.

I have heard worrying stories about the impact that the employer national insurance rises announced in last year’s Budget of unintended consequences have had in my constituency. The common thread is that the national insurance change hit the businesses for which labour is the highest cost hardest, putting services that my constituents rely on every day at risk. A fifth of everyone who works in Gosport works in caring, leisure and other service occupations. Those are by far the biggest employment sectors, and account for almost three times the average for England, so my constituents felt the Chancellor’s national insurance rises the hardest.

[Dr Luke Evans]

My hon. Friend is making an excellent speech about what happened a year ago. Another problem is that all the kite flying in the Treasury at the moment means that people are now making decisions to withdraw their pensions schemes, not employ people and not invest. Is my hon. Friend seeing that in her constituency, as I am in mine? All that kite flying has real-world consequences, even before we get to the Budget in three weeks’ time.

[Dame Caroline Dinenage]

My hon. Friend is 100% right to point out that people are making knee-jerk decisions because of fear about what the Chancellor will do, and they are delaying business decisions that they might otherwise have made that would have brought growth to my constituency.

My constituency lies on the south coast. The stunning Solent coastline may mean that Lee-on-the-Solent, Stubbington and the wider Gosport area is a wonderful place to retire. As I often repeat, we have the largest proportion by percentage of veterans of any place in the United Kingdom, but that requires adequate health and care provision. However, care providers, whose main cost is personnel, are struggling.

The Nuffield Trust has calculated that the national insurance rise costs England’s 18,000 independent adult social care providers £940 million, which has severe consequences for the elderly and vulnerable people who need the service. One local provider, who operates a 44-bed care home offering residential care for the frail elderly and those living with dementia, suggested that they had no choice but to pass those national insurance rises directly on to their customers. As a result, one constituent told me that he was seeing an increase of nearly 8% in his brother’s care home fees.

At the other end of the spectrum, Hopscotch nursery, which looks after 1,900 children across our local region and provides fantastic care and support, told me that the jobs tax added £1 million to its overheads—that is a 10% increase, which means a 10% fee increase is being passed on to many of my constituents. Working parents need childcare, so working parents have to pay. What is the impact? Reduced household spending and a slower economy or, even worse, a parent dropping out of work to look after the children. Perhaps that is why we have seen growth flatline, borrowing costs rise and, this week, unemployment reach its highest level since lockdown.

On 26 November, will the Chancellor demonstrate that she has learned the lesson that tax rises that hit employers’ bottom lines have serious implications for our businesses, communities and economy? I would be shocked if she has not, but we are still hearing reports that hiring costs are going to increase yet again. None of the hospitality and retail businesses in my constituency will welcome that. After all, the sector has already seen 80,000 job losses.

I am particularly concerned for young people. A recent Telegraph article said that young people were giving up on Gosport because of the lack of employment opportunities. For many, a job in hospitality or retail is the first step on the route into work. Businesses in the sectors that take on so many young people across my constituency, from adult social care and childcare to hair and beauty, are telling me that they are not taking on more staff as a result of the Chancellor’s changes to national insurance contributions. In fact, the National Hair and Beauty Federation told me that, at the current rate of decline, there would be no new apprenticeships in that sector at all within the next few years. It is not a coincidence that this year my constituency saw the number of young people between 18 and 24 years old claiming unemployment-related benefits rise by 31%. So when the Government conduct their new independent review into why this is happening, they might want to start by looking in their own backyard.

When the Chancellor is considering the vast array of tax measures at her disposal to fill the £30 billion black hole, will she consider the impact on the employment of young people of any proposals to further penalise retail and hospitality businesses? She might even consider taking a Conservative growth policy, and announce that business rates will be scrapped for high street businesses such as pubs.

It is not only businesses that support growth. Across Gosport, Lee-on-the-Solent, Stubbington and Hill Head, many people dedicate their own time to volunteering, towards supporting sports clubs, charities, health forums and community organisations. Those groups are the backbones of our communities, but like any organisation they cost money to run. The Culture, Media, and Sport Committee, which I chair, has heard how increasing costs have impacted the ability of charities and voluntary organisations to deliver the services that local people rely on and love.

We often forget that charities face employment costs too. Despite 83% of charities recording an increase in demand for their services over the past 12 months, last year’s tax hike added a combined £1.4 billion to the wage bills of more than 44,000 charities. A huge amount of pessimism is growing in the sector. A third of charities are reducing their workforce as a result of the tax rises, and a similar number think that the sector is in an unhealthy space.

The increase might be easier to shoulder were it not for the parallel drop-off in funding streams. Tax rises mean less money for charitable giving, especially if the Chancellor is going to go after pensioners with her increase in income tax. I cannot stress enough how much tax rises have hurt and will continue to hurt the charitable sector, and the unintended consequences are huge. We have less charitable giving and fewer hours volunteered, as people work longer and salary sacrifice schemes are raided, while increased costs threaten jobs at national charities such as Oxfam, Scope and the National Trust, which face the loss of £50 million through restrictions on their ability to claim gift aid.

Sports clubs do a fantastic job of alleviating pressure on charities and the NHS, but they can also reduce the burden on the Chancellor to pay out-of-work benefits. On current estimates, spending on working-age disability and incapacity benefits is expected to increase by £25 billion to more than £70 billion by the end of this Parliament, and an estimated 148.9 million working days were lost due to sickness or injury in 2024. Physical activity can play such a vital role in the prevention of so many conditions, and so many of our sports clubs lean in, but the tax rises in last year’s Budget mean that the sector is in a precarious position and unable to meet its potential. The facilities that teams use to practise, play and socialise need staff as well as revenue streams. Tax undermines the work being done by our sports clubs to increase the take-up of physical exercise, reduce the burden on the NHS and keep our communities together.

We do not yet know what the Chancellor plans to announce at the Budget in a couple of weeks’ time. Last year we saw £40 billion-worth of tax rises. It was the highest tax-raising Budget in a generation, and I know that many people in my constituency were shocked. That was not what the Government promised when they were in opposition or at the general election. We now fear that the Chancellor will go big on tax rises, despite categorically saying last year that she had wiped the slate clean and would not be coming back for more. My concern for my constituents is that they have seen no tangible benefit from last year’s Budget, just pain, and they will undoubtedly shoulder the burden whenever new measures are announced.

Stamp Duty Land Tax

Luke Evans Excerpts

Tuesday 28th October 2025 Commons Chamber

[Sir Mel Stride]

My hon. Friend is exactly right. The tax does precisely that. It stops people moving to where the work is, to get better jobs and further themselves. Who wants to move to one place and pay stamp duty, and then move to another to pay more stamp duty? It does not add up.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

Is my right hon. Friend aware of the study by Jackson-Stops, which looked at people aged 55 and over to see how much abolishing stamp duty would help to move the market along? The study estimated that in the first year, abolishing the tax would allow 500,000 people to downsize to free up homes for families, and in the second year, 1.4 million. Stamp duty is a real blocker. Does he agree that that study shows the power of this policy?

[Sir Mel Stride]

My hon. Friend is absolutely right. The tax is a blocker on the aspirations of those who are growing their families and simply want to find a home with more bedrooms. Often, they cannot find those homes because empty nesters—those whose children have left home—are not prepared to face the huge, eyewatering stamp duty involved.

--- Later in debate ---

[James Murray]

I had definitely been born by that time, Mr Speaker. I was doing my maths very rapidly, but I can be confident in saying that. I seem to have quite lost my way after your intervention, Mr Speaker, but let me return to the main thrust of the argument that I was making a few moments ago.

We are a serious Government who are a serious partner for the private sector, which is why we are investing in things that will get our country moving again. It is early days; the damage that the Tories did will take time to unpick and there will be more difficult decisions ahead, but since we came to power, this Government have announced £250 billion of new investment commitments, creating tens of thousands of jobs. The Bank of England has cut interest rates five times, meaning that someone on a tracker mortgage of just over £200,000 is already around £100 a month better off.

We have cut red tape and changed planning regulations so that we can deliver 1.5 million new homes over the course of this Parliament. We have acted to accelerate the construction of nearly 100,000 new homes, which were previously stuck. We were the fastest-growing G7 economy in the first half of this year. Most telling of all, since the general election real wages have risen by more than they did in the first 10 years of the Conservative Government.

The Conservatives’ answer to the nation’s challenges is always the same: austerity. They want to cut spending, increase debt and accept decline. In contrast, we will never accept austerity and we will never gamble with the public finances.

[Dr Luke Evans]

Another term for austerity is “living within your means”. That is what the British public understand, and that is the point we are trying to make in this debate. When the Government have needed to make difficult decisions, they have fallen short. Can the Minister explain why the Government are not living within their means?

[James Murray]

As the hon. Gentleman will know, the Chancellor’s fiscal rules say that day-to-day spending must be paid for through tax receipts. That is the definition of living within our means. Those fiscal rules were met at the first Budget last year and at the spring statement this year. They are an iron-clad commitment, and we will continue to meet those fiscal rules next month at the autumn Budget.

Those fiscal rules underpin our approach to the economy and to stronger public finances. We know that fiscal responsibility, which the previous Government abandoned, underpins a stable economy, and we need to secure our country’s renewal through public and private investment. We want to secure rising wages, support for businesses, more jobs, more homes and more opportunities in every corner of our country.

The motion before this House today simply is not serious. It is an admission from Conservative Members that after years in power and countless opportunities to reflect and learn from their mistakes, all they can come up with is the same failed solution: more unfunded tax cuts, more cuts to public services, more failure to invest, more austerity and more pain for the British people. That is what will keep them on the Opposition Benches for a very long time. We reject their recklessness, we reject their lack of ambition for our country and we reject this motion.

--- Later in debate ---

[Daisy Cooper (St Albans) (LD)]

Our tax system is a mess. It is complicated and unfair. It is riddled with cliff edges that distort behaviours and create inequities, and there are exemptions that have not been reviewed for years. Council tax is outdated and hated. Inheritance tax and capital gains allow the super-wealthy to exploit loopholes while the squeezed middle picks up the tab. Business rates are a tax on bricks and mortar that penalise our high streets while online giants corner more and more of the market. IR35 is a sledgehammer to crack a nut for contractors, and research and development tax credits are in such a muddle that they are triggering lots of disputes, even for legitimate claims.

When any one of those taxes is tweaked, it causes problems elsewhere. Time and again, we see that when people want to do the right thing and pay the right amount of tax or query a tax issue, they call His Majesty’s Revenue and Customs, only to have the call handler hang up, or they contact the Valuation Office Agency and have to spend money on an expensive third party that specialises in disputes.

Stamp duty has all the hallmarks of a bad tax. It is a transaction tax and an extra cost that stops people from moving, when they might want to move to start a family, to take up a new job or to take on caring responsibilities. It prevents people from getting on the housing ladder, from upsizing and sometimes from downsizing. It gums up the housing market in a country where we simply cannot afford for that to happen. It disincentivises people from moving and holds back a dynamic economy.

[Dr Luke Evans]

The Liberal Democrat spokesperson is making some excellent points. Will she therefore support the motion?

[Daisy Cooper]

No—for all the reasons that I will come to. The hon. Gentleman was a fraction too early. Here’s the rub: stamp duty raises a lot of money, and that is presumably why the Conservatives did not seek to scrap it at any point during all their years in power.

Stamp duty for primary residences in England and Northern Ireland raised around £4 billion in 2023-24, and it is suggested that it will raise £9 billion in 2029-30. The Institute for Fiscal Studies estimates that the cost in 2029-30 will be around £11 billion, with the additional costs in Scotland and Wales taken into account. That means that abolishing stamp duty on primary residences would cost in the region of £36 billion to £44 billion in total over the next five years. For anybody who is not keeping up, that is almost the cost of the mini-Budget, just in slow motion.

The Conservatives say that they want all those cuts to come from public expenditure, but in this motion they do not say where those savings would come from. By my calculations, they could choose to scrap nearly the whole of the Ministry of Justice—given revelations in recent days about prisoners being let out wrongly, it feels like that may already have happened.

The Conservatives could instead decide to end all support for farmers by scrapping the entirety of the budget for the Department for Environment, Food and Rural Affairs, which reached £7.4 billion in 2028-29, including capital—[Interruption.] Well, it does not say that in the motion. Maybe they would want to do away with the cost of clearing the vast majority of the NHS maintenance backlog—a cost they would reach in a single year—or maybe they would want to scrap the £12 billion a year budget for special educational needs and disabilities. It is not clear in the official Opposition motion where the cuts would come from.

There is a strong case for looking at reforming or scrapping stamp duty all together, alongside other property tax reforms and moving to a land value tax. Indeed, some commentators suggest that scrapping stamp duty and council tax together and phasing in a land value tax over time could be one way to move ahead.

--- Later in debate ---

[Sir Ashley Fox (Bridgwater) (Con)]

All of us here want to improve the lives of our constituents, though we often differ in how we might achieve that. As a Conservative, I believe we do so by working with the grain of human nature, by allowing people the maximum amount of liberty to live their lives, by supporting families, by rewarding hard work, rather than penalising it, and by incentivising entrepreneurship and the creation of wealth. As legislators, we do that by keeping the size of the state under control, keeping borrowing low and reducing the burden on taxpayers wherever possible.

It is with regret that I see this current Labour Government increasing taxes, increasing borrowing, increasing the deficit and our national debt, and increasing the interest we pay on that debt. It saddens me that we have a Government whose answer, whatever the question, always seems to be more public expenditure. I am pleased therefore that not only will the Conservative party reduce taxes when we form the next Government, but will scrap one altogether.

Stamp duty is a bad tax. The current stamp duty regime means that anyone seeking to buy their first home or to move house faces an additional burden at one of the most important moments in their lives. By eliminating this tax on main homes, the Conservatives would be removing a financial barrier, which for many first-time buyers or young families makes the difference between owning their first home or not. My hon. Friend the Member for Windsor (Jack Rankin) alluded to that in his excellent speech. It would mean the dream of home ownership was made more accessible.

While stamp duty has been around since 1694, the current regime was introduced by Gordon Brown in 2003. When it came into effect, it charged a fixed percentage rate depending on the value of a house—the so-called slab system. It meant that when the price went from £250,000 to £250,001, people faced an enormous increase in the tax paid. The coalition Government, to their credit, reformed the tax so as to remove the tax from those purchasing a property for under £125,000. They eliminated the slabs in the model with a slice model. That made the tax better, but the core problems remain. Stamp duty makes it harder to purchase a house. It dissuades people from upsizing or downsizing, and therefore prevents a host of other economic activities associated with moving house. A vibrant housing market is vital to economic health. When more people buy and move, transactions increase, new homes are built, tradespeople are employed, and local economies benefit. The tax on each move discourages those transactions. People stay put because of the cost of moving, and that can lead to the housing market locking up. Scrapping stamp duty on primary homes will free up the market. That will have benefits not just for buyers and sellers, but for builders, developers, local services, and the whole national economy.

There is a fairness argument, too. Buying a home is one of the largest investments that most people will ever make, and to tax that moment seems not just counterintuitive but perverse. Removing the tax on a main residence signals a commitment to giving people a chance to grow, to aspire and to build their lives. Those are Conservative principles, and the announcement made by my right hon. Friend the Leader of the Opposition in Manchester recognised that. I entirely agree with my right hon. Friend that this change will create

“a fairer and more aspirational society.”

[Dr Evans]

My hon. Friend is making an excellent speech. Does he agree that when supply is tight, if we allow people to move more easily, the right people will be in the homes that are right for their time of life? An elderly couple in a five-bedroom house will make the choice to downsize, while a family can upsize to the right house. When supply is tight, that fits much better for us as a society.

[Sir Ashley Fox]

My hon. Friend has made a valuable point. This tax cut benefits not just the first-time buyer, but the family moving into a larger home and the empty nesters—I am almost one—seeking to move into a smaller house.

--- Later in debate ---

[Bradley Thomas (Bromsgrove) (Con)]

It is a pleasure to speak in this debate on this important topic, Madam Deputy Speaker. It is one that I am passionate about. I got involved in politics to make people’s lives better, and to be on the side of those who work hard, do the right thing and aspire for themselves and their family. That is the fundamental point at the core of this argument.

My hon. Friend the Member for Windsor (Jack Rankin) made a great point when he said that this is a moral mission. It is a moral mission to be on the side of those who are aspirational, and to unlock the hopes and dreams of a generation who want a tangible stake in society but have great fears that they will never have it. Stamp duty, for many, is a tax on that dream home, on that bridge between where they are today and where they want to go tomorrow, particularly for their family.

We have heard a lot in this debate about first-time buyers, and it is right that we focus on them; it is particularly shameful that one of the first acts of this Labour Government was to lower the threshold at which stamp duty was imposed on those first-time buyers. But once a first-time buyer has been in their home for a few years and had a child, and maybe a second, and wants to move up the property ladder into a house that will better meet their needs, that is when this tax really starts to bite. Constituents have approached me to say that they are able to afford a mortgage on their next home, and have even identified one that they want to move into, but the stamp duty prevents them from moving.

What strikes me about this argument between the two sides of the House—and, in fact, between Opposition parties as well—is that many make the case that if we removed stamp duty, it would cause house prices to rise. If it was removed as a temporary measure, there would be a chance of that happening, but if it was removed in perpetuity, the housing market would regularise without a huge increase in prices. That is the key to unlocking the aspiration that so many have for themselves and their family.

I do not believe that Labour Members have particularly nefarious intent; I can only conclude that their position really does demonstrate the politics of envy. It is a fact of life that some in society will always have more wealth than others—the scale is always relative—but even if those at the upper end of the wealth scale benefit from the abolition of stamp duty, those further down the chain will also benefit. The great reality of this proposal is that it is universal in its application, so everyone will benefit.

This is fundamentally about unlocking mobility and the aspirations of so many. It applies not just to first-time buyers and those wanting to move up the ladder, but to those who want to downsize, whom we have heard so much about today. There are plenty of constituents across Bromsgrove and the villages who are asset-rich but cash-poor, and who are trapped in larger houses but would like to downsize, should the fiscal incentive be there for them to do so. Stamp duty, in the form of tens of thousands of pounds, is absolutely key in so many cases.

[Dr Evans]

A really important issue, especially for elderly people who are caught in a large home, is social care. We need to make sure that healthcare and support is there as people get older. If they find themselves trapped in a large house, how do we make sure that it is modified? That has an additional cost, which is often lost. Does my hon. Friend agree that freeing up such people to move offers them the benefit of saving money?

[Bradley Thomas]

My hon. Friend makes a valid and important point. That is one of the great peripheral benefits of this policy, should the Government embrace it, and I encourage them to look seriously at it. I encourage the Government to vote for this motion, even if only to show their intent, and even if they cannot implement it anytime soon.

We have heard about the stimulus effect. The typical spend of a family moving house is around £9,000. My hon. Friend the Member for Windsor pointed out that those employed in trades would benefit from saving that money. These are people who are not necessarily rich; they are hard workers who set their alarms in the morning. They are the very people who have aspiration for their family and want to be able to move up the property ladder.

One of the fundamental ideologies that have emanated from Labour Members is a denial of capitalism and the role that it plays in driving up prosperity. My right hon. Friend the Member for North West Hampshire (Kit Malthouse) made this point eloquently: capitalism is not something that we should be afraid of; it is the biggest driver of prosperity that the western world has known. Labour Members should embrace it with a little bit more vigour.

A point that I have to touch on, because it affects my constituency so profoundly, is the Government’s increase in housing targets. We Conservative Members are not anti-house building, but we believe that house building has to be proportionate. Bromsgrove and the villages is a 79% rural constituency. It really is the green buffer between Worcestershire and the urban sprawl of Birmingham. It is 89% green belt, yet our housing target has increased by a staggering 85%, whereas the housing target in adjacent Birmingham has decreased by over 30%. I have given various Ministers various opportunities to address this point of the Floor of the House, but no one has been able to do so yet, so I can only assume that, in the words of my hon. Friend the Member for Bridgwater (Sir Ashley Fox), the Government are “fiddling” the figures for political reasons. I would welcome it if the Minister could address the disproportionate burden that the Government’s housing targets are putting on rural areas, including Bromsgrove and the villages.

There is something that the Government could do to make the bitter pill of more housing easier to swallow, but they abandoned the idea on day one: make high-quality design a central tenet in the planning system. The previous Government opened the Office for Place, which is an advisory body that advises the Secretary of State on the quality of the built environment. Every single Government, regardless of political colour, should embrace the principles of good design, because they lead not just to good houses, but to better communities. If the Government can convey to communities that new housing is not going to impose red-brick monotony that erodes their sense of identity and character, there will be much more openness from communities to the house building agenda.

[Dr Luke Evans]

My hon. Friend makes an excellent point. One of the biggest concerns I have is that the Government have taken away the funding for neighbourhood plans. We know that neighbourhood plans give villages their say in where planned housing goes, but more importantly they deliver more housing. Does he believe it is short-sighted to take away that funding, which will compound the problem he is talking about—he is discussing the aspect of style and design—of getting communities to take on extra housing?

[Bradley Thomas]

My hon. Friend is spot-on. That is incredibly short-sighted, and I think it will prove to be a false economy.

I urge the Government to embrace good design to provide a justification to my constituents for why they are pursuing the current house building targets in such a disproportionate way across the country. Most of all, I implore the Government to put at the centre of their fiscal plans the scale of ambition that hard-working people have every single day when they set their alarms and go out to work—they want to do the right thing for their families. The Government must realise that pulling the right fiscal levers and cutting the right taxes will stimulate the very activity that will drive the growth they are so desperate to achieve.

--- Later in debate ---

[Sir James Cleverly (Braintree) (Con)]

I thank my right hon. Friend the shadow Chancellor for setting out the opening case for the Opposition’s position on stamp duty. I feel particularly passionate about this policy, which is one I put forward when I was running for the leadership of the Conservative party. Like all good ideas, it has been embraced by my right hon. Friend the Leader of the Opposition. I am particularly glad—this is a key point—that my right hon. Friend the shadow Chancellor and his team have worked hard to make sure that cutting stamp duty is not just a headline, but a fully costed and set out policy.

The Leader of the Opposition has, I think very magnanimously, said that if the Government want to steal this idea and implement it now, they will get no opposition from us. I think that shows her typical generosity of spirit. The Government are clearly struggling to come up with credible economic plans of their own, so they are very welcome to steal our economic plans.

I have been struck by the positive nature of this debate. As Conservative colleagues have noted, the expected wall of thoughtless opposition to this proposal has not materialised at quite the scale we expected. It has materialised in some instances, but that is only to be expected. We heard in a number of speeches, and I will refer to some contributions as I go through my speech, that Labour Members recognise that stamp duty is a bad tax, a counterproductive tax and a tax that has a dampening, drag-anchor effect on the housing market. However, they went on to say, “But we need the money.” They are desperate for the tax revenues, which I think shows the fundamental challenge that, frankly, Labour is going to have to deal with in November. If the Government cannot agree to get rid of this damaging, counterproductive tax, what tax will they be willing to reduce? If they are going to say to the House that, basically, there is not a single tax in the British system that they are willing to cut, reduce or remove, then the mask has slipped. Under a Labour Government, this country faces ever-increasing taxes—that is basically what they are saying. They admit that this is a bad tax, but they are not willing to vote for its removal because they want to see—they need to see, are desperate to see—taxes going up. That was fundamentally the argument put by many Government Members.

[Dr Luke Evans]

Does my right hon. Friend agree that that is compounded by the Government’s position on spending reductions? We saw that on the Floor of the House, when the one attempt to make spending reductions was gutted mid-discussion, with proposals being pulled from a Bill that dealt with welfare. Therefore, the Government will not make any spending cuts either, which does not leave much else bar borrowing, in my estimation.

[Sir James Cleverly]

My hon. Friend is spot-on. That point was very well highlighted by my good friend, my hon. Friend the Member for Bridgwater (Sir Ashley Fox), who said that official Opposition felt that this damaging and counterproductive tax should be removed. As I have said, my right hon. Friend the shadow Chancellor has set out that that would be paid for by a reduction in the welfare bill—something that I know has universal support on our Benches. My hon. Friend the Member for Bridgwater highlighted that a reduction in welfare spending is not only something that we think is a necessary and good idea, but something that Labour Front Benchers used to think was a necessary and a good idea until, with great leadership, they were told by their Back Benchers to stop thinking that it was a necessary and a good idea, and to start thinking that it was a terrible idea. Such leadership from the Back Benches is something that I admire from that party. If only Labour Front Benchers had anything like the spine of the Labour Back Benchers, the country might not be in quite such a dire economic state.

Labour Members have basically said that they are unwilling to cut even the worst taxes because basically they want to see taxes go up. The Lib Dem position is yoga-like in its ability to bend—

[Dr Luke Evans]

Pretzel-like.

[Sir James Cleverly]

Yes, pretzel-like. One after another, the speakers on the Lib Dem Benches stood up and said, “We agree that this is a bad tax. We agree that this is a counterproductive tax. We agree that it is a tax that needs to go.” I, and I suspect others on the Conservative Benches, thought, “Here we go. Here is the crescendo, the pièce de resistance,” and that those speeches would end by saying, “Which is why you will see us in the Lobby with you, ensuring that the motion is passed.” But that is not what we heard.

--- Later in debate ---

[Lucy Rigby]

It is a tax, so obviously I do not love it, but what I find extraordinary is the Conservative party’s new-found hatred of taxation when they increased taxes 25 times in the last Parliament.

As I said, we heard from various hon. Members about their objections to this tax. I will not engage on the points made about the Budget, for obvious reasons, except to repeat that we are committed to a single major fiscal event per year where the Chancellor will set out any tax decisions in the usual way alongside the OBR’s forecast. That fiscal event will take place, as everyone knows, on 26 November, at which point there will be plenty of time to discuss and debate the decisions that the Chancellor takes in the Budget.

I want to speak to some of the points raised during the debate. We heard plenty from Conservative Members about why they want to abolish stamp duty. I think some points were made thoughtfully; I say that in a well-meant way. I am sorry to say, however, that we heard absolutely nothing from Conservative Members on their appalling economic record. We heard nothing from them on their appalling record on house building—save for the acknowledgment of the right hon. Member for North West Hampshire (Kit Malthouse)—nothing on the waste of public money from the fraud on their watch, and nothing whatsoever that could be described as fiscal responsibility.

We heard from some of my hon. Friends on the Labour Benches about the urgent need to build more houses in this country, given our appalling inheritance. That is the key way that we solve the housing crisis. I pay tribute to the thoughtful speeches of my hon. Friends the Members for Welwyn Hatfield (Andrew Lewin), for Milton Keynes North (Chris Curtis), for Crewe and Nantwich (Connor Naismith) and for North Warwickshire and Bedworth (Rachel Taylor), and to my hon. Friends the Members for Loughborough (Dr Sandher) and for Tipton and Wednesbury (Antonia Bance), who spoke powerfully of the consequences of the Conservative party’s mismanagement of the economy, which include food banks, poverty and, of course, the housing crisis.

I welcome the commitment of the right hon. Member for North West Hampshire. He talked about the need to build more housing and, indeed, about beautiful housing. I assure him that that is exactly the type of housing that this Government will facilitate being built—although I note that his colleagues took him straight back to opposing development no sooner had he made that point. I also welcome his mini-insight into the infighting of the last Government.

[Dr Luke Evans]

The hon. Lady may recall that it was a Labour Secretary of State who removed the word “beautiful” from the national planning policy framework. How does she expect to have those beautiful designs if that has been taken away as a standard within the guidance that her Government provided?

[Lucy Rigby]

I assure him that the houses will be beautiful and that we will build 1.5 million of them over the course of this Parliament. There was a brief reference to Nirvana from the Conservative Benches before a descent back into half-baked and unfunded plans, to which we on the Government Benches thought, “Well, Nevermind.”

Property Taxes

Luke Evans Excerpts

Wednesday 3rd September 2025 Commons Chamber

[Sir Mel Stride]

There is no doubt that under the previous Government there was a need to support the economy. That involved the expenditure of £400 billion, not least on the furlough scheme. I do not remember the hon. Gentleman’s party arguing at the time that we should not do that; in fact, it argued that we should go further still. The Conservative Government stepped in, supported jobs and saved us from going into mass unemployment that many feared would be worse than even in the 1980s, and I take great pride in that. But we are where we are now, and what the Government should be doing is growing the economy, stoking up business sentiment, getting taxes down and getting the economy moving, but they are doing precisely the opposite.

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

Is not the difference now that we are seeing stagflation—high inflation and the economy not growing as it should be? We are therefore seeing job losses and unemployment going up every month under this Labour Government. Unless they do something drastically different, it will only get worse, and that will impact on our growth prospects and therefore on the prosperity not just of our nation but of the individuals who work and try to thrive here.

[Sir Mel Stride]

My hon. Friend is absolutely right. We are seeing high inflation, anaemic growth, high gilt yields and a pound that has been plummeting in recent times. All those are signals flashing red on the dashboard.

Instead of getting a grip on spending and getting taxes down, the Government have been out there pitch-rolling yet more taxes. Over the summer, we have seen briefings to the press suggesting tax rises on property. The Labour party has an opportunity this afternoon to rule out those possibilities, and the Minister should do just that when he responds.

First, there has been a suggestion that there will be changes to the private residence relief under the capital gains tax regime. That would strike at the heart of our country as a property-owning democracy. People would be penalised simply for selling up and moving home. It would have clear implications by bunging up the property market, and clear economic implications by causing friction in the process of people moving from one part of the country to another, often in search of work. It would discourage downsizing, even though that would be beneficial in providing more homes for people to live in. Before the election, the Prime Minister said that there never was a policy of that type so it did not need to be ruled out, but let us rule it out just in case anyone pretends that there was such a policy. When he responds, will the Minister confirm that he stands by the words of the Prime Minister?

Secondly, there has been a suggestion of an annual tax on homes. What a tax on aspiration! What a tax on people who have saved hard and managed to get on the property ladder, but who will then be stuck with annual taxes. What about those who are asset-rich but income-poor and cannot afford to pay—are they expected to sell up? Will the Minister rule out that possibility and put people’s minds at rest?

If that was not enough, we hear that the Government may be considering changes to the gifting regime in inheritance tax. They are not content just to pulverise farmers and family businesses, and to see those businesses and farms broken up when they are passed on from one generation to another, because of the imposition of tax. In fact, it was a Labour Government in the 1970s who brought in the reliefs that this Government have chosen to abolish. The inheritance tax yield will double over this Parliament. The Opposition say, “Enough is enough.” We should not punish parents who wish to pass something on to their children. Socialists do not understand that we do not all stand as atomised individuals; we work together as families and communities. We care about each other, we care about the people we love, and it is right that we have the opportunity to pass something on to them.

--- Later in debate ---

[Sir Mel Stride]

The hon. Gentleman refers to cutting spending. His party attempted to cut spending, but entirely failed to do so. My point is that if he wants money to spend on public services, he needs to cut welfare and should worry about how to do so. I do not know how he voted when that was put to the test in this House, but if he in any way voted against his own Government and against getting on top of the welfare bill, he should ask his own question of himself.

As for those on low incomes, they are precisely the people who are now being devastated by the increase in national insurance. There is not just an increase in the rate, but a substantial reduction in the threshold at which national insurance kicks in, which has meant higher unemployment, in particular among younger workers, part-time workers, women and people getting that vital first job so that they can get themselves on a career path. They are the people whom the Labour Government are punishing most.

[Dr Luke Evans]

Is that not exactly the point—that the top 1% of earners pay almost 30% of income tax? If we lose them, we damage the people who need the support and the investment from the very taxpayers we have just scared off. Should not the reverse be happening? We should attract more people into this country to spend more money, so that we have more money for such services through tax collection.

[Sir Mel Stride]

My hon. Friend is absolutely right. I have already shared with the House the classic example of the number of people who have left this country because of a punitive tax regime and the costs of that.

--- Later in debate ---

[Sir Mel Stride]

It is a simple matter of logic that even if the hon. Lady’s assertion is true—I do not know whether it is or not—it does not contradict the point that I made.

[Dr Luke Evans]

Was it not the current Prime Minister who said

“not a penny more on your council tax”?

Is the shadow Chancellor aware of how that worked out?

[Sir Mel Stride]

In a word, badly.

--- Later in debate ---

[James Murray]

I am going to make some progress, because a few moments ago I said I would do so. I have been gently reminded by Madam Deputy Speaker that I really must live up to my promise on that front.

The right hon. Member for Central Devon asked me questions in his opening remarks—indeed, his colleagues have their sheets from the Whips, and they have been dutifully following up in their comments—but they are on matters that we cannot talk about today. There are of course other important facts that the right hon. Gentleman does not want to talk about, but the British people have not forgotten them. There is the £22 billion black hole in our public finances, which the previous Government hid from the light. There is the disastrous mini-Budget, which caused damage to households across the country and to our reputation around the world. We had stalled housing, unfinished infrastructure and public services brought to their knees by under-investment and disinterest. The Conservatives do not want to talk about those things because that is the legacy of the last Government. We found out just today that the right hon. Gentleman does not even want to talk about things happening in Conservative councils, as my hon. Friend the Member for Basingstoke (Luke Murphy) raised so importantly in his contribution earlier.

Now that the Conservatives are in opposition, the right hon. Gentleman’s party and Reform Members are talking Britain down. They want to claim that Britain is broken, but I believe that Britain is unbreakable. Our country is full of potential. It is home to hard-working people, brilliant businesses, world-leading universities and research institutions, cultural giants and the promise that if people work hard and contribute to the country, it will be a place where they can succeed. Yet undeniably, after 14 years of Tory mismanagement, far too many working people feel that the economy is stuck.

[Dr Evans]

Will the Minister give way?

[James Murray]

I have been asked by Madam Deputy Speaker to make some progress, so I will return to the hon. Gentleman a little later.

I hear from my constituents, as I am sure many other Members in the Chamber hear from theirs. They tell us that no matter how much effort they put in at work, their careful management of household finances and their diligent efforts to save for a brighter future, they do not yet feel that they are getting enough in return, and it has become harder to get ahead. At the same time, our roads and railways seem slow and less reliable and our classrooms seem fuller, while the NHS has a massive backlog. The root cause of all that is the chronic under-investment by the previous Government. That under-investment over many years has slowed our productivity growth to a rate not seen since the Napoleonic wars.

Taxes

Luke Evans Excerpts

Tuesday 15th July 2025 Commons Chamber

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

I am grateful to the shadow Chancellor for making that point. Does he believe that a humble toolmaker who happens to own a small business is a working person?

[Sir Mel Stride]

Indeed, my hon. Friend is absolutely right. We need to stand up for everybody—even our toolmakers.

Let us be frank: we have had to table this motion today, which seeks to do nothing other than reaffirm the commitments that the Labour party has already made, because of the litany of broken promises that I have just shared with the House.

--- Later in debate ---

[Sir Mel Stride]

It would be sensible for the hon. Lady to look at those on her own Front Bench and ask why they take these appalling anti-business decisions. The answer is that hardly any of them have any experience of private business or of setting up a company—in fact, not one senior Front Bencher from her party has that. That is unlike the Conservatives—whether that is myself; the shadow Home Secretary, my right hon. Friend the Member for Croydon South (Chris Philp); the shadow Business Secretary, my hon. Friend the Member for Arundel and South Downs (Andrew Griffith); or others—who actually understand the real world of business.

[Dr Evans]

The shadow Chancellor makes a very good point. Is he surprised by the Federation of Small Businesses, which has come out and said that for the first time ever in its index—since records began in 2008—more small businesses will contract than will grow? Is he as worried as I am about what signal that sends to those small business owners who are trying to grow for our economy?

[Sir Mel Stride]

My hon. Friend is absolutely right. The reality is that if we tax something, we tend to get less of it. This Government have taxed business, so it is not surprising that the economy has been damaged as a consequence.

An often fair question asked of the Conservatives is: what would we do? Let me answer that question directly. First, we would have taken very different choices. We would not have loaded up taxation on businesses and stifled growth in the way that Labour has: we would have focused on productivity. We would not have come into office and given the train drivers 14% and the junior doctors 22% with no strings attached whatsoever. We were told by the now Health Secretary during the run-up to the general election that all we needed to do was get around the table with the unions and settle and the problem would go away—well, the junior doctors are back for more.