Autumn Statement Resolutions

Matt Warman Excerpts

Monday 27th November 2023 Commons Chamber

[Matt Warman (Boston and Skegness) (Con)]

I welcome the autumn statement, which set out clear dividing lines between the two parties. The Conservative party wants to grow the cake and the Labour party wants to slice it into ever tinier pieces. The Conservative party understands that we will grow the cake by allowing people to fulfil their own potential, rather than imagining that the only possibility is increasing public spending, with the size of the cake set.

I welcome the autumn statement, but first let me talk about rhetoric. Rhetoric matters when we talk about homelessness, it matters when we talk about immigration and it matters when we talk about welfare. To be absolutely clear, this autumn statement raised benefits for working people by 6.7% and pensions by 8.5%. There is a controversial policy that suggests that those who do not engage with the welfare system should, if they proceed in that way for an unreasonable period, lose some of those benefits. It is easy to misrepresent that policy and to pretend that it is a bid to remove benefits from people who deserve them. The reality could not be further from the truth.

This is a policy like the sugar tax; it aims to alter people’s behaviour. In this case, it aims to alter the behaviour of individuals receiving benefits rather than of corporations that make fizzy drinks, but the analogy is, I think, correct. What the policy seeks to do is to encourage people to understand that if they do not do the right and responsible thing as citizens of this country and take the work that we know is out there then there should be consequences. That is not nasty; it is the definition of compassion. We as Conservatives should not be afraid to say that. It is a brave but overdue policy, and we should welcome it.

We should also acknowledge that it is part of a policy that will make a profound difference in particular to people who are able, as we now know from the post-covid environment, to take jobs that involve working from home. I welcome the new conditions around flexible working, which the Secretary of State set out in his opening remarks. As he said, we know that it is possible to work flexibly, but we also know that there is no nirvana of working from home all the time. I welcome in particular the tone that has been struck by the Chancellor and by the new and very welcome Chief Secretary to the Treasury in the way that they have talked about the rights and responsibilities of citizens when it comes to work.

Let me turn to the various issues that are loosely talked about as fiscal drag or tax simplification. The reality is that this autumn statement has overseen a tax cut unprecedented in size and scale for a number of years. Quite simply, that tax cut has come because of the increased headroom that this Government are now able to take advantage of.

The relative complexity of our tax system means that, unfortunately, we are sometimes sucked into an argument about income tax versus national insurance, versus a whole host of other things. We should be honest that the system is too complex. If we did not have the complexity around national insurance, income tax and a whole host of other things, we would be able to have a more honest, straightforward and comprehensive conversation about tax thresholds, about the right and fair level of tax and about where we as Conservatives want to lower it to. We would also be able to have a sensible conversation about some of the cliff edges that have inadvertently crept into the tax system, including around childcare and households that unfortunately have two people earning an amount exceeding the level where, if a single earner in the household exceeds it, the numbers simply do not add up. That is an inadvertent unfairness and one where I think we would all welcome greater simplification.

Another area where greater simplification in this autumn statement is welcome is pensions. I welcome the concept of one pot for life, which will allow us to look beyond the multiplicity of pots that people often accrue over the course of their lifetime, but it highlights the increasing need for the long-term pensions dashboard project to get over the line and underlines the fact that there is a greater opportunity for welcome projects such as open banking to fulfil their potential. All these projects rely on greater digital literacy among the population, and they rely on the Treasury to make further progress on the digital projects that will unleash things such as the pensions dashboard and projects such as making tax digital. All these things will allow greater simplification and greater fulfilment of potential by a host of different parts of our society, and I think we would all welcome some of those projects coming to fruition as quickly as possible.

Overall, I welcome an autumn statement that cuts taxes for 27 million working people. It sees us all benefit, but it also acknowledges that, given the extraordinary few years we have all lived through, from covid to the war in Ukraine, there is much that this Government have to continue to be fiscally responsible for. The call to cut taxes is a sensible one, but it must be done in the measured way that this autumn statement begins to do it.