Budget Resolutions

Max Wilkinson Excerpts

Wednesday 26th November 2025 Commons Chamber

[Sir Bernard Jenkin (Harwich and North Essex) (Con)]

It gives me a certain pleasure to share some agreement about the need for more resource in defence and resilience with the hon. Member for Warwick and Leamington (Matt Western). For all the Government’s talk of increasing spending on defence, the vast bulk of the promise they have made is after this spending period, and the small increase that has been allowed for in these spending plans is not even sufficient to make up for the problems that the Ministry of Defence has managing its own programmes. There is now a huge row going on there about what it is going to have to cut in order to stay within the spending envelop set by the Treasury. It is not a new problem, but it is a significant one, and it is one that underlines the need for the Ministry of Defence to adapt to a very different climate—a much more warlike and adaptive system for acquiring military kit.

The great theme of this Budget and the last, to which the hon. Member for Warwick and Leamington referred, is growth. I think we need to be realistic that the growth rate was flattened by the global financial crisis of 2008-09, and our productivity rate never recovered from that period. It is a puzzle. It is partly because our economy is more and more service orientated, which is labour intensive, but I think it is also because we have expanded the public sector so dramatically in recent years.

Public sector productivity is way below what it was before covid—it has not recovered. The productivity of the national health service is lamentable. These are issues of leadership, organisation and efficiency. The Government need to look at getting much better value for money for what we are spending, given that this country now has the highest ever peacetime levels of public expenditure.

[Max Wilkinson (Cheltenham) (LD)]

Will the hon. Member accept that some of the blossoming of the public sector in this country is as a result of Brexit, for which he advocated over very many years?

[Sir Bernard Jenkin]

I am tempted not to be drawn into the rather silly Brexit debate that seems to go on. It was notable that the Government spoofed towards the idea that they would make Brexit the scapegoat for the economy, but actually very little has come out from them on that. The Liberal Democrats may think, “Oh, if only we had a customs union to deal with the European Union, we would be £90 billion better off,” but that is fantasy economics. Why does the hon. Gentleman think that the Treasury is not saying that? Because it is not true—it is complete rubbish.

The idea that we have lost 4% of GDP as a result of Brexit is based on a very flimsy piece of evidence: a report put together from 13 forecasts made in 2016 and 2017, all before the Brexit deal was completed and we had a free trade agreement. It has never come to pass. In fact, a respected commentator, Wolfgang Münchau, said that we were approximating along growth rates in line with France and Germany before we left the European Union, and that our leaving the European Union was the “economic non-event” of the century. We have been approximating along at about the same growth rates. The very dire forecasts were based on the idea that there was going to be a 25% decline in our trade—that has not happened. There has been a marginal decline in our trade with the EU—[Interruption.]