Budget Resolutions and Economic Situation

Debate between Mike Wood and Andrew Lewin

Wednesday 28th October 2026 Commons Chamber

[Andrew Lewin (Welwyn Hatfield) (Lab)]

This is a Budget that supports those who need it most through the winter and that ask the banks, which are on course to make record profits, to make a greater contribution. Crucially, it backs young people with the ambition to own their own home and to build a business.

There is lots to reflect on. As the newest member of the Treasury Committee, I intend to get into the detail in the weeks to come, but I will start with the international context. It is crucial that we have an honest debate in this House and in the country about the impact that context has on all of us. It is true that we are spending billions more on debt interest than was projected just a few months ago, but that is not because of extra borrowing by this Government; it is because of the global spike in inflation caused by the war in the middle east. It is also the case that the IMF has praised our Government for taking decisive action on deficit reduction. However, in the 21st century no country and no economy can stand alone.

[Mike Wood]

The hon. Gentleman will be aware that a key part of the deficit reduction strategy—according to the Red Book—is a reduction of 2% a year in the annual spend on mainstream schools after 2028-29. Will he go into the next general election promising that in his manifesto?

[Andrew Lewin]

It is news to me that I will be writing the manifesto, but I am always open to a promotion. Our spending review will cover all elements of spending on public services, but this is a Government who have backed public services, unlike the Conservative party.

In a more uncertain world, it is imperative that the UK lives by our values. I have been going through the Red Book, and—this is on page 103—the single biggest increase in investment announced today is in our defence, to fund the defence investment plan. That is a very important statement of intent at such an uncertain time for our country, Europe and the world, which is further demonstrated by the package of £10 billion for additional support in loans to Ukraine.

Before the Budget speech, I was pleased to hear the Prime Minister reassert how important it is to him that we have a stronger economic trading relationship with the European Union. Also—I will be honest—I am slightly pleased by how much it upset the hon. Member for Harwich and North Essex (Sir Bernard Jenkin), because that means we are going in the right direction. It is a sad state of affairs that the Conservative Party has drifted so far away from mainstream business opinion that they are saying they will not countenance any improvement in our deal with the European Union. That is why people in areas such as mine, Welwyn Hatfield in Hertfordshire, are no longer voting Conservative.