Budget Resolutions

Nickie Aiken Excerpts

Tuesday 12th March 2024 Commons Chamber

[Nickie Aiken (Cities of London and Westminster) (Con)]

The measures announced in the Budget by my right hon. Friend the Chancellor promote a pragmatic and sensible approach to growing the economy, improving productivity and ensuring that more people keep more of their earnings. We still carry the economic scars and fallout of the once-in-100-years pandemic and the energy crisis caused by Russia’s illegal invasion of Ukraine. Let us not forget that covid shut down major parts of our economy and the Government spent more than £400 billion protecting hundreds of thousands of businesses and millions of jobs.

I note the Chancellor’s comments in his speech last week that the UK’s post-covid recovery is among the strongest of the G7, ahead of France, Germany and Italy. Russia’s war in Ukraine has led to a serious energy crisis. I am proud that the Government chose to support households with increased energy bills, providing £40 billion of financial support. This Conservative Government were able to spend that money because they spent the previous nine years rebuilding our economy after it was ravaged by successive Labour Governments. Let us not forget that when we took office, the then Chief Secretary to the Treasury told us that there was no money left.

Thankfully, we are now witnessing a steady recovery, following two major economic shocks in the last four years. Economic recoveries do not succeed overnight, but this Conservative Chancellor is doing the right thing by ensuring that our public finances are on a strong footing, and that the recovery is sustainable and aimed at growth and improving productivity. He is also doing the right thing by putting more money back into people’s pockets. Following this Budget and the autumn statement, we have seen a 4p cut in national insurance in just five months. Some 27 million working people will keep an average of £900 more of their earnings.

One tax loophole that I was pleased to see closed was the abolition of the furnished holiday lettings tax regime, eliminating the tax advantage for landlords who let short-term furnished holiday properties over those who let residential properties on a long-term basis. I have campaigned for reform of the short-term lets industry for over a decade. In the Cities of London and Westminster, 10,000 short-term let properties are stripping out the long-term rental market, leaving young people struggling to pay rising rents in the capital, as they are in regions such as the south-west.

I also welcome the Chancellor’s recognition of the importance of culture in our economy, with his unveiling of the package that will provide the creative industries with over £1 billion in additional tax relief over the next five years. That is a vital sector not only in my constituency but to the wider economy. It employs 2.4 million people across the UK and contributed to £125 billion to the UK economy in 2022 alone. The relief will make a huge difference to the creative industries.

Our public services play a vital role in the life of our nation, schools, council, police and fire service and, of course, our beloved NHS, supporting us from the cradle to the grave, but we must never forget that these are all funded by taxpayer money. Thus, it is imperative that we strive for the best value for money and focus on efficiency. I fully support the Chancellor’s public sector productivity programme. Currently, productivity remains below pandemic levels, and we must close the gap. Modernising and streamlining our public services will mean better allocations of resources, leading to better outcomes for those who use these services.

Our medical professionals are best placed to improve a patient’s experience and outcome. I saw that at first hand on a visit to Barts hospital in my constituency. Barts-based Dr Debashish Das and colleagues from across London’s cardiac units have designed a shared platform to monitor remotely more than 5,000 patients who are awaiting heart surgery. This doctor-led initiative has significantly reduced emergency surgery, improved patient outcomes and saved the NHS money. That sort of project must be encouraged, not only in the NHS but throughout the public sector.

As a former councillor, I know full well how we must improve productivity and reduce costs. In 2010, as cabinet member for children’s services, I led Westminster’s merger of children’s services with Royal Borough of Kensington and Chelsea, and Hammersmith and Fulham. It was a landmark move and the first of its kind in the United Kingdom. It not only led to improved outcomes for our children but saved tens of millions of pounds for the taxpayer. We must see more of this type of project, and freedom and flexibility must be given to the public sector to improve productivity.

There is one measure missing from this Budget, which would benefit the economy if implemented: the reinstatement of tax-free shopping. Since the tax incentive was lifted, international visitor spending has fallen in the UK and risen in European cities such as Paris, Milan and Madrid. An Oxford Economics report predicts that reintroducing tax-free shopping could attract more than 1.6 million extra visitors to the UK, stimulating an extra £2.8 billion in tourist spending overall. I remain at a loss to understand why the Treasury does not accept the arguments to reintroduce tax-free shopping for overseas visitors, and to go further and extend it to EU citizens. Reintroducing tax-free shopping would boost the economy for the retail, hospitality, hotel, leisure and culture sectors, and also for the manufacturing of luxury goods. It is a no-brainer.

Thanks to the responsible and prudent management of the economy under this Chancellor, we are seeing green shoots of a sustainable recovery. That is fair and sensible.