Bank Closures and Banking Hubs

Nusrat Ghani Excerpts

Thursday 5th June 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. We have shy of 30 Members hoping to contribute, so we will have a hard speaking limit of four minutes to begin with.

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[Esther McVey]

I agree—the lack of banks is a disgrace. Where do people go for their banking needs? The reality is that the banks that are closing have entered into an agreement with businesses and individuals; when they opened their bank account, they opened it with the bank on the high street. The business was there because it expected a certain amount of customer service—that is why they went there in the first place. Face-to-face banking offers confidence, security and efficiency, especially for businesses handing over cash and making significant financial decisions. Without those services, it just will not work.

In 2022, the Federation of Small Businesses found that four in 10 small businesses still relied on cash as a primary payment, and six in 10 needed to make regular cash deposits. I regularly hear from businesses in Tatton that they simply cannot deposit cash or access the basic services needed. Why? Well, that is because 64% of bank branches have closed in the last decade and 65% of cashpoints have gone. That is reducing the ability of businesses to deposit cash in the local area. The shift to online poses risks from technical failures and cyber-attacks. We have heard that through this monopoly and lack of access, there is a squeeze, and commission is being charged for the transactions of these businesses.

Our high streets are at the heart of our communities, but without access to banking services, our high streets, which are already under pressure, have become even harder places to trade, grow and thrive. If we are serious about supporting small businesses and seeing investment on our local high streets and in our town centres, we must stop the decline in banking infrastructure.

Some may argue that closures would be reasonable if banks were losing money and needed to take cost-cutting measures, but that is simply not the case. Banks are not struggling institutions. Last year, HSBC reported nearly $25 billion in post-tax profits. Barclays made $6.4 billion. Lloyds made $4.5 billion. NatWest made $4.8 billion. Those are all eye-watering profits—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order.

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[John Whitby (Derbyshire Dales) (Lab)]

Cash is still alive and well, and for some, access to it is still a necessity—indeed, last year £80 billion in cash was withdrawn from the Link network. However, with the rise and rise of internet banking and contactless payments, we have seen a near-complete withdrawal of bank branches from certain parts of the country. As has been mentioned, there were 10,000 branches 10 years ago; now, there are just 3,000. One of those closures was the NatWest bank in Bakewell, in February 2024. It was not just the last bank in Bakewell; it was the last bank in the entire Peak District national park. In a few weeks’ time, when the Lloyds bank in Ashbourne closes, there will be no banks in the entire Derbyshire Dales constituency—an area of nearly 400 square miles.

There are many reasons why people need access to cash, all of which are ably demonstrated by the magnificent market town of Bakewell. Of course, there are residents there on low incomes or benefits, who find it much easier to budget using cash and are less likely to have access to the internet. There is an ageing population there who simply will not want to change, or do not trust the technology. We have had elderly residents taking two-hour round trips on the bus simply to withdraw cash from what was their new nearest bank, rather than use the ATMs in Bakewell. There are several successful markets each week; the traders will all have electronic card readers to take payments with, but despite what the mobile networks may say, people struggle to get a signal in Bakewell and traders often have to ask shoppers to pay in cash. There are also numerous independent shops that serve Bakewell’s 6 million visitors. Those shops need cash to run, and when they queued up for cash at the post office they found that they were being rationed, as it simply could not cope with the demand.

Despite all its attributes, Bakewell was turned down for a banking hub the first time around. When I was elected, I went back to Link, which does the assessments and makes the decisions on banking hubs. Over the course of several conversations, I tried to understand what had been missed the first time around. I have to say that Link was very responsive, and after we had submitted another application following a slight relaxation of its criteria on population size, its representatives were happy to come back to Bakewell. I took them to the agricultural business centre to see the livestock markets, where the auctioneers demonstrated to them the staggering number of transactions taking place using cheques. This, I am glad to say, seemed to be the missing part of the puzzle. Back in December, we were told that we had been given a full counter service banking hub—it was the best Christmas present ever.

The experience in Ashbourne was completely different, showing that one size does not fit all. The process there was seamless: Lloyds announced that it would close, an assessment was done, the criteria were all met, and I liaised with Cash Access UK over timeframes, locations and so on. I am very glad to say that the permanent Ashbourne banking hub will open on 27 June, and it looks like the permanent Bakewell hub will follow towards the end of July. This will continue the excellent work and growing reputation of the temporary Bakewell hub.

A national Cash Access UK report suggests that over 90% of customers believe that banking hubs are extremely important to the community, and the feedback that I get from service users is all positive. The evidence suggests that banking hubs increase footfall and boost the local economy, and I am very relieved that we will shortly have two in the Derbyshire Dales.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

The speaking limit is now three minutes. I call David Mundell.

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[Jon Trickett (Normanton and Hemsworth) (Lab)]

The banks have more or less abandoned my constituency, and it sounds like that is the case for many others. Some 6,500 branches have closed in recent years, as have more than 200 post offices. There are 23 separate settlements in my constituency with no access to banking. We do have banking hubs. It is an hour each way by bus to get to one, and it costs at least six quid to get there and back. I represent large numbers of people living in poverty, and it is hard for them to raise that kind of money just to have access to banking services.

I will make two other points about my constituency and then a general point. The bus services are very poor. As I have just said, it can take an hour each way to get to the banking hub, and the banking hub does not provide all the services that a bank should provide.

My other point about my constituency is that there are 15 zones for the internet, and 11 of those 15 zones are among the worst for internet provision in the country. How on earth is someone supposed to access banking on an internet system that is simply not working? It shows the extent to which Britain’s infrastructure is creaking, and it is not acceptable that banks should abandon the people who helped to create them in the first place.

I will just make this final point about mobility and accessibility. One in four households in my constituency has no access at all to a vehicle. That is more than 20,000 people without a van or a car to get them to a bank, even if a bank were available. It is a disgrace that the banks have turned their backs on all those people who were their loyal customers for so many years. Businesses that rely on cash and collect cash each day have nowhere to deposit it. People are driving home from their place of work or their business with cash in the boot and nowhere safe to put it. That is a dangerous thing.

It is odd, ideologically, to hear Members from the party of free enterprise and the free market saying, “We have to do something about capitalism withdrawing from communities.” That is what is happening, and that is the nature of capitalism itself. We should just say that the financial sector in this country is worth £17 trillion, which dwarfs our GDP of £2.5 trillion. The banks are worth eight times more than the total output of the whole UK. As we have heard elsewhere, £44 billion of profit has been made by the banks in recent years. It is time we brought the banks to order to serve our communities—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. I call Helen Morgan. [Interruption.]

Bank Resolution (Recapitalisation) Bill [Lords]

Nusrat Ghani Excerpts

Report stage
Thursday 24th April 2025 Commons Chamber

[Emma Reynolds]

I beg to move, That the Bill be now read the Third time.

We can hopefully do Third Reading in a more relaxed fashion. As we have discussed through the Bill’s passage, the Bank Resolution (Recapitalisation) Bill will strengthen the UK’s bank resolution regime by providing the Bank of England with a more flexible toolkit for responding to the failure of banking institutions.

As volatility over recent weeks has shown, global uncertainty can have a real impact on financial markets across the world. That is why it is important that the UK remains equipped with an effective financial stability toolkit. The primary objective of the recapitalisation mechanism introduced by the Bill is to protect the taxpayer; it will provide more comprehensive protection for public funds when banks fail. I think both sides of the House can agree that this is of vital importance to ensure that our constituents are not left on the hook when a bank collapses. The Bill achieves that without placing new up-front costs on the banking sector, and therefore strikes the right balance between protecting financial stability and supporting the Government’s No. 1 priority of driving economic growth.

I would like to thank all those in this House and the other place who have contributed to the scrutiny of the Bill. In particular, I would like to thank the Opposition for their constructive engagement. As I said on Report, there is broad agreement on the primary objectives and principles of the Bill, but differing views have been expressed on the scope of the mechanism and certain finer details. I reiterate the Government’s position: it is important to learn the lessons from the case of Silicon Valley Bank UK, which demonstrates that the implications of a firm’s failure cannot always be anticipated, and things move very quickly. It is important that the legislation avoids overly restricting the Bank of England’s ability to use the mechanism in unpredictable and fast-moving failure scenarios, and can achieve its primary objective of protecting the taxpayer. I hope that those in the other place will agree with the Government’s position when the Bill returns there for their consideration.

I thank the shadow Minister, the hon. Member for Wyre Forest (Mark Garnier), the hon. Members for Dorking and Horley (Chris Coghlan) and for Wokingham (Clive Jones), and others who were on the Committee. I thank the right hon. Member for North West Hampshire (Kit Malthouse), and the hon. Members for St Albans (Daisy Cooper) and for Bridgwater (Sir Ashley Fox), for their contributions on Second Reading. I thank the Minister with responsibility for pensions, my hon. Friend the Member for Swansea West (Torsten Bell), who assisted me on Second Reading, and my hon. Friend the Member for Newcastle-under-Lyme (Adam Jogee) for his input. I thank my hon. Friend the Member for Hendon (David Pinto-Duschinsky) for his speech on Report.

I would like to extend my gratitude to my officials in the Treasury for their hard work in developing this highly technical Bill, which could not easily be rushed, and for supporting me throughout the Bill’s passage. I am also grateful to the House staff, parliamentary counsel and all other officials involved in the passage of the Bill.

This Bill supports the UK economy’s resilience to the risks posed by bank failures. We all remember the damage caused by the financial crisis, and the Bill, alongside other measures that allow failures to be managed in an orderly way, upholds the economic and financial stability that will deliver on the Government’s growth mission. I am pleased that the Bill has received broad cross-party support in this House and the other place, and I look forward to its enactment. I commend it to the House.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the shadow Minister.

[Mark Garnier]

May I first say a hearty congratulations to the Minister on bringing through her first Bill in the new Government? She was parachuted into the job rather recently, but she has done a magnificent job, and it has been a pleasure to engage with her. We share the aim of working in the interests of the wider economy, and we have worked together on the Bill. We may differ on a few tiny details, but we agree on its overall objective.

As I mentioned on Report, I spent some time on the Parliamentary Commission on Banking Standards looking at how we can stop another banking crisis, and on the Treasury Committee doing pre-legislative work on the Financial Services Act 2012. This is an iterative and organic process. We will never be able to stop financial crises happening, but working together, we can ensure that there are no more instances of contagion flooding through the system. This Bill is extraordinarily good in following that iterative process, in order to make the banking system unsinkable, I hope—and I do not use that term lightly, as someone might have done in the film “Titanic”; this is genuinely very important.

I pay credit to the former Chancellor, my right hon. Friend the Member for Godalming and Ash (Sir Jeremy Hunt), and the former Economic Secretary to the Treasury, my hon. Friend the Member for Arundel and South Downs (Andrew Griffith), and their officials, who worked tirelessly to ensure that Silicon Valley Bank UK was transferred to HSBC over that weekend, which undoubtedly avoided wider disruption to the financial system. We are delighted that the Bill was introduced in the previous Parliament, and we welcome the Government’s decision to carry it over into this Parliament. I was about to say that our swords will cross in the coming months and years, but I do not think they will; I think we will almost certainly agree on things. We will engage with the Minister and her officials to ensure that we have a world-class financial system that is the envy of the world.

Question put and agreed to.

Bill accordingly read the Third time and passed.

Spring Statement

Nusrat Ghani Excerpts

Wednesday 26th March 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. We have another 45 minutes on the statement. If questions are short, more Members will get in.

[Imran Hussain (Bradford East) (Lab)]

It is absolutely right that the Opposition devastated our communities and left us with billions of pounds’ worth of debt, but it is not right that disabled people and the most vulnerable in our society should pay for it. Thousands of my constituents continue to be fearful about the announced welfare cuts, and disability organisations have warned that hundreds of thousands of people will be pushed into poverty. So I say to the Chancellor: we must make the right political choice. We must protect the most vulnerable in society and introduce a wealth tax so that multimillionaires and billionaires can pay their fair share.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Nusrat Ghani Excerpts

Consideration of Lords message
Tuesday 25th March 2025 Commons Chamber

Consideration of Lords message

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I must draw the House’s attention to the fact that financial privilege is engaged by Lords amendments 1B, 5B and 8B. If the House agrees to any of those amendments, I will cause the customary entry waiving Commons financial privilege to be entered in the Journal.

After Clause 1

Exemptions from the changes made by section 1: NHS and social care

[The Exchequer Secretary to the Treasury (James Murray)]

I beg to move, That this House disagrees with Lords amendment 1B.

[Madam Deputy Speaker]

With this it will be convenient to consider the Government motions to disagree with Lords amendments 5B, 8B and 21B.

[James Murray]

I welcome the opportunity to consider the new Lords amendments to the National Insurance Contributions (Secondary Class 1 Contributions) Bill. I start by repeating my thanks to Members of both Houses for their careful scrutiny and consideration of the Bill. Four new amendments have been made during consideration of the Bill in the other place, which we will seek to address today.

As I reminded hon. Members last week, when we entered government, we inherited a fiscal situation that was completely unsustainable, and we have had to take difficult but necessary decisions to repair the public finances and rebuild our public services. The measures in the Bill represent some of the toughest of those decisions, but they, along with other measures in the Budget, have enabled us to restore fiscal responsibility and get public services back on their feet. The amendments from the other place before us today put at risk the funding that the Bill seeks to raise. Let me be clear again: to support the amendments is to support higher borrowing, lower spending or other tax rises.

It is with that in mind that I turn to the first group of amendments: Lords amendments 1B, 5B and 8B. These amendments seek to create powers as part of the Bill to exempt certain groups from the changes to employer national insurance rates and threshold in the future, including exemptions for care providers, NHS GP practices, NHS-commissioned dentists and pharmacists, charitable providers of health and care and those providing hospice care. It also includes powers to exempt businesses or organisations with fewer than 25 full-time employees from the changes to the employer national insurance threshold.

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[James Murray]

The right hon. Gentleman raised the question of hospices during last week’s debate on amendments from the other place. As I made clear at the time, although hospices do not receive support to meet the changes in employer national insurance contributions, we greatly value the work they do. I pointed to the wider support that the Government are giving the hospice sector—namely, the £100 million boost for adult and children’s hospices to ensure they have the best physical environment for care, and the £26 million revenue to support children and young people’s hospices.

The right hon. Gentleman also referred to people giving to hospices, which are established as charities. Of course, the Government provide support for charities, including hospices, through the tax regime, which is among the most generous in the world, with tax reliefs for charities and their donors worth just over £6 billion for the tax year to April 2024.

Lords amendment 21B would require the Government to conduct assessments on the economic and sectoral impacts of the Bill. As we have discussed previously, the Government have already published an assessment of this policy in a tax information and impact note published by His Majesty’s Revenue and Customs. That note sets out that, as a result of measures in the Bill, around 250,000 employers will see their secondary class 1 national insurance contributions liability decrease, and around 940,000 employers will see it increase. Around 820,000 employers will see no change. The Office for Budget Responsibility’s economic and fiscal outlook also sets out the expected macroeconomic impact of the changes to employer national insurance contributions on employment, growth and inflation. The Government and the OBR have therefore already set out the impacts of this policy change. The information provided is in line with other tax changes, and the Government do not intend to publish further assessments. However, we will of course continue to monitor the impact of these policies in the usual way.

I hope that right hon. and hon. Members will understand why we are not supporting these amendments from the other place. The measures in the Bill will play a crucial role in fixing the public finances and getting public services back on their feet. The amendments require information that has already been provided, do not recognise other policies the Government have in place or, most seriously, seek to undermine the funding that the Bill will secure. I therefore respectfully propose that this House disagrees with these amendments, and urge all hon. and right hon. Members to support the Government on that disagreement.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the shadow Minister.

[Gareth Davies (Grantham and Bourne) (Con)]

I rise on behalf of the official Opposition to support Lords amendments 1B, 5B, 8B and 21B. It feels like only last week that we were all here, but it is clear that our colleagues in the other place feel as strongly as the Opposition do about these amendments, as they have returned them to us with a similar aim once again.

Lords amendments 1B, 5B and 8B seek to address two of the most serious consequences of the Bill that should concern and unite us all: that a rise in secondary class 1 national insurance could lead to a significant reduction in health and social care services, including our hospices, hitting the most vulnerable in our society; and could represent a complete hammer blow to the future aspirations and very survival of small businesses throughout the country.

We all know that the Chancellor has an addiction to creating fiscal black holes. First she used a fictional black hole, discredited by the Office for Budget Responsibility, as an excuse for her manifesto-breaking tax rises. This has led to more black holes, only this time they are very real because they are being felt out there in the real economy. The Bill before us today will create black holes in the finances of hospices, GP practices, farms, fruit shops, butchers, bakeries and businesses of all shapes and sizes, but especially the very smallest.

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[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Liberal Democrat spokesperson.

[Daisy Cooper (St Albans) (LD)]

I rise to speak to Lords amendments 1B, 5B, 8B and 21B. Even before the Budget, there were rumours that the Government were thinking of introducing a hike to national insurance contributions. We Liberal Democrats issued a stark warning to the Government. We challenged them at Prime Minister’s questions and in questions to the Deputy Prime Minister, saying that if they went ahead and introduced these changes, social care providers up and down the land would be hit incredibly hard. The Government cannot say that they were not warned. We warned them, even before they made the announcement.

In the many long debates that we have had in the Chamber since the Budget, we have consistently made the case that health and care providers should be exempted from this change. The Government say that they want to make the national health service a neighbourhood health service; we heard this just an hour ago from the Secretary of State for Health and Social Care. They also say that they want to take services out of hospitals and on to the high street, but this tax hammers the very providers of the neighbourhood community services on which the NHS relies. It is GPs, dentists, pharmacists, hospices and care providers who hold up our community care, and prop up our NHS, so that it does not fall over.

Government Ministers have said on many occasions that they have increased funding to social care, but the additional funding announced in the Budget is dwarfed by the rise in national insurance contributions. As other Members have highlighted, the Government have said that they have given more funding to hospices, but that funding is for capital projects. There is no point having another hospice building or hospice bed if there are no staff to look after the people lying in them. We know that we have to fix the front door to the NHS—our GPs and dentists—but we have to fix the back door to our NHS too, which is social care.

On hospices, there is nowhere else for the people in them to go. People look for support from hospices so that they can die in dignity, with independence, in a setting of their choice, surrounded by their loved ones—not in the sterile environment of a hospital ward or, worse, a busy corridor or ambulance parked outside. We need our GPs, dentists, hospices, pharmacists and care providers to survive and thrive if we are to end the crisis in our NHS.

The Lords in their wisdom have not sent back an amendment that simply asks for an exemption. They have put in a very clever tweak that asks that the Government to adopt a Henry VIII power. That is not something the Liberal Democrats would normally support, but on this occasion it would give Ministers the power to choose if and when they want to exempt health and care providers from the rise. That way, when we get this enormous growth booming in our economy—when we see the success that we all hope to see—a Minister could choose to exempt health and care providers and give them the cash injection that they need. I urge the Government to support this measure.

Amendment 8B provides a power to exempt small businesses from the changes. Small businesses are the engine of our economy and of growth. They are the very organisations that prop up our high streets. They are the glue that hold our communities together. The Government have raised the employment allowance for microbusinesses, but they have not put other provisions in place to support small businesses. While our small businesses can be the engine of growth, they are screaming out about the number of obligations being put on them, with the NICs changes, business rates bills going up and the new obligations under the Employment Rights Bill. It is all happening at once, and they say that they are overwhelmed. I support amendment 8B, which would give the Government the power to exempt small businesses.

I am also in favour of Lords amendment 21B on an impact assessment. As Ministers remind us, there is a tax and spend announcement coming, but looking at the impact of the provisions, this is less about tax and spend and more about the overwhelming impact on small businesses, which are really struggling right now. Many of them still have covid loans, and many are struggling with access to finance. Many owners are remortgaging their homes to prop up a new business. This change has come out of the blue. Small businesses have not been able to plan ahead for it, and many of them are fearful about what will happen. I fear that if the measures go ahead, in a matter of days, we will start to see shop fronts boarded up on high streets up and down the land.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I was going to call Sir Roger Gale, but he is no longer bobbing—ah, I call him now.

[Sir Roger Gale]

Thank you, Madam Deputy Speaker. I naively assumed that, having already been called twice today, I had to take my place in the pecking order.

I want to come back briefly to hospices. This is a very serious issue, and I do not think that the Minister or the Government understand the deleterious effect of the change on care for some of the sickest people in the land, both in adult hospices and children’s hospices. I have listened very carefully—twice now—to the Minister’s response about giving this and giving that, but they are giving with one hand and taking away more with the other. The net result will be a reduction in staff. This is a straightforward tax on jobs.

Without dedicated, caring staff, who do jobs that frankly most of us would not begin to know how to do, the health service will not function. There are children living in and being serviced by Demelza House, Shooting Star and all the other children’s hospices. The Pilgrims Hospices in Thanet and Canterbury will not be able to afford to recruit and or pay the staff that they need.

Hospice care is an integral part of the health service. The point was made by my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) and others that hospice care is part of the health service and should be treated as part of the NHS. [Interruption.] My right hon. Friend asks from a sedentary position, “Where are all the Labour Members?” The answer is that they will be in the Lobby, voting against these measures, but they are not here listening to the debate. It saddens me to have to say it, but in this instance, their absence speaks volumes. Quite simply, they do not care.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Nusrat Ghani Excerpts

Consideration of Lords amendments
Wednesday 19th March 2025 Commons Chamber

[James Murray]

I thank the hon. Gentleman for drawing attention to the very important reforms that my right hon. Friend the Secretary of State for Work and Pensions set out in this House yesterday, which are a crucial part of getting people back into work. Further details on interventions to help people back into work will be set out. We recognise that charities may, in some cases, provide that support, which is why many of the elements of support for charities in the tax regime remain so generous. There was £6 billion for tax relief for charities and their donors in the tax year to April 2024 through features that will continue in the tax year that we are entering. The employment allowance is more than doubling from £5,000 to £10,500, which will benefit all charities in this country. Charities, particularly small charities, will benefit directly from changes that we have made to the employment allowance. [Interruption.] Sorry, Madam Deputy Speaker—I thought you were going to intervene on me.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

The Minister is making a lengthy contribution; I am just waiting for a conclusion.

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[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. This debate has to conclude within two hours of its start, so we will have a six-minute time limit, other than for Front-Bench Members. I call the shadow Minister.

[Gareth Davies (Grantham and Bourne) (Con)]

I rise on behalf of the official Opposition in support of Lords amendments 1 to 4, 8, 10, 14 and 21.

Before I dive into the detail, I want to get a little nostalgic. One year and six days ago, I opened Second Reading of the National Insurance Contributions (Reduction in Rates) Act 2024, which cut national insurance for some 29 million working people across the country. What a difference a year makes. At the end of my speech that day, I posed a simple question to the shadow Minister, now the Exchequer Secretary, which was really bugging me at the time: how will Labour pay for all its many spending commitments? I asked specifically what taxes Labour would put up, and called for Labour to just be straight with the British people. Alas, no straight answer was forthcoming, but now we know the answer, don’t we? It is just a shame that Labour gave it to us only after the general election.

Labour promised not to raise national insurance, and that it was on the side of British business. It said that it would deliver economic growth; how is that going? The fact is that the Chancellor is delivering a £25 billion tax rise on jobs across the country. That will stifle growth, hold back British business, and harm public services. This Labour national insurance Bill will, unbelievably, take the tax burden to its highest level in history on the backs of working people.

We are debating a series of amendments tabled and voted through in the other place with the aim of mitigating at least some of the damage to three vital parts of our economy and our communities: healthcare providers, charities and small businesses. Lords amendments 1, 3 and 4 seek to exempt from the measures care providers, NHS GP practices, NHS-commissioned dentists and pharmacists, providers of transport for children with special educational needs and disabilities and charitable providers of health and social care, such as hospices, as we have heard. That is because we have been warned that as a direct result of the national insurance tax hikes, we could see fewer GP appointments, reduced access to NHS dentistry, community pharmacies closing, adults and local authorities paying more for social care, and young working families being hit with even higher childcare costs. We have to avoid that.

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[Rachel Blake (Cities of London and Westminster) (Lab/Co-op)]

I listened carefully to your answer to the Minister’s question about what you would cut if this change were to be reversed. You have not been clear about whether you would reverse it, but I listened carefully to the answer, and what I heard you say—[Interruption.] I am so sorry, Madam Deputy Speaker. The shadow Minister referred to GB Energy and the National Wealth Fund. Will he clarify whether he is really saying that he wants to reverse record levels of investment in energy infrastructure and innovation jobs, and in jobs across this country, to stabilise our economy into the future?

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I remind hon. Members that interventions should not be short speeches. The hon. Lady is absolutely right; looking at the Chair should hopefully prevent her from saying the word “you” repeatedly.

[Gareth Davies]

The problem with that intervention is that the chairman of GB Energy himself disagrees about the number of jobs that it will supposedly be creating. I have set out clearly some of the things that we would do differently, and the different choices we would make from the choices this Labour Government are making.

When we talk about small businesses, and about the impact of this national insurance tax increase on businesses as a whole, the Minister and other Labour Members incorrectly suggest that only the largest businesses will be forced to pay this jobs tax. As I have told them consistently in every debate we have had on this Bill, that is simply not the case. Village butchers, high street hair salons and community pharmacies are not what most people would regard as large businesses, yet businesses such as those will be hit. If the Government really want to ensure that our smallest businesses are exempt from at least part of this damaging tax, they should support the Lords amendments that are before us today.

[Sir Gavin Williamson]

We know that the Minister is having to defend the undefendable—he has got a certain Matt Hancock about him in how he does it with zeal. [Interruption.] Sorry, Madam Deputy Speaker. Does the shadow Minister agree that the people who are paying for these increases are taxpayers? They are people who are working hard. I was talking to a manufacturing business in my constituency that was going to give its employees a 4.5% pay increase, but can now only afford to give them a 2% increase. This money is coming out of the pockets of hard-working people.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I remind hon. Members that language should be respectful at all times.

[Gareth Davies]

The jungle awaits the Minister, clearly. My right hon. Friend is absolutely right; in fact, the OBR has clearly demonstrated in its analysis that 76% of this tax increase will be passed on to working people. That is a manifesto breach if ever I saw one. Not only that—the Institute for Fiscal Studies has made clear that this tax increase will not just have an impact on working people. It is the lowest-paid people in our country who will be paying for it, which is another under-appreciated and under-commented fact for the Labour party.

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[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Due to the length of Front-Bench contributions, Back Benchers are now limited to five minutes.

[Dr Jeevun Sandher (Loughborough) (Lab)]

Thank you, Madam Deputy Speaker, for allowing me to rise to speak to Lords amendments 1 to 19. I want to speak about what makes a good tax system and, in particular, optimal tax theory, which is a topic that is as thrilling to me as it is no doubt to the entire Chamber.

A good tax system is defined by neutrality, simplicity and stability, as set out in the Mirrlees review. A tax system designed along those three principles will raise the maximum revenue with the minimum economic impact. Each of the amendments in isolation might seem reasonable, but together they introduce individual exemptions that make our tax system less neutral, less simple and less stable. The amendments would make our tax system worse.

Today, we are discussing raising national insurance contributions from the largest employers to fix our broken public services and invest in our prosperity. Three quarters of that £23 billion of investment is from the richest 2% of businesses, while we are reducing contributions from the 250,000 smallest businesses.

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[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Liberal Democrat spokesperson.

[Daisy Cooper (St Albans) (LD)]

Notwithstanding what was said by the hon. Member for Loughborough (Dr Sandher), the Lords amendments were clearly not designed with the aim of creating a simpler tax system. They have been sent to us to consider because they may create a fairer society, and that, in my view, should be a driving force in our consideration of them today and in the work of this House.

Such is the strength of feeling in the other place that it has sent us 21 amendments, and such is the strength of feeling on the Liberal Democrat Benches that we will support every single one. Taken together, they offer exemptions for health and care providers, for small charities with an annual revenue of less than £1 million, for transport providers, for children with special educational needs and disabilities, and for small businesses with fewer than 25 employees.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. We have three more speakers. If anyone intervenes, I will not be able to get all of them in.

[Caroline Voaden (South Devon) (LD)]

I rise to speak to Lords amendments 1, 2, 3 and 4. The Liberal Democrats are extremely concerned that this tax rise risks dire consequences for social care, primary care, the NHS, hospices and charities, many of which are delivering vital healthcare in the community. Thousands of care providers are already on the brink of bankruptcy, and this national insurance increase risks tipping them over the edge.

The OBR estimates that this hike will bring in £10 billion a year rather than the £25 billion estimated by the Government, once employers change their behaviour in response to the tax and once public sector employers are compensated. Yes, we know that finances are stretched, and that the Government inherited an incredibly difficult situation, but the Government could have raised that amount of money through much fairer tax changes, and we Liberal Democrats have come up with many suggestions. For example, they could have reversed Conservative cuts handed to the big banks; increased the digital services tax; doubled the rate of remote gaming duty; and introduced a fair reform of capital gains tax, so that the 0.1% of ultra-wealthy individuals pay their fair share. This may be something particular to Totnes, but many wealthy constituents have told me that they wish they were being asked to pay more tax.

The Liberal Democrats have called on the Government to exempt social care providers and GPs from the employer national insurance tax rise. On average, the tax rise will cost each GP practice an estimated £20,000 a year. The Government have announced an additional £889 million in the 2025-26 GP contract, but have failed to spell out how much of that they believe practices will need to use to pay the additional tax burden, and how much will be left to meet unmet patient needs. What is clear is that the national insurance rise will mean that the uplift to the GP contract is in fact far smaller than it appears, because a proportion will need to be returned directly to the Treasury—robbing Peter to pay Paul, as many Members have said.

What assessment have the Government made of how much of the recent uplift in the GP contract will practices need to use to offset the rise in national insurance? Rowcroft hospice, which is in the constituency next door, but which serves us, says the NIC rise is expected to add £225,000 to annual costs. One of my GP surgeries says that its costs will go up by £187,000, and the Devon Mental Health Alliance estimates the cost increase at £375,000, potentially resulting in a loss of 25,167 staffing hours.

One GP said to us:

“I have been a GP for 10 years and a doctor for 15. It is exhausting and, frankly, I just feel like giving up. This is not an attractive or stable job for training doctors.”

The Devon Mental Health Alliance, which is a strategic partnership, uniting five leading charitable organisations in Devon, said:

“As a sector, we play a critical role in easing the burden on the NHS by preventing thousands of people from needing GP appointments, hospital care, or sitting on waiting lists for treatment. By addressing health issues at their root and offering early intervention and prevention, this sector acts as a frontline defence, reducing demand on overstretched NHS services.”

It cannot fill the black hole by increasing revenue efficiencies or risk management. The organisation estimates costs of £375,000 next year and, as I have said, that could mean losing 25,000 staffing hours. That would mean that more people in Devon with complex needs will not be able to access its services.

Minister, at a time when we have a mental health crisis across all ages and communities, this extra financial impact on voluntary sector services is short-sighted and will only heap more pressure on the NHS. If we do not value the work done in primary care, particularly by GPs, we are putting the health of our constituents across the country at risk, putting more pressure on GPs who are already working at full capacity and threatening reforms to the NHS, which has already been brought to its knees by chronic underfunding over the past decade. I strongly urge the Government to reconsider the NICs rise for GPs, social care providers and all of those working to support health and wellbeing in the communities that we represent.

Just to finish, I would like to echo what others have said about the total absence of Government Back Benchers who have felt able to come in and speak in support of their hospices, their social care providers and their voluntary sector organisations, because they could not come in here and defend a Government policy that they know is indefensible.

Family Businesses

Nusrat Ghani Excerpts

Wednesday 26th February 2025 Commons Chamber

[Madam Deputy Speaker (Ms Nusrat Ghani)]

The Speaker has not selected the amendment. I call the shadow Chancellor.

--- Later in debate ---

[Mel Stride]

rose—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. Before the shadow Chancellor responds, let me says that “a concern of yours” would mean a concern of the Chair’s. Let us start off today’s business in good form.

[Mel Stride]

Madam Deputy Speaker, I think that I should put it on the record that you have always been very pro-farmer, and that should never ever be brought into question by anybody in this Chamber.

I have always been extremely proud of our record of supporting farmers up and down the country. That has been the case ever since I first came into the House in 2010, representing a highly rural constituency right in the middle of beautiful Devon. This party should be very proud of the many schemes, financial support packages and so on that it introduced while in government.

[Mike Martin (Tunbridge Wells) (LD)]

I thought that I would let the shadow Chancellor make a little progress in his speech before intervening on him. It seems odd to hear a speech about the economy from the Conservative party without any mention of Liz Truss. Now we hear mention of trade deals. Let me ask him this very directly: does he think that the policies of Liz Truss—[Interruption.] The shadow Chancellor cannot hear what I am saying, because the Members behind him are shouting.

[Madam Deputy Speaker]

Interventions should be very short. Come to a conclusion quickly.

[Mike Martin]

Does the shadow Chancellor think that the policies of Liz Truss were good for business investment and confidence in the economy?

--- Later in debate ---

[Wendy Morton]

The point that we are trying to make is that the Minister is looking only at one dataset, not the big picture. We have spoken a lot about farmers, but the business property relief is about the whole of the business community. Will he not go away and have another look at this, taking account of all the evidence that, hopefully, he has been listening to since the announcement of this reckless policy?

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. Before the Minister continues, let me remind Members who have not understood the etiquette that they cannot just wander into a debate when someone is on their feet and try to intervene. They need to take part in the whole debate.

[James Murray]

I return to the point that I have made several times today: the way to understand how the policy on agricultural property relief and business property relief will work is to look at actual claims data—the claims as they relate to individual estates. The overall value of farms or businesses does not tell us exactly what the estate value will be through an individual claim. That is the correct way to approach it.

--- Later in debate ---

[James Murray]

What I accept, as I said earlier, is that our difficult decision on employer national insurance contributions will have impacts on different businesses across the country. But the hon. Member should welcome—businesses across the country will welcome this—the extra support that we have provided through draught relief to support those pubs to succeed. That is an essential part not just of our economic activity across the country, but of our social lives and enjoying pints. I know that enjoying pints matters very much to Opposition Front Benchers.

I will try to make some progress, because there is quite a lot to cover in the Opposition’s motion. On employment, the motion seeks to undermine the Employment Rights Bill, so let me directly address those points. The Bill is the first phase in delivering our plan to make work pay, supporting employers, workers and unions to get Britain moving forward to bring greater predictability to the lives of working people. While I recognise that the flexibility offered by zero-hours contracts, zero-hours arrangements and low-hours contracts can benefit both workers and employers, without proper safeguards that flexibility can be one-sided, and it is far too often the workers who end up bearing all the financial risk.

That is why we have committed to ending this one-sided flexibility, to ensure that all jobs provide a baseline of security so that workers can better plan their lives and their finances. That includes ending exploitative zero-hours contracts. We will deliver the commitment through two measures: first, a right to guaranteed hours where the number of hours offered reflects the hours worked by the worker during a reference period; and secondly, new rights to offer reasonable notice of shifts, with proportionate payment for shifts that are cancelled, moved or curtailed at short notice.

I will try to draw this to a close. [Interruption.] Opposition Members might not want to hear it but, out of respect to you, Madam Deputy Speaker, I will bring my remarks to a close. The motion exposes a Conservative party that is happy to object to the difficult decisions that we have taken but totally unable to offer an alternative plan of its own. The debate has also allowed me to set out, on behalf of the Government, how we are moving fast to take the sometimes difficult but necessary decisions to deliver our plan for change.

We are taking the right decisions to fix our public finances, to restore stability and fiscal responsibility, and to ensure that both businesses and their employees can work productively and securely to drive economic growth. The changes that we have begun making are essential for economic growth, so we reject the Opposition’s motion. We are determined to move further and faster to make people across the UK more secure and better off.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Liberal Democrat spokesperson.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. As the Front-Bench contributions were so substantial and so many colleagues wish to contribute, there will be a time limit of five minutes.

--- Later in debate ---

[Lincoln Jopp (Spelthorne) (Con)]

Will my hon. Friend give way?

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. You have 10 seconds left, Mr Thomas. Do you want to finish?

[Bradley Thomas]

I will finish by saying that I will always be proud to stand up for small businesses in Bromsgrove and the villages, and across the country.

Crown Estate Bill [Lords]

Nusrat Ghani Excerpts

Report stage
Monday 24th February 2025 Commons Chamber

[James Murray]

I beg to move, That the Bill be now read the Third time.

The Crown Estate is an independent commercial business with a varied portfolio of assets across London, and with marine, rural and urban holdings. It operates for profit and competes in the marketplace for investment opportunities. However, it is governed by legislation that has not changed since 1961. That is why the Bill is focused on modernising the Crown Estate by removing limitations that, if unchanged, would hamper its ability to compete and invest as a commercial business.

The central aim of the Bill has been to ensure that the Crown Estate has a sustainable future for decades to come. Through these targeted and measured changes to its founding legislation, particularly in respect of its investment and borrowing powers, the Government are building on the Crown Estate’s strong track record of success in creating long-term prosperity for the nation. The changes will ensure that the Crown Estate has flexibility to support sustainable projects and preserve our heritage for generations to come. Crucially, the measures will unlock more long-term investment, helping to drive growth across the UK.

The Bill has been strengthened and improved in its passage through both Houses. It has been amended to require the Crown Estate’s board to include commissioners with special responsibility for giving advice about England, Wales and Northern Ireland. That will ensure that the Crown Estate continues to work in the best interests of the UK. There have also been changes to strengthen its transparency and accountability, for example through the requirement for the Crown Estate to report on its activities under the partnership with Great British Energy, and the requirement to keep its activities under review with regards to the achievement of sustainable development.

I thank all hon. Members and all noble Lords in the other place for their thorough consideration and scrutiny of the Bill, and for the many and varied amendments that have been tabled and debated. I also thank everyone who has played a role in getting the Bill to this stage, including my colleagues in the Treasury, Members from across the House who took the time to provide scrutiny, all the parliamentary staff who worked on the Bill, and the officials in my Department who have put in a significant amount of time and effort. I am grateful for the broad support for the Bill from across all Benches. It will ensure that the Crown Estate can operate successfully for many more decades to come. I commend the Bill to the House.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the shadow Minister.

National Insurance Contributions

Nusrat Ghani Excerpts

Tuesday 4th February 2025 Commons Chamber

[The Exchequer Secretary to the Treasury (James Murray)]

I beg to move,

That the draft Social Security (Contributions) (Rates, Limits and Thresholds Amendments, National Insurance Funds Payments and Extension of Veteran’s Relief) Regulations 2025, which were laid before this House on 15 January, be approved.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

With this it will be convenient to discuss the following motion:

That the draft Child Benefit and Guardian’s Allowance Up-rating Order 2025, which was laid before this House on 15 January, be approved.

[James Murray]

Regulations are made each year to set various national insurance thresholds, and to uprate child benefit and the guardian’s allowance. In opening the debate, I will give the House details of what the regulations set out to do. First, the Social Security (Contributions) (Rates, Limits and Thresholds Amendments, National Insurance Funds Payments and Extension of Veteran’s Relief) Regulations 2025 set the rates of certain national insurance contribution classes and the level of certain thresholds for the 2025-26 tax year. The lower earnings limit, the small profits threshold and the rates of class 2 and class 3 contributions will all be uprated by the September consumer prices index figure of 1.7%, while the other limits and thresholds covered by the regulations will remain fixed at their existing levels.

The regulations also make provision for a Treasury grant—a transfer of wider Government funds—to be paid into the national insurance fund, if required, for the 2025-26 tax year. The regulations also, importantly, extend the veterans’ employer national insurance contributions relief until April 2026. The scope of the regulations under discussion is limited to the 2025-26 tax year.

As hon. Members will know, national insurance contributions are social security contributions; people make contributions when they are in work to receive contributory benefits when they are not working—for example, after they have retired, or if they become unemployed. National insurance contribution receipts fund those contributory benefits, as well as helping to fund the NHS.

The primary threshold and the lower profits limit are the points at which employees and the self-employed start to pay employee class 1 and self-employed class 4 national insurance contributions respectively. The primary threshold and lower profits limit were frozen by the previous Government at £12,570 until April 2028. However, the level of those thresholds does not affect people’s ability to build up entitlement to contributory benefits such as the state pension. For employees, entitlement is determined by their earnings being above the lower earnings limit, which the regulations will uprate from £123 a week in 2024-25 to £125 a week in 2025-26. That is the equivalent of an uprating from £6,396 to £6,500 a year.

Entitlement for self-employed people is determined by their earnings being above the small profits threshold, which the regulations will uprate from £6,725 in 2024-25 to £6,845 for 2025-26. Uprating the lower earnings limit and the small profits threshold is the usual process, and it maintains the real level of income at which people gain entitlement to contributory benefits. Wage growth is currently higher than inflation, which means that following the uprating by CPI, there will be a reduction in the number of hours that someone who has received a typical wage increase needs to work to gain entitlement compared with last year.

The upper earnings limit, which is the point at which the main rate of employee national insurance contributions drops to 2%, and the upper profits limit, which is the point at which the main rate of self-employed national insurance contributions drops to 2%, are aligned with the higher rate threshold for income tax at £50,270 a year. The previous Government also froze those thresholds until April 2028.

I now turn to the thresholds for employer national insurance contribution reliefs. As hon. Members are aware, the Government have had to make difficult decisions to fix the public finances. One of the toughest decisions that we faced was the decision to increase the rate of employer national insurance contributions and reduce the secondary threshold. Although those changes are the subject of a separate Bill, not these regulations, they are the context for why our decision to maintain other targeted national insurance contributions reliefs is so important. Those employer reliefs include those for under-21-year-olds, under-25 apprentices, veterans, and new employees in freeports and investment zones. The regulations that we are debating set these thresholds in line with other personal tax thresholds.

The regulations also provide for the national insurance contributions relief for employers of veterans to be extended for a year until April 2026. This measure means that next year, businesses will continue to pay no employer national insurance contributions on salaries up to the veterans upper secondary threshold of £50,270 for the first year of a qualifying veteran’s employment in a civilian role.

Charter for Budget Responsibility

Nusrat Ghani Excerpts

Wednesday 29th January 2025 Commons Chamber

[The Chief Secretary to the Treasury (Darren Jones)]

I beg to move,

That the Charter for Budget Responsibility: Autumn 2024, which was laid before this House on 22 January, be approved.

It feels like I was in the House only a few moments ago, but I am delighted to be back at the Dispatch Box for this important debate. Sustained economic growth, supported by sound investment, is the only route to improving the prosperity of our country, and, in so doing, the living standards of working people. Growth is the primary mission of this Government.

This debate is timely, as the House knows, given that the Chancellor gave her growth speech only this morning. In her speech, she reiterated that without a stable economy, we cannot hope to attract investment into the UK; that we cannot grow our economy with a black hole in our public finances; and, importantly, that fixing the foundations of the economy starts with the new fiscal rules, which we are voting on here today.

The Chancellor announced in her speech that we are taking difficult decisions in the long-term interests of the country, including, for example, on a third runway at Heathrow airport. As she set out, the Government support and are inviting proposals for a third runway at Heathrow to be brought forward by the summer. Once proposals have been received, we will take forward a full assessment through the airport national policy statement, to ensure that any scheme is delivered in line with our legal, environmental and climate obligations. According to a recent study from Frontier Economics, a third runway could increase GDP by 4.3% over the next 25 years. It is estimated that over half—around 60%—of that boost would go to areas outside London and the south-east, underlining the fact that Heathrow as a hub airport brings prosperity not just to London but to every region and nation of the country.

The Government have also set out further plans to reform our planning system, to provide confidence to investors and builders, and to show that Britain can get building again and that we can deliver on our promises. Confidence starts with stability. Stability is the precondition to a healthy, growing economy, because it gives UK businesses and households the essential confidence that they need to spend and invest, encouraging innovation and boosting our economy. In outlining our new, robust and transparent fiscal framework, the charter for Budget responsibility that we are voting on today provides a vital and stable foundation from which our economy can grow.

What the instability of the last 14 years has given us is clear: low productivity, rising debt levels and declining public services performance. Public sector net debt is 97.2% of GDP, and net financial debt remains close to its highest recorded level as a share of GDP, which was reached in the pandemic. Per capita GDP remains 0.8% below pre-pandemic levels. In contrast, had the UK economy grown at the average rate of OECD economies over the past 14 years, it would be over £150 billion larger than it is today. Public investment in the UK has historically been low and inconsistent. Our public capital stock, as a share of GDP, is the joint lowest in the G7, and more than 10 percentage points below the G7 median.

Underneath all those challenges was a £22 billion black hole of in-year spending pressures that were not disclosed by the previous Government to Parliament, the public or the Office for Budget Responsibility—[Interruption.] My colleague the shadow Chief Secretary to the Treasury, the hon. Member for North Bedfordshire (Richard Fuller), seems to have comments on the £22 billion black hole. I will happily take an intervention from him. [Interruption.] I am told that I cannot take an intervention, Madam Deputy Speaker. That is very sad. But in that context, I look forward to the shadow Chief Secretary outlining in his speech how that £22 billion black hole came into being.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

For the record, the Minister can take an intervention if he wishes to. This reminds me of the many years all three of us spent on the Business and Trade Committee, when we could not agree on anything either.

[Darren Jones]

I was always enamoured of your arguments, Madam Deputy Speaker, as I continue to be today. I look forward to the prospect of many interventions from Members across the House as part of this important debate, and I encourage the shadow Chief Secretary to intervene.

--- Later in debate ---

[Darren Jones]

The right hon. Member knows that the Labour party takes child poverty seriously. That is why we launched the child poverty taskforce at the start of this Government, co-chaired by the Work and Pensions Secretary and the Education Secretary, to do a root and branch review of the long-term structural causes of child poverty and the interventions the Government could take to reverse those growing trends that none of us across the House wants to see. The taskforce will report in the coming months, but he is right to point out that housing costs and insecure housing have become ever more important drivers of child poverty in recent years. That is why, through the Renters’ Rights Bill introduced to the House by the Deputy Prime Minister, we are taking action in the private rented sector to provide additional protections and support for families in rental accommodation—for example, banning no-fault evictions and giving more security of tenure for people who are renting.

Like me, the right hon. Member will have had lots of casework where hard-working families, who are just trying to make ends meet and to provide security of income and a roof over their head for them and their families, are failed by a market in which house prices to buy and rent are out of reach and the rate at which we build affordable and social housing is not meeting the demand of the people who need it. That is why we increased funding at the Budget by half a billion pounds to build more affordable and social housing, which we know can be delivered quickly.

On a visit last week to Erewash, I visited social housing developments supported by Homes England and learned from the company building those homes for emh Homes, the east midlands housing association, that it takes only 14 to 16 weeks from laying the foundations through to giving the key to the person moving in. That reminds us why our reform agenda is so important, because the time involved in building—planning, consenting, infrastructure and financing deals—has been significantly holding back the rate of development of social and affordable housing across the country. Those are exactly the sorts of issues where Government have the ability to make a difference, which is why we are committed to accelerating our plans to build 1.5 million homes a year, but, crucially, to tilting that towards more affordable and social housing to support people across the country.

The Government are resetting the welfare cap, given that the previous one was repeatedly breached, and we are doing so based on the latest Office for Budget Responsibility forecast. That will set a new target for 2029-30, alongside our action to control welfare spending and to help people who deserve the assistance. The Government have demonstrated that they will not shy away from doing what is needed to put welfare spending on a more sustainable path—for example, with different decisions such as targeting winter fuel payments to those who need them the most and reclaiming £4.3 billion of public money lost to fraud and error in the welfare system in 2029-30, and £9.2 billion over five years.

We have also announced steps to tackle inactivity through the “Get Britain Working” White Paper and will set out further proposals in the health and disability Green Paper later in spring. Progress against the cap will be monitored by the Treasury and the Department for Work and Pensions. That will include a strengthened accountability framework and the DWP publishing an annual report on welfare spending. By strengthening the accountability of the welfare cap, getting more people into work and reforming the welfare system for long-term sustainability, we are taking the necessary steps to keep spending under control. But crucially, we are also serving the people of this country by ensuring that people who for too long have been at home unable to be seen in the NHS or to get access to mental health services, who have been unable to get the training or support they need to take advantage of the jobs available in our country, and who have been unable to find jobs near where they are, see hope in their futures and know they have a Government on their side who will support them to get back into work. That outcome is better for them, their family finances and their futures, but it also supports us in ensuring fiscal stability.

The reforms to the fiscal framework outlined in the new charter for Budget responsibility will ensure a more stable approach to tax and spend, as well as better transparency and accountability for our Government and future Governments. That stability is inseparable from our plans for growth. Alongside that growth, restoring stability means the Government can pay for increased funding to repair, reform and modernise our public services and to invest in the infrastructure needed to rebuild Britain. For those reasons, I commend the motion to the House.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

To clear up any confusion, this is the debate and motion on the charter for Budget responsibility. The next motion and debate will be on the welfare cap. I call the shadow Minister.

Growing the UK Economy

Nusrat Ghani Excerpts

Wednesday 29th January 2025 Commons Chamber

[Darren Jones]

The right hon. Member has been down this path before because it was his Government who went down it and blocked all these developments over the past 14 years. This Government are working on reforms to the planning system, looking at national policy statements, thinking about skills and infrastructure supply chains, and unlocking private capital because we are a Government who want to get Britain building again, and not block the projects that were stalled for years under the previous Administration.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Dr Jeevun Sandher, a member of the Select Committee.

[Dr Jeevun Sandher (Loughborough) (Lab)]

Investment is what makes us more prosperous; it produces more work, it gets wages rising and it creates good jobs. I am an East Midlands MP, and we have some of the lowest investment rates in the country, the least transport infrastructure and some of the lowest private investment. That is why I welcome the announcement today of £1 billion going to the manufacturing and logistics hub at East Midlands airport. I especially welcome the 2,000 extra jobs that will benefit my constituents in Loughborough, Shepshed and Hathern. Will the Chief Secretary assure me that this is just the beginning of the investment we can expect in the region and for my constituents?

[Darren Jones]

I thank my hon. Friend, who is a strong advocate for the economy in the East Midlands and for his constituency. He will know that I visited the region last week and met businesses and investors with our Mayor, Claire Ward. The region is doing a brilliant job of securing inward investment, and there is huge untapped potential in the East Midlands. I am pleased that the Chancellor was able to make those announcements today, and we very much look forward to hearing about more business cases and more potential so that we can unlock growth in the East Midlands.

[Madam Deputy Speaker]

I call Select Committee member Dame Harriett Baldwin.

[Dame Harriett Baldwin (West Worcestershire) (Con)]

I am sure the Chief Secretary knows and admires the plan for growth of Conservative-led Worcestershire county council. It has been working through the plan, and it has built a new train station on the North Cotswold line, which connects Worcestershire to Oxford, but a lot of that line is still single track. Will he urge the Oxford growth commission to look at the extensive work done by Oxfordshire county council and Worcestershire county council to find a way to double the frequency of the train services on that stretch of track?

--- Later in debate ---

[Madam Deputy Speaker]

I call Select Committee member Rachel Blake.

[Rachel Blake (Cities of London and Westminster) (Lab/Co-op)]

I thank the Chief Secretary for his statement about investment and growth. Does he agree with me about the role that new towns will play in tackling our country’s housing crisis and how important it is that, alongside the homes in the new towns, we see the delivery of new social infrastructure? Can he outline how those plans will work?

[Darren Jones]

I thank my hon. Friend. As I informed the House recently, our infrastructure strategy, which will be published in June, will for the first time align social infrastructure plans for schools, GP surgeries and other public service facilities with those for housing and economic infrastructure. For the first time, we will be making strategic decisions about the places where people live.

On the house building target—I met tenants who will be moving into new social homes in Erewash last week—we talk about 1.5 million homes and about economic growth, but in every one of those buildings is someone’s life, their opportunities and the dreams they want to fulfil. This Government are delivering on economic growth, and we are doing so because the people at the heart of all these decisions are the people we need to get the economy moving and Britain doing well in the future.

[Madam Deputy Speaker]

I call Select Committee member John Glen.

[John Glen (Salisbury) (Con)]

Among the fundamental enablers of growth in the economy are financial services and opening up markets to invest. I think there was consensus across this House in the last Parliament on the Financial Services and Markets Act 2023, which provided the framework to do that. What concrete proposals have come forward from the Financial Conduct Authority and the Prudential Regulation Authority consideration of changing some of the restrictions that stop the right levels of investment? This week, the Government enabled about £100 billion of surplus funds from defined-benefit pension schemes to be made available. What proportion of that money will be invested and in what timeframe? The concern around these announcements is the delay to tangible, calculable economic impact.

--- Later in debate ---

[Darren Jones]

I thank my hon. Friend the Chair of the Transport Committee for her question. I think it alludes to the fact that this is the announcement not just of a runway, but of a project which we must make sure is optimised for delivering growth for the whole of the United Kingdom, as I made clear in my statement. That means that we need to work with regional airports and look at how the slots are allocated at Heathrow, to make sure that Heathrow’s business model optimises opportunities for regional airports and the whole of the United Kingdom. That is a commitment that the Government have made very clear today.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Select Committee member Bobby Dean.

[Bobby Dean (Carshalton and Wallington) (LD)]

The whole House supports a focus on growth, which is good for our prosperity and key to funding our public services. However, growth has not only a rate but a direction, and how we seek to achieve growth is about choices. If we choose to back measures that undermine our net zero targets, we may be going for growth today with severe consequences for tomorrow. How do the Government justify their choice to back Heathrow expansion over more sustainable rail transport projects across the country?

--- Later in debate ---

[Mohammad Yasin (Bedford) (Lab)]

I have consistently called for new investment in the eastern region, and nothing is more exciting than the proposal to build a Universal Studios theme park—the first of its kind in Europe—in Bedford. The project has huge potential to transform the region. Will the Chief Secretary provide an update and reassure me that progress is being made on turning that plan into reality?

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Hopefully the Minister can meet that enthusiasm.

[Darren Jones]

I thank my hon. Friend, who has campaigned tirelessly for this investment in the region since he has been the House. As he will know, the Government are in negotiations with partners for the development. Unfortunately, I cannot update the House at this stage, but I look forward to doing so in due course.

--- Later in debate ---

[Darren Jones]

I am pleased to announce to the House today the Government’s commitment to build, baby, build. We will deliver that for this country. My hon. Friend is right to point out the difference that a change in Government can make. This Labour Government are getting on with the job of dealing with planning regulations and blockers, bringing forward investment and delivering for the country, whereas the Conservative party promised the earth and delivered nothing.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Dr Kieran Mullan—I assume you have a lot to say.

[Dr Kieran Mullan (Bexhill and Battle) (Con)]

Away from Labour’s rhetoric, I suspect that Members on both sides of this House are hearing the reality from our constituents. On Friday, I visited Saxonwood care home in my constituency, and St Michael’s hospice just across the border, which looks after my constituents. I have also heard from Bexhill chamber of commerce, and they are all clear that Labour’s planned national insurance rise will do enormous damage to their attempts to grow, and to employ people. Does the Chief Secretary agree with the OBR’s forecast that the jobs tax will harm growth, not help it?

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. If Members’ questions are short and if the answers are to the point, I will do my best to get everybody in. To show us how it is done, I invite Kanishka Narayan.

[Kanishka Narayan (Vale of Glamorgan) (Lab)]

Harold Wilson said:

“The only human institution which rejects progress is the cemetery.”

Today, we can add to that the Tory party. Will the Chief Secretary ditch that Tory past, seize the spirit of Wilson and bring the white heat of technology back to Britain’s shores, including an AI growth zone in the Vale of Glamorgan?

--- Later in debate ---

[Darren Jones]

I thank my hon. Friend for his question and congratulate him on his upcoming paternity leave. He knows that the Government are committed to protecting the environment but also to cutting red tape. We have shown that that can be done in a win-win way, through the nature fund announced by the Environment Secretary recently. We will be doing further work on this issue in the coming months to ensure that we can deliver for Britain and for the natural economy.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

The Chief Secretary has been on his feet for nearly an hour and a half. He has a long visit list, and obviously he will want to visit Sussex Weald first and foremost.