Energy (oil and gas) profits levy

Pat McFadden Excerpts

Tuesday 22nd November 2022 Commons Chamber

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

I am grateful for the opportunity to wind up on behalf of the Opposition. I welcome the new Minister to her place and wish her well. I also thank all right hon. and hon. Members who have contributed to the debate. We have heard many passionate speeches, appeals for different sectors—from cockles to hospitality, and from the gaming sector to many of the industrial sectors that make Britain great—and appeals for different areas. People spoke passionately about how the cost of living crisis is affecting their constituencies. We heard discussion of individual measures in the autumn statement and, of course, we have had lively debate on how we got here in the first place.

This debate, like the autumn statement itself, has covered a lot of ground. But for all the individual parts of last week’s autumn statement, in the end the Chancellor’s speech was an hour-long reckoning with the Conservatives’ 12 years in office. It was not meant to be like this. The promise was of a better tomorrow; the good times were supposed to be coming. Instead, there was a more bitter conclusion: the Government have failed. They have failed over 12 years, and the autumn statement sent the bill for that failure to the British people. With every measure, every leak and every warning of the decisions in the weeks beforehand, all the Chancellor and the Prime Minister were doing was confirming the weakness of their record and the destruction of the Conservative party’s reputation, such as it was, for sound economic management. Try as it might, when a party have been in office for 12 years, there is no one left to blame.

Let me address directly the subject that has been at the heart of today’s debate: the balance of global and national factors in all of this. Of course, the Chancellor tried desperately last week to claim it was all about global factors—a plea for the defence that was repeated yesterday by the Chief Secretary to the Treasury in his opening speech. There is no doubt that the experience of covid and the consequences of Putin’s invasion of Ukraine have been very costly for many countries. All major countries have had to borrow money to help their businesses and to support their citizens—no one is denying that—but only in Britain, which is among the largest economies of the world, and under the stewardship of this Government, have we failed to recover our pre-covid economic position.

The Governor of the Bank of England last week described the difference between our recovery from covid and that of our peers as “dramatic”. The Office for Budget Responsibility’s report—it was allowed to issue one this time—suggests that it will be another two years before we even recover our pre-covid position. It is here in Britain, under this Government, that we had a mini-Budget resulting in carnage, causing a run on the pound, the IMF to hit the panic button, emergency interventions from the Bank of England and rocketing mortgage rates for our constituents. This country was used as a giant experiment by a Prime Minister and Chancellor desperate to enact the pamphlet fantasies of their dreams.

This month’s crop of Ministers—in today’s Tory party, everyone gets to be famous for 15 minutes—would like to tell us that it was all a bad dream and it fell from the sky, and they want to bury it under 10 feet of concrete, but it was a Conservative mini-Budget delivered by Conservative Ministers, voted in by Conservative party members and cheered on by Conservative MPs.

I have some of the quotes. The hon. Member for South Cambridgeshire (Anthony Browne) said:

“I strongly welcome this radical and generous package of measures”.—[Official Report, 23 September 2022; Vol. 719, c. 947.]

The hon. Member for South Dorset (Richard Drax) said:

“How refreshing it is to hear some Conservative policies at last.”—[Official Report, 23 September 2022; Vol. 719, c. 950.]

The hon. Member for Buckingham (Greg Smith) said:

“I warmly welcome…the return to the low-tax free market principles that we on the Conservative Benches know will lead to growth and prosperity for everybody in our country.”—[Official Report, 23 September 2022; Vol. 719, c. 954.]

The hon. Member for Mansfield (Ben Bradley) declared how “refreshing” it all was and said to us, “I am excited.” All of this was days before the whole thing drove the UK economy off a cliff.

[Mark Fletcher]

The right hon. Gentleman is having great fun, and the whole House is in raptures—please try to find my quotes in that pile; I do not think there are any. Not so long ago the Labour party was slagging us off for too many tax rises. We tried tax cuts and they did not work, and now he seems to be in the strange position of arguing with one hand and then with the other. What is the Labour party’s position when it comes to taxation?

[Mr McFadden]

I will tell the hon. Member one thing about taxation: the burden is much higher under this Government than it was under the Government in which I served as a Minister. That mini-Budget was a mistake for which the country and the public will be paying for a long time. In every one of the constituencies of Government Members, the two-year and five-year rates on mortgage renewals are still higher today than they were before that mini-Budget. Their constituents are still paying the price for their economic irresponsibility. Apart from the economic effects, it also caused damage to the international standing of our country. We became a poster child for economic mismanagement—a point that the Prime Minister himself admitted at last week’s G20 summit in Bali.

But the failure is not just over 12 weeks; it is year on year. The UK economy’s growth has been consistently weaker than the OECD average, and that difference is now worth £10,000 per year for every household. We do have global pressures—no one denies them—but think how much stronger people would feel in facing today’s pressures if incomes had been that much higher. That is the ghost of growth past, and the forecast for the ghost of growth future is for the UK to be at the bottom of the OECD growth league, with the possible exception of Russia, for the next two years.

All of this is felt in people’s pockets. Income is set to decline by 7% in real terms over the next two years. That is a £1,700 per household reduction in spending power. Things people cannot buy, bills they cannot pay, places they cannot go, coping with worries they never previously had to think about—all of this is the price of lower incomes, and those lower incomes are the result of 12 years of anaemic economic growth. This is the Conservative party’s mess, and the British people are being asked to pay the bill.

The Chief Secretary to the Treasury quoted Ronald Reagan in his opening speech yesterday, but there is another Reagan quote that should haunt the Government right now. He asked, “Are you better off than you were before?” and the answer is no. The Chancellor announced a series of tax rises, asking the British people to pay more, and he did so at a time when inflation is already making it harder to pay the bills.

What will the Government do to recover as much as possible of the estimated £6.7 billion lost to fraud and waste in the covid loan schemes? Why is the unit set up to chase that money, announced with great fanfare by the current Prime Minister and established in HMRC, being closed down? The Government’s own former fraud Minister described the controls as being like a “Dad’s Army operation” and said it was a “happy” time to be a crook, and still the Government are asking people to pay more. Should as much of that money as possible not be recovered before asking our constituents to pay more? What of the figure in the OBR report showing that the administration of the energy company Bulb will now cost the taxpayer £6.5 billion? Why is that cost to the public so huge? Is the Prime Minister really the hedge fund manager who forgot to hedge? Once again, the British people are being asked to pay the price.

The point of all this, according to the Prime Minister and the Chancellor, is to restore financial stability, but the UK only needs to restore its financial stability because the Conservative party destroyed that financial stability. If that is all the Conservatives have to offer, then all they have to offer is managing decline. The weakness of the Prime Minister in trying to build a platform for growth was also laid bare in the autumn statement. They persist in a ban on onshore wind when the country urgently needs a transition to cleaner power in the interests of both our energy security and lower bills for consumers. They fight plans to build more houses —indeed, they might have to pull their own legislation on this—because Government Members always want them elsewhere. The previous Prime Minister talked about an anti-growth coalition—it is sitting there on the Government Benches.

On trade, the Prime Minister wants to tell the European Union that the grown-ups are back in charge and, at the same time, convince his Back Benchers that he is really a true believer—well, good luck with that. The Chancellor, who loves all things Swiss, is going to buy them all cuckoo clocks for Christmas.

The point of financial stability is that it has to be a platform for better growth in the future. Financial stability has to be a platform for hope. It has to be the basis for wealth creation, for better long-term growth and for a way to escape the doom loop in which the Conservative party has left us. That is what we must secure to make the country more prosperous and our citizens better off.

This country can do so much better through the skills and talents of our workers; through modern supply-side economics that supports help to get the hundreds of thousands of people who have left the labour market since covid back into work, as my right hon. Friend the Member for Leicester South (Jonathan Ashworth) said in his opening speech yesterday; through making the transition to cleaner energy a UK industrial and economic success story; not through rerunning the Brexit argument, but by having an adult and responsible relationship with our neighbours and allies; through making this country the best place to start and grow a business—the home of enterprise and wealth creation; through the reform of business rates; and through making sure that when we get economic growth, every part of the country can be part of it.

The fundamental difference between Labour and the Conservatives is that they believe that growth comes only from unleashing the animal spirits at the top, while we believe that growth comes from the efforts of each and every person who goes to work every day, from the entrepreneurs who start a business to the teachers who equip children with new skills. That is the point of financial stability; it is not an end in itself but a platform for a better tomorrow. Maybe that is the lasting verdict on this autumn statement: it was an admission that not only have the Conservatives failed in the past but they now have nothing to offer for the future.

Oral Answers to Questions

Pat McFadden Excerpts

Tuesday 15th November 2022 Commons Chamber

[Mr Speaker]

I call the shadow Minister, Pat McFadden.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

The consequences of September’s disastrous mini-Budget continue to be felt, as we will see in the autumn statement on Thursday—the third Budget statement in two months from the fourth Chancellor since the summer, presided over by the fifth Prime Minister in six years. Whatever they represent, it is certainly not stability.

Mortgage rates are still well above what they were before the mini-Budget. I have a constituent who is a first-time buyer, and he is facing a £200-a-month increase on his mortgage quote compared with before the mini-Budget. Why should my constituent, and thousands like him, pay the price in their mortgage payments for the economic damage caused by the Government’s recklessness?

[Andrew Griffith]

The right hon. Gentleman does this House and his constituents a great disservice with that characterisation, which did not mention once the tragedy of the events caused by Russia’s invasion of Ukraine and the fact that we are coming off the back of an extraordinary intervention to protect this country, jobs and businesses from covid. In the future, when he characterises the economy, he owes it to all of us to be more proportionate.

[Mr McFadden]

I know that, after 12 years, the Government quite like stealing our ideas, such as the windfall tax and the energy price freeze, so let me offer a suggestion. High deposit demands, increased unaffordability due to price rises and, now, rising mortgage rates all mean it is increasingly difficult for first-time buyers to get on the property ladder, so will the Government consider Labour’s proposal for a mortgage guarantee scheme, as operates in countries such as Canada, to help first-time buyers get on the property ladder and to protect them from negative equity in times of market turbulence? Would that not be a practical idea to stop people being trapped in the private rented sector and to help them buy a home of their own?

[Andrew Griffith]

Not only is that a good idea, it is a Conservative idea that we have already introduced. I am glad the right hon. Gentleman has belatedly latched on to it.

Economic Responsibility and a Plan for Growth

Pat McFadden Excerpts

Wednesday 19th October 2022 Commons Chamber

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

I am pleased to conclude the debate on behalf of the Opposition. I welcome the new Chief Secretary to the Treasury to his position. His colleague the Exchequer Secretary is an old-timer: she has been in post for six weeks. No doubt she is sitting at the Treasury talking about the old times back in September.

I thank all right hon. and hon. Members who have contributed to the debate. We have heard many powerful speeches about the impact of inflation and rising energy costs, the pressures on business, the UK’s international reputation and the impact of rising mortgage rates. If you will forgive me, however, Mr Deputy Speaker, I want to single out the speech of the hon. Member for Hazel Grove (Mr Wragg), who not only spoke about his own health issues, but added his voice to those of Conservative Members calling for the Prime Minister to go.

This country has been through very significant economic damage in recent weeks: a run on the pound, a spike in gilt yields that has increased the cost of Government borrowing, emergency interventions from the Bank of England to prop up the country’s pension system, and a spike in mortgage rates that will add to the household costs of millions of people to years to come. All of it has been self-inflicted—not an act of God, not the result of global conditions, but the result of using the country for an ideological experiment. To deal with the argument that the Financial Secretary made at the beginning of the debate—essentially, that this is all global—I will quote from a letter from the Bank of England to the Treasury Committee. If any Conservative Member wants to intervene to say that any of it is wrong, they can be my guest.

Immediately after the mini-Budget, there were two days with the biggest daily rises in gilt yields in 20 years. Over four days, the rise was twice as large as the biggest rise since 2000. The Bank of England says that

“the scale and speed of repricing…far exceeded historical moves”.

Following the mini-Budget, gilts moved more in one day than in 23 of the past 27 years. No such moves happened in gilts in dollars, euros or other major currencies. There were global factors before the mini-Budget, but as my hon. Friend the Member for Chesterfield (Mr Perkins) said, the global context was a reason not to act in such a rash manner, not a reason to behave with all the restraint of a couple of trigger-happy pyromaniacs.

This crisis was not born of global conditions, but made in Downing Street. It has destroyed the Conservative party’s claims to be the party of economic competence and of sound money. The real-life impact of what the Government have done has been to place a Tory risk premium on the country’s borrowing costs and a Tory premium on people’s mortgage rates.

[James Cartlidge]

I asked the shadow Chancellor earlier whether it was correct that Labour’s intervention in energy support would be almost primarily funded by borrowing despite its pledges on the windfall tax. Is that correct?

[Mr McFadden]

We have never argued that there was no need for borrowing. The point we made was that much more of this could be funded by a windfall tax. If the hon. Gentleman thinks that that is some sort of revelation, I can only ask him where he has been living for the last few months.

The Prime Minister and the Chancellor of September behaved like student pamphleteers. When the Prime Minister stood up at her conference and attacked

“vested interests dressed up as think tanks”,

it was an announcement worthy of the gold medal for lack of self-awareness, for never has there been a Government more symbolic of the failure of think-tanks on influential thinking than the one that she leads.

The Prime Minister and her ideological soulmate got the keys to the Treasury Ferrari, took it for a joyride and then crashed it into a ditch. Now, belatedly, by commissioning the OBR report and singing the praises of an independent Bank of England after spending all the summer undermining it, they have signed themselves up for the speed awareness course; but it is too late, because people will continue to pay the price of what they have done.

We have now had two fiscal events with no report from the OBR. This was not just about what was done, but about how it was done. The whole country is paying a price for the Conservative party’s contempt for the institutions that safeguard our economic credibility. And where does it all leave the Prime Minister? The mini-Budget was not a surprise to her; it was not imposed on her; she was 100% its co-author. It embodied her beliefs, her world view, the central core of the campaign on which she fought and won the leadership contest. Now everything she believes in has had to be burned in front of her to try to keep this zombie Government carrying on. This is not a case of “too far, too fast”, as she has claimed, or of a minor policy U-turn. It is a repudiation of everything that she stands for. It is a total and utter reversal.

The one surviving policy that the Prime Minister keeps praying in aid, the energy price guarantee, is the one policy that she campaigned against throughout her leadership campaign, saying that she was opposed to handouts. The question now is, what is her premiership for? Is it for the policies that she really believes in—those in the mini-Budget, now rejected and lying in ashes—or is it for the revenge of the orthodoxy that she so disdains? Each dose of the medicine she takes entails embracing that which she has so publicly rejected. Her argument, in effect, is “Please keep me here so that I can be what I am not.”

[Mr Perkins]

Is not the truth that what the Prime Minister’s leadership is for is for the moment? She is here for a very short period, until the Tories can find an excuse to get rid of her.

[Mr McFadden]

My hon. Friend is right. In fact, the only discussion on the Conservative Benches is about how to do precisely that.

We cannot believe anything the Prime Minister says. Only seven days ago, she stood at that Dispatch Box and promised there would be “absolutely” no spending cuts.

Five days later, the new Chancellor—October’s Chancellor—told us that the cuts had to be eye-watering. Conservative Members know that this is an impossible basis for leadership, and that it leaves the Prime Minister in an untenable position. They are remembering the words of the song that was played at their party conference as she came on to the stage:

“You've done me wrong, your time is up…there's no way back…you’re movin' on out”.

Three cheers for M People: not just a great band, but one with the political foresight of Nostradamus.

Now the new Chancellor has been sent down from the mountain, come among us, as he says, to restore confidence and stability—but who destroyed confidence in the UK? Who created the instability? Who fashioned the Tory risk premium? I am too polite to call it what they are calling it in the City, which is “the moron premium”. It was the new Chancellor’s own Government.

Let us be clear: no one was talking about spending cuts before the mini-Budget of 23 September, so the cuts are a result of what the Government have done. There has been no emergency central bank intervention to rescue pensions in the United States, Germany or France. The global circumstances that the Government refer to were the reason not to take such reckless risks with the public finances.

I have noticed one thing about the new Chancellor, though: he is not pretending that it is year zero. He is owning the record—all 12 years of it—and he now wants to implement a version of what was done after 2010. We have gone from an economic policy of having to borrow from communities such as mine in Wolverhampton South East to fund a tax cut for people earning over £150,000 to a policy of those communities having to pay for the chaos caused by the first policy.

We can see what the plan is. Having crashed the economy and brought a new dimension of pity, bemusement and risk to the term “global Britain”, the Government now want the acid test to be support for their public expenditure cuts. They have already made people pay once for their mismanagement through higher mortgage rates. Now they want to make people pay twice through cuts to public services. It is the ultimate in governmental arrogance. They get to mess up the country through a giant ideological experiment and then ask everyone else to pay the price. That is not a political virility test; it is a candid admission of failure.

The roots of that failure lie not just in one or two policy errors but in something deeper. They lie in the triumph of ideology over evidence. They lie in the view that all that is needed is blind faith—the test that someone is a true believer—and the view that anyone who questions or points out inconvenient truths is a doom-monger, part of the blob, and not a proper patriot. That destructive ideology has done great harm to our politics. It has reduced the Conservative party to its current abject state, and has served as the rationale for attacking one institution after another.

Politics begins with wanting to change the world, but what have this Conservative Government been reduced to? Attacking tofu. What other forms of food will now be lined up in the culture war that is all that is left for them? The disaster of the past few months should result not just in a few policy U-turns, but in turning away from the politics that drove those decisions and has done such harm to the country. This country has great strengths: world-leading services, great high-value manufacturing, creative industries with global reach, some of the best universities in the world, and a fantastic workforce. It deserves much better than this Conservative Government.

--- Later in debate ---

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

On a point of order, Mr Deputy Speaker, the motion that the House has just passed, with no opposition from the Government,

“calls on the Government to publish the Office for Budget Responsibility forecasts immediately alongside Government estimates of windfall profits for the next two years from energy producers in the UK.”

Both those pieces of information are very important. The House has just called on the Government to publish them immediately. I seek your help in making sure that that happens.

[Mr Deputy Speaker (Mr Nigel Evans)]

I thank the right hon. Member for his point of order. Those on the Treasury Bench will have heard what he has to say. He is absolutely right that the Government must respond within a certain period of time to say how they will act now that that motion has been passed.

Oral Answers to Questions

Pat McFadden Excerpts

Tuesday 11th October 2022 Commons Chamber

[Mr Speaker]

I call the shadow Minister, Pat McFadden.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

With your permission, Mr Speaker, I wish to send my condolences to the families of all those killed in the tragic accident in Creeslough, County Donegal, last week. My parents came from quite nearby. It is a beautiful place with a close community, and they are very much in our prayers right now.

I welcome the Minister to his place. I am sure that he and the Chancellor’s team wanted their first Budget to be remembered, perhaps even studied in years to come. Well, they have certainly achieved that ambition. Two-year fixed mortgage rates are above 6% for the first time since 2008, and they have risen sharply since the Chancellor’s mini-Budget. Everyone coming off such a rate will face much higher payments over the coming year, possibly hundreds of pounds a month more. Why should people who have worked hard to buy their own home pay the price for the Government’s mistakes?

[Andrew Griffith]

I add my comments and thoughts to those on the incident in County Donegal last week.

We have already talked about our comprehensive energy support package, which will help not just every household this winter and prevent the uncertainty of energy bills that were forecast potentially to reach £6,500 per home, but help businesses. The Government are on the side of businesses and keen to improve the supply side of our economy, so that we can grow to create the tax revenues for our high-quality public services.

[Mr McFadden]

This morning, the Bank of England made a further intervention in the markets, warning of

“a material risk to UK financial stability”.

That risk comes directly from the Chancellor’s mini-Budget two and a half weeks ago. How much more will Government borrowing cost next year as a result of the rising gilt yields since the Chancellor’s statement on 23 September?

[Andrew Griffith]

As I have already observed, we are seeing interest rates rising in every major western economy. When Opposition Front Benchers are finished with their British exceptionalism, perhaps they will lift their eyes and notice that. What is more important is that we are protecting consumers and households through the difficult winter months ahead, and cutting taxes. Those are measures that Government Members support and Opposition Members oppose.

Delivery of Public Services

Pat McFadden Excerpts

Tuesday 28th June 2022 Commons Chamber

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

I beg to move,

That this House notes that UK economic growth is forecast to grind to a halt next year, with only Russia worse in the OECD; further notes that GDP has fallen in recent months while inflation has risen to 9.1 per cent and that food prices, petrol costs and bills in general are soaring for millions across the country; believes that the Government is leaving Britain with backlogs such as long waits for passports, driving licences, GP and hospital appointments, court dates, and at airports; and calls on the Government to set out a new approach to the economy that will end 12 years of slow growth and high taxation under successive Conservative governments.

It is my pleasure to speak to the motion in the name of the Leader of the Opposition, and those of me and my right hon. and hon. Friends. The Prime Minister told us at the weekend, speaking from the Commonwealth Heads of Government meeting in Rwanda, that he was “actively considering” his third term in office. The shadow Secretary of State for Transport, my hon. Friend the Member for Sheffield, Heeley (Louise Haigh), replied that she was actively considering marrying Ryan Reynolds.

While the Prime Minister considers his future, here at home concerns are more prosaic and more real. In area after area of life, standards of service that used to be taken for granted have crumbled, leaving people facing delays and backlogs for basic services, and all this is coming on top of the cost of living crisis, which is biting deeper with each passing week. As each new backlog and delay builds up, the Government look more and more powerless to address them. Even the Government’s supporters do not seem to believe that the announcements made by No. 10 will be followed through with any proper delivery. The Government were supposed to take us forward to the future, but as we read the news each day, it feels more and more like a step back in time towards the 1970s.

In another, more candid remark, also on Saturday, the Prime Minister admitted that since the Conservatives took office the UK economy had

“not grown as it should”.

[John Redwood (Wokingham) (Con)]

Does the right hon. Member agree with me that if you wish to improve service you do not go on strike and if you wish to pay for higher wages you do not go on strike? Will he give that advice to the rail unions?

[Mr McFadden]

I had anticipated one or two interventions on strikes, so let me say to the right hon. Gentleman that whoever’s responsibility the strikes are, it is certainly not that of a party that has been in opposition for 12 years. He and the Ministers he supports will have to take responsibility for the industrial strife they are presiding over. I say that to him in the anticipation of other interventions in the same vein.

[Rob Butler (Aylesbury) (Con)]

Will the right hon. Gentleman give way?

[Mr McFadden]

That is my answer to all interventions on the issue, so let me proceed.

[Hywel Williams (Arfon) (PC)]

Will the right hon. Gentleman give way?

--- Later in debate ---

[Mr McFadden]

Not at the moment.

I am grateful for the Prime Minister’s candour on economic growth. That is a very important admission, because without good economic growth the country is less prosperous, the fiscal position is weaker—in fact, it is weaker to the tune of some £40 billion a year compared with the pattern of economic growth we had in the first decade of this century—and people’s wages are lower by thousands of pounds a year. We know that people are paying higher taxes due to the Government breaking their manifesto pledges, but let us see what they are getting for their money.

It is often said in this place that the first duty of Government is to protect their citizens and that justice delayed is justice denied. Both those statements are true, so let us look at what is happening with access to justice. Victims of crime have a right to expect a trial in a reasonable amount of time after that crime has been committed. In the year before the pandemic—I repeat, before the pandemic—the number of cases awaiting trial at Crown courts grew by 23% to more than 40,000.

[Rob Butler]

Does the right hon. Gentleman think that the backlog in the courts will be lengthened or shortened by barristers going on strike?

[Mr McFadden]

I refer the hon. Member to the answer I gave some moments ago.

As I have said, the number of cases grew by 23% to over 40,000 before the pandemic, and that number now stands at 57,000. For magistrates courts, the number is 364,000. The typical wait for a case of robbery to come to court is two years, and for rape it is often three years. No wonder that in a recent sexual offences case that had been delayed for more than three years the presiding judge, Patrick Thompson, branded the delays “absolutely farcical” and said:

“How this is justice is beyond me.”

He is not alone in his judgment. These delays leave victims without redress and without justice and with the crime that they have suffered hanging over them. They are not just a symptom of the pandemic: we must remember that in the year before the pandemic the number of cases awaiting trial had grown by 23%.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

My right hon. Friend is making excellent points. Does he agree that the excessive delays in the justice system, in particular for rape, have a huge mental health impact on the victims yet our mental health system is also failing to respond quickly to those needs?

[Mr McFadden]

My hon. Friend is absolutely right. As she outlines, these backlogs have real and important human effects; they are not just numbers on a page.

[James Daly (Bury North) (Con)]

Will the right hon. Gentleman give way?

[Mr McFadden]

I will make some progress.

This is happening not just in the field of justice. Record numbers of patients are waiting for NHS treatment, and they are waiting longer than ever: the waiting list for NHS treatment is now 6.5 million, with more than 300,000 patients having been on the list for over a year.

Given that the system had to focus on dealing with covid, some might point to pandemic effects. There would be some justification for that argument if we had not gone into the pandemic with waiting lists that had already rocketed, but we went into the pandemic with waiting lists of 4.4 million patients, almost double the number on the lists when this Government came to power. Long waits and more people waiting are not just features of the pandemic. The number waiting more than 18 weeks is now 2.5 million, but even before the pandemic that number was nearly three quarters of a million. Some 840,000 patients were told in April that they will have to wait more than a month for a GP appointment—if they can even get through to the surgery in the first place. Millions of people are struggling to get any access to NHS dental treatment. Last year 2,000 dentists left the NHS, almost one in 10 across the whole country. There are 4,500 fewer GPs than in 2013, and Conservative manifesto promises to increase the number of GPs have been broken repeatedly. These delays are not the fault of NHS staff or the patients; they are the result of 12 long years of the Conservatives presiding over the system we have and it is time they took responsibility for the backlogs and the delays that have resulted from their long period in office.

[Imran Hussain (Bradford East) (Lab)]

My right hon. Friend is making an excellent speech. The situation in our dental services is so dire that people are having to carry out do-it-yourself operations at home without anaesthetic or any other medical facilities. Does he agree that it is disgraceful that people are having to resort to such measures as a result of the Conservatives’ backlog given that we are the world’s fifth largest economy?

[Mr McFadden]

My hon. Friend is right. In a debate on the subject last week, the shadow Health Secretary, my hon. Friend the Member for Ilford North (Wes Streeting), outlined a horrific case.

[Dr Luke Evans (Bosworth) (Con)]

Is the situation not more nuanced? Healthcare is devolved in Northern Ireland, Scotland, Wales and England, with four different parties running it, but all have suffered and seen waiting times go up not only during the pandemic but in the preceding 10 years. Does that not show that there is a fundamental problem across the western world, because the likes of Germany, the Netherlands and France are all struggling and suffering the same fate?

[Mr McFadden]

To govern is to take responsibility, and the problem with saying that it is all about the post-pandemic situation is that waiting lists had almost doubled before the pandemic. I could give the hon. Member the figures again, but I do not want to read them out twice.

It is not just about the NHS. There are also delays at our ports. We have seen long queues of lorries—the delays are well known—and increased costs and bureaucracy for exporters.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

Does my right hon. Friend agree that, when the last Labour Government left office in 2010, satisfaction in the national health service was among the highest in the world and that through reform programmes, disruption and cuts in funding the Government have created problems in the NHS? They need to get a grip.

We also have chaos in the courts. I see that in my constituency, where the family courts are really struggling with long waiting lists because of shortages of judges and lawyers. We also have passport queues and disruption across the country. The Government have lost control and need to get a grip.

[Mr McFadden]

My hon. Friend is absolutely right. I remember seeing the driving down of waiting times and waiting lists in government, and never at any point did anyone say, “We can take our foot off the gas” because there might have been problems in Germany or somewhere else. We took responsibility for the system that we were running.

As I said, there have been large queues at the ports. The Government do not need to rerun the Brexit argument—Ministers should have realised that we can leave only once—but there are things that they could do. They could at least seek a veterinary agreement with the EU—even New Zealand has one—which would be a better deal for our farmers and our food industry and may cut the bureaucracy and delays at our ports.

Let us take the asylum system, which is of significant concern to our constituents. The number of cases taking more than six months to decide has been up every quarter since the Home Secretary took office, and the backlog has tripled in the last three years. That matters because delays cost money and leave everyone in limbo.

[Hywel Williams]

On ports, another aspect of the problem is the decline in business through ports in Wales and western UK ports involved in trade with Ireland. In fact, trade through Holyhead is down 34% as a permanent feature. It seems to me—perhaps to the right hon. Gentleman as well—that the Government are doing absolutely nothing about that.

[Mr McFadden]

Well, the Government have chosen the route that we discussed in the Chamber last night. I do not want to repeat that, but other routes are available to them to reduce the bureaucracy experienced by our farmers and exporters.

The delays in asylum matter because they cost money. Seventy-five per cent of asylum claims are eventually endorsed, but, until they are decided, legitimate claimants cannot make a positive contribution to the country by taking up a job, and claimants who are denied cannot be removed from the country. It is neither in the interests of those who seek refuge nor in the national interest to have a system so beset by delays and backlogs. It is certainly not value for money for the taxpayer, either.

On passports and driving licences, people are being asked to wait up to 10 weeks for a passport—a standard that was itself breached more than 35,000 times in the first quarter of the year according to the Home Office. That is where backlogs beget backlogs. There are reports of travellers being asked to seek emergency travel documents because passports have not been issued, but now—this is the least surprising news ever—there is a queue for those documents, too.

Three quarters of a million drivers are waiting for their licences to be processed because of the backlog at the Driver and Vehicle Licensing Agency. A large proportion of those drivers have medical conditions and need specific permission to keep driving. That is where the backlog begets workforce issues, because, until those people get their new licences, they often cannot return to work. I appreciate that none of that may be as exciting as the latest wedge issue thought up in No. 10, but delivering on basic governance is the Government’s job, and it is time to do that job. The duty of service delivery does not go away. At the heart of this are two issues: getting the workforce right and making the most of new technology.

[James Daly]

The right hon. Gentleman touched on criminal justice earlier. Will he join me in asking Andy Burnham, the Mayor of Greater Manchester, to take responsibility for the appalling situation that the criminal justice system is in, in Greater Manchester? It is not protecting vulnerable people or investigating crime, as a result of which my local residents are suffering. Will he join me in asking Andy Burnham to take responsibility and do something about it, which is his job?

[Mr McFadden]

I detect a pattern with these interventions. They seem to be saying that the problem is everyone’s responsibility except the Government’s. There is no escaping 12 years in office.

There are two issues at the heart of this: workforce and technology. Staff shortages are common in many areas. The unemployment figures have fallen, but so too has the overall number of people in employment. More than half a million people have left the labour market since the pandemic. They are from all age groups, but the biggest group is the over-50s, and their biggest reasons for leaving the labour market are ongoing health issues and caring responsibilities.

This is where the delays and backlogs become a vicious circle. I have already mentioned that when people with medical conditions cannot get a new driving licence approved, it can prevent their return to work. The Access to Work programme is there to help people with disabilities into work, but people face delays of up to 12 weeks in their application being processed, and the waiting list for decisions has quadrupled over the past year. That holds people back from taking up jobs and makes the staff shortages worse.

The NHS employs some 1.2 million people, but it went into the pandemic with 100,000 unfilled vacancies. We have argued for a forward plan for NHS staffing, and for training so that the vacancies can be filled. That was supported by the cross-party Health and Social Care Committee, but fiercely resisted by the Government. I have to say to the Minister that looking the other way will not make the workforce issues go away. Why are the Government so resistant to the forward planning needed by the NHS?

The question is how we make the most of our potential workforce, and help those who could go back to work to do so. Many people in this country are suffering from long covid. There are people with mental health issues, and people for whom childcare costs are a barrier. We support an expansion in mental healthcare, so that we get support to those who need it within a month, and we support mental health hubs in our local communities. More breakfast clubs and after-school activities would not only be good for children but would help parents get back to work, too.

The point of all this is that we should use the talent and energy of everyone who can make a contribution, and address any barriers to work that they face, but that is not the Government’s response to the backlogs; they have proposed staffing cuts of 20%. How will that help anyone to get a passport, driving licence or health treatment quicker, or get their case to court sooner? Is it really the best that the Government can come up with? Is it even a real response, or just another initiative thrown up to provoke a debate that distracts attention from the real issues that people face?

The issue is not just about the workforce; it is also about using innovation and technology to make public services better for the public. Covid has been described as the great acceleration. It was a time when years of change were compressed into months—in education, in the way we work, in the way we shop and pay for things, in accessing healthcare and so on. The question is how we make the most of what we have learned, and of all the other rapid changes in daily life that are powered by technology, to reform our public services for the future. Our ambition should not be just to return to where we were in 2019; it should be to improve, so that we can have high-quality public services for all.

We already knew that the Conservatives were running a high-tax, low-growth economy—we have said that many times—but the backlogs that I have outlined in public services, in area after area, show that it is also a high-tax, low-delivery economy. We have the highest tax burden since the 1950s, but people cannot get a passport or an appointment with a dentist. That is simply not a good enough deal for the British public.

The Prime Minister says that he wants another two terms in office, but our public services cannot afford another two terms of backlogs and chaos. This Government are not really governing any more. They are simply campaigning.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

My apologies to you, Madam Deputy Speaker, for attending the start of this debate tardily. Does the right hon. Gentleman agree that there is a Scottish dimension? We talk about the number of Governments we have had. Today, pregnant mothers have to make a round trip of more than 200 miles from Caithness to Inverness to give birth. Health services have gone backwards in my constituency, so all that is being said is also relevant to the Government north of the border.

[Mr McFadden]

I am glad that the hon. Member had the opportunity to make that point, whether he is wearing a tie or not.

The sole purpose of the Government is the survival of the Prime Minister. They have trashed standards in public life, as we have seen; they have damaged our standing in the world; and they are now trashing service delivery. When people pay the price for Government dysfunction in constant delays and backlogs, which have a damaging effect on quality of life; when the things that we used to take for granted become an endless slog and a debilitating battle; and when all this comes at the price of broken tax promises, people conclude that they cannot rely on the Prime Minister and on this Government. That is what is happening. As long as he and they remain in office, the chaos that has led to Boris Johnson’s backlog Britain will continue.

Oral Answers to Questions

Pat McFadden Excerpts

Tuesday 28th June 2022 Commons Chamber

[Mr Speaker]

We now come to the Labour Front Bencher, Pat McFadden.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

It is true that inflation is affecting a number of countries, but why does the Chancellor think that the UK has the highest inflation in the G7, and why is UK economic growth forecast to be lower than in any country in the G20 next year, with the sole exception of Russia?

[Rishi Sunak]

When it comes to inflation, there is a variety of reasons. [Interruption.] I was very clear with the House at the time of the recent announcement that we are experiencing not only the energy shock that Europe is experiencing, but the tight labour market that the United States is experiencing. The fact that we have very many people in work and low unemployment is something to celebrate, but, obviously, that contributes to inflationary forces. Beyond that, there are smaller technical things, such as the timing of how the price cap works here and the degree of interventions in energy being upstream or downstream. When it comes to growth—we have had this debate multiple times—the Opposition seem to cherry-pick the figure that they like. Let us look at the period since the pandemic and at our growth performance. Indeed, on the OECD’s most recent figures, which the right hon. Gentleman cherry-picked, where were we in that table? We were the second highest in the G7.

[Mr McFadden]

The Chancellor said “celebrate”. I am not sure that there is much to celebrate in the figures that I quoted to him. Does he accept that the weakness of the pound, which increases the prices of our imports, is a major contributory factor to the inflation being experienced by our constituents, along with a continuation of the trade frictions caused by the Government’s Brexit deal? Does he have any plans to address that? I am not talking about rerunning the Brexit argument. He could take one step, which is to reach an agrifood agreement with the EU, as New Zealand has. That would reduce costs and bureaucracy for our farmers, for our businesses and, most of all, for our constituents.

[Rishi Sunak]

What the right hon. Gentleman said was very telling. We on the Conservative Benches do celebrate people being in work. It is critically the most important thing that we can do to help manage the cost of living, so every week in this place, we will champion those who are working and we will get others into work and support them. When it comes to the EU and our trading relationship—it is nice to hear from the Labour party that it does not want to rerun the Brexit arguments—it is very clear that there is now a growing faction on the Labour Benches that wants to do one thing and one thing only, which is to take us back into the single market.

New Wealth Taxes

Pat McFadden Excerpts

Tuesday 14th June 2022 Westminster Hall

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

I congratulate my hon. Friend the Member for Leeds East (Richard Burgon) on securing the debate, and I thank all hon. Members for their contributions.

Taxation is high on the political agenda right now for a number of reasons, but particularly in the United Kingdom because we are the only country in the G7 to be putting up taxes on incomes in the middle of the cost of living crisis that we are going through. We often hear about the global factors behind some of what we are experiencing—for example, the opening up of the global economy after covid, or Russia’s invasion of Ukraine. Of course those factors are contributing to inflationary pressures in many countries, but specific factors in the UK have also made our situation more difficult, such as the Government’s decision to allow the closure of our biggest gas storage facility, our exposure to short-term energy spot markets and, as well as the national insurance increase, the decision to freeze personal allowances for five years, which creates more taxes on incomes as inflation rises. The combination of price rises and tax rises was specifically cited by the OECD last week in its forecast, which projected UK growth next year to be the lowest in the G20 with the sole exception of Russia.

The Government’s incoherence on tax has been highlighted in this House in one fiscal statement after another over the past couple of years. First, the tax rise was announced, then a change in thresholds, then a cut promised in two years’ time. Then there was a debate within the Conservative party about whether that cut should be brought forward from two years’ time. I thought the hokey-cokey was a dance, not a description of Government tax policy, but that is how it has felt over the past 18 months.

All that chopping and changing has served only to undermine whatever coherence there might have been in policy, and whatever credentials Ministers tell themselves that they have for sound management of the economy. In fact, the electorate could be forgiven for feeling that they have been asked to be unwilling participants in the Chancellor’s conversation with himself about whether or not he is a tax cutter. In his corporation tax announcement he declared the death of the Laffer curve in the explicit rejection of his predecessor’s justification for cutting corporation tax.

No amount of disclaimers at the end of Budget statements can change the reality of the Government’s decisions or their effects. With inflation at its highest in 40 years, the cost of living crisis is causing immense hardship, as we have heard from many colleagues. The Office for Budget Responsibility expects the fall in living standards this year to be the largest in living memory.

Another most basic thing to say about the Government’s tax changes is that they are a clear breach of their 2019 manifesto, which said,

“our plan is to cut taxes for the lowest paid through cutting national insurance.”

National insurance has gone up—it has not been cut. The Prime Minister might assume that no one takes him at his word. After all, why would they? But this rise is the opposite of what he said he would do. Now we know that the Government have also frozen the personal allowance for five years, too.

Let us turn to some of the other taxation options in front of people. The Government have followed our plan to introduce a windfall tax on oil and gas producers’ profits, although they cannot bring themselves to call it that—it is the policy that dare not speak its name. Beyond that, there is more that the Government could do to make the system fairer. The Chancellor, for example, could address some of the tax loopholes that deprive the public finances of much-needed funding that could be paid by some of those most able to pay. I take one example that we have announced: the way that private equity bonuses, otherwise known as carried interest, are treated. These substantial sums are given as bonuses to private equity partners and are taxed at the lower rate.

--- Later in debate ---

On resuming—

[Mr McFadden]

Just before the Division bell went, I mentioned our proposals for changing the tax treatment of private equity bonuses. Let us also look at the use of non-dom status to avoid paying UK tax on worldwide earnings. The principle that we adopt on this issue is very simple: if someone makes the United Kingdom their home, they should pay their tax here. Our constituents do not have the luxury of engaging in international tax arbitrage to pay tax in the jurisdiction of their choice. They cannot pay a fee to exercise that choice. That is why we say that non-dom status should be abolished. It simply is not right that those at the top can benefit from an outdated, 200-year-old tax break while most people are struggling with tax rises and the cost of living crisis. The changes we have proposed would bring us into line with other major economies, such as Germany, Canada and France, and create a system that takes into account people who are genuinely here to work for a few years on a temporary basis.

As the economy has changed, the tax system should change too. In business taxation, when it comes to domestic and international companies and the balance between physical and digital companies, the old system of assuming that every business is a physical business based in one country has become out of date. We see tax arbitrage in this world too, with companies shifting profits around to the jurisdiction of their convenience. We see high street businesses and British companies that pay their fair share struggling as large multinationals avoid paying their taxes through the shifting of profits around the world. That is one reason we support the international minimum corporation tax and want the agreement reached on that to be ratified and put into practice. It is also why we want the current system of business rates in the UK to be replaced with a new system of business taxation that is fit for the 21st century. That new system would create a more modern balance between the physical and the digital and between local high streets and out-of-town locations.

The overall tax burden is now the highest it has been in 70 years, while our economic growth rate in the last 12 years has been anaemic. Those two things are related. If the country does not generate enough economic growth, that affects our fiscal position and the incomes people can earn. If the country had continued with the rate of growth in the first decade of this century under the Labour Government, earnings would be thousands of pounds a year higher and the country’s fiscal position would be distinctly healthier. I am not the only one who has noticed it—as the former Financial Secretary to the Treasury, the right hon. Member for Hereford and South Herefordshire (Jesse Norman), made clear in his letter ahead of last week’s no-confidence vote, he believes that the Prime Minister has “no long-term plan”, and that view is shared on both sides of the House.

I will finish with a word about wealth creation, which has been mentioned in the debate, and what it is. Any serious party of Government must support wealth creation just as much as fair wealth distribution. But what is wealth creation? It has to be more than simply the ownership of assets. Wealth creation is the combination of great ideas with great effort. When we see a company in our constituency that has a great product or service—we probably all know one—we want that company to provide good work, reward its workers fairly, succeed and make a profit. That is wealth creation. It is not simply the ownership of assets. If we support that wealth creation and create the wealth the country needs, we should match that to fair taxation that can give us the public services that underpin a good society. It is that combination of wealth creation and a good society that we will continue to support.

UK Gross Domestic Product

Pat McFadden Excerpts

Monday 13th June 2022 Commons Chamber

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on today’s GDP figures.

[The Economic Secretary to the Treasury (John Glen)]

Like other advanced economies, the UK is affected by global economic challenges, including the unprovoked Russian invasion of Ukraine. As the Chancellor said a few weeks ago,

“A perfect storm of global supply shocks is rolling through our economy simultaneously.”

At the same time, the impact from the wind-down of the national covid testing scheme is dragging on UK GDP data. Overall, the figures for April, published by the Office for National Statistics this morning, show that output fell by 0.3% on the month, with the services sector falling by 0.2%, and production and construction declining by 0.6% and 0.4% respectively. As the ONS notes, the fall in GDP on the month is driven by the impact of the wind-down of the NHS covid testing programme. Testing volumes fell by 70% from March to April, which, alongside the impact from vaccines, detracted 0.5 percentage points from GDP growth in April. Looking through the impact of falling tests, we see that the rest of the economy actually grew by 0.1%. Importantly, GDP is still 0.9% above pre-pandemic levels, and support provided over the past two years has put the UK economy in a good position to deal with any economic headwinds, with record numbers of employees on payrolls and a strong economic recovery from the pandemic.

As the Chancellor has also said:

“The next few months will be tough. But where we can act, we will.”

The Government are taking significant action to support households this year, having announced an additional £15 billion of further support for households just over a fortnight ago, on top of the £22 billion announced at the spring statement. In the longer term, the Chancellor has set out his vision for a lower tax, higher growth, higher productivity economy based on the three pillars of capital, people and ideas. The plan for growth and the tax plan represent an ambitious strategy for boosting growth and productivity in the years ahead. The Government’s priority going forward is to put those into effect, including through significant investment in infrastructure, skills and innovation.

We will of course keep the data under close review, and that includes monitoring the economic impact of Russia’s illegal invasion of Ukraine, but our focus will continue to be on the best solution for all: a growing economy that supports high-wage, high-skilled jobs.

[Mr McFadden]

I am grateful to the Minister for his response. GDP down 0.3% in April. A fall of 0.1% in March. Services down 0.3%. Production down 0.6%. Construction down 0.4%. Inflation at 9%. Tax promises broken. The trade deficit at £24 billion. The pound falling against the dollar. The director general of the CBI saying business leaders are “in despair”. The OECD forecasting that, next year, the UK will have the lowest growth of any G20 economy, with the sole exception of—Russia.

That is what the Government are presiding over. Britain is going backwards under the Conservatives. Our businesses, universities and people are all great, but they do not have the partner they need in this Government. The chaos is affecting more and more areas of life: passports, driving licences, GP appointments, A&E waiting times, airports and delays in court trials. Time after time what we used to take for granted is now another feature of Boris Johnson’s backlog Britain.

Those on the Government Benches had a chance to change direction last week. They had a chance to install new leadership that might have given us some hope of a greater sense of grip on all this. But what did they do? They decided that the best person to turn the economy round, to sort out the chaos and the backlogs, and to bring the qualities of focus, attention to detail and sustained delivery to these matters was the current Prime Minister. That was the judgment they made.

The question for the Minister today is simple: after making that judgment—I do not know what he did, but that was the collective judgment—and choosing to continue with the leadership that brought us here, what will the Government do now to turn matters around, and why on earth should anyone believe that the result will be different from what went before?

[John Glen]

As ever, I am grateful to the right hon. Gentleman for his remarks. I do not accept his characterisation of the situation. What I said in my response to him was that today’s data point can be explained by the specific impact of the rapid fall-off in the testing programme. Mass testing ended on 1 April, and that constituted 0.5% of headline growth. We have also seen the impact of the Russian invasion and the impact on the supply chain across the economy. Many economies across the G7 are experiencing a significant impact on their economies and their level of growth.

The Chancellor has been clear in his long-term plan for growth and in his Mais lecture that the Government are committed to investing in research and development, investing in infrastructure and looking at how we can adjust the fiscal burden for business, in particular, to enable that growth to happen. Of course, in subsequent fiscal events, those options remain open to him.

Oral Answers to Questions

Pat McFadden Excerpts

Tuesday 17th May 2022 Commons Chamber

[Mr Clarke]

Levelling up is a social and moral mission. I believe very strongly that it is vital that we close the gap between the more successful parts of the UK and the rest. I represent a constituency that sits at the heart of that process. On the hon. Gentleman’s point on the cost of living, we have put together a £22 billion package of support, including a £9 billion commitment specifically on energy bills, but we are absolutely clear that we do not solve an inflationary crisis by throwing money at the problem, as that could worsen the issue we are seeking to address. The Chancellor will keep all these issues under close review. [Interruption.] I can assure the hon. Gentleman that he most certainly does. We will bring forward a programme of measures at such time that they will make the right difference in a targeted way, which, as I say, does not make worse the very problem that we all need to solve.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

Last week, Bloomberg published a report that showed that, on the Government’s own chosen 12 measures of levelling up since the Prime Minister took office, most parts of the country are either falling even further behind London and the south-east or have made no progress, including every single constituency in the west midlands. That includes salaries, home affordability, inward investment, transport spending and levels of crime all going backwards. Why is levelling up so far failing to deliver?

[Mr Clarke]

The right hon. Gentleman raises the Bloomberg report. We have to recognise, when we look at this issue, that levelling up is a decades-long project for reversing things that are institutionally extremely challenging in terms of the striking geographical inequalities that have arisen under successive Governments and which this Government are determined to address. The levelling-up White Paper, published this spring, puts in place a framework for the Government to work directly with people and places to help address those disparities. We will be held to account with an annual report to monitor our progress. What I would say is that the people of the west midlands made their views very clear last year when they re-elected Andy Street as their Mayor, just as they made their views very clear on Teesside when they re-elected Ben Houchen. They can see progress. They are realistic—none of this is easy and none of this is going to be an instant turnaround—but they are clear that we have a plan to deliver it and they are behind that.

[Mr McFadden]

The Conservatives have been in office for 12 years; they were not elected last week. This is the self-declared central mission of the Government. Tackling regional inequality is a good aim. Communities like the one I represent in the Black Country made the last industrial revolution and they can make the next one too if they are given a platform on which to stand, but now, with the Bank of England Governor warning of apocalyptic rises in food prices and a further likely steep rise in energy bills in the autumn, what will the Government do to reverse the failures outlined in the damning report last week, and bridge the grand canyon between the Prime Minister’s rhetoric on these things and the reality on the ground?

[Mr Clarke]

The levelling-up White Paper is a comprehensive package of measures designed to ensure we can deliver on our ambitious aims in this place. The Queen’s Speech, which we are debating this week, further demonstrates our commitment to making that a reality, including, notably, through the establishment in law of the UK infrastructure bank. It is clearly the case, as I say, that none of these problems are simple to address. We have to be honest on both sides of the House that both Labour and Conservative-led Governments have failed to narrow those disparities. We have a plan which I am confident will deliver meaningful change in short order and over the medium to long term make a transformative difference to communities.

Oral Answers to Questions

Pat McFadden Excerpts

Tuesday 15th March 2022 Commons Chamber

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

The package on energy announced by the Chancellor last month has already been rendered obsolete by Russia’s invasion of Ukraine. Some estimates of average annual household energy bills suggest that there will be rises to £3,000 or even more from October. That is a ruinous figure for many of our constituents. Will the Chancellor revisit this support package in next week’s spring statement, and will he reconsider his refusal to fund help for hard-pressed households through a windfall tax on the enormous profits that oil and gas companies are making?

[Rishi Sunak]

It is worth bearing it in mind that, because of the price cap, households will be protected all the way through the autumn. We do not know what the price cap will be at that point. If the right hon. Gentleman knows, he is probably in the wrong line of business, and it would be good if he could tell the rest of us. Regarding a windfall tax, Conservative Members believe in getting more investment into the North sea and exploiting our domestic resources. The roundtable that my right hon. Friends the Chief Secretary to the Treasury, the Prime Minister and the Business Secretary hosted yesterday showed that there is enormous appetite to invest more in the UK. A windfall tax would put off that investment.

[Mr McFadden]

Of course, there are global factors driving up energy prices and inflation in many countries, but what singles out the UK is this Government’s decision to impose a tax rise on working people right when the impact of rising energy bills is hitting people the hardest. Why are the Government so determined to make the cost of living crisis worse now with these tax rises, particularly when the Treasury is briefing anyone—including the Government’s own Back Benchers—who will listen that the Tory party is planning pre-election tax cuts?

[Rishi Sunak]

The right hon. Gentleman talks about exceptionalism with regard to policy. Part of the reason we are in this situation with energy prices is the decisions made by the previous Labour Government, in particular on nuclear energy, which we are now rapidly having to make up for. We are also committed to tackling the unprecedented backlogs in the NHS, getting the waiting lists down, and recovering from covid. Every single penny of the health and social care levy will go to the people’s No. 1 priority and, although things are difficult, I know that is what people want to happen.