Economic Growth

Rachel Reeves Excerpts

Tuesday 14th November 2023 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

I beg to move an amendment, at the end of the Question to add:

“but respectfully regret that the Gracious Speech fails to include legislative proposals to prevent a repeat of the economic fallout from the September 2022 Growth Plan, by amending the Budget Responsibility and National Audit Act 2011 to give the Office for Budget Responsibility the power to produce and publish forecasts for any Government fiscal event which includes tax and spending decisions with long-term effects over a threshold to be specified in a new Charter for Budget Responsibility.”

It is fair to say that the UK is not exactly gripped with excitement at the contents of the Conservative Government’s King’s Speech. It is as if Ministers have rummaged down the back of the sofa and found legislative loose change, a broken biro, some old Bills covered in fluff and even an old Prime Minister. In this current Tory era of three-word slogans, the country is thinking not, “Five more years!” but, “Is that it?”

It is clear what the Government’s approach is in the run-up to that election. They have given up on trying to improve the country, so all they can now do is attempt to divide it. But they will fail because the Conservatives simply do not understand the priorities, hopes and values of the people of Britain today. After five Prime Ministers—one of them recycled—and seven Chancellors since 2010, the Conservatives find changing personnel rather easier than changing our country for the better.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

I am listening to the right hon. Lady’s speech about values. The values of my constituents are such that they are calling for an immediate ceasefire in Gaza. Does she support those values?

[Rachel Reeves]

We have just had an hour and a half’s worth of questions on that issue. I am going to focus on how to grow the economy and tackle the cost of living crisis.

I wish that today we were debating the Government’s significant economic reforms and new measures to get our economy back on track after 13 years of Tory economic failure—but there weren’t any. Their big tax reform is to consult on bringing in a new duty on vapes. Their big energy Bill does not even lower people’s energy bills. In fact, a third of the Bills in the King’s Speech are reheated from the previous Session. How out of touch must the Prime Minister be to peer down from 10,000 feet up in his helicopter and conclude that everything is going so well that there is no need for legislation and Government action to help unlock growth? This is the final King’s Speech before the general election, and yet this set of proposals will not quicken the pulse, get the economy roaring or lift people’s living standards. Where is the ambition? Where is the plan?

As the British Chambers of Commerce has pointed out:

“The King’s Speech opened with an aspiration to increase economic growth—but it failed to outline how that will happen.”

[Samantha Dixon (City of Chester) (Lab)]

Does my right hon. Friend share the concern of many that rather than improving, economic growth is forecast to go into reverse next year under the Tories? Does she agree that this new Tory economic failure does not bode well for people’s living standards next year?

[Rachel Reeves]

I thank my hon. Friend for that intervention. She will have seen that the forecasts published by the Bank of England just over a week ago show that the economy is expected to flatline not just throughout the rest of this year but all through next year as well.

There is something quite apt, even revealing, about the Conservatives wanting to use this King’s Speech to protect the users of driverless cars from the damage they might inflict on others. The Conservative Government have been driving quite dangerously for 13 years. The current named driver of the vehicle—the third in four years—is nowhere to be seen, but there will be no protection for the Prime Minister or his party from voters’ verdicts at the general election, whenever that comes.

The Government’s King’s Speech was a lost opportunity for our country. There was no legislation to reform the antiquated planning process and accelerate decisions around our critical national infrastructure. Instead, planning processes continue to hold back the success of our offshore wind sector, life sciences and 5G. There were no pension reforms to encourage growing British companies to stay here instead of being forced abroad for funding, which contributes to the UK’s stagnating growth. There was no serious plan to help get energy bills down. The energy price cap has increased by half in this Parliament, yet the Energy Secretary has admitted that the Government’s energy Bill

“wouldn’t necessarily bring energy bills down”,

whereas Labour has plans for clean power by 2030, a national wealth fund, insulating homes to lower bills, and the creation of GB Energy.

There is no focus from the Government on industrial strategy or on putting an industrial strategy council on a statutory footing to help drive the growth and investment that we need. Instead, the Government reach for sticking plasters when important sectors hit crisis. We need positive, long-term plans to make the most of our assets and create good-quality jobs here in Britain.

[Jim Shannon (Strangford) (DUP)]

I commend the right hon. Lady for her strong and wise words. Like me and others in the House, she believes that the life sciences sector can grow and do much more. In 2019, the pharmaceutical sector alone provided 18% of research and development spending. There are almost 600,000 jobs in the industry and it contributes £36.9 billion in gross value added to GDP. Does the right hon. Lady agree that if we are to ensure that everyone can gain from life sciences, there must be better distribution across all of this great United Kingdom of GB and NI, and that NI must be a part of that?

[Rachel Reeves]

I could not agree more with the hon. Gentleman. Our life sciences sector is key for Great Britain and Northern Ireland, and yet too many businesses are looking to relocate, including to the Republic of Ireland, but we want those jobs and those investments here in Britain.

There was no legislation in this King’s Speech for fairer tax measures. The Chancellor and the Prime Minister have been so quick to raise taxes—they have done so 25 times between them—that we now have the highest tax burden in 70 years. It is the biggest tax hike ever in a single Parliament, with working people and businesses hit hard, yet the Government allow unjustifiable tax loopholes to remain. I believe that if people make Britain their home, they should pay their taxes here, too. That is why we will abolish the non-dom tax status and introduce a modern scheme for people who are genuinely living in the UK for short periods. Why is it so hard for this Prime Minister to say the same?

There was no legislation in this King’s Speech to increase security at work or to update employment rights. Having confidence to plan a family’s future should be not a luxury but something that working people deserve, and we need to grow our economy from the bottom up and the middle out. If an economy is not working for working people, it is not working at all. This King’s Speech has no serious plans for tackling the cost of living crisis or for growing the UK economy.

The Conservative economic failures are piling up high: a failure on growth; a failure on infrastructure investments; a failure on the cost of living; a failure on public services; and a failure on tax. The responsibility for such disappointment and damage has been a Conservative team effort these past 13 years. The Government cannot get our economy back on track or make our country better off. The Conservatives cannot and have not tackled the cost of living crisis because they are the cost of living crisis.

[Andrew Western (Stretford and Urmston) (Lab)]

Does my right hon. Friend agree that we are still paying the price of the failed Tory policies since 2010 that have weakened our NHS, stripped funding from our local council services and stopped Labour’s school repairs programme?

[Rachel Reeves]

I thank my hon. Friend for that intervention. The truth is that the combination of austerity, which was five Prime Ministers ago, Brexit without a plan—which relates to most of them—and the kamikaze Budget has contributed to the parlous state of our economy and the cost of living crisis that we are enduring today.

This is a party led—and I say “led” in the loosest sense of the word—by a Prime Minister with no mandate whatsoever and with no authority or vision for the future. This Prime Minister appears to be spending more time polishing his CV in conversation with Elon Musk than fighting for the livelihoods of manufacturing workers in Scunthorpe, Port Talbot and Derby.

And it is the previous Prime Minister, the right hon. Member for South West Norfolk (Elizabeth Truss), who still sets the tune for so many in the Conservative party. She wanted to scrap the bankers’ bonus cap in the kamikaze Budget last year, and that has now been dutifully delivered by this Prime Minister and this Chancellor. When the previous Prime Minister called this year for delaying the timetable for new electric cars by five years, undermining both the net zero consensus and the British automotive industry, this Prime Minister and this Chancellor delivered. Today, the former Prime Minister’s so-called growth commission is setting out its demands for next week’s autumn statement, oblivious to the damage already done. Will the Chancellor tell the House whether he agrees with the person who appointed him to do the job he is now doing and her proposals to slash corporation tax, abolish inheritance tax, abolish stamp duty and other unfunded commitments that make last year’s mini-Budget look like small fry, with tax cuts announced totalling £80 billion?

Labour will never gamble with the livelihoods of working people, as the Conservatives have. Labour’s economic approach is built on a rock of fiscal responsibility, with respect for taxpayers’ money. We will work in partnership with industry to bring about the change that our country so desperately needs. We know what the Tories did last autumn. They blew up our economy with their reckless, unfunded promises and a trashing of our economic institutions. It was a collective failure from the Tories. It was not just one bad apple, but a whole orchard of irresponsibility. The Conservative leadership contest of summer 2022 produced a sum total of £200 billion of unfunded promises. The Chancellor did not want to be left out. His leadership candidacy might not have been as successful or lasted as long as he may have wished, but there was still time for him to make almost £80 billion of unfunded commitments himself on corporation tax, business rates and defence, with no idea how those commitments would be funded.

Following the leadership election last year, Conservative Cabinet Ministers tried to blindfold the nation and global financial markets by preventing the Office for Budget Responsibility from publishing its assessments. The Conservatives knew that the truth would hurt, but they continued to gamble with the livelihoods of our country. The pound crashed, pensions were put in peril and interest rates soared. Working people were made to pay the price for the Conservatives’ kamikaze Budget and reckless eagerness to cut the taxes of the wealthiest few. It was reckless, it was irresponsible, and with Labour it will never happen.

The result is an average Conservative mortgage penalty of £220 each and every month for hard-working homeowners. This out-of-touch Government do not have a clue about what that really means for people. That is a lot of money to try to find from nowhere each and every month. It means holidays cancelled, spending cut back and life made harder. Some families are having to downsize, and others who have been trying to get on the housing ladder for years have had their dreams snuffed out. Meanwhile, rents rise as landlords see their mortgages go up and want to pass the costs on.

[Mr Clive Betts (Sheffield South East) (Lab)]

My right hon. Friend is making a good point about housing costs and the shortage of housing in this country. Is it not therefore astounding that, given the climate we are in, there is not one single word about housing in the whole King’s Speech? There is not a single word about the shortage of housing or the rising costs of housing, no long-term proposals to build on this vague commitment of 300,000 homes, and no idea how to build them.

[Rachel Reeves]

My hon. Friend speaks powerfully on what he knows well. On top of the big challenges with house building and the Government getting rid of their housing targets, the number of homeowners in arrears on their mortgage is also up a staggering 18% compared with a year ago. The Conservatives are no longer the party of home ownership. Higher housing costs are the last thing people need in a painful cost of living crisis. It should never have happened in the first place, and it must never happen again.

[Jack Brereton (Stoke-on-Trent South) (Con)]

Will the right hon. Lady enlighten us on the Labour party’s views on our precious green belt, because my constituents are terrified that a Labour Government will build houses all over it?

[Rachel Reeves]

Labour’s approach is brownfield-first. We also know that there is land designated as green belt that is no such thing. For example, there is a petrol station in Tottenham that people cannot get planning permission for, because it is classified as green belt. People want that land built on, and I think we can all agree across the House that we need reforms to allow that to happen, but this Government scrapped the house building target. Home ownership is falling under the Conservatives. The Conservatives were once the party of home ownership; they can no longer claim that mantle. It is Labour today that is the party of home ownership and of aspiration for working families.

Today the Conservatives can show that they have learned a lesson from last year. They can back Labour’s commitment to strengthen the Office for Budget Responsibility in our amendment. We believe that where a fiscal event is making significant and permanent tax and spending changes, the OBR should be able to freely and independently publish a forecast of the impact of those changes. No Government of the day should be able to stop it from doing so. In the event of an emergency, where changes must be introduced at speed and a forecast cannot be produced in time, the OBR would be allowed to set a date for when it can publish a forecast. The public should be able to read an independent assessment on the health of our economy, to understand the consequences of proposals and to see the prices on the menu.

The amendment should not be remotely controversial, and I look forward to seeing Conservative MPs and Ministers joining us in supporting this sensible measure today. If they do not, it will show that they have not learned a thing, and that the Conservatives continue to present a real and present danger to our economy.

What will be the legacy of 13 years of this Conservative Government? They have damaged our economy, trashed our public services, failed to invest in the industries of the future, squeezed people’s living standards and caused a calamitous cost of living crisis. A Labour Government will clean up that mess. We will clamp down on waste and fraud from the pandemic, because the country is sick of being ripped off and we want our money back. We will tax fairly, spend wisely and grow the economy. We will get the NHS back on its feet. The Conservatives have broken our public services before, but Labour Governments have fixed them in the past, and we will do so again.

As bad as the public finances are under the Conservatives, there will always be choices, so we will abolish the non-dom tax status and use that money to help our NHS tackle record waiting times and introduce free breakfast clubs for all primary school-aged children. We will close the tax loophole that gives private equity managers a huge tax break. We will close the tax loopholes benefiting private schools, which gain from not having to pay VAT and business rates, and use that money to support the 93% of children attending our state schools. If the Conservatives want to have a fight over who is most aspirational for our young people when the ceilings are crumbling in our schools, I say bring it on.

After 13 years of Conservative Government, the questions that people will be asking at the next election are simple: “Do my family and I feel better off after 13 years of Conservative government? Do our schools, our hospitals and our transport infrastructure work better than when the Conservatives came to office 13 years ago? In fact, does anything in Britain work better today than when the Conservatives came to office?” The answer is a resounding no. This King’s Speech is not remotely up to the task of changing our country for the better and meeting the challenges head on.

Real change cannot come from five more painful years under the Conservatives, but only from a fresh start with Labour. The Labour party is the only party of economic responsibility and with the ability to provide the change of direction and confidence that our country needs. As this King’s Speech shows, this desperate, decaying Government are out of ideas, out of excuses and increasingly out of time. If the Prime Minister and Chancellor are so confident about the Conservatives’ record, let us take it to the ballot box and let the British people decide.

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 5th September 2023 Commons Chamber

[Mr Speaker]

I call the shadow Chancellor.

[Rachel Reeves (Leeds West) (Lab)]

Last week, thousands of parents were told that their children’s schools were unsafe and at risk of collapse. The defining image of 13 years of Conservative government: classrooms propped up to stop the ceilings from falling in. Capital budgets have halved in real terms since 2010, with warnings ignored and repair programmes slashed. Do this Conservative Government take any responsibility for any of this?

[Jeremy Hunt]

Let me start by reassuring the right hon. Lady that the vast majority of pupils in the 156 schools affected are at school normally, and we are acting fast to minimise the impact on the rest.

Let me answer the more general question that the right hon. Lady raised. Yes, we made cuts in spending in 2010 because, as she knows well, the last Labour Government left this country with an economic crisis. Despite that crisis, the Department for Education budget has gone up by 15% in real terms, and overall capital spend—

[Mr Speaker]

Order. This is topicals. All your colleagues on both sides of the House want to get in. Topicals are meant to be very short, not a full debate between both sides. I say to everybody: think about others. I think we can move on. I call Rachel Reeves.

[Rachel Reeves]

I will repeat: capital budgets have halved in real terms since 2010. I understand—indeed, I know—that in the lead-up to the 2021 spending review, the Department for Education made a submission to the Treasury about the dangers of the deteriorating school estate, including from reinforced autoclaved aerated concrete. Those warnings were ignored by the then Chancellor—the current Prime Minister—and we have seen the consequences, so will today’s Chancellor do the right thing and publish the Department for Education’s submission to the last spending review?

[Jeremy Hunt]

Capital spending at the Department for Education went up 16% in real terms in that review. Is the difference not that, with the fastest recovery in Europe, the Conservatives build an economy that can pay for our schools and hospitals, and Labour runs out of money?

Mortgage and Rental Costs

Rachel Reeves Excerpts

Tuesday 27th June 2023 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

I beg to move,

That this House is extremely concerned that, under this Conservative Government, average mortgage costs will be increasing by £2,900 per year, with a typical household in the UK paying over £2,000 more per year than in France and over £1,000 more than in Ireland and Belgium, and that renters face huge increases in rent payments; condemns the Government for its slowness in acting to support millions of homeowners and renters and so alleviate the impact of its policies; calls on the Government to bring in mandatory measures, as the current voluntary measures could lead to around one million homeowners missing out on support, and to immediately adopt measures to ease the mortgage crisis and halt repossessions by guaranteeing support from lenders for struggling mortgage borrowers and strengthening the rights of renters; in particular calls on the Government to require lenders to allow borrowers to switch to interest-only mortgage payments for a temporary period, to lengthen the term of their mortgage period, to reverse any support measures when requested and to make mandatory repossession restrictions; and further calls on the Chancellor of the Exchequer to instruct the Financial Conduct Authority to urgently issue guidance that the credit score of borrowers should be unaffected by any temporary switches to interest-only mortgage payments or lengthening of their mortgage period and to introduce a renters’ charter that would end no-fault evictions immediately.

Throughout Britain, families are experiencing the harsh, rolling impacts of the Tory mortgage bombshell. Last autumn, the Tories’ mini-Budget crashed the pound; they trashed our economic institutions and left our country’s reputation in tatters, with higher mortgage rates as the consequence. The current Prime Minister and the latest Chancellor have not turned the situation around. For families across Britain, things are getting worse, not better. The Prime Minister is now lecturing the country to “hold our nerve”. It is easier to hold your nerve when you do not have to pay the price of the Tory mortgage bombshell.

What are the consequences? Millions of households will be hit by the bombshell, paying, collectively, a total of £15.8 billion more in mortgage payments by 2026. That will be an additional £240 per month, on average, for those re-mortgaging. In the constituency of the Chief Secretary to the Treasury, the right hon. Member for Salisbury (John Glen), the figure is higher still, with 9,700 households there facing payments, on average, of £280 per month more—or £3,400 per year. People can hold their nerve all they like, but how does the Minister think that is going to pay the mortgage or the rent?

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

My right hon. Friend is making a good introduction. Is it not the case that all this money that will be lost by households does not go to help anyone but the Tories’ friends in the banks, who, of course, have presided over those neo-liberal policies that trashed our economy?

--- Later in debate ---

[Rachel Reeves]

I thank my hon. Friend for that intervention. I will come on to the ways in which we can better protect people, but many banks are doing the right thing and trying to support their customers. It is important that all lenders take the action that is needed, which is why we need the Government to make that charter a requirement, not a voluntary agreement.

These devastating increases in mortgage rates will damage people’s plans for the future and deny many their dreams. In plenty of cases, they will mean more lives and hopes ruined. Citizens Advice said this week that many of its clients with mortgages have seen their finances “fall off a cliff”, with more and more people struggling to afford the essentials, such as food and heating. But it is not their fault: they have done nothing wrong.

For James, from Selby, the Tory mortgage bombshell is going to cost him and his family £400 more each month. That is nearly an extra £5,000 a year, but he cannot find that money and so he and his family have no choice but to sell their house and downsize. He has just told his children that they are going to have to start sharing bedrooms because they cannot afford to live in their home. Can the Minister explain why James and his family are having to pay the cost of this Tory Government’s failures?

[Margaret Greenwood (Wirral West) (Lab)]

My right hon. Friend is making excellent remarks. Does she agree that this situation is having a devastating impact not only on people with mortgages, but on renters, because landlords are passing on the costs to them? Does she agree that we need no-fault evictions to be scrapped immediately?

[Rachel Reeves]

I very much thank my hon. Friend for that intervention. She is absolutely right: the people being hit are those who are having to re-mortgage; those who are on floating rates and are just seeing their payments automatically go up; first-time buyers who want to be on the housing ladder but, because of this bombshell, are not able to get on it; and renters, who are paying the higher mortgage payments of their landlords. She is right to say that we need Labour’s renters charter, in order to do a number of things, including ending no-fault evictions.

Families facing the increasing squeeze from their rising mortgages are now having to confront that stress and anxiety day in, day out. For many, this will mean that their family holidays are cancelled this year; they will watch hard-earned savings drain away; and they will decide that they can no longer afford to spend money on days out with friends and family. For others, it could be much worse, with them not moving up the housing ladder, but slipping down it, through no fault of their own. The scale of the impact of all of this is devastating.

[Jim Shannon (Strangford) (DUP)]

I commend the right hon. Lady and the Labour party for bringing this debate forward. Every one of us, including my constituents, is dealing with the same problems. Some people contacted me last week to say that their mortgage rates are going up from £400 to £800, while others have said that theirs are going up from £600 to £1,200. It is just impossible to find that amount of money. Does she think that perhaps the Government—I look to them when I say this—should be looking at mortgage tax relief? That is one direct method of helping people to retain their houses and their dream of home ownership, and to survive this crisis.

[Rachel Reeves]

The hon. Gentleman speaks powerfully and I recognise those stories of people seeing their mortgages double because of what is happening. I will come on to the solutions proposed by the Labour party, but it is important that money is not injected into the economy at this time. If that happened, interest rates would go up even more, crippling the hopes and opportunities of exactly those we want to help. I will come on to the solutions that we propose shortly.

Over the next few years, 7.5 million families will be hit by the Tory mortgage bombshell, month after month after month. That is why it is essential that greater mortgage flexibility and support from lenders must be mandatory, not voluntary as the Government have put forward.

Consumer champion Martin Lewis warned the Government about mortgage market issues last year, and he now says “the timebomb has exploded”, yet under the Government’s scheme, 1 million households are missing out. What is the Government’s response to them? Tough? It is up to the discretion and the goodwill of their lender? That is not good enough.

Although it is welcome, as I said, that many lenders are stepping up and doing the right thing, the scheme cannot be voluntary. That is why, when Labour set out our mortgage package last week, we made sure that that would be compulsory, across the board, and required of lenders. That is right: required of lenders. Without that clarity and confidence, families are rightly anxious about what comes next and how it will affect them.

[Imran Hussain (Bradford East) (Lab)]

My hon. Friend is making an excellent speech, highlighting the real situation facing many of our constituents as we sit here today. In my constituency, 9,000 families will see a mortgage increase of up to £1,400, on top of struggling to put bread and butter on the table and keep up with energy costs. All we hear from the Prime Minister is that they should hold their nerve. Frankly, that is rich coming from somebody who is never going to be in that position. Does my hon. Friend agree with me that rather than finding solutions, what this Tory Government and the Prime Minister are demonstrating is that they are completely out of touch with people’s real problems today?

[Rachel Reeves]

My hon. Friend speaks powerfully on behalf of the people of Bradford East, a constituency that I know well and that I know will be badly affected, not just by the Tory mortgage bombshell but by the cost of living increases as well.

[Catherine West (Hornsey and Wood Green) (Lab)]

My constituent’s mortgage has gone up from £1,950 to £3,000. She spent an agonisingly stressful time waiting for that deal to come through, but if she had made the deal today, it would have been £3,500. Does my hon. Friend agree that that is too much stress for one family to take?

[Rachel Reeves]

My hon. Friend is absolutely right. People who live in Hornsey and Wood Green, where house prices are high, will see a big increase in their payments. When rates go up from below 2%, which is what many people were paying, to above 6%, there will be huge increases. It is through no fault of my hon. Friend’s constituents, or any of our constituents, that they are in that position, which is what is so frustrating.

I remember a time—you may as well, Madam Deputy Speaker—when the Tory party used to preach personal responsibility, yet this Government are taking no responsibility for the devastation that they have caused. Where is the apology for the Tory mini-Budget? Where is the apology to those paying hundreds of pounds more a month in mortgage payments, or to those at risk of losing their homes? There is nothing.

Let us just imagine for a moment that a group of people working in an office, a supermarket or a factory burn the place down. Everyone else who works there is told that they have to pay to clean up the mess and that that payment will carry on for years. The next day, the arsonists turn up to work again, expecting to be paid as normal and, not only that, they are furious if someone even brings up the incident of the fire with them. That would be preposterous and outrageous, and yet it is precisely what the Government are doing. “Inflation? Oh, that was nothing to do with us. It was all global events. It was those public sector workers asking for a pay rise. It was the Bank of England. It definitely was not anything to do with us.” That is what we hear from this Government. Well, we know what the Tories did last autumn was totally outrageous. The country will not forgive or forget the scale of the harm that the Tories have caused to the economy and to families up and down our country.

The Government say that this is happening everywhere, so let us look at what is happening in Europe. The latest data comparing interest rates among our European neighbours show that a household in Britain, with a £200,000 mortgage, is now paying over £2,000 per year more for its mortgage than in France, over £1,000 a year more than in Ireland or Belgium, and £800 more than in Germany. That impact on families in Britain reflects the choices made by this Tory Government.

To make matters worse, after 13 years of the Tory Government being in power, average real wages are still lower than they were in 2010. Many families have faced one financial pressure after another. Energy bills are twice as high as a year ago. The weekly food shop is astronomical. On top of all that, higher mortgages and higher rents are the last thing they needed. No one is reassured by the suggestion from the Prime Minister that he is “100% on it”. After 13 years in power, it is clearer by the day that the Tories are the problem, not the solution.

The truth of the matter is that we have the highest inflation in the G7, with core inflation rising and interest rates rising too. We are in a weaker position than many as a consequence of Tory choices that have left our economy lacking resilience and security in the face of shocks, including global ones. Banning onshore wind, closing our gas storage facilities and scrapping the home insulation programme have all contributed to higher bills, higher costs and less security.

A patchwork Brexit deal full of holes is making goods such as food more expensive, with the prospect that that could get worse at the end of this year, with new import checks and costs. What is the Government’s latest idea? One of the Chancellor’s economic advisers called last week for the Bank of England to “create a recession”, adding:

“They have to create uncertainty and frailty."

Will the Minister tell us whether the Chancellor agrees with that advice from his advisers? If not, why is taking advice from them?

A Labour Government would be built on the firm foundations of economic responsibility, with strong fiscal rules. We would negotiate a bespoke British food and farming agreement with our trading partners, while staying out of the single market and customs union. We would lift the ban on onshore wind and reform antiquated planning rules, working in partnership with businesses and trade unions to invest in the jobs and industries of the future, protect our energy security and reduce our energy bills. That is what is needed to get our economy on sustainable and stable path, so that families are not grappling with a cost of living crisis created by this Tory Government.

If ever there were proof that the Government do not have the answers that our country needs, it is what is happening on housing. The Conservatives once claimed to be the party of home ownership: not any more. Home ownership is falling. It is not because of just their failure to require lenders to provide mandatory support for mortgage holders, although that would certainly help today. Incredibly, the Prime Minister has scrapped house building targets in the face of pressure from some of his councillors and Back Benchers. The consequence of the Tory Government’s policy is now to push the prospect of home ownership for young people and families starting out in life even further away.

[Kim Johnson (Liverpool, Riverside) (Lab)]

My right hon. Friend is making excellent points, particularly about young people being priced out of the property market. Does she agree that we need to overhaul the housing system to include better rights for renters and more council housing?

[Rachel Reeves]

My hon. Friend makes a really important point, because the Tory mortgage bombshell is experienced whether people have a mortgage or not. Renters are seeing huge increases in their rents—on average 10% in the last year—in Liverpool and around the country. That is why Labour’s renters charter is so important right now.

Treasury Ministers remain ignorant or indifferent to the plight of the renters whom my hon. Friend spoke about. A Labour Government would bring in a renters charter, ending no-fault evictions, and introduce a four-month notice period. Renters right now are exposed to their landlords passing the higher costs of their mortgages on to their tenants. Yet it is not clear whether the voluntary package, which the Chancellor described yesterday, includes buy-to-let mortgages. Will the Government tell the House and the country what they think the consequences of that will be? Labour would rebalance the housing market towards first-time buyers and towards renters. We would bring in a comprehensive mortgage guarantee scheme, stopping overseas investors buying whole developments off plan, and introduce our tough private renters charter.

The Tory mortgage bombshell could not come at a worse time for family finances—right in the middle of a cost of living crisis. Our country is being made to pay the growing price of Tory economic failure. People cannot afford this Tory Government. We have seen mistake after mistake, wrong decisions taken for the wrong reasons, and the Government never standing up for working families and refusing to take responsibility for the problems that they have created. The only thing that the Tories have to offer is desperate excuses for the state of the country after 13 years of their Government.

At the next election, people will be asking this question: are me and my family better off after 13 years of Conservative Government? The answer to that is a resounding no. The last thing that our country needs is this Tory mortgage bombshell. The country needs security for working people. That is what Labour will deliver. We are on to the third Prime Minister of this Parliament. If this Government had any decency, they would call a general election and let the people decide who they want to stand up for them and lead our country.

Mortgage Charter

Rachel Reeves Excerpts

Monday 26th June 2023 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

Thank you, Mr Speaker. I would like to thank the Chancellor for advance sight of his statement this afternoon.

Families are worried sick to their stomach about what is happening at the moment, but the Prime Minister says, “Don’t worry—it will all be okay”. However, it is not going to be okay for the millions of homeowners who face an average increase in mortgage costs of £2,900 this year—all of this during a wider cost of living crisis. The Prime Minister told the country yesterday to hold its nerve, but where are people meant to find the money in the meantime to pay for the Tory mortgage bombshell? The Chancellor and the Prime Minister have not yet said.

For many, the Tory mortgage bombshell will mean holidays cancelled, family savings draining away and missing out on days spent with family and friends, but for others it could be much worse—not moving up the housing ladder, but heading down it through no fault of their own. The Chancellor does not need to take my word about how many people will be facing the Tory mortgage bombshell. He could speak to any of the 11,600 families in his own constituency who will be paying £450 more every month in mortgage costs alone as a result of this Conservative Government.

The Resolution Foundation estimates that millions of households will have to pay a combined total of £15.8 billion more in mortgage payments a year by 2026. That is just devastating. The Tories gambled last autumn with people’s livelihoods, and since then things have got worse, not better, yet Ministers take no responsibility for the damage that they have caused, and blame anything and everyone else. Again today, the Government claim that this is all due to global factors, yet the latest data show that a typical household in Britain are now paying over £2,000 more per year for their mortgage than in France, over £1,000 more per year than in Ireland or Belgium, and over £800 per year more than in Germany. The Chancellor is going to need a better scapegoat.

Labour set out our plans last week. Our measures were a requirement—yes, a requirement—because all lenders need to play their part when people are struggling. Our plan would have provided real help, but the Government have provided just a bad cover version. While many banks and building societies are doing the right thing by their customers, a voluntary set of measures is just not good enough. The Chancellor said today that the voluntary measures would cover 85% of the mortgage market, but what is his answer for the more than 1 million families who are missing out because their lender has not signed up to this scheme—tough luck? Just how bad does it have to get before the Chancellor recognises that mandatory action is needed to provide meaningful assistance?

I would like to ask the Chancellor the following questions. Can he confirm what consequences there are for firms who have not signed up to this scheme? Where is the plan for renters? The Chancellor did not even mention them in his statement, but many of them are paying higher rents because the mortgage costs of their landlords have gone up? Why does the Chancellor think that savers are not enjoying the full benefits from rising interest rates in the same way that mortgage holders are feeling the full pain? Why does the Chancellor think that the UK has the highest inflation in the G7, and does he still think the Government are on track with their target of halving inflation by the end of the year? How does the Chancellor think getting rid of house building targets will help increase home ownership? Finally, six days ago the Chancellor said that he was “proud” of this Government’s economic record. With energy bills twice as high as last year, food inflation close to 20% and millions hit by the Tory mortgage bombshell, is he seriously saying he is proud of that record?

People work hard to get on to the housing ladder, yet there is now a risk that dreams will become nightmares due to the decisions of this Conservative Government. The Chancellor today has come to the House with a watered-down package that does not meet the task of dealing with the Tory mortgage bombshell.

[Jeremy Hunt]

I will deal with the right hon. Lady’s specific points first. She says these measures should be mandatory, so why did Labour oppose the intervention power in the Financial Services and Markets Bill that would have made that possible? She said she wants action for savers, and I have indeed been talking to banks about action for savers and will keep the House updated. What she carefully did not mention is that we secured on Friday more than Labour committed to, because our measures provide protection for people who miss payments not for six months, but for 12 months.

The main point is that the right hon. Lady wants people to think she is fiscally responsible and will not take risks with inflation, so why on earth is she committed to borrowing £28 billion more a year when, as a former Bank of England economist, she should know that that will be inflationary and push up the cost of mortgages? Members need not listen to me; they should listen to people such as Paul Johnson of the Institute for Fiscal Studies, who said about Labour’s plans that

“additional borrowing both pumps more money into the economy, potentially”—[Interruption.]

The right hon. Lady might not want to hear this but this is what Paul Johnson says about Labour’s plans:

“additional borrowing both pumps more money into the economy, potentially increasing inflation, and also drives up interest rates.”

It is Labour’s mortgage bombshell, hidden in plain sight.

The right hon. Lady does not want people to notice the real comparison here, which is that her party faced an economic crisis in 2008, just as this Government did last year, but we are taking the difficult decisions to restore sound money and the public finances while they ducked each and every one of those decisions, ran out of money and left it to others to clear up the mess.

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 20th June 2023 Commons Chamber

[Mr Speaker]

I call the shadow Chancellor.

[Rachel Reeves (Leeds West) (Lab)]

While the Government squabble over parties and peerages, mortgage products are being withdrawn and replaced by mortgages with much higher interest rates. This is a consequence of last year’s Conservative mini-Budget and 13 years of economic failure, with inflation higher here than in similar countries. Average mortgage payments will be going up by a crippling £2,900 this year, so where does the Chancellor think families will get the money to pay the Tory mortgage penalty?

[Jeremy Hunt]

At the autumn statement, we announced £94 billion of support to help families going through very difficult times. That is more support than was ever proposed by Labour. The answer to these pressures is not borrowing an extra £28 billion a year, as people like Paul Johnson are saying that more borrowing means higher inflation, higher interest rates and higher mortgage rates.

[Rachel Reeves]

Is the Chancellor for real? These are the real-life consequences of what is happening under the Conservative Government today, so do not try to pass the buck.

Let me bring this home. In Selby and Ainsty, 12,000 households will be paying, on average, £2,700 more on their mortgage. In Uxbridge and South Ruislip, 10,000 households will be paying, on average, £5,200 more. Each and every family know who is responsible for trashing the economy: the Conservative party. Will the Chancellor apologise for the harm that his Government have caused with the Tory mortgage penalty?

[Jeremy Hunt]

I am proud of our economic record, which has seen our economy grow faster than those of France and Japan since 2010, and at the same rate as Germany. Those mortgage holders in Selby, Uxbridge or Mid Bedfordshire will be paying even more for their mortgages if a Labour Government borrow £100 billion more in the next Parliament, and we will not let that happen.

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 9th May 2023 Commons Chamber

[Mr Speaker]

I call the shadow Chancellor.

[Rachel Reeves (Leeds West) (Lab)]

The Conservatives have now had 13 years in office—wages lower, the weekly food shop astronomical, energy bills unprecedented, 24 Tory tax rises and the national debt has ballooned —so can I ask: after 13 years of Conservative Government, does the Minister think that people feel better off, or worse off?

[John Glen]

What I can tell the right hon. Lady is that, since 2010, there has been a 25% increase in real take-home pay for workers on the national living wage and, recently, the national living wage increased to £10.42 an hour—a 9.7% increase—for those over the age of 23. In 2009-10, there was a deficit of £158 billion. Before we got into covid, it was down to £38 billion. We have gone through the most tremendous challenges that this country has seen for about 100 years. I think most people in this country understand that this Government have acted on the challenges we have faced in office.

[Rachel Reeves]

The Government have had 13 years, and the answer to the question “Do people feel better off?” is a resounding no. This morning, I met 22 newly elected council leaders from the Labour party, who are creating emergency plans to help to tackle the cost of living crisis in their communities. Why will the Conservative Government not play their part, do the right thing, close the loopholes in their oil and gas tax and help working people in Britain, as a Labour Government would do?

[John Glen]

I congratulate those successful across the country in last week’s elections, but what business leaders want and what the country wants is steady policy making, delivering growth in the economy, dealing with the biggest scourge on the economy, which is inflation—[Interruption.] The right hon. Lady says from a sedentary position that we have had 13 years. We spent £400 billion when we had a global pandemic, where we had to shut down the economy. When we came out of it, we had high inflation consequential on a war that we have not had in Europe for over 70 years. Those are the realities and that is what this Government have responded to.

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 21st March 2023 Commons Chamber

[Mr Speaker]

I call the shadow Chancellor.

[Rachel Reeves (Leeds West) (Lab)]

Confidence has been shaken by the recent bank failures and stock market falls across the world. Is the Chancellor confident that our ringfencing regime is adequate to protect taxpayers and depositors, when we have seen how fast these problems can spread? Can the Chancellor reassure the House that there are no other UK banks or subsidiaries that are vulnerable, and in light of recent developments, is he confident about the Financial Stability Board, or does it need to widen the number of banks regarded as systemically important?

[Jeremy Hunt]

I thank the shadow Chancellor for her question. The Government recognise that there is some volatility in the market, but we believe the UK financial system is fundamentally strong and UK banks are well capitalised. They now have core capital ratios that are three times higher than before the 2008 global financial crisis, but we continue to monitor the situation carefully.

[Rachel Reeves]

I thank the Chancellor for that response, and am pleased that he continues to monitor the situation carefully, but the collapse of Silicon Valley Bank UK shows how our vibrant start-up sector—particularly in life sciences and tech—had become reliant on a single financial institution. The impact of these bank failures may be that other banks become more risk averse, restricting lending and raising interest rates, resulting in a credit squeeze, possibly even beyond the start-up sector. That would damage an already weak economy, so how will the Chancellor monitor the situation there and ensure that businesses have access to the long-term capital that they need to grow and to thrive?

Oral Answers to Questions

Rachel Reeves Excerpts

Tuesday 7th February 2023 Commons Chamber

[Mr Speaker]

I call the shadow Chancellor of the Exchequer.

[Rachel Reeves (Leeds West) (Lab)]

Last week, Shell announced profits of £32 billion, the highest in its 115-year history. Today, BP announced profits of £23 billion, the highest in its history. Meanwhile, in April, energy bills for households will go up by £500. The cost of living crisis is far from over, so will the Government follow our lead and impose a proper windfall tax to keep people’s energy bills down.

[Jeremy Hunt]

I am glad that the right hon. Lady asked about windfall taxes, because our plans raise more money than she was advocating in the autumn, and they are also balanced and fair. Anything higher will stop investment, increase dependence on Putin and increase energy prices. I am afraid that it is more clean energy with the Conservatives and more expensive bills with Labour.

[Rachel Reeves]

There we go again: the Government shielding the energy companies and asking ordinary families and businesses to pay more. Shell has spent more on share buybacks than it has invested in renewables. Last year, BP’s dividends and share buybacks were 14 times higher than investment in low carbon energy. The Government are allowing energy companies to make profits that are the windfalls of war, while ordinary families and businesses pay the price. Is it not the case that the Tories cannot solve the cost of living crisis because they are the cost of living crisis?

[Jeremy Hunt]

No, Mr Speaker. The total tax take from that sector is £80 billion over five years, which is more than the entire cost of funding the police force. The shadow Chancellor can play politics, but we will be responsible because we want lower bills, more investment in transition and more money for public services, such as the police.

IMF Economic Outlook

Rachel Reeves Excerpts

Tuesday 31st January 2023 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on the International Monetary Fund world economic outlook.

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

This Government have three economic priorities; our plan for this year is to halve inflation, grow the economy and get debt falling. It is a plan that will alleviate the pressure on businesses and families today, and equip us to become one of the most prosperous countries in Europe. As the International Monetary Fund said in its press conference today, it thinks that the UK is “on the right track'”. It also said that the UK had done well in the last year, with growth revised upwards to 4.1%, which is one of the highest growth rates in Europe for 2022. Since 2010, the UK has grown faster than France, Japan and Italy. Since the European Union referendum, we have grown at about the same rate as Germany. Our cumulative growth over the 2022 to 2024 period is predicted to be higher than that of Germany and Japan, and at a similar rate to that of the United States of America. The Governor of the Bank of England has said that any UK recession this year is likely to be shallower than previously predicted.

The actions we are taking, from unleashing innovation across artificial intelligence, financial services and a host of other sectors, to improving technical education and protecting infrastructure investment, will spur and fuel economic growth in the years to come, benefiting industry and communities alike. However, the figures from the IMF confirm that we are not immune to the pressures hitting nearly all advanced economies. We agree with the IMF’s focus on the high level of inflation in our country, which is why this is our first priority. Inflation is the most insidious tax rise there is, and so the best tax cut now is reducing inflation. That will help families across the country with the cost of living. As the Chancellor has said, short-term challenges, especially ones we are focused on tackling, should not obscure our long-term forecasts. If we stick to our plan to halve inflation, the UK is still predicted to grow faster than Germany and Japan over the coming years. That will help us deliver a stronger economy, one that is growing faster and where everywhere across our country people have opportunities for better-paying, good jobs. That is what the people in this country expect and what we are working tirelessly to deliver.

[Rachel Reeves]

Britain has huge potential, but 13 years of Tory failure has been a drag anchor on our prosperity. Today’s IMF assessment holds a mirror up to the wasted opportunities, and it is not a pretty sight: the UK is the only major economy forecast to shrink this year, with weaker growth compared with our competitors for both of the next two years. The world upgraded, but Britain downgraded, with growth even worse than sanctions-hit Russia. The IMF chief economist singles out higher mortgage rates as a reason for Britain’s poor performance. The Tory mortgage penalty is devastating family finances and holding back our economy. British businesses are paying the price for the gaping holes in the Tories’ Brexit deal. It will fall to Labour to clean up this mess.

If the Chancellor had ideas, answers or courage, he would be here today, but he is not. The question the people of our country are now asking is: are me and my family better off after 13 years of Conservative government? The answer is no and, as the IMF showed today, it does not have to be this way. I am sure the Minister will clutch at straws and say that everything is fine or that the IMF forecasts are just wrong, but can he explain why the UK is still the only G7 economy that is smaller now than it was before the pandemic? Why is the UK the only G7 economy with its growth forecast downgraded this year? Why are we at the bottom of the league table both this year and next year? Can the Minister answer this: why should anyone trust the Conservatives with the economy ever again?

[James Cartlidge]

The right hon. Lady talks about 13 years of failure. Let me just repeat the facts of the matter. Since 2010, the UK has grown faster than France, Japan and Italy. She talks about the next two years. As I have said, the forecast from the IMF says:

“Cumulative growth over the 2022-24 period is predicted to be higher—

in the UK—

“than in Germany and Japan, and at a similar rate to the US.”

I am grateful to the shadow Chancellor for quoting the IMF, because I, too, wish to quote the IMF. Let us go to the IMF press conference at about 3am this morning, which, Mr Speaker, I am sure you were eagerly watching, and quote the economic counsellor Pierre-Olivier Gourinchas who said:

“Let’s start with the good news: the UK economy has actually done relatively well in the last year. We’ve revised”—

growth—

“upwards to 4.1%...that’s one of the highest growth rates in Europe, in that region, for that year”—

2022.

The shadow Chancellor did make a passing reference to the pandemic, but it is usually Labour’s habit to airbrush out of history completely the fact that we as a Government have overseen two of the greatest challenges in the country’s history: a pandemic followed by the invasion of Ukraine. [Interruption.] I know why the shadow Chancellor does not want to talk about the pandemic. Back in December 2021, when the Labour Welsh Administration wanted to lock down in the face of omicron, we took the brave decision as a Government not to lock down in England. Let us remember what the shadow Health and Social Care Secretary said at the time. He said that plan B was “insufficient” and that there were additional measures that were “necessary”. Labour would have kept us locked down for longer. We took the decision to keep our country open. We did so because of the vaccine that we brought forward, which is something that Labour would not have done.

The crucial issue, as I said, is bearing down on inflation, which will give us the best chance of restoring sustainable growth. A key facet of dealing with inflation is fiscal discipline. We have heard from the shadow Chancellor recently that Labour is suddenly the party of sound money. Since the speech—I think it was two weeks ago—in which the leader of the Labour party promised to put away the great big Government cheque book, Labour has made £45 billion of unfunded spending commitments. We all know where that ends. Labour starts writing blank cheques, and it ends with a letter from its Chief Secretary to the Treasury to the rest of the country saying, “There’s no money left.”

Autumn Statement

Rachel Reeves Excerpts

Thursday 17th November 2022 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

I thank the Chancellor for his statement.

Here we are, the end of 2022. Three Prime Ministers, four Chancellors and four Budgets later, where do we find ourselves? In a worse place than we started the year, with inflation spiralling, growth plunging and living standards falling. Britain is a great country with fantastic strengths but, because of this Government’s mistakes, we are being held back. What people will ask themselves at the next election is, “Are me and my family better off with a Conservative Government?” And the answer is no.

The mess we are in is the result of 12 weeks of Conservative chaos and 12 years of Conservative economic failure: growth dismal, investment down, wages squeezed and public services crumbling. And what does the Chancellor have to offer today? More of the same, with working people paying the price for his failure. The Chancellor should have come here today to ask for forgiveness. At the very least, he could have offered an apology but, no, instead he says his predecessor was correct in his analysis at the mini-Budget that put our economy into freefall. All the country got today was an invoice for the economic carnage that this Government have created. Never again can the Conservatives be seen as the party of economic competence.

It has been clear for weeks what the Government want to do. Step one: blame global factors. Step two: pretend the mini-Budget has nothing to do with any of them. Step three: portray the Chancellor and the Prime Minister as the people who can clear up the mess of their party’s own making. And step four: attempt to lay some so-called traps for the Labour party. They have even had George Osborne in to advise them on how to party like it is 2010.

But this is not a game. This is about people’s lives and livelihoods. This is about people’s ability to pay the mortgage, to pay the rent and to pay the bills after 12 years of Conservative stagnation that have left our country so much worse off. It is about the fact that, when the global storm hit, we were uniquely exposed because of the choices that the Conservatives made.

Nobody doubts that the covid pandemic and the war in Ukraine have had profound implications, and the whole House is united in its condemnation of Russia’s aggression, but Britain’s problems started before the covid pandemic and before Russia’s illegal invasion of Ukraine. The UK has grown by an average of 1.4% a year under the Conservatives, compared with 2.1% a year in the previous Labour years. We are the only G7 economy that is still poorer than before the pandemic.

As the Governor of the Bank of England told the Treasury Committee yesterday, the US has grown by 4.2% since the pandemic and the GDP of eurozone countries is 2.1% higher, yet the UK is 0.7% smaller than at the start of the pandemic. We are not recovering; we are heading into recession, as the OBR confirmed today. The Governor described these differences as dramatic and stark. How does the Chancellor describe them, and how does he explain them?

This is the price of a decade of Tory choices and economic failure, and it is set to continue, with the IMF forecasting that, of the 38 most industrialised economies, the UK will have the slowest growth of any of them in the next two years. The Chancellor is saying today that he will be honest, so let us be honest. No one was talking about cuts to public spending two months ago, and no other advanced economy is cutting spending or increasing taxes on working people as it heads into recession. This Government have forced our economy into a doom loop, where low growth leads to higher taxes, lower investment and squeezed wages, with the running down of public services, all of which hits economic growth again. Instead of learning from the mistakes of the last decade, they are simply repeating them. We need to break free from this vicious cycle of stagnation, with fairer choices and a proper plan for economic growth.

The Chancellor and Prime Minister are trying to convince us that Britain faces problems that are nothing to do with them and that the mini-Budget, which imposed a Tory mortgage premium, put pensions in peril and trashed our reputation around the world, was all just a bad dream. It is their Bobby Ewing strategy, with Downing Street as “Dallas”. Old cast members return as if nothing has happened, with tangled plot lines to keep the audience, but the truth is that the series has lost all credibility and everyone knows it is long past time that it was cancelled. The problem for the British people is that this is not a dream. This is the everyday nightmare of Tory Britain.

The Conservatives would have us believe that they are not responsible for the last 12 years of failure. In doing so, they take the British people for fools. Millions are already worried sick about how to make ends meet and now face the added stress of higher mortgage payments, the prospect of home ownership becoming more and more remote, and rents going through the roof.

What does that mean? Family holidays cancelled, savings depleted, hopes for the future replaced by sleepless nights, and all of that on top of the fact that the average worker is earning less today than when the Tories came to power 12 years ago. The Government have presided over the biggest wage squeeze in centuries. This was a crisis made in Downing Street and it is ordinary working people who are paying the price.

As I was coming into Westminster today, I read a timely warning from the police about pickpockets in the area. They warn:

“You may have an idea of what a pickpocket looks like but they’re far less likely to stand out in a crowd than you might think…they may work in teams to distract the target…One of their tactics is…where a thief will appear to be over-friendly…while pickpocketing you.”

I must report that in the last hour the Conservatives have picked the pockets, purses and wallets of the entire country, as the Chancellor has deployed a raft of stealth taxes taking billions of pounds from ordinary working people—a Conservative double whammy that sees frozen tax thresholds and double-digit inflation erode the real value of people’s wages.

Just one of those freezes in the personal allowance will cost the average earner more than £600, making it even harder to make ends meet. At the same time, the Government are forcing local councils to put up council tax. The Chancellor seems to have confirmed today a council tax bombshell worth £100 for a typical band D property, taking council tax for such properties above £2,000 for the first time. Local people, including those with Conservative councils, will be forced to pay more because of the destruction that the Conservatives have wreaked on our economy.

This comes at a time when councils are already in dire straits because of cuts made by Conservative Governments. They probably sat around the tables in Downing Street thinking that this was some clever trick, but no one is to blame except the Government that have been in power for 12 years—not local authorities, but this Tory Government—for more taxes, more inflation and higher mortgages. Instead of tricks and stealth taxes, why do they not have a proper economic plan for Britain that puts working people at its heart? Why do they refuse to have a real industrial strategy that gives business certainty, unlocks investment and means that Britain can once again lead the world in the industries of the future?

The Chancellor is trying to claim that today’s statement is fair, yet we learn that of all the things that he could save from the wreckage of the kamikaze Budget that he chooses to press ahead with, it is their plan to lift the cap on bankers’ bonuses. At a time when he is urging wage constraints for everybody else, how can he remotely claim that that is fair?

After weeks of, “Will he? Won’t he?”, we learn today that the Chancellor will not, after all, be clamping down on non-doms—tax free income for millionaires while millions face frozen tax allowances and council tax highs. How can he possibly claim that this is fair? He refuses to act, and I wonder why. Maybe that was the only policy that he cannot get signed off by No. 10 Downing Street. I say if you make Britain your home, you should pay your taxes here.

What about the private equity managers, earning millions, who benefit from a tax break on their bonuses, which means that they pay far less tax as a proportion of their incomes than ordinary hardworking people? Did the Chancellor close that loophole today and make sure that they pay their fair share of tax? He did not. He made ordinary working people pay the price instead.

Time and again we have seen how quick the Conservatives are to raise taxes on working people. The Chancellor has even compared himself to Scrooge. He is asking working people to take the hit, with less money in their pockets in the run up to Christmas, but also for years to come. But if you are a banker, a non-dom or a private equity manager, do not worry: Scrooge has not cancelled your Christmas. [Interruption.]An hon. Member asks from a sedentary position, “What about taxes?” Well, non-doms do not pay taxes—that is the whole point. The Government could close that loophole today.

And that is before we even get on to the energy giants. After months of resistance from this Prime Minister, the Government have finally been dragged, kicking and screaming, to extend the windfall tax that Labour has been calling for since January. Yet they still leave billions of pounds on the table, profits that are the windfalls of war, because they have failed to close a huge loophole that they created that hands out massive tax breaks to those oil and gas giants for doing the things that they were going to do anyway.

For those wondering why some energy giants have paid no windfall tax in the last quarter, despite record profits and eye-watering bills for consumers, the answer is that decisions that this Prime Minister made when he was Chancellor, confirmed by the current Chancellor, let the energy giants off the hook once again.

The Government have announced plans for energy bills next year, but bill payers will still see prices go up next spring, leaving far too many people wondering how they will make ends meet. For every pound of windfall tax left on the table, people are faced with higher prices on their bills. The Tories’ failure on energy goes back much further. They closed down gas storage, blocked onshore wind and solar, and slashed support for home insulation.

Today the Chancellor says that he will act on energy efficiency, but I am afraid that is all far too late. We called for the insulation of 2 million homes a year more than 12 months ago. That could cut bills by £1,000 not just for one year, but for every year to come, and they did nothing. Insulation levels in 2021 were 20 times lower than in 2010 because of their neglect, and now he proposes a package, but we have to wait until 2025 for them to act. Why? People are facing a bills crisis now. Years and years will have gone by while he sits back. Millions of families could have been helped and they have not been.

And still the Government block renewable power, such as onshore wind, that could bring energy bills down, create good jobs in all parts of the country, and ensure that Britain can lead the way in the industries of the future. Clean power is the right solution to the energy price crisis, but, yet again, the Conservatives have failed. They have failed to protect us from future shocks, failed to tackle the cost of living crisis, and failed to take the decisions in our country’s national interest. It is because they have failed to grow the economy that they are having to bring forward yet another statement with tax rises and spending cuts.

The last Prime Minister and Chancellor embarked on a reckless sugar rush that abandoned fiscal rectitude, and the Conservatives all cheered for it, but the current Prime Minister and Chancellor have given up on growth altogether. How do we know? It is because the Office for Budget Responsibility has seen their plans and downgraded growth in the months and years ahead. Achieving the levels of growth that this country needs is not like flicking on a switch. We need a serious long-term plan to get our economy growing again, powered by the talents and efforts of millions of ordinary working people and thousands of businesses. We need a fairer, greener, more dynamic economy, creating good jobs in every part of the country—in homegrown renewables, in green hydrogen, in carbon capture and storage—with Labour’s green prosperity plan and a modern industrial strategy where Government work hand in hand with business, properly fixing business rates so that small businesses and our high street businesses thrive again, fixing the holes in the Government’s Brexit deal to help UK businesses to trade and compete in the world, and ensuring that Britain is the best place in which to start and grow a business. That is what a Labour Government will do.

While our public services are struggling and working people are being stretched, the rampant waste and cronyism from this Government continue apace. It does not seem to concern the Chancellor that his Government dished out £3.5 billion of contracts to friends and donors of the Conservative party. The latest Prime Minister spent so much time when he was Chancellor practising his signature for his glossy Instagram graphics that he failed to put in place even the most simple checks on covid support. That is why the former Treasury Minister, Lord Agnew, described the current Prime Minister’s fraud failures as “schoolboy errors”. The Prime Minister left the doors to the vaults wide open to organised criminals and drugs gangs who helped themselves to £6.7 billion of taxpayers’ money—money that the Government are failing to retrieve.

Last month, it was slipped out that the Taxpayer Protection Taskforce, set up to get this money back, is being wound down. The Government have just given up and the Conservatives are turning yet again to our crucial public services to make up the money. The fraudsters may think that they have got away with it, but a Labour Government will hunt them down for everything that they have taken from the taxpayer. The country is sick of being ripped off by the Tories; we want our money back.

It is because of Tory failure that our crumbling public services are set to suffer even more. Ordinary people lose yet again. Never before have people paid so much in tax and yet got so little in return. At the weekend, the Chancellor admitted that the NHS was already on the brink of collapse. With 7 million people on NHS waiting lists, how much longer will that list get? Three in 10 people are leaving education without GCSE English and maths. What will that do to our society and our future economy? Why do the Tories have an ideological objection to putting VAT on school fees, which the Chancellor himself admits would raise £1.7 billion? By their actions it is clear that the Government do not value our public services or the contribution of those working in them. What do we hear today? Reviews on schools, the NHS workforce, social care and waste, but what we need is action. Now is the time for delivery, not more reviews.

The Chancellor had previously said that one of his biggest regrets as Health Secretary was failing to fix social care. Today, he has further delayed the Government’s much-promised social care cap. This is yet another broken promise, after 12 years of Tory failure on social care. The Tories have trashed our public services and the statement today has proved that they are doing nothing to turn that around.

The Conservatives have crashed our economy, given up on growth and sent inflation through the roof and, as usual, it is ordinary working people who are paying the price. It is a familiar tune. Every mortgage they raise, every cut they make, every tax they hike, the Conservatives are costing you. What have we heard today? Yet more excuses and unfair choices. They have failed to tackle the cost of living crisis. They have failed to show how they will fix our public services. They have failed to show how they will deliver growth. They have no plan for the future of our country. After everything we have heard today, and after 12 long years of Tory failure, the conclusion we must come to is that Britain can no long afford a Conservative Government.

[Jeremy Hunt]

Today, we have announced tax rises and spending cuts of £55 billion. We can debate the reasons, but to govern is to choose and the shadow Chancellor did not answer the simplest of questions: does she back the need for a package of this size to bring down inflation? If Labour cannot answer, it is not fit to govern.

The shadow Chancellor says that it is the Government’s fault, but with a made-in-Russia recession, a once-in-a-century pandemic, higher inflation in Europe, bigger cuts to growth in Germany, bigger interest-rate hikes in America, to blame this on a mini-Budget that was cancelled in three weeks is just not credible. Nor are her facts right. She said that the Government are making the recession worse. Well, today, the independent Office for Budget Responsibility says that we are making it shallower, saving 70,000 jobs.

The shadow Chancellor says that this is austerity 2.0, but, in the 2010 Parliament, spending fell about 3% a year. In this Parliament, even in the next two years, it will rise 3% a year. There is £11 billion for the NHS and schools. It is not just more for our public services; it is massively more than she has ever promised. Then she talked about our record over 12 years, so let us do that: growth higher than Germany, France, Italy or Japan; the lowest unemployment for nearly 50 years; good or outstanding schools up by a quarter; and 4 million more patients in good or outstanding hospitals. In other words, growth up, employment up, school standards up and NHS funding up. Because she will not back this package, the British people today know that, under Labour, it is inflation worse, cost of living worse, unemployment worse and competitiveness worse. If we want stability, growth and funding for public services, the choice is plan or no plan. We have a plan. Where is hers?