Budget Resolutions and Economic Situation

Debate between Rachel Reeves and Tanmanjeet Singh Dhesi

Thursday 16th March 2023 Commons Chamber

[Rachel Reeves]

It is wonderful to see you in your place. We were told that this was a “Budget for growth”, but the documents published with this Budget confirm that the UK economy will shrink this year. The Chancellor expects us to cheer at the news that the economy will shrink a little bit less than he previously thought. Is that really what “good” looks like for the British economy?

The Office for Budget Responsibility also confirmed that we will have the weakest growth in the G7 this year and next year, and it saw growth downgraded for each of the last three years of the forecast period. All the while, the UK is the only G7 economy that is still smaller than it was before the global pandemic.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

This Budget will not do a great deal for my Slough constituents who are really struggling to make ends meet and pay their bills, apart from a big tax cut for the very richest in our society. My constituents will have the highest tax burden and the biggest drop in disposable income since the second world war inflicted on them. Does my right hon. Friend agree that this Budget will not actually help to solve the cost of living crisis?

[Rachel Reeves]

I have spent time in my hon. Friend’s Slough constituency talking to working people and businesses. On the most recent couple of visits there, I do not remember anyone saying, “The big priority for families and businesses in Slough is a tax cut for the 1%.” Instead, they were saying, “Let’s have a targeted scheme for the NHS, as Labour has called for, instead of this blanket approach for the top 1%.”

The Government have, to be fair, given us some growth: growth in stealth taxes, growth in mortgage costs and growth in NHS waiting lists. There is no plan for the future, just a Tory legacy of pain. It will take a Labour Government to spark and sustain growth, lift people’s living standards in every part of the country, meet the challenges of the future and achieve the change that our country desperately needs.

When I meet people in industry, I hear frustration from employers who cannot get and retain the staff that they need. It is a feeling the Tories know all too well, with three Prime Ministers in one year, and the current Chancellor the fourth in that role since just last summer. Yet somehow, it is the same Tory Government. It is a bit like Trigger’s broom in “Only Fools and Horses”, with its 17 new heads and 14 new handles, only much less useful.

After his five months as Chancellor, the right hon. Member for South West Surrey (Jeremy Hunt) might feel that he should qualify for a Conservative party long-service award. In fact, of the past three Chancellors, he is the first to deliver a Budget, although the last Chancellor did last long enough to deliver a mini-Budget that crashed our economy—an extreme experiment in ultra-Tory ideology, using Britain’s economy and people’s livelihoods as their laboratory. It must never happen again.