Charter for Budget Responsibility

Debate between Roger Gale and Harriett Baldwin

Monday 6th February 2023 Commons Chamber

[Harriett Baldwin (West Worcestershire) (Con)]

Thank you very much, Mr Deputy Speaker, and may I associate myself with those passionately expressed words from the Chair?

I did think there might be a few more people here this evening to talk about the charter for Budget responsibility, after we have had so much debate across the country about the Office for Budget Responsibility and its forecasts over the last year or so. This was the year when the Office for Budget Responsibility made it into the headlines on numerous occasions, so I thought there might have been a bit more of a heated debate. I listened to the words of the right hon. Member for Wolverhampton South East (Mr McFadden), and I am not sure I understand at the end of his speech whether the Opposition are in favour of tonight’s motion and of the charter. I am not sure whether they are in favour of Budget responsibility. In fact, I did not hear any suggestions at all for solutions to the criticisms that he raised.

This evening, I reiterate, for those who were not here in early 2010, the rationale for the setting up of the Office for Budget Responsibility. It was because, in the Treasury of 2008, 2009 and early 2010, it was far too easy for the Government simply to make their own forecasts and to mark their own homework. I think there is merit in having someone external to the Treasury and oblivious to ministerial pressure come up with a set of forecasts. We all acknowledge that none will be perfect, or have perfect foresight about the future, but that externality means there is a way of marking the Treasury work and the Treasury projections. A Chancellor can certainly make an argument about why they may take issue with some of the elements going into the forecast, and there is often a more dynamic quality to tax revenues than is perhaps put into some of the external forecasts referenced this evening. A Chancellor can certainly have a debate about the numbers, but we do need to remind ourselves of the importance of this process and its external nature.

The other point I want to raise is about the fiction, which the Treasury Committee highlighted in one of our recent reports, that clouds the Office for Budget Responsibility forecasts for fuel duty. Again, this practice goes back many Chancellors and many Governments, and it is about putting into the projections for future tax revenue a ratchet up every year of fuel duty, yet for the last 12 or 13 years, every Chancellor coming to the Dispatch Box has decided not to implement it. It would be astonishing—I note that the Chief Secretary gave me a little cheeky smile—to see what is currently projected for fuel duty in the Office for Budget Responsibility forecast, which is for an extra 12p to go on to fuel after the Budget if the Chancellor does nothing. I think we can all agree that that is fiction. I cannot see the Chancellor coming to the Dispatch Box on 15 March and increasing fuel duty by 12p—I would be astonished—because the temporary one-year reduction of 5p will expire and there is the cumulative impact of the ratchet over the years.

I just wanted to highlight that there is some element of a work of fiction in the Office for Budget Responsibility forecast. It would be healthier for all concerned if a more realistic approach could be taken to the forecast for fuel duty not just in the short term, but in the medium term, because I think we all recognise that there will have to be a change, as more and more people are buying electric cars, in how we tax transport and drivers. I also wanted to publicise how our Committee has come together on a cross-party basis to make that point.

[Mr Deputy Speaker]

I call the SNP spokesperson.

Non-domestic Energy Support

Debate between Roger Gale and Harriett Baldwin

Monday 9th January 2023 Commons Chamber

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Chair of the Treasury Committee.

[Harriett Baldwin (West Worcestershire) (Con)]

I welcome the Minister’s announcement. He rightly points out that President Putin has, by illegally invading Ukraine, effectively weaponised the cost of energy against western economies, and he is right to highlight that we have been able to withstand that attack with £18 billion of support over this six-month period.

We now have a gas price close to where it stood before the invasion of Ukraine, and businesses across the country have realised the big risk they face in terms of their energy costs. Will the Minister encourage them not to pass on the cost of higher energy through inflation to their customers, and instead call for the wholesale price of energy to feed through more swiftly to the retail price our businesses pay?

[James Cartlidge]

I think this is the first time I have taken a question from my hon. Friend since her appointment to the chairmanship of the Treasury Committee and I congratulate her belatedly on her success. She makes the good point that wholesale prices have fallen significantly. The gas price is back to where it was before the invasion. Of course, we should be clear that before the invasion it was still elevated in relative terms historically, not least because there was an increase in energy prices following the reopening of the economy after the pandemic. Of course, we do not want prices to be passed on to customers in terms of inflation—that is the last thing we want to see—but I should stress that one reason why we are giving extra support to energy and trade-intensive sectors is that, because they tend to trade internationally, they are particularly exposed to those price pressures and find it harder than other companies that are energy intensive but not trade exposed to pass on those high prices.

Cyclone Idai

Debate between Roger Gale and Harriett Baldwin

Wednesday 20th March 2019 Commons Chamber

[Harriett Baldwin]

The International Development Committee, on which the hon. Gentleman sits, is doing important work in relation to DFID’s overall approach on climate change, and I look forward to hearing what the Committee has to say. I recently gave evidence to the Committee about the £5.8 billion of international climate finance. He will be aware that that has already helped 47 million people adapt to the impact of climate change.

A lot of the work that we are doing is about ensuring that people can be more resilient to these more extreme weather events, which climate scientists predict will continue to occur. Our work was recently praised in an assessment by the Independent Commission for Aid Impact, which said that we showed good strategic leadership and that our work was effective. I agree that this is an important issue on which we need to focus, and I assure the hon. Gentleman that we continue to play an important leadership role and to spend a significant amount of money in this area.

[Sir Roger Gale (North Thanet) (Con)]

One of the longer-term effects of such disasters is the loss of the livestock upon which people depend for their livelihoods and to feed their families. My hon. Friend mentioned the Disasters Emergency Committee. There is not a single animal welfare organisation represented on the DEC. Will she ensure that that shortcoming is addressed so that when people are able to return to their homes, they can also return to the livestock on which they depend?

[Harriett Baldwin]

My hon. Friend is right to highlight that, long after the waters have receded, there will be an impact on the local population’s ability to continue to have successful food markets, whether that food is livestock or maize—given that it is a particularly maize growing area. There are early reports that much of the maize crop across the three countries has been damaged. This food is an absolute staple in the region, and any damage to the maize crop and the staple diet will have ongoing knock-on effects for the food resilience of the local population. We will be working with our advisers to understand the impact of that issue, and to see where there is an additional need for programming and international leadership.