Economy, Welfare and Public Services

Siobhain McDonagh Excerpts

Monday 22nd July 2024 Commons Chamber

[Madam Deputy Speaker (Dame Siobhain McDonagh)]

I inform the House that Mr Speaker has selected amendment (h), tabled by the Leader of the Opposition.

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[Rachel Reeves]

I have already given way to the right hon. Gentleman.

[Madam Deputy Speaker (Dame Siobhain McDonagh)]

Order. Could I just urge the House to think about interventions? There is a very long list of Members who want to speak and lots of people who want to make their maiden speech, and it would be great if they could all get in.

[Rachel Reeves]

Madam Deputy Speaker, you will be pleased to know that I will not apprise the House of every Bill that supports economic growth in the King’s Speech. Needless to say, there are many more—from the English devolution Bill to transfer power back into the hands of local communities to the employment rights Bill to make work pay, and the Great British Energy Bill to take back control of our country’s energy and create new jobs across the United Kingdom. Growing our economy flows through almost every word of this Address.

The British people put their trust in us on 4 July to fix the foundations of our economy, to rebuild Britain and to make every part of our great country better off. I do not take that trust for granted. We will not let people down, and I am ready to deliver the change that we need. I know it will take time and I know it will require hard work, but we are already getting on with the job by ending a reckless, chaotic approach to economic management, by putting politics back in the service of working people and by making economic growth our fundamental mission. I commend the Address to the House.

[Madam Deputy Speaker]

I call the Liberal Democrat spokesperson.

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[Several hon. Members rose—]

[Madam Deputy Speaker (Dame Siobhain McDonagh)]

The dilemma we face is self-evident: many hon. and right hon. Members want to speak, and we will do all we can to get in as many people as possible. Unfortunately, there will now be a five-minute limit on speeches. The clock will not be used for maiden speeches, but we ask Members to keep an eye on the time.

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

May I start by adding my congratulations to the Chancellor on being the first woman to hold that office in the history of our country? At this rate, the Labour party might even have a female Prime Minister some time this century. I also thank the shadow Chancellor, my right hon. Friend the Member for Godalming and Ash (Jeremy Hunt) for everything he did while in office. In particular, I thank the voters of West Worcestershire for returning me here for the fifth time.

I was one of those who was here in 2010. It is ironic that I should be following the right hon. Member for Birmingham Hodge Hill and Solihull North (Liam Byrne), because he was the one who left that famous note, “I’m sorry: there is no money left.” If people want to know what a bad economic legacy looks like, I was here in 2010 when we received one from the Labour party. The deficit was over 10% and rising and unemployment was over 8%. Inflation was nearly twice its target, and the banking system had just collapsed and had to be bailed out by taxpayers. We can contrast that with the economic legacy of 2024 that the new Government inherit.

Despite the economic costs of the pandemic and the energy crisis, the UK is enjoying the fastest growth in the G7. Unemployment is now half the rate it was in 2010. Inflation is back on target. We have a well-capitalised banking system, almost completely out of taxpayers’ hands. Wages are now rising faster than inflation. We are the fourth-largest exporter in the world. Members do not have to take my word for it; they can take the words of the International Monetary Fund, which in a recently published report said that

“the UK economy is approaching a soft landing”,

with

“growth recovering faster than expected…inflation has fallen faster than was envisaged…The banking system remains healthy”.

So I approach the economic measures in the King’s Speech with a degree of trepidation, because they come at a time when the economy was back on track. While I agree that “securing economic growth” is a fundamental mission of government, I would add the word “non-inflationary”. I have looked and looked through this King’s Speech, and I cannot see any measures that magic up economic growth. Growth does not just happen because it is written into the King’s Speech.

In my time as Chair of the Treasury Committee, we had the opportunity to have a private session with the IMF. It is interesting to observe that many of the measures put forward by the Government in the King’s Speech were in the IMF’s prescription for the UK economy. Reforming planning and building on our beloved green belt were from the IMF, as was strengthening the role of the Office for Budget Responsibility and crowding in private capital on net zero projects via a national wealth fund.

What else does the IMF want? Well, colleagues may not be surprised to learn that it also wants to see more taxes. It does not quite say it like that—it calls it “closing tax loopholes” or “mobilising additional revenues”. Some of the measures we heard about in our private session with the IMF were as follows. The first was setting capital gains tax rates in line with income tax rates. I hope that Ministers will rule that one out. The second was subjecting the sale of primary residences to capital gains tax. I hope that Ministers will rule that one out. The third was ending inheritance tax loopholes for pensions, family businesses and farms. I hope that Ministers will rule that one out. The fourth was revaluing all of England’s homes for council tax, and especially those over £320,000 in value. I hope that Ministers will rule that one out. The IMF also liked the idea of road pricing; I hope that Ministers will rule that one out. It also wants to bring forward considerably the date at which the state pension age increases.

Given that those are all tax measures that the IMF recommends, I am sure that the Chancellor is beginning to contemplate them. When the Government respond to today’s debate, I hope that they will specifically rule those things out, because the tax rises that the Government admit to already—the pensioner tax, the tax on education, and regulatory costs galore—are bad enough. Let us hear some specific denials on those other taxes.

[Madam Deputy Speaker (Dame Siobhain McDonagh)]

I call Georgia Gould for her maiden speech.

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[Suella Braverman (Fareham and Waterlooville) (Con)]

I congratulate the hon. Member for Queen’s Park and Maida Vale (Georgia Gould) on a simply superb speech that follows the best traditions of the House. She has done her constituents proud, and I know that she brings huge expertise and commitment to this House. I wish her all the best.

I put on record my thanks to the good people of Fareham and Waterlooville for sending me back to Parliament. We had a fantastically energetic—let me put it that way—and hard-fought campaign. I am honoured and humbled to have the privilege to speak on their behalf in this Chamber.

One thing struck me in the King’s Speech—not the long list of policies that will no doubt damage our economy, or the vague promises that will not survive contact with reality. For me, the thing that was conspicuous by its absence was the total failure of the Labour Government to deal with child poverty and scrap the two-child benefit cap on welfare. [Interruption.] Yes, hon. Members heard that right. [Interruption.]

[Madam Deputy Speaker (Dame Siobhain McDonagh)]

Order. Could we show respect and listen to the Member’s speech?

[Suella Braverman]

I detect a bit of surprise on the Government Benches. I have risen to speak on scrapping the cap. In the grand tapestry of British politics, where the warp and weft of policy and principle interlace, it is not often that a Conservative MP will find threads of agreement with friends across the aisle, but here we are, discussing a proposal backed by Labour MPs, led by the hon. Member for Liverpool Riverside (Kim Johnson) and backed by the Liberal Democrats, the Scottish National party and many Opposition parties. It is one with which I agree, because it speaks to my profound sense of justice and, dare I say, compassion. I will say why Conservatives can and should back scrapping the cap.

Let us not rewrite history, because there has been a lot of nonsense from Labour Front Benchers about the situation that we inherited in 2010. To put it simply, we inherited no less than an economic catastrophe, and we worked hard to recover from that situation. The deficit stood at 10% in 2010; we got that down to 1.9%. Public sector net borrowing was at 10%; we got that down to 3%. We were in a deep recession, and we now have the fastest growing economy in the G7.

We had to make incredibly difficult decisions back in 2010 to reduce our welfare bill, but it is clear to me that through those welfare reforms, spearheaded by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith), we overhauled an overly complex, bureaucratic system, and helped millions of people get back into work. Four million more people are in work now than in 2010. The unemployment rate is down to 4.4%—almost half what it was in 2010. We can make changes to some of the decisions that we made back then.

It is clear to me from my work with vulnerable families in Fareham that the cap is not working. It is pushing more children and families into relative poverty, causing them to use more food banks. There are three good reasons for scrapping the cap.

[Suella Braverman]

I just set out that the parlous economic situation forced us to make impossible choices, but thanks to the improved economics and the improvements brought about by universal credit, I believe that it is time to put child poverty first and scrap the cap. There are three big reasons for Conservatives to support that. First, it is affordable. For about £1.7 billion—0.14% of total Government spending—we could quickly bring around 300,000 children out of poverty. In this improved situation, that is the fair and right thing to do. Secondly, the reason why it was introduced in the first place was to disincentivise poorer families from having more children, but that has not necessarily worked. The number of children born has remained relatively stable. As the Joseph Rowntree Foundation found, heartbreakingly, 43% of children in larger families are in poverty. The children hardest hit are those under four. It predominantly affects younger children, and those in large families. I believe that the cap is aggravating child poverty, and it is time for it to go.

I know that there is the argument, “Don’t have children if you can’t afford them.” To me, that is not compassionate, fair or the right thing to say. As Conservatives, we should be proudly and loudly the party of family. We should encourage families on lower incomes to have more children. For those families on middle and higher incomes, we should change our tax regime so that they are incentivised to have children. We have better parental leave policies, better childcare provision policies and better maternity care. I am a Conservative because I believe in the strength and the sovereignty of the family unit. We should support it, not suppress it. This is not about right or left. This is about right or wrong. Let us come together, in a spirit of compassion and common sense, to scrap the cap and end child poverty for good.

[Madam Deputy Speaker]

I call Sarah Sackman to make her maiden speech.

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[Wera Hobhouse (Bath) (LD)]

The shift to a green economy represents the most significant transformation for centuries. We must reverse the damaging rhetoric by the failed Conservative Government that the economy will suffer if we are uncompromising in our ambition to get to net zero. This is not an either/or of economic growth or investing in the green economy—the green economy is at the heart of economic growth.

We must end our reliance on oil and gas. Renewables would mean cheaper energy bills across the country, and we would no longer be reliant on dictators such as Vladimir Putin who use natural gas as a weapon. As well as being more affordable, renewables are the best route to energy security. Under the Tory party, renewable projects faced long delays and costs skyrocketed. The new Government’s reversal of the de facto ban on new onshore wind is welcome. We are also glad restrictions on new solar have been reversed.

The Liberal Democrats share the ambitions of the Government’s climate agenda, but we will also ensure that these projects have local buy-in. Local authorities must play a leading role in delivering climate action, and the communities that host the new infrastructure must directly benefit from it. For example, there is huge growth potential in community energy. The Liberal Democrats are calling for small-scale renewable energy generators to receive a guaranteed fair price for the electricity they sell back to the grid. Community benefit and individual economic incentives are crucial to securing support and active participation in our energy transition.

In both the Labour and the Liberal Democrat manifestos there was a clear commitment to tightening energy efficiency standards for private landlords. National Energy Action has warned that the statutory fuel poverty target cannot be met without doing so. The King’s Speech provided an opportunity for the new Government to set that as a priority in their new renters’ rights Bill, but it was missed out. I hope the Government will hear this and ensure that improvements to energy efficiency for renters materialise before the situation worsens.

Under the previous Conservative Government, the cost of living crisis was exacerbated by rises in travel costs, particularly for commuters. It is not clear how Labour’s plans for nationalisation will do anything to alleviate the high cost of travelling by rail. We urge the new Government to freeze rail fares and simplify ticketing to ensure that regular users are paying a fair and affordable price. For too long, decisions over local transport have been centralised. Liberal Democrats have long argued for lifting the ban on local authorities franchising buses. It is reassuring to see that the Government recognise the importance of local decision making. However, councils will need adequate resourcing to expand services. We are yet to see a strategy for that. We would also like to see a long-term plan from the Government for further electrification of the rail network. Not providing one would be a dereliction of duty to reduce emissions and improve air quality.

I look forward to working together constructively with the new Government to turbocharge our energy to get to net zero, and to make sure we really improve our green public transport and grow the huge opportunities of a green economy.

[Madam Deputy Speaker (Dame Siobhain McDonagh)]

I call Andrew Lewin to make his maiden speech.

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[Several hon. Members rose—]

[Madam Deputy Speaker (Dame Siobhain McDonagh)]

Order. Let me just give the House a reminder—not that the next Member I will call needs this reminder—that for those of us who could be described as veteran Members, it is the custom to praise maiden speeches.

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[Andrew Rosindell]

I am deeply proud to have been elected for the seventh time as the Member of Parliament for Romford. I am now the longest-serving MP for Romford since 1885, when the constituency was created. I am here because I believe in things. I am here not because I seek titles and positions, but because I believe in this country, and I am also passionate about my constituency, because it is where I am from. I think that those of us who come from our constituencies know how important it is to represent a place where we have lived all our lives, and I will always be proud of being the MP for my home town.

As I have said, I believe in things, and I believe first in this country. Let me say to Ministers, whom I congratulate on their election to power, that things change and Governments come and go, but the one thing that we must never give away is the freedom and liberties of the British people. I say to them, “Whatever you do, please do not reverse the biggest democratic decision that the British people made.” We want to have sovereignty; we want to have the right of self-governance; but we also want prosperity, and that means free enterprise, low taxes and smaller government. It does not mean creating a larger centralisation of power. Margaret Thatcher taught us that if we have lower taxes and free enterprise, if we give people the freedom to prosper and make their own decisions in life, in the end we create more prosperity and more opportunities for all. That, I am sure, is what all of us, in all parts of the House, want to see, so let us learn from past mistakes.

I respect the fact that we have different opinions on many issues, and I also understand that all of us here want the best for our country and our constituencies. However, I believe that if we want economic prosperity, we need Governments to stay out of people’s lives. We need to allow business to flourish. We need less regulation, and we need to cut unnecessary public expenditure, so that people are not paying high taxes which disincentivise work and put people off from investing in our country. I hope that the Government, having taken office, will pay heed to that. I also say to them that, yes, we want to protect our environment, but we have to think very carefully about the evangelism of net zero. We do not want to make our country cold and poor, and to give competitive advantage to other countries that do very little about climate change and have not met their targets. I am afraid the policy that the Government have adopted will deliver more power to China, so I warn them about going too far in that direction.

I believe that we should be a Parliament that makes decisions, so I disagree with more and more quangos, committees of experts and bodies that are not democratically accountable having so much say. Why are we effectively giving the Office for Budget Responsibility a veto over the rights of this Parliament to decide economic policy? Surely that is something that the Government should think again about.

Before I have to end, I would like to say that if we are serious about devolution, we should give all parts of the country greater control over their local communities. Boroughs such as Havering would rather be independent. We do not want to be under Greater London; we want power devolved back to our local communities. Historically, we are part of Essex, and we do not like being controlled by City Hall—and certainly not by the current Mayor of London. I represent the people of Romford, and they would agree with what I have said. Let us have free enterprise, true devolution and, above all, prosperity for the British people, but let us also stand up for our country abroad and at home.

[Madam Deputy Speaker]

I call Miatta Fahnbulleh to make her maiden speech.

[Miatta Fahnbulleh (Peckham) (Lab/Co-op)]

Thank you, Madam Deputy Speaker. May I start by commending my hon. Friends for their impassioned maiden speeches? I am so proud to be sitting on these Benches with them.

I am incredibly honoured to be speaking for the first time in this House as the Member of Parliament for Peckham, a new constituency that spans from the oak trees of Nunhead cemetery to the spires of St Giles’ church, the African food shops of Peckham, the bustle of Rye Lane, the market stalls of Faraday’s East Street, the vibrant mosques of Old Kent Road and the Latin quarter of North Walworth. Ours is a community of communities that represents the very best of multicultural Britain—people of different colours, cultures, faiths and backgrounds united in our openness and acceptance of each other. We take pride in our diversity and the magic it brings to Peckham, and in our warmth and generosity of spirit.

Whoever you are and wherever you have come from, you will find your place in Peckham. For me, this is what makes representing the constituency so special, because it was among friends and the Sierra Leonean community in Peckham that my family found refuge when we fled from west Africa when I was a child. It was in this community that I learned the values of compassion and solidarity that have shaped my politics, and it was in this community that I first understood just how much the economy is failing people. I learned that you can work hard every day and still live in poverty, that our kids can be talented but still be deprived a shot, and that you can have billionaires living in the same borough as families that cannot feed their kids. It is in Peckham that I found my resolve that this must change. That is why I became an economist, why I have spent the last 15 years developing and campaigning for ideas to bring this change about, and why I am standing here today.

As I begin my journey in this House, I take inspiration from my formidable predecessor Harriet Harman, our inaugural Mother of the House. Harriet set the highest bar possible for what it means to be a great MP, having given 42 incredible years of service in working for the people of Camberwell and Peckham. In knocking on doors across Peckham, I heard story after story about how Harriet helped her constituents and touched countless lives. At a time when trust in our politicians is so frayed, the warmth, love and trust that she commands in our community speaks volumes. But more than that, she combined tireless work in her constituency with making a huge impact on our politics nationally—whether through enduring policies like the minimum wage, the winter fuel payment and the Equality Act 2010, which went to the heart of the inequality she saw in our community, or through the trail she blazed for women in politics by breaking ceilings and carving a path for others to follow. Today, the 190 Labour women MPs in this House are standing on her shoulders. On a personal note, I will always be grateful for her kindness, wisdom and grace, and for showing me what it means to be fearless in defence of your constituents, loyal but independent of mind, and tenacious about the change that is needed.

The need for change has never been so great. Today, as we debate the economy and all the uncertainties it brings, there is one thing I know for certain: people in Peckham are struggling. Their pay packets have flatlined for too long, with their safety net cut to shreds. Over a third of them cannot afford day-to-day essentials, and too many of our children now live in poverty. But it is not just about the money in your pocket; it is the fact that something as basic as a decent and affordable roof over your head is now out of reach for so many. Our schools, youth services, hospitals and care system are at breaking point, and children in my schools tell me that they only feel safe at home or at school—nowhere in between.

People in Peckham need change—not words or the promise of change that never comes, but real, tangible change that they can feel in their communities and see in their lives. They need change that will end the sense of being ground down, end the constant survival mode that so many people find themselves in, and rekindle the hope that has been beaten out. The weight of responsibility to deliver this now sits with me and all my hon. Friends on this side of the House. While the task feels insurmountable, what gives me hope is that those on our side have always grasped for big ideas to change the country when we have needed to do so. The NHS, social housing from the rubble of war, and the minimum wage—we have always been the party of big ideas. We have done it before at moments of crisis, and now we must do it again. As we find solutions to the challenges in front of us, I, as a proud Labour and Co-operative MP, hope that we will draw inspiration from the deep traditions of our movement—the enduring force of co-operation, putting power back in local hands, creating businesses run by local people for local people, trusting communities like Peckham to decide their own future, and giving them ownership and a stake in their economy—so that we can deliver the change for which my constituents and constituents across the country have given us a mandate.

If you will allow me, Madam Deputy Speaker, my final words are to my constituents. To the people lying awake at night and worrying about bills, the traders fighting for the survival of the businesses they have built, the families that cannot afford a home to lay down their roots, the people who cannot get the care they need and the kids who do not feel safe in our community, I want you to know this. I have listened to every conversation we have had. I have heard your worries, your anger, your frustration and your hopes, and I make one promise to you: in everything I do in this House, I will keep you in my mind’s eye. I will be your loudest voice, your fiercest defender and your proudest champion. I will fight every day to deliver the change that you deserve. I will serve you.

[Madam Deputy Speaker]

I call Bradley Thomas to make his maiden speech.