Autumn Statement Resolutions

Thérèse Coffey Excerpts

Thursday 23rd November 2023 Commons Chamber

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

In these unprecedented times, we stand at the crossroads of recovery and resilience, and the autumn statement gives us a clear road map for the challenging economic terrain we still find ourselves in. I have a lot of time for the shadow Secretary of State for Business and Trade, the hon. Member for Stalybridge and Hyde (Jonathan Reynolds), but I gently remind him that when we came to power in 2010, the former Chief Secretary to the Treasury, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) had left a note saying there was no money left. We have made a lot of progress since then and taken long-term decisions, and it was only thanks to that that we were able to pay for the substantial financial support we rightly gave to families and businesses during the covid pandemic. But we are still paying for that support and that is part of the challenge we face. Targeted support schemes such as the furlough scheme demonstrated a deep understanding of the challenges faced by businesses and employees, and I remind the House that no such scheme was put in place after the financial crash overseen by the previous Labour Government.

We still have an aftershock from covid at home in terms of economic productivity, but we are much boosted by the new trade deals that have been secured and I look forward to our taking advantage of that. The key issue, however, is the illegal invasion of Ukraine by Putin and the impact on energy costs. Again, we have given unprecedented financial support in the past few years to households and businesses. I was, frankly, somewhat shocked by the hon. Member for Glenrothes (Peter Grant); I never thought of him as a Putin apologist. To try to suggest that this Government stimulated the inflation is far from the truth, and he knows it is that energy challenge that has really made the difference. That is why it is right that the Government are investing in the energy of the future while also making sure that we can keep the lights on.

I welcome the measures in the Chancellor’s statement yesterday. They reflect a profound understanding of the evolving needs of our society and economy, highlighting the imperative to adapt and evolve.

[Peter Grant]

Will the right hon. Lady give way?

[Dr Coffey]

No, I will not.

The autumn statement unveiled a comprehensive plan that addresses immediate needs while also putting in place the foundations for long-term growth. The measures outlined in it serve as pillars of stability, fostering hope and laying the true foundations for a resilient and prosperous future. There are 110 measures, and I must admit that I have not read the entire Green Book, but some parts stood out to me, particularly those on backing business and making work pay. This autumn statement clearly sets the way for growth.

Given the challenges facing business, the full deduction is welcome and this is a good moment to make it permanent, especially as the UK will be hosting the global investment summit this coming Monday. I used to work for Mars, Incorporated and I know its investment in capital was pivotal to its manufacturing industry productivity and financial success, so I welcome this improvement and the long-term confidence in investment in manufacturing capital and other areas.

Businesses in my constituency, particularly those in hospitality and tourism, will welcome the business rates measure. It will help with cash flow, but I have heard today from Andrew Dalby, managing director of Brafe Engineering in my constituency, a very successful business largely driven by exports, and he has made a point to me that I want to share with the House. He says:

“The R&D tax credits…must run in parallel to see the development through to profitability to then permit the investment in the selected capital equipment needed to boost production efficiency.”

There are other substantial elements, but Brafe Engineering needs to make its components part of the system in providing skills and equipment to energy companies. It needs to enhance how it manufactures those complex components, but there is no grant system to support that and to help its customers succeed. For that business, I encourage my right hon. Friend the Chancellor to consider further work on the benefits of adjusting the R&D tax credit claims. I am aware that when they were introduced about 15 years ago, there was abuse of them, particularly by financial firms, so I think the Treasury will continue to be cautious, but we need to make sure that in R&D we focus not just on research but on development too, because that is where the value will come from.

I am thrilled that we are finally getting on with the reforms to solvency II. I remember a meeting in Downing Street just after COP26. I had been encouraging a lot of financial institutions there to raise this issue, and I am very pleased that—after some resistance, I think, from some of the institutions in Government because of the uncertainty it would bring, and indeed some concerns on pension fiduciary duties—we have found a way through, as we must unlock that investment for the long term. This has always seemed odd to me: we want things such as the local government pension scheme, so why do they not invest in the infrastructure they want if they believe it represents good value for taxpayers’ money? I am not just referring to local government. There are plenty of other insurers and others who can try to get a better return from long-term investment and long-term pension increases.

One of the big highlights of the autumn statement were the big tax cuts, for employees in particular. That is very welcome. I will be surprised if any Member votes against the legislation announced for next Thursday, because it is very important that we help people in these challenging times with more money in their pockets.

I welcome the announcements about stability in benefits and pensions. We have twice voted in this Parliament to set aside the earnings lock, recognising what happened with the dip in earnings where if we had not changed the law we would have frozen pensions. That would not have been the right thing to do, so we put in place our triple lock and lifted pensions then by 2.5%. That was followed by a year when there was a surge or spike—almost a covid-related distortion—when again the House agreed to set aside the normal earnings link. I was in the Government then and I did say that that would be it and we would apply the triple lock policy for the remainder of the Parliament. I am conscious that this is one of the biggest earnings uplifts that people will enjoy and it is right that pensioners share in that success. I am delighted we have kept to our commitments, therefore.

The Government have wisely recognised the need for a change to the local housing allowance. We made a shift during covid but then froze that change. Increasing interest rates have led to challenges in terms of rents, so I am pleased we have reinstated that. It represents a large sum of money. When we did this a few years ago, it cost an extra £1 billion just for the following year. There will be an extra £1.3 billion of spending, so I expect the amount of money taxpayers now pay in housing support will probably rise to about £32 billion or £33 billion a year. That is a substantial sum to help others, but I am conscious that there have been particular challenges with regard to local housing allowance and finding appropriate accommodation in various parts of the country.

The broader aspects of the back to work plan that have been announced and the reforms to welfare are welcome. Some of the catcalls directed at the Chancellor yesterday were completely undeserved. There is no greater dignity than being in work. Many people want to work, but feel that they cannot. They struggle to do so, and it is absolutely right that we help people into work. During my three years in the Department for Work and Pensions —we were in the covid pandemic for part of that—it was critical to try to help people’s mental health and wellbeing to support them to get back into work.

I am conscious of the issues that people have raised about access to mental health appointments and so on, but such things as the expansion of individual placement and support and other aspects of universal support go straight to the heart of trying to tackle some of the barriers that people face. Instead of focusing on some of the changes that will happen to fit notes, the whole focus has been—I worked on this for some time, and I am delighted that policies came through last year and we are seeing the funding to support them—on what people can do, not what they cannot.

I am conscious that GPs do not like to be the barrier to the gateway to benefits, but it must be good for their patients if, instead of just signing them off with even more time out of work, they were helping them to find a way through. If we wanted to be radical, perhaps the NHS budget should pay for disability benefits of people of working age. That would bring it together. I appreciate that may be a step too far at this moment, but it is about working together so that people have a fulfilling life. That is not only about being in work and away from social isolation, but the extra financial rewards that come from it.

[Peter Grant]

We are all in favour of helping people back to work, but is it not the case that by focusing on the punishment aspect, as the Chancellor and Prime Minister have done, we are talking not about helping people back to work, but about starving them back to work, whether or not they are fit to go back to work?

[Dr Coffey]

I am not sure why I gave way. I should have expected a low-quality comment like that.

In terms of the thinking about when we were coming out of covid, I worked with the now Prime Minister on the Way to Work, and we got 500,000 people back into jobs. A lot of that comes with support, but there were other aspects, such as bringing interviews into the jobcentres so that people actually turned up. I commend in particular our frontline work coaches. Candidly, if any Member of Parliament has not been to the jobcentre in their constituency or nearby, I strongly urge them to do so. They are a beacon of hope for people who are often desperate, but those who work there are frustrated by the fraud they experience, and they would like to do more about it. This sort of approach—not a stick, but a carrot—helps people. It gives a lot of time and support.

I note the expansion of the restart programme, which is to be improved, and that is good, but it has been successful in getting people back into work. There are a few ghosts, I suppose, within the benefits system, and it can be challenging to identify them. I am conscious that the Department for Work and Pensions considers the vulnerability of its claimants. It is a sensible approach and a step forward, and I know it will be undertaken with great care.

One of the other aspects I will talk a bit more about is planning and energy. I commend the Secretary of State for Energy Security and Net Zero and the Government more broadly on one aspect: finally, we will have a much more co-ordinated approach on the national grid. I have been trying to get that sorted for my constituents for six or seven years, and the proposed reforms have come too late for them. We still have a disconnected element and we still have projects that should have come in as direct current, where the infrastructure was built to support that and the developer then changed their mind. New infrastructure then had to be built for the same developer. There are no jobs that come with that. It is not about being a nimby, but about trying to make sure that we have a co-ordinated grid for the future, recognising the dynamic change that has happened, instead of the traditional coal and gas plants that we had. We have moved to a situation where a lot more of our energy will be coming in directly from the coast.

I encourage the Government to look again at considering existing brownfield sites where there are already energy connections, whether that is the Isle of Grain or Bradwell in Essex, rather than ploughing up acres and hectares of land that is otherwise used for agricultural production. Indeed, I recognise my constituents’ concerns about the change in status of a lot of this network to almost default approval; that goes against the normal way of doing planning. I understand why the Government are considering this, but it will be unwelcome in my constituency. We will be debating the national policy statements on energy at another time, so I will not dwell on that now. I understand that we have to move as quickly as possible, but I think that a more holistic approach, even for projects that are in the pipeline now, should be undertaken. My understanding is that that will not delay the connections in the future.

The port of Felixstowe is part of a freeport, and I welcome the extensions there, given the benefits. I ask the Minister to work with other Departments, particularly the Department for Levelling Up, Housing and Communities, to ensure that the freeports are effective and flowing, and to listen to the feedback from people in East Anglia about how we think some aspects could be improved. We will discuss the local government finance settlement on another occasion, but when it comes to spending I am conscious of the challenge that county councils in particular face on social care, special education needs and disabilities, and transport to school.

Historically, a constituency like mine would be seen as exceptionally prosperous; it always surprises people when I tell them that the median salary is far higher in Liverpool—apart from in Liverpool, Walton—than in my constituency. That is because a lot of people come to my part of the world to retire. There is quite long life expectancy in the area, but people in the health system know that as soon as someone goes past 80, the likelihood that they engage the NHS and social care is much higher. This long life that people enjoy—I continue to welcome people who come to see the special coast of Suffolk Coastal—needs to be taken account of, rather than some of the traditional assumptions. Indeed, the chief medical officer Sir Chris Whitty recently highlighted that in his annual report.

I encourage the Government to go even further on a few things, on top of their 110 measures. One is continuing to focus on supply-side reform. We have already seen what is being proposed for energy, and trying to get a connection timeline down from five years to six months is sensible because it can be very frustrating for people wanting to connect. But we should go further. Yesterday I spoke in a Westminster Hall debate on the apprenticeship levy. Let us also go a bit further on childcare; the Government have done some really good things, but let us go further and see whether we do need Ofsted to be the arbiter. Why can we not rely on our local councils, which already have a statutory duty for children and adults? We could consider that, as it would localise provision as well.

I could go further. I have a particular pet project for the Department for Transport, which the Transport Secretary well knows. People who passed their driving test before 1997 can drive a D1, which is basically a minibus not for hire, and a C1, which is a typical Tesco or Ocado delivery van; they are also used by many other firms, like Amazon, DPD and so on. A European regulation then required people to undertake the expensive tests needed for HGVs. I think that is unnecessary. At the time, I guess it must have been a Labour Government, or perhaps it was still a Conservative one; I cannot quite remember—[Interruption.] I apologise: it must have been a Conservative Government who thankfully negotiated to keep grandfather rights. I say that we should get on and repeal this unnecessary law, as that would allow many more people into the market to drive these sort of vans. This is a particular issue for rural communities, which do not have extensive public transport, because so much community transport relies on volunteers to drive minibuses so that people can get to a variety of activities, and those areas are currently having to pay quite a lot of money to train people to do that. This is a really easy win. I keep being told that primary legislation would be required, but let us do that, if that is what is needed to boost that aspect of productivity.

There is much in the autumn statement of which I am proud, and I commend the Chancellor and the Prime Minister on their extensive work on it. The autumn statement resonates with compassion and foresight. It acknowledges the hardships faced by individuals and businesses alike Our commitment to bolstering our economy while extending support to those most affected by recent upheavals is commendable and a clear demonstration of the principles of a Conservative Government. I commend the resolutions to the whole House.

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[Matt Western]

My right hon. Friend is absolutely right. He and I, and I am sure all of us, know the immediate pressures that local authorities face, whether in addressing homelessness or in addressing social care, so it is not within their current capacity to absorb any more; in fact, they are shrinking by the month.

[Dr Coffey]

I understand what the hon. Member says about bandwidth. Of course, any additional duties, if the Government were minded to take that forward, should be accompanied by new burden funding.

[Matt Western]

I thank the right hon. Lady for that clarification. She is right but, as we saw through the pandemic, it was local authorities who did so much to make up for the failings of the over-centralised Government, who—through the covid-19 inquiry—we now understand were incapable of getting to grips with the pandemic in our communities. That is why local governance is so important. I will move on to my speech.

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[Wera Hobhouse (Bath) (LD)]

The United Nations has warned that we are on track for 3°C of global warming. That is unacceptable and would be a catastrophe. We urgently need to limit global temperature rises to 1.5°C. We cannot pretend that the UK is safe from climate change. Last year, the UK suffered the most intense heatwave it has ever faced. Hospitals struggled to cope, there were around 3,000 more deaths among people aged over 65 and 20 % of operations were cancelled. These impacts will only get worse.

Sadly, our Government are in denial. The Chancellor speaks about economic growth, yet fails to understand that reaching net zero is an opportunity as well as a necessity. The green transition can encourage billions of pounds’ worth of investment, yet this Government are ignoring that unprecedented opportunity. The US Inflation Reduction Act and the EU’s green industrial plan will see a combined $670 billion of green investment. Even Canada, an economy smaller than ours, announced a package that offers nearly £50 billion-worth of tax credits for clean technologies. This autumn statement was an opportunity to equal the ambition of our international partners, but the Chancellor is explicit that the UK will not match the ambitions of other countries

If the UK does not invest now, we will turn our backs on investment worth potentially £1 trillion by 2030. I am pleased that the Government plan to halve the time taken to build new grid infrastructure, but why has it taken 13 years to see the problem? I am also pleased the Government will provide tax relief for meeting energy efficiency targets. However, why are they waiting until 2025 to put these measures in place?

All the dither and delay gives the Government time to U-turn on their commitments. Their record speaks for itself, including on transport. After months and years of defending HS2 and spending millions of pounds preparing for it to go ahead, the Government are now in chaos and without a vision. Transport is the largest emitting sector in the UK. Rail produces 76% less carbon dioxide emissions than the equivalent road journey. We must encourage a move away from polluting transport modes, towards greener public transport, such as trains.

[Dr Coffey]

I hear what the hon. Lady is saying, but instead of building the extra bit of HS2, the money will be used in a variety of ways, mostly on roads and the electrification of train lines. That is an important way of decarbonising our existing rail industry. Between 2010 and 2015, both Secretaries of State, including the current leader of the Liberal Democrat party, were Secretaries of State for the Department of Energy and Climate Change, so they were there when that policy was being developed in a variety of ways, early on in the lifetime of the Government.

[Wera Hobhouse]

I am not sure what the right hon. Member’s question is, but I am not denying that we need to invest more in all these sectors. The worst thing about HS2 is the dither and delay, the back and forth about decisions. That is what wastes the millions of pounds of taxpayers’ money and is unacceptable.

The decision to scrap the northern leg of HS2 will mean 500,000 more lorry journeys up and down the country. Meanwhile, as the right hon. Member for Suffolk Coastal (Dr Coffey) has just said, the Chancellor plans to take £8.6 billion meant for the railway to support road use.

The Government also want to increase aviation. I was shocked to hear that Luton Airport has called for an expansion in passenger numbers to 32 million a year. Hertfordshire’s skies would become polluted with endless planes and noise. The plans directly contradict the Climate Change Committee’s recommendation of no net expansion in airport capacity. I urge the Government to do the right thing: listen to local people from Harpenden and Berkhamsted and block the Luton Airport expansion, which flies in the face of our climate commitments.

This Government have failed to invest in renewables, have failed to support greener public transport, and are now failing to keep our constituents warm. Last winter was devastating, with the average annual household bill increasing by nearly 178%. Many people had to make severe sacrifices in order to heat their homes. It is a scandal that some people had to restrict themselves to one shower per week. This was not a blip. The Government need to realise that, even under the energy price cap, annual bills this winter will be 69% above summer 2021 levels. People need help. Lowering energy bills must be a priority, yet there was nothing in this autumn statement to support my constituents from the increase in energy bills.

We Liberal Democrats propose that the Government implement a social tariff. This would bring in lower energy bills for vulnerable customers. The Government must also ensure that the warm home discount is made available to all customers in vulnerable circumstances. That would prevent a repeat of last year, when suppliers set limits on the number of people who could access this money.

The green transition is a huge opportunity. We need a Government with the political courage to treat climate change with the urgency it demands. The country needs a bold Government with a bold plan. This autumn statement is simply another missed opportunity.

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[Mr Dhesi]

The Labour party believes that we must see a focus on renewable energies as we transition the economy, which includes investment in the nuclear sector. The hon. Gentleman rightly highlighted the construction industry; from my various conversations with leaders in that industry, I know they have been put in a very difficult position by this Government’s lack of direction, especially with regards to the building of housing. As many hon. Members have rightly highlighted, we have a housing crisis, so where is the Government’s investment to deal with that crisis and ensure that our construction industry grows, thereby providing more jobs for the hard-working British people?

[Dr Coffey]

Can the hon. Gentleman clarify the answer he just gave to the hon. Member for Kilmarnock and Loudoun (Alan Brown)? Sizewell C is in my constituency, so I just want to get clarity: does the Labour party support what the Government have done so far in investing in Sizewell C, and does Labour support its ongoing construction?

[Mr Dhesi]

I am not here to speak at length about the particular details of each project, including the sizeable project in the right hon. Lady’s constituency, but as far as the Labour party is concerned, we believe in various forms of energy, but they must come with value for money for the taxpayer. That is why we will have an office for value for money under a Labour Government.

To conclude—as I am sure you will be pleased to hear, Mr Deputy Speaker—it is clear that we need a new direction. After 13 years of missed opportunities and fiscal mismanagement, Labour is ready to write a new chapter for Great Britain, and one in which hard-working people are rewarded, not penalised. We understand the challenges faced and have a clear actionable plan. We will lift the barriers to business investment through our long-term industrial strategy and our green prosperity plan, resolving to create jobs, grow our economy and cut energy bills, as well as being transparent on economic management and always ensuring value for money for the taxpayer. Our country has phenomenal potential. Britain deserves better than the Conservatives, who over their 13 years in power, have made most people in our country much worse off. It is time for a change. It is time for a Labour Government.