Budget Resolutions

Tony Lloyd Excerpts

Monday 1st November 2021 Commons Chamber

[The Secretary of State for Levelling Up, Housing and Communities (Michael Gove)]

My right hon. Friend the Chancellor of the Exchequer delivered his Budget statement against the backdrop and in the shadow of the covid pandemic, but he also did so unveiling a new era of economic optimism, as we build back better after that pandemic and secure the investment required to make sure that every part of this United Kingdom flourishes economically and every citizen has the chance to achieve their fullest potential.

It was striking that the Office for Budget Responsibility, in its assessment of the Chancellor’s response to the covid pandemic, said that he was “remarkably successful” in the steps that he had put in place. It is important, against the backdrop of the Budget statement and the spending review that accompanies it, to reflect for a second on the Chancellor’s success. The plan for jobs, which he was responsible for, has ensured that, contrary to the grim expectations that we would face unemployment of perhaps 12%, it is now expected to be 5% at most. It is also striking that the Office for Budget Responsibility estimated that the scarring effect on the economy—the drop in GDP that we would inevitably suffer as a result of the covid pandemic—would no longer be 3%, but just 2%.

Those figures, which reflect the success of my right hon. Friend’s approach hitherto, should be in our mind as we consider the approach that he is taking, because it is only as a result of success in ensuring sound money, success in ensuring an approach towards a balanced budget that commands the confidence of the markets, and success in ensuring that more of our fellow citizens can remain in employment that we have the foundations today on which to build, unite and level up our country.

[Tony Lloyd (Rochdale) (Lab)]

The right hon. Gentleman talks about success. In part of my constituency, child poverty is something of the order of 60%. That compares with a national average of just under 20%. Is that a success because, if not, what does levelling up mean for the children in my constituency?

[Michael Gove]

The hon. Gentleman makes an important point. At the heart of levelling up is a recognition, as he rightly reminds the House, that while talent is spread equally across this country, opportunity is not. There is a series of measures in the Budget statement designed to specifically attack the problem of child poverty. The creation of new family hubs is specifically designed to address that, as is the additional investment in the supporting families programme, the successor to the troubled families programme.

I should add that the changes to the taper on universal credit will also ensure, allied to the changes in the national living wage, that someone who is on the minimum wage, who is therefore in work, and who is receiving universal credit will receive at least £250 extra a year as a direct result of the national living wage increase and an additional £1,000 a year as a result of the associated changes to the taper. I recognise that eradicating poverty is not the work of one Budget, but it is only fair that everyone across the House recognises that there are measures in this Budget statement—measures being taken by this Government—directly to address the problems that the hon. Gentleman raises, because they are a scar that needs to be healed.

--- Later in debate ---

[Tony Lloyd (Rochdale) (Lab)]

Nothing typifies the difference between the Pollyanna view of Conservative Members and the more realistic view of the Opposition than the conversation about the Chancellor’s brave decision, as he described it, to cut the universal credit taper from 63p to 55p. Had the Chancellor been brave enough to put a 55p tax rate on high earners, I would have applauded because it would have been legitimate to raise it from the 47p in the pound that high earners pay, compared with the 55p in the pound that the poorest people in our society have to pay. That is the difference between the values of this Government and those of my constituents and the overwhelming majority of people in this country.

The Budget did nothing about the environment. We saw a decrease in air passenger duty and fuel duty, and no investment in heat pumps, insulation for our homes and all the things that we know we have got to do. Where was that investment?

The Chancellor cut bankers’ tax, and he cut Amazon’s tax, I think by a total of £15 billion. I could have found better ways of spending £15 billion. I would have spent it on the things that matter to those on universal credit, for example, because they are our fellow citizens and they are in need. He should come to my constituency—to a constituency that is poor. It is not poor across the piece —there are people there who do well enough—but in the worst wards, 60% of children are living in poverty. That is a disgrace to this country of ours and it is a disgrace to this Government, because it has got worse consistently, year by year, since they came to power in 2010.

Look at the pay of the public servants that even the Conservatives now say they value. Someone working as a medical secretary, for example, is 5% worse off today than they were in 2010. A paramedic is 7% worse off, and people in other industries are even worse off. The Chancellor’s lifting of the pay restraint on those in public sector services will not go a long way, frankly.

Let us look at the question of growth. We know that this country has a productivity crisis. We know that there are things that we have to invest in for the long term rather than engaging in short-term tinkering as the Chancellor did. That long-term change will require investment in health so that, for example, my constituents in the worst wards do not die 10 years younger than constituents in the City of Westminster. That is another disgrace in modern Britain.

We also need investment in education. Again, young people in my constituency see less spending and bigger cuts to education than those in other parts of the country. We have had 8% cuts over the last 10 years, compared with 4% nationally. Are we going to see that money put back with the new investment in education? I hope so, but I do not rely on this Government to do that. We have seen cuts in further education. We have seen cuts in our sixth-form colleges, which are so important to young people in towns such as Rochdale. When will we see that money back?

There is real anger in my constituency. This Budget is not disappointing; it is a waste of time. It was an opportunity to make real change—an opportunity that a tinkering Chancellor used to put himself forward to be leader of the Conservative party, not for the country.