In response to Russia’s unprovoked aggression against Ukraine, the Treasury has helped deliver a world-leading package of economic sanctions to deliver severe consequences to the Russian economy. Across insurance, finance, trade, public and private capital markets, clearing, SWIFT, central bank assets and, indeed, bank asset freezes, we are ensuring that the Government play a leading role in making sure that Putin’s aggression does not go unpunished.
Families in my constituency are facing the cost of living crisis, and the planned real-terms cut to social security will force more of them into poverty and into having to make impossible decisions between eating and heating their home. According to the Trussell Trust, one in three on universal credit were not able to dress for the weather last month as they could not afford appropriate clothing or shoes. That is unacceptable. Will the Chancellor increase the level of social security support in his spring statement next week to alleviate some of the worst impacts of the cost of living crisis?
As is common to all other years, welfare is uprated annually by September’s CPI. That will be the case next year as well, as my right hon. and learned Friend the Financial Secretary laid out. For those on universal credit we have cut the tax rate to ensure that work pays, delivering a £2 billion tax cut to 2 million on low incomes—the best route out of poverty.
My hon. Friend is right to point out the importance of fuel as a cost for both businesses and households. That is why I am proud that we delivered the eleventh freeze in fuel duty in a row. That has delivered huge savings for households and businesses over the past several years.
Millions of people are worried sick about soaring bills. Meanwhile, BP says it has more cash than it knows what to do with and has compared its record profits from inflated prices to a cash machine. Those profits are not being used to fund new investment. They are going on dividends and share buybacks, so why will the Chancellor not make North sea oil and gas companies pay their fair share of taxes to tackle the enormous cost of living crisis?
The hon. Lady talks about a fair share. It is worth bearing in mind that oil and gas companies are already taxed at double the rate of all other companies: 40% versus 19%, currently. Last year saw the lowest amount of investment in the North sea on record—just a few billion pounds. As my right hon. Friends who were at the roundtable yesterday know, there are billions of pounds of projects waiting to be unlocked. We want that investment and those jobs here in the UK.
That is not happening with the share buybacks. The Chancellor is totally out of touch. He does not seem to understand how the cost of living crisis is affecting the least well off in society, as campaigner Jack Monroe highlighted. The Institute for Fiscal Studies confirmed that the poorest households face an inflation rate 50% higher than the richest households. The Resolution Foundation warns that between 2020 and 2022, 700,000 more children will have fallen into poverty. That is devastating, but it is not inevitable. The Chancellor can and must do more in the spring statement to provide people with real help, not just a loan. Why is he so intent on shielding oil executives, instead of protecting the poorest in society?
The best way to help people cope with rising energy costs and bills over time is to make sure we have a diversified and secure supply of energy, more of which comes from here at home. I share the hon. Lady’s concern for those on the lowest incomes. I am proud that all the evidence points to the fact that the decisions made by this Government over the last few years have benefited those on the lowest incomes the most. We have protected those who need our help, and we will continue to do so.
It was very interesting to meet my hon. Friend, together with his colleagues from the all-party parliamentary group on investment fraud, and to hear his idea. As we discussed, Her Majesty’s Revenue and Customs is very keen to make clear which schemes do not work. That is why, in the Finance Act 2022, the Government legislated to allow HMRC to name promoters and the schemes they promote at the earliest possible stage, to warn taxpayers of the risk of entering into those schemes, and to help those already involved to exit avoidance.
We are spending record amounts on supporting those who are disabled. Relative to the OECD, I think we are spending in excess of the average for other leading countries. My right hon. Friend the Secretary of State for Work and Pensions has a particular programme of support in place to help those who are disabled to move into employment; plans were announced earlier this year.
My hon. Friend is right to highlight the effect of a high effective tax rate on incentives to work. That is why the Government reduced the universal credit taper rate from 63% to 55% and increased the universal credit work allowance by £500 per year, which is essentially a tax cut for the lowest-paid, worth more than £2 billion in 2022-23, and means that 1.9 million households will keep an extra £1,000 per year on average.
The changes to the taxation of red diesel were announced back in 2020, were confirmed in spring 2021 and are coming in this year, so businesses, including in the sector that the hon. Member refers to, have had plenty of time to prepare. It is absolutely right that we tax fuels that are highly polluting; unfortunately, diesel is one of them.
My hon. Friend is an active campaigner for the steel sector in her constituency. I can assure her that energy-intensive industries such as steel receive substantial support from the Government, including free allowances from the emissions trading scheme and the £315 million industrial energy transformation fund, to help them to cut energy bills.
A statutory instrument entitled the Customs (Amendment) (EU Exit) Regulations 2022 was on yesterday’s Order Paper for approval by the House. It amends the customs arrangements for the United Kingdom by excluding Northern Ireland from them, changing the term “United Kingdom” to “Great Britain”. That runs totally contrary to the assurances given by the Prime Minister that Northern Ireland would remain part of the UK customs territory; it runs contrary to article 4 of the Northern Ireland protocol; and it now means not only that Northern Ireland is part of the single market under the European Court of Justice, but that it is outside the UK customs territory. The motion relating to the instrument was not moved. Can the Financial Secretary give an assurance that it will not be brought back to the House until there has been a meeting to explain why it is necessary, what its impact on Northern Ireland is and why the Government have brought it forward?
I am happy to answer that question. I understand completely the concerns of people in Northern Ireland about the impact of the protocol; the right hon. Member will know how seriously the Government take those concerns and how we are negotiating with the EU to ensure that we get the right arrangement for Northern Ireland. I can give him assurances here and now about what the statutory instrument was doing: it was making very minor technical changes in a number of areas, for example in relation to the provision of information that might have to be given but that was never previously enforced. It was actually easing up the requirements for those who operate trade between Northern Ireland and Great Britain. These were technical changes, and I am very—
My hon. Friend has made an extremely good point. Now is the moment for us to go full steam ahead with our transition away from fossil fuels. We are investing in nuclear, we are accelerating our progress on renewables, and we are boosting energy efficiency in homes across the country. This is how we will bring bills down, improve our energy security and tackle climate change.
When the Government set up the coronavirus business interruption loan scheme, they recklessly failed to agree any guidance on early repayments. As a result, businesses are now being charged extortionate fees and are facing bankruptcy. Why is the Chancellor putting the profits of unscrupulous lenders above the recovery of our small businesses?
He is not doing that. The schemes were set up in various ways, depending on the size of businesses, and it will be for the individuals who borrowed money to engage with the lenders to refinance those loans on a case-by-case basis.
My hon. Friend has made an important point. We recognise that some people living in mansion blocks are part of a heat network and are not covered by the price cap. I draw my hon. Friend’s attention to the £144 million in discretional funding that went to councils as part of the recent £9 billion energy support package, and to forthcoming legislation in which we will give Ofgem new powers to regulate prices in the sector as a matter of priority.
We really must start seizing assets and not just freezing them. That is the only way in which we can make sure that the money goes towards the reconstruction of Ukraine. Would it not also be a good idea for us not just to look at the really famous people like Abramovich, but to look at the people who own £750,000 properties in the UK and who may be the cousins, brothers, sisters, parents or some other proxy of Russian oligarchs in the UK? Must we not also do far more to tackle the personal finance of President Putin, much of which, I am told, is in the UK?
My hon. Friend has made an excellent point. He is right to champion the value of apprenticeships, in which the Government keenly believe. I had a great roundtable with apprentices in Newcastle recently, and heard for myself just what a difference they are making both to their employer and to the wider economy.
It is estimated that the Chancellor’s smash and grab on national insurance will raise £13 billion. By happy coincidence, at the end of the financial year the Chancellor will have an extra £13 billion-worth of borrowing, because the Government have not met the borrowing expectations. Will the Chancellor use that happy coincidence to scrap the tax on jobs?
The forecast for the public finances will be updated next week. As for jobs, I am happy to confirm that, according to today’s figures, there are record numbers of people on payrolls, record numbers of vacancies, and, indeed, more people in work now than before the crisis—and the unemployment rate is now lower than, or at the same level as, it was before coronavirus hit.
The Government have repealed many of the powers in the Coronavirus Act 2020, but they have not repealed the Act itself. This means that the Treasury can still order Her Majesty’s Revenue and Customs to start support schemes such as furlough without recourse to Parliament. Control of expenditure is Parliament’s first responsibility, so are the Government going to repeal the Act in total, or will the Treasury take action to give the proper powers back to Parliament?