Income Tax (Charge)
Debate resumed (Order, 29 October).
Question again proposed,
That income tax is charged for the tax year 2019-20.
And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
Four weeks ago, the Prime Minister promised to end austerity. She raised people’s hopes—the hopes of teachers that they would no longer have to rely on begging letters to parents to fund the running of their schools; the hopes of police officers that the safer neighbourhood teams would return to tackle the rise in violent crime; and the hopes of local councillors of all political parties that they would have the resources to support local families in need at a time when a record number of children are being taken into care.
Those hopes were dashed yesterday. At best, those people got what the Chancellor described as “little extras”. No wonder so many teachers, police officers, local councillors and others feel bitterly disappointed at the Prime Minister’s broken promise, because yesterday’s Budget was not the end of austerity. Even with yesterday’s Budget, two thirds of the welfare benefit cuts planned by the Government will still roll out. Outside the NHS, departmental budgets are flat, and the Resolution Foundation this morning revealed that some Departments faced a further 3% cut in their budgets by 2023. Austerity is not ending.
For most people, ending austerity is about not just halting some of the cuts planned by the Government, but lifting the burden that austerity has imposed upon them and their communities over the last hard eight years.
I thank the shadow Chancellor for giving way so early in his speech. May I refer him to page 39 of the Red Book, which shows clearly that, by fiscal year 2023-24, there will be a £30 billion fiscal loosening? He referred to the Resolution Foundation, but it says that under universal credit, more money will be paid out to recipients than under the current system.
To be absolutely clear, the Chancellor gave the impression yesterday that there would be no departmental cuts, but the Resolution Foundation has said that, although some Departments will be protected, others will have a 3% cut as a result. I call that continuing austerity.
Ending austerity is about more than that; it is about ending and repairing some of the damage that has been inflicted on our society and, yes, has undermined some of the social fabric we rely upon. Yesterday, the Chancellor claimed that this was a “turning point”. It is, but not in the way he suggested. This is not the end of austerity, but it is the beginning of the end of the dominance of an economic theory and practice that has wreaked havoc on our communities. People no longer believe the myth that austerity was necessary. They are seeing this Government hand out £110 billion in tax cuts to the rich and corporations while their services are being cut and their children are forced into poverty.
We are currently seeing local councils—the first wave has been Conservative—virtually going into administration. That must say something about the impact of a 50% cut in local government funding over the last eight years.
People no longer accept the trickle-down economics that has gripped the Tory party for four decades.
I will in due course. The Parliamentary Private Secretary has done his job and handed out the briefings and questions to everyone. I respect the hon. Gentleman for his diligence and I will allow some interventions but, to be frank, people out there are fed up with parliamentary banter and want a debate that reflects the real world.
People no longer accept the trickle-down economics that has gripped the Tory party for four decades—the idea that somehow if we cut taxes for the rich and the corporations, this wealth will trickle down to everybody. They no longer accept “public sector bad, private sector good”. They no longer accept privatisation and deregulation; in fact, those are anathema to most people now. What was surprising yesterday was how lacking in self-awareness the Chancellor and his colleagues were and how out of touch they were with the reality of our people’s day-to-day lives. His speech reflected how ideologically crushed the Tories are. They are so bereft of ideas that the Chancellor yesterday, in a major parliamentary speech, was reduced to toilet gags. They are so bereft of ideas that they made a pathetic attempt to imitate Labour policies.
A former Local Government Minister gets to his feet in this House and does not express a word of apology for what the Government have done to local government.
For some time, I have had concerns about the nature of the whole debate on austerity. First, many—I accept not all—in the Conservative party seem to have no appreciation of what austerity has meant and continues to mean for our society. I thought at one point that that was because many Labour MPs such as me represented constituencies with a different demographic to many Conservative constituencies. I represent a working class, multicultural London constituency. Yes, it is faced with different challenges from those of leafy Surrey, for example, but most of all our constituents, wherever they are, rely on the NHS, local schools, the police and local council services, so all of us should have some idea of what the public services that support our constituents have been going through.
Not at the moment, if the hon. Gentleman does not mind.
What shocked me yesterday was that the Chancellor delivered a Budget that so clearly failed to address the desperate needs of our society after eight years of austerity. Let us look at just some elements of the human cost of austerity and what the Chancellor brought forward in the Budget.
As part of the number crunching that the right hon. Gentleman has undoubtedly been doing, has he worked out how much more would have been available for the police, prisons, schools and local government if the UK had not voted to leave the European Union two and a half years ago? Does he not believe that that reinforces the case for a people’s vote now to restore the level of growth that we saw two and a half years ago?
I respect the right hon. Gentleman’s views on Brexit because I campaigned for remain as well, but it behoves any Liberal Democrat to come to this House with a bit of humility after serving with a Tory Administration that savaged our public services.
Let me look at some of the elements of human suffering. Health workers are having to cope with the biggest financial squeeze in the NHS’s history.
That is an essential element of the reconstruction that Labour will have to do when we come to power.
The Institute for Fiscal Studies said that a rise in health spending of 3.3% was needed just to maintain the current stretched service, and that at least 4% was needed to improve it. Instead, according to the Nuffield Trust, what we got amounts to just a 2.7% increase in overall health spending in real terms next year.
Police officers have seen 21,000 of their colleagues’ jobs cut since 2010. As a result, violent crime is on the rise. The independent police watchdog is warning that
“the lives of vulnerable people could be at risk.”
What did the police get yesterday? Some £160 million for counter-terrorism—far less than is needed—and not a penny more for neighbourhood policing. And that despite the head of counter-terrorism warning that counter-terrorism work relies on regular policing being properly funded.
Teachers’ pay has fallen by 4% since 2011 and the schools budget has been cut by £3 billion in real terms. Some 36,000 teachers have left the profession in a year —the highest since records began.
Does my right hon. Friend agree that the cuts to education that have left 22 out of 26 Wallasey schools facing cuts and that have seen £3 million cut from their budgets, while teachers are earning £4,000 a year less and having to do more, are an absolute disgrace, and that that demonstrates that this Government give no priority whatsoever to the future of our children?
My hon. Friend has got it exactly.
It takes something, does it not, to have headteachers marching on Downing Street? That has never been seen before. Just what did yesterday’s Budget do to tempt teachers back? What the Chancellor offered was “little extras”. It was an insult, especially when 60% of teachers are not getting a pay rise this year.
There are now 4 million children living in poverty, 500 children’s centres have closed, 500 children’s playgrounds have closed and 128,000 children are living in temporary accommodation. When children’s social care faces a funding gap of £3 billion by 2025, what did the Chancellor offer? Just £84 million for just 20 councils. That will not even scratch the surface of the problem.
We have a record number of children coming into care. I know what coming into care means for a child: they are scarred for life. Why are they coming into care? Because there has been a 40% cut in funding to councils for early intervention to support families. Let the Government justify that.
On young people, the YMCA reports that spending on youth services has fallen by 62% since 2010. The average graduate comes out of university with a £50,000 debt. The IFS describes home ownership among young people as having collapsed completely. Tragically, with the mounting pressure, a decades-long decline in suicide among men has been reversed since 2010.
I am grateful to the right hon. Gentleman for mentioning suicide. I wonder whether there is anything in this Budget that he can welcome, even though I appreciate that we may differ. Does he not welcome the announcement on mental health or the announcement of a £21 million centre of excellence for public sector leaders?
Of course we welcome more money for mental health, but what was required was £4 billion, not £2 billion; and that £2 billion was contained within the £20 billion that had already been announced, so it is not additional money. There are some things that we can work on on a cross-party basis in this House, but we have to be honest about the needs and the requirements, and we have to be straightforward in saying how they can be funded.
The facts speak for themselves.
To make a real difference to the lives of young people, the Chancellor needed to address the housing crisis, deal with the toppling mountain of student loans, and restore work allowances for single people and couples without children. Instead we got piecemeal, unambitious housing announcements and re-announcements, nothing on student finances, and nothing on universal credit recipients who are single and without children.
The Chancellor’s meagre contributions to universal credit will do nothing to reverse the social security cuts for disabled people. Does my right hon. Friend agree that for the millions of disabled people, austerity is far from over?
I will come on to the plight of disabled people, who seem to have been a particular target for this Government, given how they have withdrawn funding and services.
On older people, there were more than 31,000 excess winter deaths among the over-65s in 2017, and well over 150,000 elderly people are in arrears in their social care payments. The Local Government Association, which works on a cross-party basis, said that £1.5 billion was needed by 2020 just to fill the funding gap in adult social care. The £650 million that was announced yesterday is less than half of that.
What comes out of the analysis is this. The burden of austerity has fallen disproportionately on who? On the shoulders of women. Yesterday, that did not just continue; it got worse. The share of the Government’s tax and benefit changes impacting on women increased from 86% to 87%—another year with an increase. The 1950s women, who have been treated so unjustly, have been overlooked once again.
The victims of possibly the harshest cruelty inflicted by this Government are disabled people. A UN inquiry into the rights of persons with disabilities found this Government guilty of “grave and systematic violations” of their human rights. When have any UK Government been charged with that by a UN body? Never. To be frank, we know—
Order. I apologise for interrupting the right hon. Gentleman. The hon. Member for Croydon South (Chris Philp) has made his point with force and alacrity, but he should not witter from a sedentary position, engaged in an animated conversation with a Member on the opposite Benches. The same goes for Members on both sides of the House. The shadow Chancellor has addressed the House, as in my experience he invariably does, with considerable courtesy. Whatever people think of what is being said, they should extend courtesy to the Front-Bench speakers, as they should to Back-Bench speakers.
I understand the hon. Member for Croydon South (Chris Philp); he gets excited at times, but as someone who has been excited myself at times, I completely understand.
The Government have been repeatedly forced by the courts to change how they are treating disabled people. They do not seem to have learned their lesson yet, so yesterday we saw no restoration of disability premiums, no end to the cruel social security freeze, and no end to dehumanising and unreliable work capability assessments.
The Government are also putting the livelihoods of future generations at risk. A few weeks ago the world’s leading authority on climate change said that avoiding dangerous climate change would require “rapid, far-reaching and unprecedented” action. What did we get yesterday? We got no mention of climate change, no reversal of cuts to renewable energy, and no significant environmental policy.
Because it was not on a scale that would have had sufficient impact. I welcome interventions, but I think we should have a rule that when Members intervene they should describe their background, in this case as advisor to George Osborne, who cut back on the solar energy industry, who undermined wind power in this country, and who set us back so that we will never meet our climate change targets.
The impact—[Interruption.] Calm down, calm down—George Osborne used to say that to me, and I said “I’ll calm down when you resign,” and he did. The impact on the self-employed and small businesses has been equally stark. Some 51,000 high street stores closed last year. Wages for the self-employed have collapsed to around the same level as 20 years ago.
Does my right hon. Friend agree that it was a disgrace that yesterday we heard that the Government are going to save the high street by turning our shops into residential properties and risking the very fundamentals of how the high street operates?
My hon. Friend is right. Yesterday we needed serious action to address the bias against high streets, which has led to so many empty shops. Instead we got legislation that will help turn shops into flats.
We then had a huge media presentation about an online tax being introduced: it was said that £400 million will be found from this online tax in a few years’ time. At the weekend the Tax Justice Network said the top five tech companies have avoided £5 billion-worth of tax.
My second concern about the austerity debate is that if we understand and appreciate what people have been forced to go through with austerity, only callous complacency could drive us to inflict those policies on people. Yesterday the Chancellor’s speech, with references to “Labour’s recession,” demonstrated that he is trapped in a time warp of a political propaganda exercise by the Tories of a decade ago. [Interruption.] I thought they would like that one. Let us be clear: the financial crash was the result of greed and speculation, and a lack of regulation that goes right back to the 1980s. Austerity was always a bad idea.
Like my right hon. Friend, I heard the Chancellor try to blame the last Labour Government for the recession, but in actual fact the previous Chancellor said a couple of months ago that it was not the Labour Government’s fault; it was the whole system’s fault, starting with Lehman Brothers in America. We should get the facts right.
I always said George Osborne would get it right one day.
The consensus among economists, and the evidence of recent history, is absolutely clear. The worst possible response to a recession is for a Government to cut their own spending. In a recession, the Government should be there to support businesses and households. Instead, at the moment when Government support was most needed to help people back on their feet, Conservative Chancellors chose to impose the most severe spending cuts in generations. They did not have to, and they should not have done.
The Tories were warned that austerity would lead to slower growth and lower wages, and it has. The economic experts the Tories chose to ignore were proved right. Growth since the financial crisis, under Conservative Chancellors, has been the slowest after any recession in modern times. Real weekly average earnings are still lower today than they were in 2010. The Resolution Foundation reports this morning that real wages will not have fully recovered until 2024.
Ten years after the crash, we should be clear about the causes of the financial crisis. The Chancellor seemed confused on that point yesterday. It was not the deficit that caused the crisis; it was the crisis that caused the deficit. It was a crisis—[Interruption.] They don’t like to hear the truth. It was a crisis that resulted from the casino economy that the Tories helped construct right from the 1980s and supported every step of the way.
The right hon. Gentleman asked us to give our personal history: I was a proud public sector employee for 17 years and I take issue with the way that Labour wrecked the economy and spent money we did not have. Would he like to tell us how he proposes to pay for his current funding system?
Here is an answer: it is called a fair taxation system.
It was the ideology of neoliberalism that said markets were always right, that regulation was simply a barrier to growth, and that, ultimately, greed was good. The financial system this ideology helped design collapsed 10 years ago, and it was Conservative Chancellors who took the political decision to force working people, not the bankers, to pay the price for it.
Mr Speaker, you will admit that I have been generous in the number of times I have given way, and I suggest that, as you have a large number of Members wishing to speak, particularly on the Labour Benches, I should press on.
The result has been a period of stagnation unprecedented in modern British history: a period of falling wages, crumbling public services, and insecurity in an economy visibly failing across great swathes of the country. And because the cuts are still, even now, grinding on, the stagnation will continue, as the official forecasts say: investment forecasts have been revised downwards across the Office for Budget Responsibility’s forecast period, real wages will barely recover, and growth will remain far below its long-run trend.
The Chancellor cannot use Brexit as an excuse for those dismal figures. The OBR presented its forecasts on the basis of what it called a “relatively smooth exit” from the EU next year, but the Tories are bungling the Brexit negotiations—it is so bad that there is now an impact on the economy. Investment is being delayed and has even been cancelled. Britain already has the lowest rate of business investment in the G7, and even that has fallen this year. It is the uncertainty the Tories have introduced into the whole process that is so terrifying businesspeople. They just want to know where they stand, but the uncertainty was made even worse yesterday. The Chancellor has taken to threatening to revoke his own Budget in the event of a no-deal Brexit, yet on the very morning of the Budget, his Prime Minister was contradicting him. How can any company looking to invest in Britain not wonder where we are heading?
For well over two years, the Government have spent more time negotiating with themselves than with our European partners. With the date for leaving the EU just five months away, time is running out to present a deal that would respect the result of the referendum and win the support of the House. Instead, as the Tories continue to indulge in their squabbling, the economy and the whole country are being confronted with the grim prospect of a no-deal car crash. I have asked the Chancellor before to rule out a no-deal Brexit. A responsible Chancellor simply would not support such a thing, and would not, as he has done before, idly threaten to mutate this country into some form of tax haven off the coast of Europe. Let us put it on record that austerity is not ending. In the weeks and months ahead, people will recognise that the Prime Minister’s promise has been broken. There are rumours that this was possibly a pre-election Budget with pre-election tax giveaways. If the Conservatives are contemplating a general election, let me say on behalf of the Labour party: bring it on.
Yesterday’s Budget proved the time-honoured truth that careful stewardship of the economy, taking difficult decisions, creating the environment for enterprise and generating growth will lead to better days, not just for those with the dignity of employment, now in record numbers, who did not have it in the past, but for the provision of the public services on which we all depend. This Budget reported record jobs, unemployment lower than in a generation, more full-time jobs, the lowest proportion of low-paid jobs for two decades and rising real pay, with the fastest rises in real pay among the lowest paid in our society, thanks to our national living wage.
We have just seen the big difference between the two Front Benches. While we are delivering more jobs, more opportunity and more prosperity, those on the Opposition Front Bench promise more borrowing, more taxes and more debt. We have just heard it again from the shadow Chancellor: no ideas for the future; just talking Britain down. There is a big difference in this Parliament between a party that believes in the future and an Opposition Front Bench that would only take us back. Wherever it has been tried in the world, the programme that the right hon. Member for Hayes and Harlington (John McDonnell) proposes has led to bankruptcy and misery for millions, and we cannot fund public services on that. Without a strong economy, we cannot fund an NHS that everyone can turn to in their hour of need, whether that involves a life-threatening condition or falling over some fly-tipping. We are able to put record funding into our NHS only because there are millions more people in work who are earning more and paying their taxes.
On that point, may I thank the Secretary of State for his work on securing the public capital for the Midland Metropolitan Hospital in Sandwell, which had some difficulties following the collapse of Carillion? His work with the chief executive and the board of the trust has secured the future of that hospital, which is now on track to be built. It will be a vital resource for my local area of Rowley Regis.
I pay tribute to my hon. Friend, who has worked so hard to get that hospital back on track. It is now being built because we have put in the capital—it is in the NHS budget. We had to rescue it from the failed private finance initiative that was invented by the Labour party. It is only because we have a strong economy that we can give the NHS the longest and largest cash injection ever in its history—
I want to ask the Secretary of State about acquired brain injury. We save so many lives now, but if we put in significant investment up front to ensure that everyone got the right neuro-rehabilitation, we could save vast amounts of money for the taxpayer. Is that not rather a good model for us to pursue?
Yes, and the constructive approach that the hon. Gentleman has taken on this subject with me over many months, and for years before that, shows the progress that we can make. We are putting £20.5 billion extra into the NHS, and making an uplift like that means that we can turn resources towards preventing ill health in exactly the way that he describes. I pay tribute to the work that he has done on this subject.
We have a plan to improve the cancer workforce and to try to solve some of these problems. Maybe the hon. Gentleman should come over to this side and work with us to put record funding into the NHS. We can only have record funding for the NHS if we have a strong economy.
My hon. Friend is absolutely right. People want to see more funding for our NHS, and they are going to get it, but they also want to see all the money being well spent.
The Budget confirms that the NHS is the Government’s No. 1 spending priority, just as it is the British people’s No.1 spending priority. This Budget places the Government four-square in the centre of British politics. It is progressive and optimistic and focused on the future, not just for the many but for the whole country that we serve.
I absolutely welcome the uplift to NHS funding, but will the Secretary of State answer a small technical question, please? In the Red Book, there are separate entries for the increases in the resource departmental expenditure limits for health and for NHS England? Can he confirm that the difference—£6.3 billion versus £7.2 billion—will not result in a transfer from Public Health England, from Health Education England or from capital budgets to fund the discrepancy? That has happened in the past.
Yes, I can confirm that. The £20.5 billion real-terms funding for the NHS in the Budget is for the NHS itself and will be channelled through NHS England. Of course there are budgets in the Department that are outside the NHS envelope, and they will be settled in the spending review. This is exactly as has been planned, and it was made clear in June. I can tell the House that the £20.5 billion is both the longest and the largest settlement for any public service in the history of this country.
I want to make some progress.
I received some representations about what we should do on NHS funding. One was from a John from Hillingdon, who called for a 2.2% increase in funding. John said that would make the NHS the “envy of the world”. Others may preach a gospel of envy, but we are getting on with building the NHS to be there for us all. The £20 billion increase I have talked about is not a 2.2% per year increase—it is 3.4% a year more over the next five years.
I acknowledge the Secretary of State’s contribution to funding the Midland Metro Hospital, which is very important to people in the Black country. However, given that NHS hospital trusts have cumulative debts of around £7.5 billion plus a further £5 billion or so of other debts, can he reassure us that the £20.5 billion will be used not just to pay debts but to provide extra services?
The £20.5 billion is just for day-to-day running costs—the resource costs. Of course there is a capital budget, too, which includes £4 billion of taxpayers’ money. That goes towards ensuring that we can get the capital built. The critical point is that we have not only that £20.5 billion uplift in running costs but a capital budget. We will make further announcements on the allocation of the capital budget later in the autumn.
I am grateful to the Secretary of State for clarifying the £20.5 billion figure, which does not include training or capital. Of course, that contradicts the unhelpful briefing from Downing Street during the summer that it was something like £84 billion. Will he confirm that that £84 billion figure, which has been repeated in the media, is, as the Health Service Journal says, a fib, and that we are talking about £20.5 billion purely for resources in the NHS in England and Wales?
No. The £84 billion is the cash figure. The £20.5 billion is the real-terms increase by the end of the five years. If we add up all the extra money, we get £84 billion. It is there on page 36 of the Budget, if the hon. Lady wants to look. The biggest single cash increase comes next year, in 2019-20. It is all there in the Red Book.
I thank the Secretary of State for more good news for the midlands in the form of £70 million for the Defence and National Rehabilitation Centre just outside my constituency to help civilian rehabilitation. Can he share further details of that with us?
I pay tribute again to my right hon. Friend, who has worked tirelessly in support of that project. The Defence and National Rehabilitation Centre in Loughborough will link world-class military medical facilities with our NHS. That means lessons learned in the medical field from treating our brave troops who come back from the frontline can be brought into the NHS—for instance, surgical techniques that were learned in battle can be adapted to help civilians here. I pay tribute to her and others for the work they have done.
Here is a representation from a Jonathan from Leicester. Further to the question from the Chair of the Select Committee on Health and Social Care, the hon. Member for Totnes (Dr Wollaston), can the Secretary of State confirm that, in next year’s spending review, the cuts to capital budgets and the £700 million-worth of cuts to public health budgets will be reversed, and that there will be real-terms increases in funding for capital, training and public health? Can he guarantee that?
The spending review is next year. What I can guarantee is a £20.5 billion increase in NHS spending. That is the biggest increase in any spending commitment for any public service in the history of this country. [Interruption.] It is a pity that the Leader of the Opposition is not interested and does not want to hear about it. If he stayed, he could also hear about the reforms we are going to make. He should hear this more than anyone. We are acutely aware on the Conservative Benches that this is not Government money or NHS money but the hard-earned money of taxpayers, and we need to ensure that it is spent wisely. When he sprays his commitments around, Opposition Front Benchers would do well to remember that this is money from taxpayers.
So many of us know just how important air ambulance services are and the countless lives they save. I am delighted that, on top of the £20.5 billion for the NHS—the biggest ever, longest ever cash settlement for any public service in history—there was £10 million for air ambulances.
If my right hon. Friend will excuse another Leicestershire-based health intervention, I am incredibly grateful for the creation of the new Cottage Hospital in Market Harborough, the gleaming new A&E ward at Leicester Royal Infirmary and the decision to save the brilliant children’s heart unit at Glenfield Hospital. Does he agree that that is a more welcome record than the Labour party’s record of bankrupting the country, giving us the biggest recession since the second world war and putting 1 million people on the dole?
It is true that the Labour party in office has always left unemployment higher than it found it; it is true that, while Labour left the deficit higher, we are bringing it down; and it is true that inequality, too, is coming down. Page 8 of the distributional analysis shows that, contrary to what we heard in that paean of gloom from the shadow Chancellor, the biggest rises in full-time employee gross weekly real earnings over the last three years have been among the 10% least well paid in our country. That is what this Conservative Government are doing—delivering for everybody in our country.
On inequalities, does the Secretary of State recognise that life expectancy is stalling under his Government? In some regions it is getting worse. For women, it is getting worse. Perhaps he can answer the question he could not answer last week—why, for the first time in 100 years, do four babies in 1,000 not reach their first birthday?
As the hon. Lady knows, life expectancy is increasing, and we are forecast to see an increasing number of people live to a good old age. Indeed, the number of people aged 75 and over is set to double in the next 30 years. That is a brilliant achievement, which is in part down to the hard work of our NHS. Cancer survival rates are at a record high, strokes are down by a third and deaths from heart failure are down by a quarter. Of course, those successes have brought new challenges. The biggest health challenge we face is that people are living longer, often with multiple chronic conditions. The money is only one part of the plan to safeguard the NHS and ensure it is fit for the 21st century. The Budget delivers the funding, and later this year we will deliver the plan for how we will set the NHS fair for the future.
I have very little hope for the older people of our country given that the Government have cut £7 billion from the social care budget and replaced it with only £240 million. How is that safeguarding our old people for the future?
Is not it true that Labour talk the talk but do not walk the walk? They failed to deliver an effective long-term solution for social care when they were in government. They had 13 years to sort it and they did not. Is not it also true that, even though they said they would use the comprehensive spending review to address that, they left office without delivering? That is what they do time and again.
My hon. Friend is absolutely right. The long-term plan needs to ensure that we address the challenges of today and of tomorrow, including dementia, obesity and the rise in mental ill health. It will set out how we are going to address and deliver these changes. The Government believe in an NHS that is free at the point of use for everyone, for the long term.
The A&E in my local hospital is deeply loved and I am very grateful that it is staying, but it is still under huge pressure. When I have been out at night with the emergency services, I have seen that emergency services personnel have to stay with someone who has an acute mental illness and needs a mental health bed, which means that they cannot get on with other roles. Does the Secretary of State agree that the Government’s strong announcement of more funding for mental health will help the whole NHS to do more?
My hon. Friend is absolutely right, and we can only have a sustainable NHS if the social care system is also properly supported.
The social care Green Paper to be published later this year will set out the options to meet the unprecedented demographic challenge—and what a challenge. Some 70% of people in residential care homes now have dementia. The number of people with dementia is set to rise from 850,000 today to over 1 million in less than a decade. The number of people of working age in need of care is rising and is set to increase by almost half by 2035. Yet, despite these pressures, 83% of adult social care settings are now rated good or outstanding by the Care Quality Commission. That is the highest level since assessments began. As a society, we need to address the pressures on social care so that everyone can live in dignity and we can have a situation that is sustainable for the long term.
The Green Paper will bring forward a range of proposals to reform our social care system. I pay tribute to the excellent cross-party work of the Health and Social Care Committee and the Housing, Communities and Local Government Committee, which are helping to build a consensus behind potential solutions. This is exactly the sort of long-term cross-party work that we need to see, when fair-minded people from across the House come together to address the challenges of the future, and I will work with anyone from any party to get this right.
I listened with care to my right hon. Friend’s very welcome remarks on yesterday’s “Today” programme about having parity of esteem between mental health and physical health, and I welcome the announcement in the Budget of £250,000 for children’s crisis centres. Sadly, people in society now have complex mental health problems at a younger and younger age. In order to make these policies work, will the Secretary of State ensure that there is a sufficient number of well trained staff in the NHS to deal with these mental health problems?
On the issue of mental health support and services for children, I was quite disappointed that mental health support for schools was missing from the Budget. A lot of money was promised for child and adolescent mental health services but, as the Secretary of State will know, the Education Committee produced a joint report with the Health and Social Care Committee entitled “The Government’s Green Paper on mental health: failing a generation”, in which we outlined that we were really keen to see additional funding for mental health support in schools. Is there anything that the Minister can do to look again at that issue?
Yes—part of the £2 billion of extra mental health funding that we announced yesterday is to ensure that there is support in schools, particularly for young people. That is one of the elements of the funding that we announced in the Budget yesterday, and I am very happy to talk to the hon. Lady about the details.
The social care Green Paper will address the question of long-term funding reform for social care and how we can help people to plan sensibly so they do not have to fear the risk of losing everything. But the Green Paper will not just look at funding; it will also look at the role of housing, at how we can combine a home with high-quality care, and at the links between the care of children and of the elderly. I have seen how such links can benefit both groups, helping children’s development and tackling the scourge of loneliness that elderly people too often face. The Green Paper will of course also look at how we can better integrate the NHS and the social care system. What matters is what works, so we will look at things such as auto-enrolment, and how and if reforms elsewhere can be applied to social care. Like the NHS, the future of our social care system rests not just on funding, but on reform, and we are determined to rise to this challenge.
Every Member of this House will have their own personal story of the NHS. Whether it was the first few breaths of a child or the final few moments of a loved one, from cradle to grave that care is ever present, whatever the shade of Government. This Government want to ensure that that care will always be there for whoever needs it, and that the NHS remains free at the point of delivery. That is why we are putting the extra £20 billion into the NHS. It is only because our economy is strong, employment is rising and we believe in a free market economy that we can fund this increase, for just as there can only be truth when there is freedom of speech, so can there only be prosperity to fund public services when there is freedom of enterprise. It is a great sadness that, in stark contrast with the greats of his party in the past, the shadow Chancellor opposes both. It is now a combination that we can only get under a progressive, optimistic, future-focused Conservative Government. That is what this Budget delivers. I commend it to the House.
It is an honour to speak for the Scottish National party on the second day of the 2018 Budget debate.
Ten years ago last month, Lehman Brothers collapsed. Excessive risk-taking by financial institutions created an international banking crisis, and a global downturn followed. Since then, people and families across the UK have had to pay for the fall-out. There has been a decade of wage stagnation, a decade of cuts and a decade of the most vulnerable in our society being hit the hardest by Tory austerity. Looking forward, we are staring into the abyss that is Brexit. Mark Carney says that Brexit has already cost householders an average of £900, and the Fraser of Allander Institute estimates that leaving the single market and customs union would cost 80,000 Scottish jobs. After a decade of austerity, households cannot afford to lose £900 each, and they certainly cannot afford a Tory Brexit.
The reality is that the people of Scotland are badly served by Westminster. We did not vote for a Tory Government and we did not vote for Brexit. I cannot think of a time in the past when a country has committed such a foreseeable act of economic self-harm. The Chancellor does not believe that we will be better off after Brexit. Even the Prime Minister does not believe that we will be better off after Brexit. We were promised £350 million pounds a week for public services. We will not be bought off with a commemorative 50p coin.
I absolutely agree. An economic catastrophe is coming down the line as a result of Brexit. It does not matter what kind of Brexit there is; any Brexit is bad for the economy. Staying in the EU is the best possible option for the economy. If we cannot stay in the EU, staying in the single market and the customs union is the second best option.
Further to that point, did my hon. Friend notice in the Red Book that the expected growth that the UK will achieve in the next four to five years equals that of Ireland in only one year? Is that example not a clear signpost to all in Scotland and elsewhere that independence has worked for Ireland and is going to work for Scotland, and that the sooner we get it and the sooner we are clear of this lot, the better?
Absolutely; it is clear that remaining part of the UK is bad for Scotland’s economy. The comparators in the Budget information documents show that the UK economy is growing slower than the EU economy is set to grow in every but one of the next five years.
Do you know what? The reality is that we have argued for a very long time—I have argued for my entire adult life—against the current democratic system, because it does not work for the people of Scotland. We do not get the Governments we vote for and we do not get the result that we voted for in the EU referendum. If the democratic system meant that Scotland’s votes were reflected in reality, we would be in a very different situation today.
On a serious note, every week in our communities and at our surgeries MPs from both sides of the House are faced with the consequences of Westminster’s poor decisions. We see working mothers forced to go to food banks. We see and hear about the Home Office-enforced separation of families. We meet young men struggling with mental health problems who have been sanctioned yet again because they are unable to jump through the unreasonable hoops put in their way by the Department for Work and Pensions. I do not know how anybody, even in this Westminster Government, can believe that their policies are having a positive benefit. The tears and desperation with which we are all faced on a regular basis give the lie to that notion.
The Chancellor has failed adequately to fund our public services in this Budget. He has failed to undo the devastating social security cuts, he has failed to legislate for a real living wage and he has failed to provide adequate support for businesses facing the impending cliff edge of Brexit.
The Budget should have included decisions to help support all those who have been hit by a decade of austerity, and all those who will be hit by the forthcoming Brexit. The roll-out of universal credit should have been halted. A third of working-age households will be entitled to some universal credit. Of those, around a third will be at least £1,000 a year worse off than under the legacy system.
Does my hon. Friend agree that the Government missed an opportunity in the Budget yesterday not only to correct the injustices of universal credit but to compensate councils such as Highland Council that are having to foot a £2.5 million bill out of council tax funds simply for administering this failed and shambolic universal credit roll-out?
Absolutely. The Highland Council area has been particularly badly hit as one of the first areas in which universal credit was rolled out. It is currently rolling out in Aberdeen, and I am hugely concerned about the impact it will have on my constituents. The roll-out needs to be halted, because the issues that happened in the highlands and elsewhere have not been fixed, and they need to be fixed before any further roll-out can occur.
The benefits freeze should have been lifted, the sanctions regime should be scrapped, support for lone parents under the age of 25 must be reintroduced and the WASPI issue must be sorted, with those women being given the money they are owed. I am pleased that the Government have made a commitment to the pensions dashboard, but they now need to legislate to compel companies to comply so that people can access information about the pensions they are owed, and so that they can then get those pensions. That is important, and lots of people have been calling for it.
Workers’ rights are another reserved issue, and the Chancellor should have committed to increasing the minimum wage to the living wage—an amount people can actually live on—by the end of this Parliament. The Office for National Statistics said this week:
“Among the countries of the UK, long-term pay growth has been highest in Scotland… Median pay for full-time workers was 87% higher in Scotland than it was in 1997.”
The Scottish Government are doing all they can, particularly for staff employed in public sector roles, but we need the powers to do more. In Scotland, our Government have focused on uplifting the pay packets of the lowest paid, which is a progressive choice that makes the most positive difference. The UK Government have not chosen to do that.
We have fought long and hard for a single, real living wage rate. The UK Government need to recognise that it does not cost a 24-year-old less to live than it costs a 25-year-old. If the Chancellor will not make the required commitment to a real living wage for all, he should devolve it so that we can.
Statutory paternity leave should be doubled from two to four weeks, giving fathers even more opportunity to bond with their babies. A complete review of parental leave should be undertaken, including consideration of the start date of maternity leave, especially when a baby is born prematurely.
We propose that the Government set up a labour participation committee to consider groups that are currently under-represented or over-represented in certain sectors, and to examine barriers to work for women, disabled people, parents and other marginalised groups.
The Institute of Directors has called for a pot to be set aside so that small and medium-sized enterprises can bid for advice on how to cope with Brexit. The UK Government’s advice thus far has been wholly inadequate, and we have only five months to go until the UK crashes out of the EU.
Businesses need to be able to access finance in order to grow. To do that, they need to have trust in financial institutions and, crucially, financial institutions need to earn that trust. The Chancellor should have committed to setting up a tribunal service so that those affected by business banking fraud—through the Royal Bank of Scotland’s global restructuring group, Lloyds Bank, Halifax Bank of Scotland or others—can seek affordable redress, rather than having to go through a court process that is too expensive to access.
The UK Government must also ensure that current EU funding will continue until the end of the current multi-annual financial framework. Scotland must not be any worse off in respect of the funding allocations that replace those provided from the EU, and any arrangements must fully respect devolution and must be put in place with the consultation and agreement of the Scottish Parliament.
The Chancellor had an opportunity to make a commitment to the oil and gas sector deal, and he failed to do so. Our industry needs the deal to be signed off now, particularly with the impending lack of access to labour and investment following Brexit. I am pleased that he has heeded calls to make a clear statement on the future fiscal regime, because we cannot have unforeseen, sudden tax hikes like those made by previous Chancellors.
The other part of the jigsaw that is missing is a commitment to reducing the harmful climate change effects of the use of fossil fuels. In 2015, the UK Government cancelled their £1 billion carbon capture and storage competition, just six months before it was due to be awarded, after spending £100 million on it. That left Peterhead—a key candidate for support—behind. After three years of research and development, we have missed out on this vital industry of the future. The UK Government need to make an unequivocal commitment to supporting the development of CCS.
My hon. Friend makes a powerful point about carbon capture, and about the betrayal of the £1 billion project at Peterhead. Does she agree that, if the UK Government are serious about meeting the climate change targets under the Paris agreement, spending £100 million now, when we are behind the pace after abandoning a three-year £1 billion project, is just not good enough?
Absolutely. The potential benefits of CCS are unquestionable and, as my hon. Friend says, we need to get ahead of the curve again. We need the UK Government to commit to putting the money in now. That is especially important because their pulling the plug means there is now a lack of trust among the companies that are developing CCS. The UK Government need to make a clear and unequivocal commitment.
On evolving technologies, Scotland is a global leader in tidal, and the UK Government must work with the Scottish Government on the contract for difference process to support the technology journey from development to commercialisation, which is particularly important for tidal.
On solar power, we have been contacted by so many individuals who are concerned about what is happening to export tariffs for homes, small businesses and community energy projects from next April. The tariff is a vital support that encourages people to invest in solar power, and it must continue.
Lastly, in order to reduce climate change and to increase the use of healthier methods of transport, this Budget was an opportunity to reduce VAT on bikes. Just as we would like to see VAT removed from digital books, reducing VAT on bikes would make them cheaper for all and would be a real statement of intent from the Government on reducing climate change.
Actually, reducing VAT is quite possible for a member of the EU. Zero rating things is a problem, but reducing VAT is fine.
The Scottish fire and rescue service and Police Scotland are still owed £175 million of VAT. The UK Government have recognised that the system they had in place was unfair, yet they have refused to pay back the £175 million they owe our two vital life-saving industries. It would be incredibly useful if they could see their way to giving us back that £175 million.
On the subject of the UK Government reallocating funds that should rightly have gone to Scotland, the convergence uplift of £160 million should have been paid to Scottish farmers. The Secretary of State for Environment, Food and Rural Affairs has admitted that the money has been spent elsewhere. We need a commitment that this money will come to Scotland in future years, and we need the previous years’ money to come to Scotland now, so that our farmers can have the cash they have been allocated.
I am pleased that the Budget includes measures to ensure that companies pay their fair share of tax in the digital sphere, but the reality is that this is a consultation and the measures are not going to be in place yet. We also do not have a solid idea of what those measures will be. The Scottish National party would therefore like to propose two measures on digital taxation, and we hope that the Government will take them into account. First, we believe that online retailers should be held liable for tax fraud committed by their suppliers. Sometimes when people order a product from a well-known online retailer it is delivered from China with a customs declaration and a stamp that says “gift”. Large online retailers should be held responsible for ensuring that those who use their platform pay the correct customs duties. We also believe that in order to combat tech firms that avoid corporation tax by registering implausibly low UK profits, the Chancellor should levy corporation tax on an assumed UK share of worldwide profits that is equal to their UK share of worldwide revenue. That could be subject to a dispute tribunal process to ensure fairness. The SNP will submit these suggestions in the consultation process, and we hope that they will be considered seriously.
Scotland’s cities have received city deal funding from both the UK and Scottish Governments. That is welcome, but what is not welcome is the fact that the UK Government have contributed far less to those deals than the Scottish Government. In total, the Tories have failed to match more than £350 million of Scottish Government funding for city deals and growth deals in Glasgow, Aberdeen, Inverness, Stirling and Clackmannanshire, Tay Cities and Edinburgh. We believe that they should match our contribution, and we call on the Chancellor to make that commitment, as well as to fulfill the Chief Secretary to the Treasury’s commitment to provide each part of Scotland with a regional deal.
I come to an ask, for the NHS, that would require only a small financial contribution but would have significant positive benefits. The UK Government could have used this Budget to follow Scotland’s lead on PrEP—pre-exposure prophylaxis. In Scotland, PrEP is available on the NHS, but England has been dragging its heels on making it available. The benefits in terms of the reduction in new cases of HIV are unchallengeable, and it is not fair that those in England cannot currently access the drug on the NHS. That change would not cost a huge amount of money, but it would make a massive difference to people’s lives.
If the UK Government are serious about taking their place on the global stage, they need to reform the immigration system. Countries will be looking for a more flexible immigration policy before signing trade deals with us, and we should start by getting rid of the fees that EU citizens will be expected to pay to acquire settled status. The OBR mentions the ageing population at many points throughout the Blue Book. The UK Government must recognise this challenge, and recognise that we need and want people to come to live and work in our communities. Last year’s Red Book said that a reduction in net migration of 20,000 would reduce GDP by about 0.2% by 2022. The Government need to be honest about the benefits of immigration and be clear that it is good for our country. They need to be clear that, with an ageing population, it is incredibly important that we get people to come to work here, particularly in the care sector and in the NHS. We also need a more flexible working visa policy that gives those who are seeking asylum the right to work, as the current system is dehumanising and unsustainable. Lastly, we should scrap the fees paid that families have to pay to get their children citizenship, which are ridiculously high and are yet another tax on families.
On health spending, the UK Government gave commitment after commitment that they would pass the full Barnett consequentials of the increased health spending on to Scotland, but they have chosen not to do so. They have chosen to short-change Scotland by £50 million. This comes on top of the fact that the Scottish Government’s fiscal resource block grant allocation will be almost £2 billion—or 6.9%—lower in real terms than it was in 2010-11. Despite the addition of consequentials and other non-Barnett allocations in 2019-20 that the Chancellor announced, Scotland’s fiscal resource block grant is still lower in real terms than it was in 2010-11 and at the start of the current spending review in 2015-16.
The Chancellor had the chance to make a real difference. He had political choices to make and at almost every turn he chose the wrong path. Is it any wonder that people do not trust the Tories? This Government need to follow the lead of the Scottish Government, who have put dignity and respect at the heart of decision making, rather than punishing those who are not born rich. The reality is that people in Scotland are faced with a choice of two futures: they can choose to continue to have a Westminster Government, who make political choices that disadvantage those who can least afford it; or they can fight for a fairer Scotland, where our Parliament has the powers and the responsibility to make choices on behalf of our citizens—choices that will make our country fairer, not create further inequality.
This is my ninth Budget in this place, and the majority of them have been framed by the fact that my party has had to clean up the mess left behind by the previous Labour Government in 2010. They have been framed by the comments of the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), who wrote:
“I’m afraid there is no money. Kind regards—and good luck!”
That was the position that the country found itself in. I feel that yesterday’s Budget was a turning point and we are now starting to see light at the end of the tunnel. We need to give great thanks to the people of this country for their hard work and their determination to see the course through. Yesterday’s Budget means we are now starting to repay the faith of the British people.
I want to focus on three areas, the first of which is public services. The Chancellor was clear yesterday—he was right—that local government had made a significant contribution to tackling the deficit. I firmly believe it needs to be recognised for that, and we need to make sure it is properly funded. I welcome the £650 million package for social care that was announced yesterday, and the £420 million for roads and potholes that will be going to local government.
I also welcome the fact that for probably the first time ever road tax will be paying for our roads rather than being spent on other things. As a consequence, the budget for Highways England will go up by 40%. It is great to see my right hon. Friend the Secretary of State for Health and Social Care in the Chamber because I warmly welcome the additional £20 billion that this Government are committing to our NHS each and every year. I look forward to seeing the 10-year plan for the NHS and, within that, the use of the £2 billion for mental health services, which are crucial. Mental health provision is important because the mental health challenges we are experiencing underpin many of the social challenges that we face in this country, so it will be great to see his proposals.
Security is the most important thing for and the first duty of any Government, so I really welcome the extra £1 billion for our armed forces and the £160 million that is going into counter-terrorism policing. I noted that the Chancellor referred to the police and the challenges our forces face in his Budget statement, so I hope that when the police settlement comes forward early next year, we will see positive progress. My local Warwickshire force is taking on additional officers, but it also faces challenges down the track, such as the pensions revaluation. I sincerely hope that that will be reflected in the policing settlement.
Clearly the police have been given access this year to an additional £450 million, and an extra £160 million was given to counter-terrorism policing. I am sure the right hon. Gentleman, who was part of the coalition Government, will recognise that a process needs to be followed and that the police funding settlement will come forward in a few months’ time.
Secondly, on the cost of living, I am delighted that the Chancellor has chosen to freeze fuel duty again. It has not increased in this country since 2011, which is good news for motorists. In that time, the average motorist has saved £1,000 as a result of the decisions made by Conservative Chancellors. I am also really pleased that the rail companies have taken up the railcard for 26 to 30-year-olds, who will get a 30% reduction in fares.
I very much welcome the increase to the personal allowance. The lowest paid will now earn £12,500 before they have to pay income tax. That is a far cry from the £6,500 personal allowance in 2010, and it means that those people will have an additional £1,250 a year in their pockets compared with then. I also welcome the change to the 40p threshold, because although that rate is an important aspect of our tax system, many public servants, such as police sergeants and senior teachers, have been dragged into the 40p rate, as have been many tradespeople such as bricklayers. I do not think that that was ever the intention when that measure was introduced.
It is good to see the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for North Swindon (Justin Tomlinson), on the Front Bench, because I welcome the universal credit changes, which will further underpin the principle that it always pays to work. It is excellent that £1.7 billion will be put into universal credit year on year, and that is in addition to last year’s package. It looks as though tweaks are being made to the system constantly to make sure that it responds to some of the challenges. I hope that another look will be taken at the assessment period, because several of my constituents have had challenges with that part of the process.
Finally, on high streets, I am delighted that 30% will be knocked off rates bills for people who own small retail businesses with a rateable value under £51,000. Business rates are an analogue tax in a digital world, and I am pleased that the Chancellor has started to recognise that. I recognise that larger retailers occupying anchor positions in high streets and town centres will not benefit from that change, so perhaps in future we will need to consider those businesses, too. A £675 million fund for the regeneration of our high streets is a massive start to help high streets throughout the country to regenerate. We need to make sure that we preserve our high streets, but not in their current form. We need to make them fit for the 21st century because they are places of massive community value. They are the community centre of towns and cities throughout the country.
The House of Commons Library tells me that I have listened to Budgets in the House 44 times, so I hope I am an experienced Budget evaluator. I always come to the Chamber to listen to the Budget, and I base my evaluation of its quality on two criteria. The first is the great global issues that we face, which for me are always the fragile planet, the environment, climate change and global warming, and the fact that the planet’s burgeoning population has to be fed, and fed sustainably. We also face the challenge of keeping the peace. Many of us thought that that could be taken for granted, but in the current global circumstances, keeping the peace has become a great concern for us all.
My second criterion for evaluating a Budget is what it will do for my constituents. I believe that I have a sacred duty to come here and represent my constituents, and to make sure that everything that I do—the contribution that my colleagues and I make in the House—adds to the welfare, health and prosperity of my constituents. Those are the twin criteria, and on both I believe that this is an uninspiring little Budget. It is lacking in passion, leadership and values. That is my sincere criticism of the Budget.
Let me go into a little more detail. I have been in the House at times when the country has been in great crisis. At a time of crisis, I have seen people whom one would have thought were pretty ordinary politicians suddenly stepping up to the Dispatch Box and showing the world that they had leadership quality, that they understood what was going on in the wider world, and that they could stand up to do the right thing. I take umbrage at the fact that a Chancellor of the Exchequer could stand in the Chamber yesterday and call the cataclysm of 2009 and the global meltdown of the world economy “Labour’s great recession.” I have to say that it must have been a very powerful Labour party and Labour Government who caused the world recession. What rubbish that the man who is supposed to be our Chancellor of the Exchequer could say such a thing—shame on him!
I saw Gordon Brown and Alistair Darling at that Dispatch Box, calm in the face of a hurricane in the world economy. They stood there and made the right decisions. They bailed out the selfish banks. They did what was necessary to save our country. This bunch over on the Government Benches should not tell us how to rise to our responsibilities. We showed leadership. We showed that we had the values. We worked incessantly to get this country back on track.
We understand that there was a global banking crisis, but is it not right that the Labour Government did not prepare the country for problems that might occur, given their chronic overspending of money that we just did not have, which left us in a great deal of debt when the recession happened?
I hear what the hon. Lady says, but let us be serious. I recommend that she goes away and looks at a rather good book that I have recently read called “Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon” by Gretchen Morgenson. Read it and learn it, because that was what we came through.
The Chancellor’s remarks yesterday did not really touch on many of the issues that affect my community. The fact is that we have a hospital in danger that suffers due to a private finance initiative scheme. All the Chancellor said was that Labour was responsible for PFI. I have been here long enough to know that the great charm offensive on PFIs was led by John Major. PFIs were the fashion among Members on all Benches. As Chairman of the Education Committee, I saw good PFIs and bad PFIs, but I also saw a lot of smart City types who danced rings around local authorities and local health authorities and gave them a rotten deal. That is the truth of PFIs—there were good ones and bad ones, but a lot of City spivs made a lot of money out of them. Nothing that the Chancellor said yesterday will rescue my local hospital and health trust from that burden.
The Chancellor took no steps to help those parts of the country that are in trouble due to PFIs.
Watching the television and reading the papers, my constituents are not fooled: they know that what was left out yesterday was that whatever Brexit deal is struck, it will not be as good as staying in the European Union—that is the truth of it. I come here to represent my constituents, and I know that we are moving towards a disaster for their living standards, their health standards and everything else that will touch their lives over the coming years. This is a year of crisis. Just as we had the crisis of the great depression and the crisis in 2009, this will be the next crisis, and we need people at the Dispatch Box who will take on their role as leaders. I do not mean people such as the former Prime Minister and Chancellor who, when they lost the referendum, ran away from their responsibilities and from leadership. Where are they now? Writing for the Evening Standard I suppose, or writing their memoirs in their man caves.
Being in this House and representing our constituents is a grave responsibility. The job does not come and go—we do not want people who try a bit of time as Chancellor of the Exchequer and a bit of time as Prime Minister but then disappear. The great people who have been at that Dispatch Box are the people who have had values, showed leadership, and led this country in good time and in bad times. The fact of the matter is that we are heading for a very bad time indeed if we leave the European Union on bad terms, but that was not mentioned. The Chancellor of the Exchequer, at this time of crisis and impending disaster for our country, did not have the courage to mention Brexit more than once—that is the truth, and my constituents want me to say that today.
At this time of the year, I am, like many in the Chamber, wearing my poppy. I have just been reading a lovely new history about the first world war. The fact is that right in the middle of that war, everybody knew that it was unwinnable and that more and more young men were going to die. Of course, the real responsibility for the first world war lies with us—the politicians. Politicians failed the people of this country. German politicians failed their people, as did French politicians. It was politicians who did it, and they went on killing more and more young people. That was a failure of leadership, a failure of values, a failure of responsibility and a failure to make courageous decisions at the Dispatch Box. We are heading in that direction—not particularly into war, but into the most troubled times when our people will come out impoverished, miserable and unhappy. That will hurt their health, their education and their chance of a good life. For my part, I will do everything that I can to stop the disaster that those on the Government Benches have wished on our people.
Last year, after the disappointment of the general election manifesto process, I left the Government in order to make the case that we needed to make this a moment of much bolder national renewal, that we needed to move on from the first phase of reducing the deficit through a programme of austerity and that we needed to set a trajectory of higher growth, more public sector enterprise and innovation, and wage increases and tax cuts focused on the poorest—those on the lowest incomes—in our society. Let me start by saying that I strongly welcome the Chancellor’s Budget for all those reasons. He managed to square an almost impossible circle in a clever Budget that has done something important for some of the most vulnerable in our society.
As a constituency MP, I wish to mention in particular the measures to support the high street. In Mid Norfolk, as in many other rural constituencies, we have seen our high streets hit hard by a big transfer to online retail without the digital giants paying tax in return, and I welcome the measures that the Government have taken to support our high streets. In particular, in health and care day of the Budget debate, I want to highlight the £10 billion put aside for social care; the extraordinary announcement, which I strongly welcome, of the launch of the first mental health emergency service; the £10,000 for every primary school and £50,000 for every secondary school; the £400 million a year for our schools; and the £2 billion to make sure that universal credit is properly funded. These, I suggest, are compassionate steps taken by a Government still paying off the legacy of the appalling inheritance from the Labour party, but doing so in a way that tries to put the needs of the most vulnerable in society first.
All of that is made possible because of the extraordinary economic success over which we have managed to preside. It pains Opposition Members, which is why they are all looking away, that the rate of real income growth has been rising. In the next five years, the OBR forecasts that there will be a bigger real-terms rise in real incomes for the lowest paid than for anybody else, and 3 million new jobs. This is a success story, and nothing tells us how important it is more than the howls of derision from the Opposition, so upset are they that more and more people in this country are not in need of Labour party support. People are coming to us because they know that ours is the party that supports growth.
I want to acknowledge that after eight very painful years, there is a weariness afoot among both those on the frontline of public services, who have tightened their belts, and the lowest-paid people in work. Those two groups have tightened their belts far more than those in plum jobs in government, in Whitehall, or even in local government. We need, as a House, to say to them that they have earned it and to send a very sincere thank you. The British people have tightened their belts far harder than the Government have in the past eight years.
Talking of public sector workers and the need for public sector leadership, I want to thank the Chancellor for announcing the new public sector leadership academy—an academy to support those on the frontline of public services, who have one of the hardest jobs in our society. [Interruption.] The hon. Member for Dewsbury (Paula Sherriff) might say that is rubbish, but that is because she has never had to run anything. The people on the frontline of our public services are actually running very complex public services. They, alongside the lowest-paid people in work, are the people to we need to support in the next five years in tightening the belt and delivering the innovation and efficiency that the public want to see.
I note that the hon. Gentleman said that I have never had to run anything. I wonder whether he would like to change his mind given that I ran a crime management centre in a police station and two incredibly busy departments in a busy hospital. Perhaps he would like to correct the record.
I will happily correct that bit of the record, as long as the hon. Lady welcomes the public sector leadership academy, because, given her experience, she will know how important it is.
If we are really to tackle the structural legacy of the 13 years of a Labour Government that led to the biggest economic crisis in this country’s peacetime history—[Interruption.] That is a reality that Labour Members now shout down because it is inconvenient. The crisis that a new generation of voters needs to be consistently reminded of was the legacy of 13 years of a Labour Government. If we are to tackle that, we will have to do two important things: yes, we must continue to drive the modernisation of public service, but we must also increase the rate of growth and revenue generation in the economy by the Government. Even more powerfully, over the next five years we need somehow to make those two ambitions work together. I would like to share some thoughts on how we might do that.
The truth is that our growth rate has dropped since the EU referendum, from 3% to 1.5%. Therefore the first thing that we need to do is to get a good Brexit deal for business confidence. I hope that the Opposition will take the opportunity of the forthcoming Brexit votes to put the needs of business, prosperity and the economy ahead of ideology or party politics. We also need to create an environment in which we can unlock business investment in this country. There is £600 billion tied up on businesses’ balance sheets, and we need to trigger the confidence needed to unlock that money in the post-Brexit dividend. We will not get it unless the Brexit deal gives business the certainty that it needs in the years ahead.
We also need to go much faster on infrastructure. I am delighted that, at this point, the Chief Secretary to the Treasury has entered the Chamber, because for eight years she and I have been holding meetings to try to accelerate funding for the Ely rail junction. I want the Treasury now to recognise that, across the country, there are infrastructure schemes that could be funded by private finance. I am talking not about PFI, but about giving local authorities and mayors powers to set up infrastructure bonds to create more innovative ways of driving investment into our public services. If we regenerated rail links and rail lines, gave planning permission for stations and developed innovative schemes for capturing the value increase around those lines, we could harness that growth to fund new models of infrastructure.
I particularly welcome the Government’s continued emphasis, through the industrial strategy, on fields such as life sciences, robotics and artificial intelligence so that we can create in this country the research platform needed to support the creation of the jobs and businesses of tomorrow. But if we are to be more than just a research economy—if we are to be a genuine innovation nation that pulls innovation through into practice—we need an economy that uses innovation in the private and public sectors. The great trick is to harness the power of innovation in our public services, and nowhere more than in the NHS. If we are really to lead the world in digital health and digital medicine, and the extraordinary revolution that that offers, we will not do it with an NHS running on paper and cardboard. We need to make the NHS a genuine catalyst for UK leadership in digital health. It is the same in genomics. When I set up the UK genomics programme, the idea was not only that we would launch the world’s first genomic medicines service in the NHS, which we have, but crucially that, in so doing, we would make this country a leader in genomic research and life science investment.
This, in the end, is the key to getting out of the debt that we inherited from the Labour party—the high-debt, low-growth model that yesterday’s Budget acknowledged. We have to somehow unlock innovation in our public services and drive much higher rates of growth in the private sector. With Brexit coming to its resolution here in this House in the next few weeks, we have to make it a catalyst for the renaissance of innovation and enterprise, and the moment at which we set out a vision for public services in the 21st century.
I was really shocked when the hon. Member for Mid Norfolk (George Freeman) said that there is weariness. It was Halloween yesterday, and that Budget was damn scary, never mind wearying. As for asking public sector workers to tighten their belts, it was not about tightening their belts—it was about going and accessing food banks. That is what that Budget was about, and what the Government continue to be about.
I sat here yesterday listening attentively to the Chancellor delivering his Budget. I was not holding my breath given this Government’s track record on breaking their promises, but I am ever an optimist, so I still sat here in hope: hoping, on behalf of my constituents of Bradford West, for this Government to deliver on their all-singing and—dare I say it?—all-dancing “end of austerity” Budget. Alas, even the Chancellor’s self-deprecating humour could not mask the reality of yet more broken promises.
No doubt we will hear from many colleagues, as we have heard before, about what this Budget really means and how it has failed to redress the balance and the crisis in the health and social care sector, with no end in sight under the Conservatives. But for now I want to talk about young people, and particularly their mental health. That is not only because I come from the great city of Bradford, which will have the youngest population in the whole of Europe by 2020, but because, as a former chair of a large mental health charity and a former NHS commissioner, I have an acute understanding of the realities that this Government continue to fail to grasp. They fail to listen to charities such as Barnardo’s, which has warned the Government that they are sleepwalking into a crisis.
Throughout this country we have seen a huge increase in the number of young people, in particular, suffering from mental health issues. Just a few weeks ago in my constituency, I met George Zito. George and his colleagues work to provide positive mental health training across schools in Bradford. George explained to me that 8,500 young people across Bradford have been diagnosed with mental health disorders, but the number with lower-level concerns is estimated to be at least double that. Implementing mental health specialist departments in every large NHS A&E is one way of tackling the crisis in mental health at the last stage, but we cannot afford to provide just last-minute crisis rescue for people’s mental health disorders, as the Government are currently doing with their Brexit negotiations.
When 50% of mental health problems are established by the age of 14, and 75% by the age of 24, making young people’s mental health a priority allows us to prevent future life problems for a whole generation. The Children’s Society has expressed concern that the Government’s plans for improving children’s mental health more generally are moving too slowly. With only one in four children being reached by school-based mental health teams in the next five years, there was nothing in the Budget to address that. My hon. Friend the Member for Kingston upon Hull West and Hessle (Emma Hardy) mentioned earlier that is extremely disappointing that the Government did not put extra resource into schools to provide counsellors who can effectively tackle low levels of wellbeing and support children with poor mental health.
The reality on the ground is that people like George Zito from my constituency will not get the resources they need, and little will be done to help reach young people with mental health issues in their schools. With this Budget, the two-year waiting times for young people trying to see a specialist counsellor for issues to do with mental health will remain to a large extent in Bradford West. The Chancellor decided it was okay to trick the young in my constituency facing issues with mental health while his Budget could treat the wealthiest, who are 14 times more likely to benefit from it than the poor.
Between 2012 and 2016, this Government’s cuts led to a loss of 600 youth centres, 3,500 youth workers, and 140,000 youth centre places for young people. This Budget does nothing at all to resolve the loss of those services. It not only neglects young people’s need for direct access to mental health counsellors in their schools but, given the minimal youth services available, leaves them with little or no face-to-face support. Although I sincerely welcome the Chancellor’s cash injection of £2 billion, which has been referred to on more than a few occasions, I am afraid that it just does not cut it for my constituents, or for young people up and down the country. The Institute for Public Policy Research suggests that almost £4.1 billion is the actual figure needed to meet the necessary provision of mental health services.
I absolutely share those concerns about that expenditure when we are not investing in the infrastructure we need. What we heard yesterday, and more of today, was sticking plaster options—those are the only solutions that this Government have come up with. That is one thing that the Conservatives are absolutely the masters of—saying, “We are investing £2 billion, but actually we stripped you of £5 billion the week before.” It just cannot work like that.
My concerns remain as valid as they were before the Chancellor stood up yesterday and delivered his Halloween frighteners, because the truth remains that once again this Government are using their mastery of applying sticking plasters to try to hold together a wound that they have inflicted and that, quite frankly, is not healing. The tricks in his bag were exactly those, delivered by the Chancellor on behalf of a Tory Government who are now a master of disguise. Yesterday, the Chancellor liked to refer to himself as Fiscal Phil. Although it may be humorous for the Chancellor to half-pronounce his name, it is catastrophic for this whole country when his Budget does not even half halt austerity, half provide the provision needed for mental health services, or go halfway towards providing the parity of esteem that his own Government have been promising.
With the Chancellor suggesting that he will put an emergency Budget before Parliament in the event of a no-deal Brexit, a few things come to mind. Is the Minister willing to provide assurances that the extra funding for mental health will not be swallowed up, that there will not be cuts, and that the Prime Minister’s failure to negotiate a Brexit deal will not mean collateral damage for those suffering the most?
Finally, I want to talk about the investment in the public sector leadership academy, which the hon. Member for Mid Norfolk mentioned. I concur: I absolutely value that investment. However, the problem is that it is those very public sector leaders who are having to deal with austerity. For example, there is the former chair of Solace in Doncaster, who has written an article about it. In Northamptonshire, the Tory council is having to go through bankruptcy. There is nothing wrong with the people involved as leaders. What is wrong is the cards that they are dealt in having to cut services and make decisions every single day of the week about whether a woman is not going to get a bed for the night following domestic violence, a child is not going to get a CAMHS referral, or a child is going to take home a begging letter from their school because there is not enough funding and it cannot afford food. That is the reality of austerity, and it needs to stop now.
I am grateful to have caught your eye in this important Budget debate, Mr Deputy Speaker.
I would like to begin by welcoming the Chancellor’s statement and recognising that UK public finances are in a much better shape than they were. Despite the narrative of negativity from the Opposition, the economic facts demonstrate a much more positive reality. I thought the Opposition might welcome the fact that average real wage growth in the public sector is now 3.1%—a 10-year high—or that the Chancellor is predicting an additional 400,000 people in work by 2023. That is on top of the 3 million extra jobs we have created in the last 10 years or so. But nothing came from the Opposition, except that they have 39 uncosted expenditure pledges. That is irresponsible public policy making.
As my hon. Friend the Member for Mid Norfolk (George Freeman) said, we need to build on the high-tech areas of our economy, such as AI, where we are world leaders. We need to ask ourselves why, when we can do the innovation in this country—for example, inventing the world wide web—large IT companies such as Google did not emerge in this country. We need to concentrate on the high-tech sectors of the economy. As my hon. Friend said, that is the way to build ourselves out of the debt created by previous Governments. We need to encourage more students from around the world—the brightest and the best—to come to our universities to study subjects such as computer sciences, so that our universities are at the world forefront of this much needed research.
We need to relentlessly pursue a growth strategy post Brexit. I was delighted that the Chancellor was able to release some of his cushion in this Budget. I hope that we get a deal; I am optimistic that we will get a deal and that this Parliament will pass it. We can then move forward, businesses that are currently shelving investment decisions will make those decisions and the economy will start to thrive.
One thing we can do in the post-Brexit era is to look carefully at the business rates system. I held an Adjournment debate on that earlier this month, in which I pointed out that business rates are not necessarily related to the ability to pay. There are some unfair quirks in the business rates system. For example, a business with a rateable value of under £12,000 gets small business rate relief, but if someone has two businesses with a rateable value of, say, £3,000 each, they get no small business rate relief for either of them.
I welcome the fact that the Government have put £900 million into the rating system, but again, that is a sticking plaster over a system that needs to be thoroughly reformed. I also welcome the fact that there is a third off business rates for retailers with a rateable value of up to £51,000 and a fund for the sustainable transformation of high streets.
Perhaps the most important thing that we need to look at in public services over the next few years is education. As I have alluded to, education is the way that we will be at the forefront of innovation in this country. I have campaigned over a number of years as part of the f40 group to ensure that my schools in Gloucestershire get fair funding. I welcome the additional £475 million for capital spending, but that does not address the current spending problems. In Gloucestershire, we have overspent by £3.2 million on the high-needs block of the education budget. As I mentioned in my intervention on the Health Secretary, that is unfortunately because our children are getting more and more complex health and other problems at an earlier age and need more special assistance in schools.
While I welcome the additional £1.3 billion put into education as a result of our manifesto commitment, it was predicated on the basis that secondary school children throughout the country were to get £3,800 under the fair funding formula. In fact, we will only be able to afford per pupil secondary school funding of £3,600 in Gloucestershire. That additional £200 per pupil would make a huge difference to my schools. I have to report to the House the sad fact that while we had a period of years when our schools in Gloucestershire were going from good to outstanding ratings, that has begun to drop back, which is of great concern.
One way in which the Chancellor has responded to public concern over IT companies such as Google and Facebook is to introduce a digital services tax. I agree with a little bit of what Opposition Members said—I think the tax is unambitious. If we look at the Red Book, we see that the tax is only 2% on profits, with a £25 million annual allowance, and it only covers relevant global revenues in excess of £500 million. The result is that hundreds, and maybe thousands, of relevant small and medium-sized IT companies around the world will be exempt from it. The tax is only predicted to raise £440 million by 2023-24. If we raised more from that tax, we would be able to put more money into schools. The Chancellor needs to look at that carefully. He introduced the diverted profits tax to start to deal with the issue of international companies not paying proper tax in the UK, but that has only raised £388 million this year.
Infrastructure is very important in this country, and I welcome the £25.5 billion for the roads programme. I desperately hope that that extra money will finally secure the construction of the missing link on the A417 in my constituency, for which I have campaigned for 15 years. The Chief Secretary is listening, and I hope I will get good news shortly. We have consulted on it, and we have a preferred route. All we are waiting for is the Government to announce which route they want.
Affordable housing is very important, and I welcome the extra £500 million for the housing infrastructure fund. I welcome the fact that a lot more money is going into housing. Providing housing is one of the most important things that we can do for our young people, and intergenerational fairness needs to be looked at. Low-paid public sector workers in my constituency, whether they be nurses or teachers, often cannot afford to live in the Cotswolds, and we need to look at more innovative ways of providing social housing for them.
It is a pleasure to participate in the Budget debate. There were some announcements to be welcomed yesterday, such as the tax on big tech companies. I have been calling for those changes since my time on the Public Accounts Committee, and they are long overdue. In the round, though, this Budget fell well short of what is required. After the Prime Minister’s big talk of ending austerity, what we got was too little, too late. To get the changes we need to create jobs and prosperity in all parts of the UK, there is only one solution: a Labour Government.
Today, I want to focus on a key issue that has affected families in south Wales and on which the Government have failed to act, and that is helping people to protect their pensions. Last year I called attention to a brewing steel pensions crisis. Facing a hard deadline on their future options, British Steel pension scheme members found themselves targeted by unscrupulous pensions advisers. There were nearly 8,000 transfers out of the scheme, and we know that 872 of those were advised by firms that were eventually required to stop advising. Worryingly, one financial planner has said that the high number of compensation claims submitted against just one of those firms might be the tip of an iceberg.
Too many people saw their hard-earned pension pots put at risk, including constituents of mine who were worried sick about their future. They needed an immediate, robust and decisive response from the regulators. Unfortunately, poor co-ordination, unclear consumer information and weak oversight meant that the response for those consumers has been hesitant and insufficient. It was often unclear who they needed to approach for help. Unbelievably, they were expected to take up their concerns with the advisers they suspected of fleecing them. Pensioners researching specific advisers had to go through a lengthy process to find out basic information. They needed to search the Financial Conduct Authority’s register to decipher legal notes that were sometimes closer to double Dutch than plain English. The FCA is now making changes to its register, but it still is not giving people critical information in a straightforward enough way.
The most pressing problem remains the sorry state of financial regulation and pensions oversight. As a Work and Pensions Committee report found, while interest in steel pension transfers was increasing from late April 2017, it was not until November that the FCA began to take action. At that point, a full-scale crisis was under way. Even then, it was not until December that it was taking regular action against suspect firms. While there has been some progress, it has not been clear enough for us to give concrete answers to the people affected, or to give us confidence that this will not happen again.
Nowhere is this more evident than with one of the firms most closely identified with this scandal, Active Wealth (UK), and its director Mr Darren Reynolds. The Financial Services Compensation Scheme is paying out over £500,000 for claims related to this firm alone, yet 162 claims, many from steelworkers, are still open. Mr Reynolds failed to turn up to Parliament to answer questions. The ability of his company to advise on pension transfers was restricted and the company is now in liquidation. Despite this, Darren Reynolds is still listed as an active person on the FCA register. From my inquiries, he does not appear to have been referred for more serious investigation. What needs to be done for this sector to tackle this bad behaviour and for this character to be properly held to account?
The pensions debacle that hit steelworkers last winter should never have happened. It is a stark warning that regulating these businesses is not working well enough. It happened because we have a system of pensions and financial regulation that fails to protect hard-working people. After much criticism, the FCA and the Pensions Regulator say they are working better together, and that is a positive step. However, this is not a problem of co-ordination alone; we also need stricter penalties, better information and far tighter oversight. The Government urgently need to look at what has happened to drive improvements in the future. They need to review current regulation on pensions advice regularly, make sure that any wrongdoing is aggressively dealt with and ensure that consumer information is easy to find and to understand.
I want to include this personal plea for action. Many of my family were steelworkers or miners, and our steelworkers put in decades of toil to earn these pension pots. Some have found these pension pots put at risk because of the wrongdoing of some and the inaction of others. The Chancellor needs to put this right and to get on the side of working people.
I will end by focusing on the extreme pressure that the Government’s recent proposals on pension valuations could cause our police forces. Gwent police estimate these could cost them the same amount of money as 100 officers. The Government need to give our police more funding. Instead, however, they are forcing expensive accounting tricks on them with no notice. That is not right.
Finally, I point out that there is a better path. For a genuine end to austerity, real help for our public services, and rules and systems that work for working people and those in retirement, we need a Labour Government.
I have been in the House long enough to remember lots of Labour Budgets, and I remember the claim that boom and bust had been abolished—only to be followed by the biggest bust that we have had in our history. It must have been a big bust, because only that would have made the Conservative party and the Liberal Democrats work together. We normally fight like ferrets in a sack, but in the context of 2010, a real crisis had to be dealt with.
If we look at what has occurred over the long term, we can see that we have made a great success of it. First, we have reduced the deficit from 10% to about 1%. That is a good thing, because if we borrow lots of money, we pay interest, which means that taxpayers’ money goes to pay bondholders and shareholders, not on the things that people want. I think that a compassionate Government is one who balance the books, because that means they can devote resources to the priorities that people have.
We have managed to do that without crashing the economy. Despite the calls that were often made about the economy going into recession, we have had eight years of a growing economy, which is actually pretty good. On top of that, we have created 3 million jobs. We all know that the best way to deal with poverty, to give people life chances and an opportunity to train, and the best thing for families is employment. If there is a challenge now it is to get wage levels and take-home pay up. When we compare our performance on employment with the EU and most of our neighbours, we can see that we have done a pretty good job. I am pleased there are signs that pay is picking up and that British workers will be paid more.
There is a lot of good to be said about the Budget yesterday. I do not think that Budgets in themselves make much of a difference. What makes a difference is long-term economic success and planning. If we look at Germany and other countries, we can see that they have pretty sane policies year after year—over seven, 10 or 15 years—which grow the economy gradually. Certainly since 2010, we have made pretty good progress, and there is more progress to be made as we exit from the European Union.
I welcome what the Chancellor has done on public spending. We all know that there are pressures with an ageing population and with mental health, and the Government have started to address some of those pressures. They have been able to do so because of careful management of the public finances. I also welcome the additional spending on defence. I am one of those who have always felt we have cut defence too much, perhaps because of the economic crisis. I think that Britain, as a world power and as a member of the United Nations Security Council, does need to spend sufficient resources on defence, so the £2 billion announced in the Budget is to be welcomed.
I think we have made good progress, and all that the Government need to do now is to keep that progress up year on year. We have a decent balance in this Budget because not only have we been able to spend more on public services—with the proviso that we need reform, and the proviso that we need productivity to rise because spending money will not necessarily in itself produce better outcomes—but we have managed to reduce taxation. Since 2010, we have doubled the allowance to £12,500 for those who pay tax, which is pretty good, and it massively increases the incentive for people to get into work. It is no accident that we have record employment, because we have made raising the tax allowances to help people get a job a very critical part of our employment strategy. It is also quite right for the upper rate of tax to go up as well, because that lifts all the tax bands for many middle earners. The fact of the matter is that, as a country, we tax people too much too early, and we need to increase incentives. There has to be a balance between incentives and extra spending, and on this occasion we have got that right.
We have a key task over the next few months in getting a good deal on Brexit. I note that the shadow Chancellor criticised the Government for contemplating leaving without a deal, yet as far as I know the Labour party are going to vote against the deal, so there seems to be a slight double standard.
Well, we shall see what comes back in the next few months.
The reality is that the Government have actually managed the economy well, and because of that, despite the level of uncertainty, we are still creating jobs and we are still growing. The interesting point is that, despite the soft patch earlier this year, the third quarter growth figures show that we are now growing more than the EU, so we are starting to pick up again.
I am confident that we have a good team at the Treasury and that they are listening to what colleagues are saying about their constituency concerns. I think we have had a really decent Budget, which has balanced sensible spending with reform and a sensible reduction of taxation. We are also maintaining a sensible management of the economy, certainly in the plans to have a 1% deficit, which is a massive reduction. I hope that we over-perform, and that if we do, we can reduce that further. The reality is that this Government have done well, and the country is doing well. We need not run down the country; the country’s best years are still ahead of us.
I thought I would start by picking out a few key points from the Office for Budget Responsibility report, which might have a slightly different emphasis from the points that the Chancellor would pick out. Let us start, on page 64, with household disposable income:
“Real household disposable income fell by 0.2 per cent in 2017”.
On page 65, the report says:
“We expect relatively weak growth in per capita real earnings and real disposable incomes… In 2019, real per capita disposable income growth is flat”.
On household saving and debt, on page 67, it says:
“We expect unsecured debt to rise steadily as a share of household disposable income”.
On household net lending and balance sheets, on page 70, it says:
“the ratio of household debt to income has risen steadily since the start of 2016…we expect the ratio of household debt to income to continue to rise steadily…with the ratio reaching just under 150 per cent by the start of 2024.”
On business investment and stockbuilding, on page 72, the report says:
“The latest data suggests business investment fell in both the first two quarters of this year…we expect a modest rise in business investment as a share of real GDP over the forecast period—less than would be typical at this stage of an economic cycle.”
On UK exports as a share of GDP, on page 77, it says:
“In August, the Government announced an ambition to increase the UK’s exports to 35% of GDP, but has not specified the date by which it believes that this can be achieved. The Government’s previous aspiration was to increase exports to £1 trillion by 2020—our forecast suggests that this will be missed by £320 billion. The Government is not on course to meet its current ambition in our forecast”.
On risks and uncertainties, on page 81, the report says:
“The outlook for productivity growth remains hugely uncertain.”
On page 83, it says:
“the probability of a cyclical downturn occurring sometime over our forecast horizon is…high”.
On assumptions regarding the UK’s exit from the EU, it says:
“we still have no meaningful basis for predicting a precise outcome upon which we could then condition our forecast.”
On page 91, it says:
“Real GDP Growth has been revised down in 2018”.
Now, the Chancellor, of course, would and did choose to cherry-pick a different set of headlines yesterday, but I think this is a more balanced picture than that presented by him.
I can assure the Chancellor of two things in relation to this Budget. First, the people of Enfield are sick and tired of austerity. Secondly, we have no confidence that the Government’s programme of austerity is coming to an end. The Government’s £1 billion cut to the Metropolitan police budget since 2010 has resulted in 230 police officers and police community support officers being removed from the streets of Enfield. Over the same period, violent crime has surged locally by 85%. Where was the Chancellor’s announcement to reverse those cuts, put more bobbies on the beat and help create safer neighbourhoods?
How can the Government have the cheek to say austerity is over, when they are still planning cuts of £1.3 billion to councils next year? By 2020, the Government will have slashed funding to Enfield Council by 60% in just a decade.
There is a better example in this Budget of the Government’s misguided priorities. The Chancellor announced more funding for potholes than for our schools. Pothole funding is welcome, but surely education should be a higher priority. Does the future of our children not matter? This is a slap in the face for many schools in my constituency, which are having serious problems paying for basic items such as pens and paper, let alone retaining and recruiting teachers.
Austerity is not coming to an end, and nor, as the Chancellor asserted, is the “economy working for everyone”. This year, we have seen household debt rise to its highest level on record. Over-indebtedness in Enfield is higher than the London and national averages, and we have more than 14,000 residents in real financial difficulty. One in three workers living locally does not earn a living wage, and the average worker is £800 a year worse off than they were a decade ago.
The Government’s abject failure to address the housing crisis means local families are struggling to cope with soaring rents and a lack of affordable homes, with our borough having the highest eviction rate and the second highest level of homelessness acceptances in the capital.
The last Labour Government lifted 1 million children out of poverty, but child poverty rates under the Conservatives are getting worse, not better. Some 34,000 children in Enfield are now living below the poverty line. This is a shameful record for the Government, and a record that could deteriorate still further as a result of their disastrous universal credit roll-out.
My right hon. Friend is making an excellent speech. Does she agree that the failure to say anything considerable in the Budget about early years support and education and Sure Start centres yesterday represented a glaring omission, and addressing those issues would have helped families in constituencies such as Bristol South and Enfield North?
My friend is absolutely right. In fact, in Enfield, we now see a real problem, as we do in many other parts of the country, with children not being ready for school at the age of five. This has a significant impact on their achievement throughout their school careers and on their future.
North Enfield Foodbank has said that food bank usage continues to increase, with Enfield having the fourth highest rate of food bank usage in London last year. The main reason for that increase is delays in the payment of benefits and changes to them.
The Chancellor said that the Government were
“delivering on the British people’s priorities, supporting our public services”—[Official Report, 29 October 2018; Vol. 648, c. 668.]
There is no public service or institution more important in our country than the national health service. Huge pressure has been placed on doctors’ surgeries. Well over half the residents who replied to my GP services survey said they had difficulty getting an appointment to see a doctor, and we know that, going forward, Enfield is short of 84 GPs to serve our growing population.
The Government’s chronic underfunding of our national health service since 2010 means that North Middlesex Hospital, like so many other hospitals across the country, is operating with a substantial financial deficit. NHS England is trying to deal with a deepening staff crisis, while hospitals are trying to recruit doctors and nurses. This is an impossible situation. We cannot square this circle. On public health, which warranted no mention whatever, we in Enfield are facing another £1 million cut by 2020, and everybody knows the link between poverty and health.
The Government have failed to address eight years of devastating cuts to our communities, and they are failing to deliver on the priorities of the British people. Austerity is not coming to an end. Yesterday’s Budget proves it. There is no hope here that I can take to the people of Enfield from this Conservative Government. I will not be supporting this Budget.
It is a pleasure to follow the right hon. Member for Enfield North (Joan Ryan). Since the Chancellor sat down yesterday, much has been made by commentators of the question of whether austerity has indeed ended. However, surely that is the wrong question, because what the Chancellor’s speech set out yesterday was the most important point of all: fiscal prudence and careful financial management are what a good Chancellor should always focus his attentions on before all other things, so that when there is a need for more cash for urgent or unexpected events, it is possible to provide resources without jeopardising the long-term economic stability of our country.
Mr Deputy Speaker, I would like to apologise if I became agitated yesterday during the Leader of the Opposition’s reply to the Chancellor, but that was because it is so very frustrating to listen to someone who offers himself as a potential leader of our country but has absolutely no interest in its financial stability. His willingness to borrow “to invest”, as he calls it, means simply a new vast mountain of debt, binding all our children and their future offspring to huge debt interest payments—real cash from real, hard-working taxpayers being used to service debt and therefore not being used for public services, for supporting those who cannot look after themselves, or for ensuring that we invest in the most advanced and flexible defences to protect and look after our constituents. He would rather enjoy the short-term self-gratification of handing out cash that we have not yet earned, but those who would suffer most are those who can least afford it. High interest rates would cripple people with mortgages. There would be a flight of capital investment from our business community, and the small and medium-sized enterprises and larger businesses that are the backbone of our jobs, and whose hard work and risk taking generate so much of the tax we need to pay for our public services, would stop investing, move abroad, and leave a Corbyn Labour Government to bankrupt our nation, as Labour has done before.
That is a scenario that Conservative Members—and, I believe, many on the Opposition Benches—cannot bear to consider for our constituents, who deserve so much better. The last eight years of fiscal rectitude have been hard, but we can now see the benefits of that graft, and the increasing tax take that the Chancellor can use to help to grow our economy and look after those in need. A stable economy means business investment, and that means real jobs, low interest rates and real investment in our public services.
The confirmation of £20 billion for our NHS is very welcome. I hope that the NHS five-year review will invest in local services and community hospitals, and address the rural sparsity factor, which has for too long been ignored by the centre.
There is the investment in the borderlands deal, a devolution programme that allows Northumberland and her neighbouring counties—regardless of the Scottish border, which is simply a line on a map as far as we in north Northumberland are concerned—to focus our investment on the areas of infrastructure and business sectors that we, as the locals, know will help to boost our economic growth most effectively. We will be able to work with our neighbours to achieve what those pesky border reivers never did: a coherent economic and cultural community based on geography and our natural assets; and, rather than fighting each other for personal gain, working together for us all in the most wild and beautiful part of our country.
The Chancellor’s commitment of £50 million for trees—funding to purchase carbon credits from landowners who plant qualifying woodland—is most welcome. This is real support to help those who commit to the slowest-growing crops: the trees that maintain good soil health; improve the water basin; reduce the risk of flooding in the valleys; and hold carbon dioxide while they are growing and then continue to be a carbon sink when they are harvested, with the wood used in housing and the wood trade.
It is excellent news that the Chancellor will be directing all road tax receipts into road investment and maintenance. That makes perfect sense and is welcomed by those who pay their taxes to use the roads every day. I had thought I might not be able to find a way to thank the Chancellor for his support, when he was Secretary of State for Transport, of my campaigning efforts to invest in the A1 through Northumberland in order to dual it and to make it into the safe and functional 21st century road it needs to be for local users, visiting tourists and businesses moving goods. He understands the investment concept of “build it and they will come”. The first £300 million, which he committed, is now being spent to dual the first 13 miles. With the commitment to allocate £28 billion to the national roads fund, he can be assured that I shall be returning to discuss the dualling of the last stretch of the English undualled road between London and Edinburgh shortly. Before that, however, the commitment to general road maintenance and the battle against potholes is most welcome. Northumberland County Council looks after over 3,500 km of roads. The “beast from the east” managed to shred many of our roads earlier this year, so this commitment to spending the monies collected from road users makes real sense to us.
I am also most grateful that the Chancellor has heard the call from my most rural communities for investment to ensure that we can get decent broadband to every property and business, wherever it is. This will ensure that we have long-term solutions that use technology to reach everyone.
Most welcome, of course, are the cuts to income tax, which will mean that my constituents will each have a personal allowance of £12,500 from next April, as well as an increased national living wage of £8.21. Could nobody tell my son, because that will really excite him, given that he will have earned even more when he gets down to the pub at the weekend? There is much for our small businesses to benefit from. The Chancellor has made a commitment to Brexit and to giving all Departments the cash that they need to get ready for the changes that will need to be put in place.
I thank the Chancellor for listening to the voices of so many MPs about one of those areas of Government spending that most people take for granted and assume is all working fine. I believe that we need to talk about this area of critical national policy much more than we do. It is a public service like no other, because this public sector workforce puts its life on the line for us every day. The question of defence investment and why a comprehensive insurance cover is necessary is not a subject of conversation every day among mums at the school gate. However, every parent’s focus is on keeping their children safe, well fed, healthy, and able to have a happy and safe childhood, so how is it that the most important role for any Government to fulfil—protecting their population—is too often forgotten or ignored in polling and questions of day-to-day spending? It is our insurance policy, but we assume that everything is all okay. I therefore listened with pleasure to the Chancellor committing nearly £2 billion over the next 18 months to help the Ministry of Defence to ensure it can maintain all our capabilities to keep us safe.
As we leave the EU, the one thing which remains fixed is our geography. We will remain, as we have always been, an island maritime trading nation—outward facing and trading across the globe. We need to keep safe the seas across which all our trade moves. We need to ensure that international waters are free of danger so that oil and other goods can move around the globe, whether they are British products being exported, or our imports into our thriving ports of the food in our supermarkets and the oil we need every day. Without the Royal Navy’s day-to-day invisible work, our economy would be profoundly affected. I am very pleased to support this Budget.
It is a pleasure to follow the hon. Member for Berwick-upon-Tweed (Mrs Trevelyan), who, despite being on the wrong side of the line at the border, is always entertaining.
Despite the Chancellor’s rather dead-pan delivery of yesterday’s lengthy Budget, the simple truth is that not one of us can trust or believe a single word we heard. Whether on jobs, investment, tax cuts, austerity, extra funding for the NHS or universal credit, the truth is that the Budget is little more than a wish list cobbled together by someone seriously lacking in ambition. It is, none the less, a wish list of what the Chancellor would like if everything turns out the way he hopes it will in the Brexit negotiations. If those negotiations go pear-shaped—I reckon one would get pretty short odds on that being the case—he has admitted that we will all be back here in the spring for what he described, rather euphemistically, as a fiscal event.
In short, what we heard yesterday was, “This is what I’d like to do in an ideal world, but just don’t mortgage the farm on it happening because we have absolutely no idea how Brexit will turn out, and if it doesn’t go well, everything will be up in the air and we will have to do it all again before the clocks go forward.” The Chancellor basically admitted that his Budget will not be able to withstand Brexit. What a way to run a country. What a way to run an economy. Perhaps saddest of all, given that this was his best shot, what a paucity of ambition on the part of the Chancellor.
Anyone watching yesterday who had hoped for or expected the fulfilment of the Prime Minister’s promise of an end to austerity would have been left sorely disappointed. This Budget most certainly did not sound the death knell for austerity. Public sector workers, the low-paid, the disabled, the sick and those seeking employment will all still continue to bear an unfair share of the burden of austerity. Frances O’Grady, the general secretary of the TUC, was absolutely right when she said:
“This Budget does not undo the austerity that has devastated public services. And it lacks the investment needed to speed up wage growth after the longest pay squeeze in 200 years”.
Let no one be in any doubt that, 10 years on from the financial crash, austerity is far from over. The UK Government will continue to balance the books on the backs of the poorest, weakest and most vulnerable in our society.
I refer the hon. Gentleman to the commission’s report and advise him to read it, rather than simply taking the crib sheet handed out by his party.
Much has been made of the Chancellor’s announcement that £20 billion of new funding would be made available to the NHS over the next five years. We are told that that funding will be transformational for the national health service, but let us put it into perspective. The new money, which we welcome, averages out at a 3.4% increase per annum for the next five years. That is actually still less than the average funding increases received by the NHS in the first 60 years of its existence. All the Chancellor announced is that NHS funding, having been squeezed mercilessly by the Tories in the past decade, is returning to a position that is a little below its historical average. The reality is that in releasing this money, the Chancellor has simply removed the Treasury’s heavy boot from the neck of the national health service. If the Chancellor had had the good manners to remain in the Chamber until my right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford) had spoken yesterday, he would have heard him ask why the Scottish national health service is being short-changed in the Budget to the tune of £50 million a year, which makes a cumulative shortfall of £250 million over the five-year period. That £50 million is enough money to pay for 1,200 nurses in Scotland.
In his Budget, the Chancellor had the perfect opportunity to do the right thing: stop the roll-out of universal credit dead in its tracks until the well-publicised faults in the system, which are hurting the poorest and most vulnerable in our society, have been fixed properly, once and for all.
Further to that point, is it not a scandal that the Highland Council has to fork out £2.5 million of its carefully hained resources to pay for the roll-out of universal credit? What might that £2.5 million have done for some of the poorest people in areas such as Argyllshire and my constituency?
I could not agree more. The hon. Gentleman is absolutely right to highlight the cost to councils and individuals of the appalling roll-out of universal credit. The Government know that it is wrong, but they are pigheadedly determined to see it roll out. The Budget was the Chancellor’s perfect opportunity to stop it, but he refused. For reasons best known to himself, he decided instead to tinker around at the edges, with the promised money coming nowhere close to meeting the shortfall that was created by his predecessor. The Chancellor has decided to do almost nothing for those who are currently on universal credit and are struggling under the work allowance, the two-child cap and the benefit freeze.
As Gillian McInnes, the manager of the citizens advice bureau in my Argyll and Bute constituency, said:
“The Government has still not done enough to address the real problems of universal credit, which are causing serious hardship for many families. Without further support for families, many parents and children will be left in a desperate situation, with many”—
indeed, many more—
“forced into using food banks.”
This was the Chancellor’s opportunity to end austerity—he chose not to. This was his opportunity to stop and fix universal credit—he chose not to. Instead, he and the UK Government chose to hand out tax cuts to the wealthy while continuing to try to balance the country’s books on the backs of the poorest in our society. Heaven help us all if this was the Chancellor’s “good guy Budget”—the one that was based on the Government securing a half-decent Brexit deal. One shudders to think what he has up his sleeve when we are all forced to reconvene in this place early next year for his fiscal event, if and when the Brexit negotiations go totally pear-shaped.
There is much to celebrate in the Chancellor’s autumn Budget, which carefully balances the need to spend more on key services with the need not to snuff out progress in repairing our economy. Having listened carefully to the criticisms from Opposition Members this afternoon, I am left only with the sneaking suspicion that if we had announced £100 billion of extra spending, Labour Members would probably have advocated £200 billion, using our constituents’ money to hose their party in crowing virtue.
The first duty of any Government is to keep their citizens secure. In a world of rapidly changing threats from both state and non-state actors, the substantial additional money for the armed forces and the £160 million extra for counter-terrorism policing operations are timely and welcome. If we fail to retain skilled personnel or to keep up with technological changes in warfare, and if we look only at the immediate challenges while our enemies plan for the next half-century, we risk reneging on our principal commitment to the electorate.
Our vital reforms to welfare have been broadly welcomed by the public, who understand the inherent justice of making work pay. However, if those reforms are to maintain public confidence, it is vital that they are funded correctly. Universal credit is only just beginning to roll out in my constituency, and I know that my local jobcentre has been eager to use the new tools available to them with universal credit. The £1,000 increase in UC work allowances, the boost to the minimum wage, the increase in the personal tax allowance, and money to ease the transition to universal credit will make crucial differences to the credibility, and therefore the sustainability, of our welfare policy.
My main high streets in Upminster, Elm Park, Harold Hill and Hornchurch are sustained by lively independent retailers who work exceptionally hard and take risks to provide jobs and services to the local community. The cut in business rates by a third for retailers with a rateable value under £51,000 is vital to their sustainability. Coupled with cash for high street regeneration, money to repair roads and the removal of rates for public toilets, I hope that we shall begin to see a revival of small town centres.
We all know that the NHS faces massive additional cost pressures from an ageing population and expensive new medical advances. The Government have set out an unprecedented multi-year funding plan that equates to over £20 billion more a year in real terms by 2023-24. I hope that will put the finances of our major hospitals on a sustainable footing. The demographic pressures on outer London of growing numbers of children alongside a rapidly ageing population, the PFI debt burden and difficulties recruiting staff place constant pressure on the budget of my local hospital, Queen’s. Beyond that, any additional funds must be relentlessly focused on investments that ultimately bring down the cost of the NHS. In that regard, I put in a plea for a nurse training facility in outer east London to reduce reliance on agency staff, measures to boost primary care to keep people out of hospital and, as a special request from a young constituent, the full implementation of the Think Autism strategy. I also want to raise the concerns of my local hospice, Saint Francis, which is worried that the NHS pay award will make it harder for hospices to get the right staff. I ask that their needs be considered, given the exceptional support they provide to the terminally ill and their families.
None the less, I must sound a note of concern. The NHS is now consuming an ever larger slice of the national pie—it is projected to account for 38% of public service spending by 2023—and this will have consequences. Even if we removed the extra money for NHS England, however, the Budget suggests that spending pressures on our local police and councils would likely continue. We have been giving councils more power to raise revenue, and yesterday we announced £650 million to ease short-term social care pressures. That is right. The core schools budget is to rise, too, and primary and secondary schools will get some additional capital spending, but I fear that these measures will prove insufficient to keep at bay the rising costs and demand pressures in my outer-London constituency, particularly on special educational needs provision, additional employer pension contributions and increased use of statutory services that squeeze money needed for other critical elements of council work.
The NHS boost must be openly debated before the spending review and set against other public spending priorities. Health is vital to my constituents, but if they were asked whether the NHS should be the almost exclusive beneficiary of additional public funds, or whether a portion should be given to our overstretched police forces, schools and councils, I am not convinced the health service would secure all the bounty. People in my constituency are worried about crime and frustrated at the Mayor of London’s leadership of the Metropolitan police, which is seeing outer-London boroughs deprioritised against inner-London ones. Beyond the precept, we need to be confident that the Home Office is providing the funding that police officers need to meet their increasingly complex workload.
Finally, I would like to issue a word of caution about Brexit. It has been suggested in the approach to the Budget that any failure by MPs to back the Government’s eventual Brexit deal will jeopardise our ability to turn on the spending taps in the spring. Parliamentarians on both sides of the divide have expressed concerns about the Chequers strategy, as has the EU itself, and I am anxious that we avoid a deal cemented with unacceptable concessions or a proposal that slithers us into an indefinite period of limbo. Either scenario would heighten the risk of no deal and the prospect of a radical Labour Government, which would have profound implications for the public finances. The cost of Labour’s renationalisation programme alone is £176 billion.
I have heard it said that most of the electorate care little about customs unions, trade deals or regulations, and that they just want an agreement of any shape and then to move on. I caution MPs against making that assumption. One resident wrote to me last week:
“Speaking to people locally, I feel I am not alone in worrying that what we will end up with is just what we have now without any influence.”
The best way to protect our public finances from a Labour Government, unleash our economy from uncertainty and bring about the growth that can pay for better services is to negotiate a deal with the EU that is not only deliverable but gives our nation the flexibility and autonomy it needs to make the most of Brexit.
I should have liked to say much more about investment, growth and trade policy, all of which ultimately underpin the provision of strong public services, but I will conclude by suggesting that what matters above all to our constituents is not the amount spent on each service but the outcomes from and quality of those services. We must not forget value for money, the risk of false economies and the inadvertent pressure placed on other Departments amid the laudable desire to put the health service on a firmer footing.
I note the Prime Minister’s recent announcement that austerity is over, although the message does not seem to have reached the Chancellor. There was nothing in yesterday’s Budget to end austerity and there is no doubt that austerity is alive and kicking viciously in my constituency. As with so many things, the Prime Minister seems to think that just by saying something she can make it happen. Her first announcement as Prime Minister was that she was going to help those just about managing. Well, the just about managing are still waiting, and the just about managing in Burnley are managing just a bit less well than they were two years ago.
When we confront the Conservative party with the dire consequences that its budget cuts have wrought on our constituents—from the rise in NHS waiting lists to the lack of care available to the elderly and disabled and headteachers struggling to manage underfunded schools—we are told that record amounts are being spent. It does not take an economist to see that the Chancellor cannot, on the one hand, take credit for reducing the deficit and, on the other, brag about increased spending, without having a better record on growth than this Government’s miserable effort.
Yesterday’s Budget failed to address the crisis in the NHS and social care—one mention of carers, but not a single penny of support; not even a mention of the WASPI women or women’s refuges; no attempt to right the wrongs of universal credit; no extra funding for the police and fire services; no attempt to provide additional funding for nursery schools, in spite of the Education Secretary’s recent warm words. The extra spending on repairing potholes is welcome, but I find it shocking that the Chancellor provided more for potholes than he did for schools, even though every school in Burnley and Padiham is facing damaging cuts.
The Government like to mislead with figures. There is a pattern of swingeing cuts, followed by the reinstatement of modest amounts amid a fanfare of celebration. However, the recent revelation from the Office for National Statistics about the Department for Education’s dubious figures really was something else. Most ridiculously, spending on private schools was counted as Government spending on education. Next, I would not be surprised to see the use of luxury spas included in public health spending.
For me, the most damning statistic to emerge over the summer was the one on life expectancy, which has fallen in parts of my constituency for the first time in over 30 years. That is a true reflection of the Government’s record in office and the price my constituents are paying for austerity. Members will not be surprised to learn that the last time there was a fall in life expectancy was the 1980s, during the tenure of another Tory Government committed to policies that resulted in the decimation of our public services. Members may recall that we were told at the time, “There is no alternative.” Well, there is an alternative: it is a Labour Government.
The Government consistently remind us of the need to be fair to taxpayers. Let us consider that with regard to taxpayers in my constituency. Consider the low-paid essential worker who earns £12,500 per annum. Every extra pound they earn is taxed at a marginal rate of 32%. Compare that with the tax paid by the multimillionaire who, barely lifting a finger, reaps the benefits of stock market wheeling and dealing, and pays capital gains tax at a mere 20%. There is nothing fair about that.
Let us consider fairness for council tax payers. The owner of a band A property in my constituency, worth as little as £50,000, has to pay a council tax bill of £1,220, while the owner of a band G property in Westminster worth £2 million gets a council tax bill £36 lower. There is nothing fair about that.
My hon. Friend makes a good point; I agree with him absolutely.
Some 36% of the children in my constituency are growing up in poverty, and the changes to universal credit will make that much worse. Can it be fair to punish children whose only crime is to have two siblings? Five and a half thousand children growing up in Burnley and Padiham will be affected by those draconian measures. There is nothing fair about that either.
The people in my constituency know who is responsible for the growing queue at the food bank; they know who to blame when they cannot get a GP appointment; they know who to hold to account when the old and disabled are left to struggle on without adequate social care; and, perhaps most importantly, they will not forget that it was this Conservative Government who, most shamefully of all, forced record numbers of our children to grow up in poverty, short of food, warmth and hope. They will not forget.
It is always a pleasure to follow the hon. Member for Burnley (Julie Cooper), but I disagree with her. This is a great Budget.
I am glad that the Chancellor has set aside substantial amounts to prepare for all eventualities as we approach Brexit. The Banbury constituency’s vote in the referendum was the closest in the country; by 500 people, we voted to leave. Now, I hear a great deal of unity locally over the need to get on with getting a deal. The uncertainty of Brexit is challenging for my constituents. With a good deal done, I really look forward to a pro-growth spending review early next year.
Locally, we can see that the economy is going well. There are great employment figures, but we need to focus on wage growth, which leads to more disposable income. I, for one, was pleased to hear the figures the Chancellor gave yesterday.
In my area, we are obsessed by healthcare. Everybody in this Chamber will have heard me talk, probably several times, about the Horton General Hospital, which we have been fighting to save for the past 40 years. The problem over the years has in fact been not financial, but structural. Small is beautiful and local, and we must not give in to the overweening ambition of Oxford to suck in more cases or more births. The German model of maternity offers choice but retains smaller obstetric units and, most importantly, excellent outcomes for mothers and babies. We have had a historical failure to recruit both midwives and obstetricians. Locally, we have had real progress with the clinical commissioning group since the fabulous new interim chief executive took over. The Horton has a very bright future.
I welcome the extra funding in the Budget—an average in real growth terms of 3.4% a year—but we need to ensure that it translates into extra people doing the right thing in the right place. Nobody is pretending that every sort of complicated surgery can be done everywhere, but A&E, paediatrics and simply having a baby with the benefit of an epidural should be provided locally. I know that the new Secretary of State for Health and Social Care agrees with this broad premise and I look forward to talking about my local situation with him.
In north Oxfordshire, we are proud of building three new houses a day. We are keen to welcome people to Banbury to fill our jobs and we are building them houses to live in. I am often asked how we are managing to make this progress: we have done so by having a consistent and strong local message and strong leadership. Cherwell District Council’s policy of putting housing generally on brownfield sites near towns, rather than piecemeal in villages, has seen new communities flourish. I also welcome the housing measures we heard about yesterday.
It would be wrong of me not to mention the public service I have worked in throughout my adult life. The Justice Committee, on which I am very proud to sit, recently heard that spending on justice will have fallen by 40% between 2010-11 and 2019-20. The Department does not have a protected budget. I was very pleased to hear what the Chancellor had to say yesterday and, more importantly, what I read in the Red Book afterwards, about the justice spend, and I welcome the £30 million to improve security and decency across the prison estate.
Today I received a letter from the Cheshire police and crime commissioner co-signed by the acting chief constable informing me of £60 million in cuts since 2010 and a further £12 million in cuts over the next two years. There are severe pressures on policing in Cheshire. Does the hon. Lady agree that the Government have failed to provide adequate funding for policing?
No, I do not agree, but I was able to take my local PCC’s issues up with the Chief Secretary to the Treasury directly in the last fortnight, and I encourage the hon. Gentleman to go to the Treasury with specifics; I think he will find that Treasury Ministers are listening.
We have £30 million extra to improve security and decency across the prison estate, which I feel very passionately about. We also have a whole new prison, Glen Parva, which was due to be a private finance initiative project, but the Treasury has now agreed to fund it. No specifics on the finances have been given in the Budget because it has to go out to tender and there will be all sorts of legal issues, but that is a very big commitment from the Treasury, and I for one am very proud of it. We need to put decent conditions in place for criminals so we can rehabilitate them before they are put back into society.
I also welcome the £21.5 million to be invested in the wider justice system. I feel very strongly that justice is not free; it does not just happen. The rule of law is not automatic, as we can see from the world we live in: it is a world in which people are poisoned in Salisbury, and in which the Chinese have a definition of the rule of law that does not coincide with the norms of modern international law since the second world war. I feel very strongly that we need to stand up for British justice values, and this does not happen automatically or cheaply.
We have had real difficulties in the prison service.
No, I will not; I am sorry, but I need to make progress, and I feel very strongly about this subject. We have had real difficulties in the prison service under successive Governments which we know can only be resolved if we can recruit more staff. The prisons Minister and the Lord Chancellor, whom I am happy to see in his place, are both working extremely hard on staff recruitment, and real progress has been made. We can see that this is making a day-to-day difference on the coalface, if you like, in prisons. People are being treated more appropriately.
However, there are other areas of justice spend that are harder to justify and even to talk about in this place. We have a crisis of judicial recruitment, for example, and it is tied up with the provision of suitable judicial pensions. The quality of court buildings also matters for morale, and it is therefore important for the recruitment of the people that we need to provide justice in a way that we all too often take for granted. The justice system stands or falls as one. What we do for the most lowly magistrates court is just as important as what we do for the Supreme Court. The system must be joined up, and if we are proud of the rule of law and the separation of powers that we talk about so often, we must be careful to fund the system as an entirety.
I am glad that the Lord Chancellor has been here to listen to this. I commend him for what he is doing. I also commend the Chancellor of the Exchequer for what he is doing for the justice system. The subject does not often get talked about in the House, and it was not talked about a great deal yesterday, but the detail in the Red Book has pleased me. Thank you for your patience, Madam Deputy Speaker.
I welcome the rise in mental health funding, but people with mental health problems also need support from other Departments, not just Health, particularly when they have problem debts. A person is four to six times more likely to have a debt crisis if they have mental health issues, and half of all those seeking debt help have a mental health issue. The two are interrelated. Debt can trigger clinical depression, anxiety attacks and more, while mental illness can build debts. Universal credit is not helping. I am thinking not only about the complex and stress-inducing work capability assessment but about the wait for the first payment. Also, if people are able to get an advance payment, they struggle to pay it back. None of that will do anything to relieve their mental health issues.
If the Government really are intent on prioritising the nation’s mental health, they need to guarantee that no one will be left without sufficient income as a result of moving to universal credit. Under the rules, any advance payment could be deducted at a rate of up to 40% of the standard payment. It was also possible to have other debts, such as council tax arrears or money owed to utility companies, taken at the same rate. The Chancellor has announced a reduction of this rate to 30%, but that could still mean a combined deduction of up to 70%, which is much higher than for pre-existing legacy benefits, so actually the change will be of little help. For some people, having deductions taken from their benefits to pay their creditors can be a positive method of repaying debt and managing their bill payments, but a rate of 70% is ridiculous. What steps is the Department for Work and Pensions taking to determine whether a deduction is appropriate or even affordable for the individual? I recognise that this method can be positive, but for many people it is inappropriate and unaffordable.
Universal credit can push people further into debt. The Government’s data confirm that people on universal credit are falling into rent arrears, with more than two in five saying that that is due to problems with universal credit. More than half the recipients of universal credit that Citizens Advice helps have had to borrow money while waiting for their first payment. We know that 97% of tenants in Wigan who live in social housing go into arrears because of universal credit, and that 60% of those tenants have arrears of more than £600. It is therefore perhaps ironic that the Chancellor has finally announced a breathing space in the form of a statutory mechanism to give those in problem debt a period of respite while they get their financial lives in order.
I met representatives of Macmillan Cancer Support this morning, and they were talking about the challenges facing cancer patients in the self-same circumstances that my hon. Friend has just described. Does she think that action needs to be taken for them, as well as for people with mental health issues?
I absolutely agree with my hon. Friend. I also think that the rules on terminal illness should be changed.
Going back to the question of the breathing space, the devil will be in the detail. For a breathing space scheme to work well, it has to have minimum standards. It has to provide enough time for the person in debt to get advice on the best way to resolve their problem debts, to recover from temporary financial difficulties and enter a statutory debt solution, and to pay their debts at a manageable rate. There must also be funding so people can access free, independent and impartial services speedily, because when people decide they are at the end of their tether, they want to see someone quickly.
The Government suggest a breathing space of 60 days, but debt advisers need the flexibility to recommend an extension. I worry that if the arrangement is too rigid, creditors may well delay until someone gets out of the breathing space period so they can start chasing them again. Call me cynical, but that is what 23 years at Citizens Advice does.
There is clear consensus that a breathing space solution must cover all debts, including debts to the Government—household bills such as council tax and moneys owed to central Government. It must also offer protection against further interest and charges, and against enforcement action. Creditors must stop collection activities such as calls, letters and visits—that means no more bailiffs. Returning briefly to universal credit, there must be no deductions from benefits or other income to recover outstanding debts during the breathing space period, future deductions must be affordable, and—please—there must be no public register of people who enter a breathing space. Evidence from Scotland shows that that deters people from doing so. If there is going to be such a register, let us make it private between creditors and people in debt.
I welcome the announcement that the Government will look at no-interest loans, although the long timescale will allow many people to fall into debt. It is unfortunate that, despite the work of the Law Commission, Government time was not given to debate ending the exploitation of a Victorian law that was used as a vehicle for logbook loans.
I turn to education—in particular sixth-form funding, which is at crisis level.
I have to move on, I am afraid. There is a range of new requirements, the needs of schools and colleges have increased, and under-investment in sixth-form education is having a negative impact on the education of the young people in my constituency. That simply means the Government will be unable to meet their stated objective of having a strong post-Brexit economy and a socially mobile, highly educated workforce. That is bizarre, frankly.
At least £760 per student is required to continue providing 16 to 18-year-olds with a high-quality education, but the Raise the Rate campaign asked the Chancellor to increase national funding by a more modest £200 per student. That would at least have been a start. It is disappointing that there has been no action.
Will the £400 million to provide the “little extras” be shared with sixth-form colleges? That might have helped Winstanley College in my constituency with the little extra of providing a teacher so German A-level could be reinstated, or allowed St John Rigby College to reinstate one-to-one time to support students who are struggling emotionally or academically—it might have, had that money not been ring-fenced for building maintenance and purchasing equipment.
Let me comment briefly on the raising of personal allowances. Families on the average wage in Makerfield will gain just over £12 a month, while people on more than £50,000 per year will gain just under £40 a month. It is pretty obvious who will gain the most. It certainly is not women over 50, who are still waiting for any measure to help them.
The Chancellor said he chose not to unveil the Budget tomorrow as he wanted to avoid Halloween jokes. It is a good job he did not wait until next Monday, as my constituents, having heard that austerity is over, may have expected a firecracker of a Budget that lit up their lives. Instead, all they got was a damp squib.
Our country faces some immense challenges and this Budget—from a fine Chancellor, who I hope stays for many more Budgets—does good work in tackling a number of them, but there are several others that I want to address and that some colleagues have touched on.
The first challenge to which the Chancellor and the Prime Minister have risen is the need to fund healthcare properly. A number of Members across the House have regularly made the case for an increase of about £20 billion a year to bring our spending in line with German or French levels, and this is happening. But I agree with the point made yesterday by the hon. Member for Bassetlaw (John Mann)—that is, that we need to pay for this. It should not just come from additional borrowing, and we should continue to look at using hypothecated or other forms of revenue, particularly when it comes to social care.
A second challenge that the Chancellor has met—as, indeed, have employers up and down the country—is the need to increase and maintain employment, and to reduce unemployment to the lowest level in decades. The unemployment rate has fallen from 8% to 4%. In many constituencies, including mine, it has fallen much further than that, but every person out of work is still one too many. It is also welcome that on the whole jobs are gradually becoming better paid.
The third area in which the challenge is being met is defence and our global role, particularly in international development. The UK is one of the only major countries in the world—if not the only one—to maintain both the 2% defence commitment under NATO and the 0.7% official development assistance, and I welcome that. In difficult times, we can be proud that the UK will meet our international commitments as well as the commitments to our own people on safety and security.
Now, what about the challenges? The big and immediate one is clearly exiting the EU. It is absolutely essential that we reach a deal. I am a member of the Exiting the European Union Committee, and the more I hear of the consequences of no deal, the more apparent it is just how damaging it would be to the EU and to the UK. The Chancellor recognises this, and I sincerely hope that he does not have to come to the House with his alternative Budget. But this is not just about exiting the EU; it is about the future of the economy.
My hon. Friends the Members for Mid Norfolk (George Freeman) and for The Cotswolds (Sir Geoffrey Clifton-Brown) have mentioned the challenges we face and the future opportunities. The right hon. Member for Birmingham, Hodge Hill (Liam Byrne) and I recently produced a book on the future of work, looking at countries around the world that are meeting these challenges, including South Korea, Singapore and Argentina. Lots of people across the country are trying to meet these challenges, but they also exist globally.
It is an honour to follow the hon. Member for Makerfield (Yvonne Fovargue), who was right about funding for 16 to 18-year-olds. The years from 16 to 18 are a critical time, and funding dropping off at that stage poses some severe challenges to colleges and schools.
Like me, the hon. Gentleman is a west midlands MP, and knows that the west midlands economy is very important to the country. I am not sure whether the Government have clarified whether there will be more money for further education. Further education is the backbone of things such as apprenticeships, and we need more apprenticeships. Does the hon. Gentleman agree that we should be focusing on this important area?
Indeed, and I think I just mentioned that. In my constituency, Newcastle-under-Lyme College and Stafford College do excellent work, as does South Staffordshire College, but they are underfunded, particularly at that level.
A further challenge is balancing the Budget. The OBR report refers to the Chancellor in terms of St Augustine, as it describes the Budget as Augustinian—“make me chaste, but not yet.” I believe that it is nearly 20 years since the UK has run a Budget surplus, and we are now pushing that back by a further two years. This is not the way to go. We have to look carefully at how we can return to a balanced Budget or a surplus, which can only come from growth, more efficiency or allowing tax rates to rise—we have some of the lowest revenues as a percentage of GDP in the G7—but that has not happened this time. If we are to maintain a sound fiscal policy, it will have to happen soon. The country needs to build up assets in better times to meet the challenges of hard times, and one of those assets is a surplus Budget and a reducing deficit.
Local government finance has been mentioned today. This is a great challenge because I believe, as do pretty much all colleagues in this House, in the importance of devolution and making decisions locally. However, the Government are placing more and more pressures on local government, without giving it the means to deal with them. Local authorities, including Staffordshire, have done excellent work to reduce spending while maintaining services over the last eight years. That cannot go on. Local government has reached the bottom. I welcome the additional money, but we need to see more, particularly in terms of loosening up the requirements for referendums.
The right hon. Member for Enfield North (Joan Ryan) rightly said that the Office for Budget Responsibility report talked about the low savings rate and rising personal debt. That incredibly important area has not been focused on, and I am extremely concerned about it. We need to help households rebuild their balance sheets. People cannot always look to Government to support them in times of difficulty. Personal assets are vital, and I urge the Chancellor to look at ways of encouraging saving, difficult though that is—including efficient lifetime savings accounts that people can draw on in times of difficulty, financial education in schools and further support for credit unions.
We have the biggest current account deficit in the G7—from memory, it is about 3.8%. That is down from 5.1%, but it is still too much. We are too dependent on resources from other countries, and we need to build up our network of foreign assets, from which we receive income. At the same time, we need to reduce our balance of trade deficit.
Finally, we have the challenge of supporting people on the lowest incomes who are long-term sick or disabled. At a time when many people in this country are seeing their incomes continue to rise and are living in prosperity, which I welcome, we need to meet the needs of those who suffer from disability, sickness or low income. I welcome the changes to universal credit, but it still does not work for everyone. I welcome the additional money, but we have to make sure that nobody loses out in the transfer to universal credit, most particularly disabled people. Others, including my hon. Friend the Member for South Cambridgeshire (Heidi Allen) and the right hon. Member for Birkenhead (Frank Field) yesterday, have spoken about how that could be done.
This Budget is a chance to tackle long-term challenges in difficult circumstances, with the coming exit from the EU. The Chancellor has seized the chance to address some of those areas, on which I congratulate him. I believe that, but for this challenge of exiting the EU, he would have tackled other areas, too, but the challenges that remain cannot be put off for ever.
I refer the House to my entry in the Register of Members’ Financial Interests, especially with respect to renewable energy.
This might not be a Halloween Budget, but it is yet another attempt to scare Members about Brexit and to frame the Brexit question as deal or no deal. Although the Chancellor hardly mentioned Brexit, the underlying message is that there is something for us if we back this Budget—tax cuts and something for the NHS—and more in store if we get a soft Brexit. The other message is that if we do not vote for a deal, there will be a disastrous hard Brexit.
Certainly a hard Brexit would be a disaster, but so would this soft Brexit. It is just wrong of the Government, day after day, to propose a choice between the Brexit deal that the Government come back with and a hard Brexit with no deal. The truth is that there are alternatives. When we get there, this House must debate those alternatives, not just the two that the Government keep scaring us about. It is almost like the Noel Edmonds TV game show, “Deal or No Deal”. I switched over to another channel when it came on my TV, and this Parliament could switch over and have a third choice—that choice should be a people’s vote and an exit from Brexit.
The Budget forecasts show why a third option is so important. People should look at the growth forecasts, which are seriously scary. We are going to be trapped in a Brexit low-growth economy. We have had 10 years of financial crisis austerity and, with these growth figures, we are going to have 10 years of Brexit austerity. The figures should be really scary. Our economy had near to the highest growth rate of any G7 country in the four years before the referendum, and since then we have had the lowest growth in the G7. That should worry us, and that is even before we add in the risks and uncertainties. The OBR’s economic forecast could not factor in all the risks and uncertainties; it had to assume that there would be a soft Brexit.
So even these low growth figures may well not be as bad as things turn out to be. That feeds in to the spending figures. Ministers have made much of the health figures, but when one strips out the health increase, one sees that all the rest of the Departments will, on average, see 0% growth for the next few years. That is austerity continuing—it is really scary and completely not needed. According to the OBR, Brexit has already cost £15 billion in lost tax revenue, and we hear in the Budget that even Brexit preparation is going to cost more. That is why we have to escape this Brexit trap; whether it is a no-growth Brexit or a deal Brexit, we have to have a people’s vote.
This Brexit Budget was shaped to try to buy off the Back Benchers and the Democratic Unionist party, not to try to get a proper forward strategy for this country. There were deals in there for Belfast. It may deserve that money, but the timing for it is funny, and we know what the talks have been to try to get there. We know that the Government could not put forward the tax rise needed to get the Budget into surplus and to invest in public services because they could not get that tax rise through their Back Benchers. The Brexiteer Tories on the Back Benches would not have voted for a tax rise. The hon. Member for Stafford (Jeremy Lefroy) was right: we need to get a surplus, we need to invest in our schools, hospitals and police, and we need to undo some of the damage from universal credit. We need that, but we can only do it if we have some honesty on the public finances. The reality is that this Chancellor and this Government are so weak that they cannot put through the tax measures needed to get the right economic balance in this country and the right investment in our public services.
When we look at individual public services, we see that they are crying out for investment. For example, since 2015 we have lost 4,789 full-time police officers, 2,231 community support officers and 4,334 special officers. That is more than 9,400 officers lost, at a time when crime has been going up. Knife crime has increased by 62% since 2015, firearm crime has increased by 30% and homicides have increased by 33%. The Conservatives should be ashamed of themselves for not having been prepared to invest in the security of our people and safety on the streets when violent crime is going up by so much.
I have a question for those on the Treasury Bench. We have been looking in the Red Book. The Government have announced £164 million for counter-terrorism police, which is welcome, but it does not score anywhere in the Red Book. We have been making inquiries and asking the Treasury about this, and it says that it is from the reserves. I have never heard an explanation like that. The Chancellor announces £160 million for counter-terrorism policing yet it is not in the Red Book or said to be in the Red Book. That is an insult to this House, and I hope that Ministers will have an answer by the end of the day.
My constituency is seeing school funding cut, and headteachers have been marching. They do not normally do that in the Royal Borough of Kingston upon Thames, but they were doing so recently because they are fed up with having to lose staff, cut the curriculum and cut opportunities for young people in their charge. They do not stand for it, and this House should not stand for it. It was an insult to offer less money to schools than the Government are spending on potholes. What sort of priorities do this Government have when they put potholes before our children and their futures?
Not only did the Government get the short-term spending decisions wrong but they got the long-term spending decisions and strategy wrong. Where was the investment to tackle climate change? What about the opportunity in green growth—in our renewable energy? There are huge opportunities there, but there was nothing on that in the Budget. As for social justice, it was good to see some recognition that universal credit is causing pain out there, but the Budget did not go anywhere near enough. We are going to have to revisit this as a House if we are going to make sure that the poorest people in our country share in any future prosperity.
There is much to digest in the Budget, so I shall focus on only a few of the announcements that were made. In line with the theme of today’s debate, I shall start with those on health.
As a children’s doctor, I work on the frontline of the NHS. Throughout my career, I have become increasingly concerned about the number of young people with mental health problems. More than half of those problems start before the child is 14, and 75% have started by the time the child is 18, so early intervention is critical to try to avoid crises further down the line. I therefore welcome the Government’s announcement of £2 billion more for mental health, which will ensure that every school has a dedicated mental health team to tackle what is becoming an epidemic of eating disorders, depression and self-harm among young people. It is a welcome step as part of the Government’s commitment to develop parity of esteem for mental and physical health problems. More work needs to be done to identify the cause of these problems so that they can be tackled earlier.
As my right hon. Friend the Secretary of State for Health and Social Care thinks about how to spend the Government’s £20 billion increase for the NHS, will he consider how much money is given to children with life-threatening and life-limiting disorders? Many of their families struggle from day to day, so extra money to help to fund children’s hospices, as well as the availability of respite care, would be most welcome.
I have spoken in the Chamber previously about the challenges facing ambulance services in rural areas. My beautiful constituency of Sleaford and North Hykeham covers some 433 square miles. Ambulances have to rattle along lots of little tiny winding roads, at speed, to get to patients. Increasing the number of ambulances available to East Midlands ambulance service would help.
Ambulances do not just travel by land. Air ambulances provide an incredible service to our most unwell patients. They are funded entirely by philanthropy, and such services are under constant pressure to fundraise so that they can buy and maintain aircraft and pay for staff. I welcome the Government’s announcement of £10 million of capital funding for air ambulance trusts, which will contribute towards these life-saving services.
For ambulances on the ground, the challenge is not just distance but the road network along which they travel. The additional £28 billion investment in roads will represent the biggest single upgrade of the network since the expansion of the first motorways in the ’60s and ’70s. I will continue to campaign for extra money to complete the Lincoln bypass, and to improve the A46/A17/A1 junction and areas of the A1 and A15, so that roads in Lincolnshire are safer and we can travel more smoothly.
The money for potholes has been mentioned by other right hon. and hon. Members. Potholes are a big problem in Lincolnshire, so I am pleased that extra money will be spent on them, particularly as winter is coming.
I am glad that the Government are investing in our physical infrastructure, but in the 21st century, digital infrastructure is also extremely important. We rely on the internet more and more in our daily lives, so the lack of high-speed broadband in some rural areas can create a real sense of isolation. Whether for the person who cannot download their papers, the small-business owner who cannot submit their taxes online or the studious schoolgirl who cannot complete her homework on the online maths platform, a poor internet connection affects all aspects of work, family life and opportunity for rural constituents. I am therefore delighted that the Government are providing an extra £250 million for high-speed broadband in rural areas. It will be a welcome boost, if it is ensured that the money is directed towards connecting the remaining 5% to 8% who are not yet connected rather than towards getting faster speeds for those who already have a reasonable connection.
A Government’s first responsibility is always the protection of their citizens. As we mark the centenary of the end of the first world war, we remember the sacrifices that were made by many, and also remember the sacrifices made every day by our brave servicemen and women. I participated in the Royal Air Force branch of the Armed Forces Parliamentary Scheme, through which I met many service people at all levels. I heard about their concerns and worries, and about the pressures they were facing. They do an incredible job in the most challenging and, often, the most terrifying of circumstances. It is vital that we provide them with the support that they need, and the Chancellor’s announcement of an extra £1 billion for our armed forces will help to ensure that our armed forces can continue to operate at the very highest level.
Finally, I welcome the Government’s commitment to making work pay. Increasing the work allowance and decreasing the taper rate further for universal credit will help even more people into work. Some 1,000 more jobs are created in the UK every day, and we also have one of the lowest unemployment levels in Europe, which affects young people in particular. Young people in this country have a much better chance of getting a job than those in other parts of Europe, which is something of which we should be proud.
Furthermore, increasing the personal allowance to £12,500, which fulfils our manifesto promise a full year early, allows people who have gone out to work to keep more of what they earn to spend as they wish. The best stability that someone can have is a monthly pay packet, and this Government’s effort will ensure that a record number of people have that stability.
I am grateful, Madam Deputy Speaker, for the opportunity to speak in this most important debate on public services and the Budget. It is a pleasure to follow the hon. Member for Sleaford and North Hykeham (Dr Johnson). I agreed with her comments about children’s mental health. As co-chair of the all-party group for the prevention of adverse childhood experiences, I agree that tackling the causes of children’s mental health problems is vital.
Today, however, I wish to talk about community safety and the public service that our police provide. My constituency of Stockton South desperately wanted a better response from the Chancellor than a Budget that ignored community policing. I cannot really imagine how it must feel to be frightened in my own home. I have heard many people’s stories of the fear that they feel, but how many Members really know what it is like? How many of us know what it is like to be woken in the night by people loudly bashing on the door looking for someone to sell them drugs; what it is like to know that, if we were to go out to walk the dog, someone might break in and steal our possessions; and what it is like to have to listen to sex workers being threatened by clients through a flimsy adjoining wall when we are lying in our beds in the early hours of the morning?
Hon. Members have probably heard these sorts of stories from looking in their email inboxes, engaging on social media and meeting people at their surgeries, but yesterday those affected were ignored by the Chancellor. Cleveland police, which covers my constituency, has dedicated professionals working hard under the exceptional leadership of Police and Crime Commissioner Barry Coppinger, a new chief constable, and a team of hardworking officers, police community support officers and support staff. I pay tribute to everyone working in our police forces to keep our communities safe. They are the people who pick up the pieces during a crisis. I thank them for everything that they do. No police officer goes to work each day not wanting to help, not wanting to prevent crime, not wanting to respond to need and not wanting to engage with communities, but our community can see that the policing in Cleveland is not adequately meeting their needs. In the past eight years, the actual cash—not real terms—budget for Cleveland police has fallen by more than 10% from £148.5 million in 2010 to £134.6 million in 2018. The money that remains buys much less today than it did in 2010. Inflation, pay awards, national insurance increases and the apprenticeship levy all increase the cost of policing.
In real terms, Cleveland police force is £39 million worse off than in 2010, and we have 500 fewer police officers as a result, but is that not the same picture as in the rest of the country? No. This Government are widening social divides by making the greatest cuts to policing in the areas of highest need. The least impact of the Government’s police cuts has been experienced in Surrey, where residents have seen an overall funding increase of 1% since 2010. Recorded crime is nearly 60% higher in Cleveland than in Surrey. If Cleveland had received the same increase, my local police force would have gained an extra £15 million a year instead. I am genuinely pleased that the people of Surrey have had a 1% increase in their police funding, but if it is good enough for Surrey, why is it not good enough for Stockton South?
Why is my community different and why is Cleveland so special? Cleveland is a great place to live. Our communities are strong, and we are a good place in which to do business, but policing our area is a challenge. We have particularly high needs: the highest levels of antisocial behaviour in the country; the second highest levels of domestic violence; an increasing level of recorded crime; the highest levels of drug abuse in the country; high deprivation; and serious and organised criminals involved in the supply of drugs. The Government promised us a Budget to end austerity, but the fact remains that Cleveland police is now £39 million a year worse off than it would have been, with more cuts to come.
Austerity has always been a political choice. Over the past eight years, time and again, the Conservatives have been able to find giveaways and sweeteners for a few people at the top while leaving communities in places like Stockton South to pick up the pieces. Think about the woman in Parkfield in my constituency who contacted me in tears because she says she has no choice but to sell her home just to get away from a small number of criminals in the area who act with impunity. Or think about the police officer who got in touch and offered me a picture of a force working its hardest, but unable to do its job, with low staff morale and significant concerns about a loss of public trust. “We desperately need the support of Government,” the officer told me. There is crime that officers want to tackle—crime that they want to fight—but it carries on with impunity because they do not have the numbers to be there when they are most needed.
Since 2010, Cleveland police has lost about 500 officers, yet next year the Government plan to make Cleveland’s thin blue line even thinner, with a further cut of an even greater £9 million. Nine million pounds of cuts means even fewer police officers at a time when our communities have never felt less safe. If the Chancellor really wanted to end austerity, he would give Cleveland police their £9 million back. Police in our county need the resources to be able to do their job. My constituents have a right to feel safe in their community and to know that the police will be there for them when they are needed.
The Conservatives used to call themselves the party of law and order. How can Conservative Members carry on saying that with a straight face to some of the people who visit me at my surgeries, and probably theirs too? This Government will carry on fighting among themselves long after the grand gestures of Budget week have been forgotten; I and my Labour colleagues will carry on fighting for the proper funding that our local police forces need to keep our constituents safe.
It is a pleasure to follow the hon. Member for Stockton South (Dr Williams), and I will pick up on one or two of the themes that he mentioned. I want to touch on the NHS and policing before turning to employment and, finally, the family.
I know that my constituents will welcome the additional funding for the NHS, with £20.5 billion more by 2023-24 —£394 million per week—and average real growth rates of 3.4% per annum. That is significantly more than Labour promised at the last general election. Importantly, with this money there will also be reforms and improvements. That will be welcomed and will make a big difference to our NHS in Dorset and Poole. I look forward to further announcements from the Secretary of State clarifying exactly how this will affect our area.
On policing, I was pleased yesterday when the Chancellor specifically mentioned the submission by my hon. Friend the Member for South West Bedfordshire (Andrew Selous). The Chancellor said that he recognised that policing is under pressure from the changing nature of crime. Furthermore—the hon. Member for Stockton South did not mention this—the Chancellor told the House that the Home Secretary will review police spending powers and further options for reform when he presents the provisional police funding settlement in December. I strongly support my hon. Friend the Member for South West Bedfordshire in his campaign for a fairer funding formula for our policing, because that will make a difference in my part of the country, Dorset. I look forward to working with him on policing.
I want to focus a little on employment, and then on the family. I welcome the Chancellor’s comments and revised estimates on future employment growth. I have the privilege of chairing the all-party parliamentary group on youth employment. Each month, we look at the statistics on employment and unemployment relating to young people—not just because statistics are important but because they affect individuals’ lives, including young people moving on to the first rung of their career ladder. At our meeting this month, we celebrated the fact that youth unemployment is now at its lowest level since comparable records began, at 10.8%. Of course there is more to do and further that we can go, but for interest and comparison purposes, the EU average is 14.8%.
Our current all-party inquiry is on social mobility—another theme that has been mentioned in this debate—and in particular we are looking at young care leavers moving into work. In that regard, I very much welcome the Department for Education’s announcement last week about the care leaver covenant. I look forward to hearing more about that from the Under-Secretary of State for Education, the hon. Member for Stratford-on-Avon (Nadhim Zahawi), when he comes to our all-party group in December. At this month’s APPG meeting, we heard from two care leavers about the importance of stability and having a consistent mentor figure in their lives. Stability and family support are so often crucial when young people move into the world of work.
I turn to the family. I am grateful for the work that the Centre for Social Justice does in this area. I have learned from the CSJ that despite the increased risk of poverty, it is estimated that the Treasury spends about £1 on preventive spending for every £6,000 it spends on responding to the consequences of family breakdown. Furthermore, it appears that marriage is disappearing in policy making, just as much as it is disappearing in our poorest communities. Some 87% of high earners marry, and 24% of low earners marry. The rich get married and stay together, and the poor do not.
Why does that matter? Because where there is poverty, family breakdown is often not far behind, and while poverty is often a driver of family breakdown, crucially so too is family breakdown a driver of poverty. According to the Department for Work and Pensions, children who experience family breakdown are twice as likely to fall into poverty—[Interruption.] Despite the chuntering from those on the Opposition Benches, the public really get this. A recent CSJ poll confirmed that young people aged 14 to 17 aspire to a lasting relationship just as much as they aspire to a long-term career; they find that just as important. It is clear that support for the family is important for social mobility and for alleviating poverty. Marriage and the family should not be disappearing from Government policy making. When it comes to the Budget and our public services, it seems to me that more could be spent on preventing family breakdown, which would mean that less was spent on the consequences.
Finally, I welcome the increase in support for universal credit—a policy that I have wholeheartedly and repeatedly supported. When it was last debated in the Chamber, almost the moment that I sat down, I received an email from a resident in Dorset, of which it is worth reading a significant part. The email reads:
“I have just seen Michael taking part in a debate today on universal credit”—
people do actually watch these proceedings, strange though that may seem. It goes on:
“I have been in receipt of universal credit since March this year and have generally had a very positive experience. I greatly appreciate the guidance and support from my work coach, the simplicity of use of the online system”.
It is not starry-eyed, because it mentions a concern about moving into part-time work and the relationship with council tax support, but it concludes:
“I love the fact that all aspects of my life are dealt with centrally. It is crucial that Michael emphasises the positive aspects of the universal credit system and that the Government continues to roll it out.”
Given yesterday’s Budget statement, universal credit will make it even more worthwhile to be in work. The work allowance increase is progressive, and Opposition Members should welcome it. I look forward to more positive comments about that policy, possibly even from those on the Opposition Benches.
This was a Budget for
“the strivers, the grafters and the carers who are the backbone of our communities and our economy.”—[Official Report, 29 October 2018; Vol. 648, c. 653.]
Or so we were told—I would like to extend an invitation to the Chancellor to come to my weekly advice surgery and say that to the dozens of families I meet every single week who are trapped in insecure gig economy work, who are being failed by universal credit and who cannot afford to put a private rented sector roof over their head. I will talk about each of those issues in turn.
Let us start with workers’ rights. The Chancellor stated that delivering higher wages for those in work is core to his mission, yet our national living wage is littered with loopholes and used by some of the biggest organisations to cut terms, conditions and take-home pay. Those organisations should be named and shamed—I am referring to the likes of Marks & Spencer, Zizzi, Ginsters, Le Pain Quotidien, Caffè Nero and countless others that have sought legislative loopholes, against the spirit of the law.
Only this morning, I heard from one of the thousands of B&Q staff members being forced to move from nights to days. Just two years ago, one lady lost her annual bonus and her Sunday premium. She works the twilight shift to enable her to care for her two children. If she keeps her job, by the end of the month she will earn £1.50 an hour less than she currently does, but she cannot work the new shift because she cannot care for her children as well. She is not being offered redundancy. I ask those on the Treasury Bench to use their influence to encourage B&Q to offer redundancy to the 441 twilight shift workers who cannot at the moment take the hours that are being offered to them.
The Chancellor talked about protecting employment for lower-paid workers. Does that mean that the Government will follow the lead of British Telecom and the Communication Workers Union by calling for the abolition of exploitative “pay between assignments” contracts that keep agency staff on low pay for years at a time, even though they lack a gap between assignments?
On housing, which is a supposed Government priority, I was expecting a little more than the few lines that we heard yesterday. I welcome the proposed measures and money, but they are simply not of a scale that will make the difference that is so desperately needed. Solving the housing crisis is the politics of “and”: we should lift the housing revenue account cap, for sure, but is it not time to argue that all public sector sites that have been disposed of should be used first for the purposes of social housing, to introduce more punitive action for empty properties and to increase the surcharge for the one in six over-55s who own a second property? What about councils such as Merton that do not have a housing revenue account? In the past year, Merton has had one four-bedroom property to offer, and there are 441 families chasing that one four-bedroom property.
What about the green belt? The Budget states that revised planning reform ensures
“more land in the right places…for housing.”
Do Treasury Ministers agree that we should de-designate the 19,334 hectares of unbuilt green-belt land within a 10-minute walk of London train stations? This supposed green belt includes a car wash, a waste plant, a disused airfield and even a lap dancing club. At no environmental cost, that is enough space for almost 1 million new homes.
Finally, I turn to universal credit. I appreciate that I do not have much time left to speak, but I must ask those on the Treasury Bench for their help with Mr C, who applied for universal credit at the beginning of September. As the result of a routine operation, he had an artery severed, and the likelihood is that his foot will now have to be removed. He lives in one room above a shop, which he shares with his sister, who is in her 50s. Since the beginning of September, we have attempted to get a home visit for him so that he can claim the money he is entitled to. More than eight weeks later, in spite of getting the help of the local jobcentre manager, and in spite of numerous calls and letters to everybody we can think of, that man is still awaiting his appointment. Surely that is absolutely wrong.
This is a Budget with an absence of hope. The era of austerity is said to be coming to an end, but for now it continues to proceed, dragging almost a decade of damage in its wake, affecting people without homes for their children, people trying to claim benefits and people who just want a fair week’s pay for a fair week’s work.
It is a pleasure to follow the hon. Member for Mitcham and Morden (Siobhain McDonagh).
I thank the Chancellor and his team for their efforts in making this Budget possible. In particular, I am immensely grateful to him for his consideration in cutting business rates for small businesses. This issue is important both to my constituents and to businesses in Southport, and I am grateful to him for mentioning this in his speech yesterday. It seems to me that we should be trying to play to our strengths as a country. That is the way we are going to attract investment, keep employment at a record low, provide jobs and prosperity for people in the future, and create increased funding for our public services.
One of Britain’s, and indeed Southport’s, strengths is its small businesses that provide the majority of jobs in the private sector. One of the benefits of being the Member of Parliament for Southport is that I get to meet some extraordinary entrepreneurs and small business owners. They are the people who form the backbone of our economy, and over the past year I have had the pleasure of meeting many of these hard-working individuals. I therefore deeply welcome the new tax reforms set out by the Chancellor in his Budget speech yesterday, which will provide unparalleled relief to many small business owners in my constituency.
However, things have been all the more difficult for small businesses in Southport because they are having to work without the support of Labour-led Sefton Council, which is more interested in punitive charges than in building a strong economy. Lord Street, in particular, is suffering under the Labour Council, but it is now set to be handed a fighting chance under this Conservative Government and this autumn Budget.
There are a number of things I want to talk about in the time I have available. The first is the Chancellor’s plan for our high streets, which will provide up-front support through business rates, while implementing a package of transformational initiatives, including a £675 million future high streets fund. Then, specifically, there are those things that can make a real difference to small businesses in our communities: how we can get out of their way in terms of tax and regulation; how we can stand up for them by regulating the online marketplace and digital businesses to create a level playing field with the marketplace on our high streets; and then, finally, how we can create growth so that we can continue to put record investment in our public services.
Cutting the deficit is still important, because only if we continue to deal with the debt left behind by a reckless Labour Government will we be able to safeguard our economic future and invest in all those things that are so essential. We are making good progress—the UK economy has grown every year since 2010, and unemployment is at its lowest level since 1975. But we have to be honest: there is still more work to do to ensure we live within our means. We have to stick to our plan, making difficult decisions about spending that will get the debt and the deficit under control but that do not penalise the wealth creators and businesses in our country. We need to invest tax receipts, not waste them like the Labour party does.
We also have to provide a much needed boost to small businesses that were left behind by the last Labour Government, to ensure unemployment remains at a record low and that the longevity of our high streets is maintained. Again, that takes difficult decisions, so I welcome the announcement in yesterday’s Budget to provide up-front support through the business rates system, cutting bills for retail properties with a rateable value of below £51,000, which will benefit 90% of retail properties. I also welcome the addition of the £675 million future high streets fund. That means that someone running a small business will see their tax come down by a third and their high street restored.
It is not just about getting out of the way of small business but about standing up for those specific issues. It is about making sure that those same small businesses are not disadvantaged by an overbearing digital marketplace that is not paying its fair share—a real David and Goliath battle. I was therefore delighted to hear in the Chancellor’s statement yesterday that the Government will introduce a new 2% tax on the revenues of certain digital businesses to ensure that the amount of tax paid in the UK reflects the value they derive from their UK users, ensuring an even ground between businesses on our high streets and online. It is not Amazon or Facebook that are the lifeblood of this country; it is the small businesses in constituencies like mine.
That is why small business is important. It means more business and more tax collected and more economic growth, and, yes, a strong economy means more money for our public services. I therefore welcome the Chancellor’s announcement yesterday of additional funding, and an indication that the hard work is starting to pay off. This means £2 billion more for mental health, and the long-term plan for the NHS will commit further funding to help achieve parity of esteem between mental and physical health services. That means anyone experiencing a crisis can call the NHS line 24/7, and it means more mental health ambulances, increased community support and comprehensive support at every major accident and emergency by 2024.
I have discussed school funding with headteachers in my constituency. This Budget means £400 million more for schools this year, with £10,000 allocated to the average primary and £50,000 to the average secondary to help schools buy the equipment they need. It means £1 billion more for defence across this year and next, ensuring our world-class armed forces can face the new threats and build on the UK’s record of spending more on defence than any NATO member except the US.
With unemployment at its lowest since 1975 and employment at a near record high, the years of financial hardship endured by the people of this country due to Labour’s inability to fix the roof while the sun was shining is now a thing of the past. With this Budget and a strong economy, constituents and businesses in my constituency of Southport can be assured that this Government are delivering for them and that their hard work is paying off.
The financial health of industry in my area is absolutely critical. The attempts yesterday by the Chancellor to bury the bad news for industry, in particular energy-intensive industries, did not help at all. He did not mention it, but he did not bury the news very deep either: it is there for all to see on page 47 of the Red Book. If the changes in carbon taxes materialise in response to Brexit, it will cost individual firms millions of pounds. The carbon emissions tax is significantly higher than the average emissions trading scheme price over the past 12 months, which was just £12.30. This would increase the cost of carbon for UK installations across the country, currently covered by ETS, by 30%.
The Chancellor acknowledges the increasing high total carbon price, but proposes to freeze it at £18 a tonne of carbon dioxide for 2021. He might think that that is an ambitious move, but these plans come with little notice and a particularly high cost for industry. Firms like CF Fertilisers in Stockton are significantly exposed to the additional extra costs. The EU energy trading scheme is a market-based instrument for which companies had developed a strategy over time to ensure they were able to comply. Now, on top of the perfect storm of high electricity and gas prices, this carbon tax, coupled with the doubling of the gas climate change levy, is a very real issue for energy-intensive industries.
The Government did publish a document on this last night. It betrays a fundamental change in policy since the Brexit vote, with no consultation with industry along the way. In the worst Brexit scenario of all, EIIs are being given an expensive fait accompli with no notice, no discussion and no impact assessment. This makes industry very nervous. Rolled together, all this serves to make the UK an unattractive place for EIIs to do business in the future.
The Chancellor could have helped an industry facing such a dilemma by giving some indication of Government support for carbon capture, use and storage, but he did not. As I have said on numerous occasions, Teesside is ripe for investment in carbon capture, use and storage. The industry needs some indication that the Government are capable of making the right call on this matter. Perhaps once the task group on CCS reports we will hear something more positive from the Chancellor in the new year.
This is my ninth speech in a Budget debate, and in every single one I have talked about health inequalities in my area and the need for a 21st century hospital in Stockton to help tackle them. Stockton was promised a new hospital, but in 2010 the coalition Government scrapped it while making sure that similar plans went ahead where there just happened to be Government MPs of both the blue and yellow. Let me outline why we need to solve the social care crisis and build a new hospital in Stockton.
Nationally, on average, a boy born in one of the most affluent areas of England will outlive one born in the poorest parts by 8.4 years. In Stockton, where life expectancy for a man in the town centre ward is 64, that gap is around double at 15 years. Incidentally, that life expectancy age is the same as in Ethiopia. Our children in these inner-city areas are living in poverty. They are more likely to be undernourished, more susceptible to all manner of illnesses and more likely to end up in care. Older adults are more likely to be ill, given a lifetime of hard work in the heavy industries. One in five babies in Stockton is exposed to cigarette toxins in the womb because their mother smokes while pregnant. That was in 2015-16. That year, there was a significantly higher rate of hospital admissions attributed to smoking than the national average. According to the British Lung Foundation, people in the north-east have the highest chronic obstructive pulmonary disease mortality ratio in the country. The English average for children achieving a good level of development at five years old is at 60%. In Stockton, this is just 50%.
Does my hon. Friend agree that the cuts to public health funding have had a significant impact on Stockton Council’s ability to deal with some of those health inequalities, and is he as disappointed as I am not to have heard about increases in public health funding in the Budget?
Most certainly. My hon. Friend and I represent between us some of the most difficult areas in Stockton, with high levels of smoking and drinking that make the national average pale into total insignificance. We desperately need that additional funding, so I most certainly agree with him.
Our local North Tees hospital does an exemplary job in the most difficult circumstances, yet it could do so much better in a modern building with services that are required cheek by jowl and where people can be treated in wards rather than converted corridors. That is why we need a new hospital in Stockton and why I will mention that in every Budget speech I ever make until I get it.
Still on health, the police and crime commissioner for Cleveland has been doing excellent work on the introduction of heroin-assisted treatment in neighbouring Middlesbrough—a project that the experts believe will help to save lives and money and reduce crime across Teesside—but he needs Government support to make it the best that it can be. I hope that there will be a full Government commitment to that initiative.
On policing, I am really worried, like my colleague next door in Stockton South, about policing in our area. Like most others, the Cleveland police force area has been short-changed by this Government over many years and the police know that they can no longer deliver the full service that is needed. As my hon. Friend said, over the last eight years, the Government grant for policing and crime in Cleveland has been cut by around 24%. He also outlined in detail why we need that extra money, yet Cleveland is harder hit by cuts than most other forces because of how it is categorised. The county is largely rural, but the vast majority of the population is in inner-city areas, with the same challenges of the cities, yet we do not get the same level of funding. Let me be clear: there will be severe repercussions for public safety and criminal justice in Cleveland if the people do not get more funding.
On education, the Chancellor announced some one-off funding for schools to pay for little extras, but it is teachers and action on pay that they need. Stockton’s branch of the National Education Union visited my surgery on Friday. It wants to see the Government fund the full pay award rather than leave schools to do it. It also wants all teachers treated fairly, which the pay award fails to do. I hope that they will hear something better from the Government in future.
I simply plead again with the Chancellor to do the right thing by Stockton: help us to tackle the health inequalities that we have; help us to deliver the public health programmes that help to educate people about the choices that they have in life; and please find a way to build us a new hospital.
It is a pleasure to speak in favour of this Budget, which continues the important work that was begun in 2010. A lot has been achieved. We have record employment, with 3.3 million more jobs and 1,000 more people in work every single day. I am particularly proud that we have halved youth unemployment, meaning that more young people can get a good start in life. I meet them all the time in Harborough, and it is a huge pleasure.
Incomes are now rising the fastest that they have in a decade—most rapidly at the bottom end of the labour market—and the national living wage has already increased the wages of people on it by £2,750 a year. That will go up to about £5,000 a year, and combined with increases in the personal allowance, that has raised the income of someone working full time on the national living wage by 44% since 2010 alone. That is one reason why inequality is now lower than at any time under Labour.
The deficit is also down by nine tenths and debt is falling as a share of the economy—in fact, debt as a proportion of GDP is now forecast to go down by a whopping 11 percentage points. The corner has definitely been turned. In the Budget, the Chancellor has helped small businesses in my constituency. He has helped with the cost of living. He not only has debt falling but has a lot of headroom to respond to the needs of our public services. I will come back to that point in a moment, but first, let me note some of the progress we have seen in our public services in recent years, starting with schools.
The proportion of pupils in good or outstanding schools has gone up from 66% to 86% since 2010, which is a huge improvement. Thanks to the national fair funding formula, we are addressing the historical unfairness that has seen places such as Leicestershire do badly. As a result, funding in my constituency over the next two years will go up twice as fast as the national average—and, through things such as the sugar tax and the condition improvement fund, we have seen big improvements such as the new school hall in South Kilworth.
We have also seen many improvements in our schools that are not to do with just spending more money. We have ended the right of appeal against exclusions so that we protect teachers and other pupils against disruption and violence; we have introduced year one phonics screening to nip problems in the bud; we have ended grade inflation and restored rigour; we have stopped Ofsted being so overbearing, which many teachers will welcome; and we have enabled innovations such as the brilliant free schools, which are now the highest-performing type of school in our system.
The improvements go beyond schools and into further education. FE colleges in my constituency can now teach the new T-levels, a new, more rigorous qualification with 25% more funding per student and 50% more hours taught and worked.
The new T-levels will fix a problem that has been known about for 100 years and give us a more technical system that will be more like the German one and will be the envy of the world.
I welcome the £20 billion for the NHS—a staggering £400 million extra a week—and the fact that we have a vigorous new Health Secretary who is bringing new technology into the NHS in order that it will no longer be the place with the most fax machines and pagers in the world. If you really love something, you want it to be the best it can be and you make it the best it can be.
I welcome the fact that crime is down since 2010 and that we protected police spending in real terms in the 2015 spending review, and I welcome the £200 million a year extra in the Budget to counter serious youth violence and the money for counter-terrorism, but I hope that those are a down payment on a strong settlement for law and order in the spending review. I have been unhappy with the lenient sentences people have received in recent cases, such as the motorcyclist who repeatedly kicked a police officer in the head but was spared jail—that was a mistake; an unprovoked assault and wounding in Market Harborough that did not lead to imprisonment. Assaults on prison officers in HMP Gartree were not even prosecuted. We should be jailing more people for longer, and if we need to find additional resource to do it, it will be money well spent.
In the battle to get our terrible deficit under control, a corner has been turned. In the 2010 spending review, annual average real growth in departmental spending was minus 3%; in 2015, it was minus 1.3%; and from next year, it will be plus 1.2%—a clear difference in direction. Some people now argue that, if we exclude everything that is going up, such as health, defence and aid, other things are going down. I have two things to say about that. First, yes, absolutely the NHS has been prioritised—because it is the people’s priority. Secondly, the Chancellor has sensibly left himself some headroom. With national debt as a percentage of GDP now forecast to fall by 11 percentage points over the forecast period, compared to 7.5 percentage points before, we now have some headroom.
Only through a thorough spending review can we find out how much money we need on top of more efficiency. Once that review is complete, if the Chancellor feels he needs to use some of that headroom to invest in strong public services, he will have my full support, but while such a balanced approach has my support, the country is in no position to go on a massive spending spree. To use a diet metaphor, we have been through a difficult diet to stop the country having a heart attack and we have got the weight off, and some people say that we should get back on the burgers and the cream buns. No, we need to stay fit for the long haul and have a strong economy. That is what we will do.
Now that the partisan part of this debate is over and the real cognoscenti are here, let me finish with a couple of points we do not talk about enough in these debates. Labour sometimes says that this is an ideological choice and that we did not need to reduce spending. Why then did Labour’s last Budget propose to reduce total managed expenditure from 48% of GDP to 42% of GDP? We in practice reduced it to 41% of GDP, but the idea that the difference between 42% and 41% is the difference between a massive ideological crusade and sensible socialist cuts is ridiculous. We should be clear in the House that the differences are not so great as they are sometimes made out.
Secondly, we must be careful about promising people a huge spending splurge. We are an ageing society, and the OBR’s fiscal sustainability report forecasts that, in the absence of no policy changes, debt-to-GDP will start to rise because we are all living longer and using the NHS more, and that this will take debt to more than 250% of GDP in the second half of the century. Let us not promise people things we cannot deliver.
Thirdly, let us not be complacent about managing our debt. Sometimes people say, “Oh well, after the second world war we had huge debts that were 250% of GDP and that was fine.” I say to them that we used to have 25% inflation in this country, which cut through our debts pretty quickly, we did not have index-linked debt and we did not have an independent central bank. We must recognise in this House that if we run up big debts, it will be much more difficult than it ever was before to get them down. We must have a prudent approach.
To conclude, if Members on either side of the House say that we should use some of the headroom that we have earned to invest in strong public services, I agree with them. However, if Members want to pretend that there was an easy alternative to what has been done over the past eight years, that is just not the case. If they want to pretend that we can use magic money tree-ism to fund everything we want and not worry about the deficit ever again, that is just not true. The most sensible Opposition Members know that, and if the Opposition ever find themselves in government they will experience it. I plead for an honest debate in this House. We have to have a balanced approach and we must not promise people things that simply cannot be delivered.
Austerity has been inflicted on the UK for the past eight years. Austerity was, and still is, an ideological and political choice. The absolute truth that we cannot get away from is that true austerity would not have allowed for further tax cuts for the wealthy, while the rest of us bear the burden. We do not hear a lot about those tax cuts from Government Members.
The Government were lying to us when they said that austerity was a necessity, and they are lying to us now when they say that it is over. Tax cuts costing £2.8 billion will benefit high-income households at the same time as we see a cash freeze on working-age benefits. The idea that this Government are strong and stable on the economy is ridiculous. The economy they have presided over for eight years is one of low investment, low growth and low pay. After eight years, economic productivity is on its knees, local government is at breaking point and the cuts are not forecast to end any time soon. Calling this Budget the end of austerity is a mockery of those who have taken the brunt of the cuts over the past eight years.
I am very concerned that no extra funding has been provided for regular policing, because the cuts to policing budgets have hit Lincolnshire hard. I am also worried that three quarters of the £12 billion of welfare cuts announced after the 2015 election remain in place. It is not tinkering around the edges of income thresholds that will address the callous and chaotic roll-out of universal credit in my constituency of Lincoln. Proper funding and a route out of poverty are needed. I hope that the links between poverty and ill health need no explanation. It is a national disgrace that, thanks to this Budget, food banks will remain a feature of our society.
Under this Government, the NHS has experienced the slowest spending growth in its history. After eight years in which NHS budget increases have averaged just 1.4%, the Government’s 3.4% increase is, to quote the Health Foundation, “simply not enough”. This Budget will barely keep our NHS afloat, let alone reverse eight years of neglect. As a nurse, I saw at first hand the appalling damage the Government have done to our health services. I get fed up with hearing people say how good our health workers are and, “Let’s give them a pat on the back.” Actually, let’s pay them properly, because they cannot spend a patronising pat on the back; they cannot pay their rent with it or buy food with it.
An estimated 4.3 million people are on NHS waiting lists and last year 2.5 million people waited four hours or longer in A&E. With 41,000 nursing vacancies in the NHS in England and more nurses leaving the profession than joining it—some of them are my friends—the Government must reinstate nursing bursaries to reverse the 32% drop in applications since they were scrapped in 2016. I support nursing apprenticeships, but they are not delivering the numbers. We have to reinstate bursaries if we want the numbers. It is all right saying that we will fund however many places, but we have to train those nurses and we have to give them the money to be able to afford to train. I know; I have been there. I remind the House how expensive the current reliance on agency nurses is. That expense is coming out of the public purse. It just makes no sense not to have bursaries and trained nurses.
The insufficient funding increase for the NHS is further undermined by the Government’s disregard for public health services. Public health budgets have decreased by 5.2% since 2014. Those cuts have consequences for our local communities; 85% of councils are planning to reduce their public health budgets this financial year.
The Government have been similarly short-sighted in slashing funding for social care, which has been cut by an estimated £7 billion since the Tories came to power. While the Chancellor allocated an increase to social care grants, that will not close the social care funding gap, which could be over £2 billion by 2020. Age UK estimates that 1.4 million older people do not have access to the care and support they need.
In conclusion, I welcome the Government’s commitment to increase mental health funding by £2 billion, but the Institute for Public Policy Research estimates that double this amount is needed to achieve true parity of esteem between mental and physical health. That sum is meaningless; it is simply not enough. With one in four of us experiencing a mental health problem each year, there is no excuse for the Government’s half-hearted approach. The Government’s cuts to mental health, social care and public health also drive demand for NHS use, creating a bleak cycle in which underfunding places further strain on staff and service delivery. I know that; I have been there first hand.
This Budget shows that austerity is part of the Conservatives’ political ideology and make-up; it is central to their small state, low public investment approach to managing the economy. We should not expect anything other than austerity while we have this Government. To truly end austerity, we need a general election and a Labour Government, and we on this side of the House say, “Bring it on.”
It is, of course, a pleasure to follow the hon. Member for Lincoln (Karen Lee), but unlike her, I choose to welcome the Budget, which will deliver genuine benefits to my constituents in Redditch.
First, I welcome the overall framework of this Budget—the fact that the money being spent for my constituents comes from growth in the economy. It comes from jobs and lower taxes, which means that my constituents will have more money in their pockets.
I am glad to see the shadow Chancellor back in his place. He referred to leafy Surrey, and we are very proud of our leaves in Redditch, but I doubt that that was what he had in mind. This is a Budget for middle England. My constituents come from all walks of life, and we cannot get much more middle England than somewhere like Redditch. We welcome the £20.5 billion to be spent on health up to 2023-24, a massive increase of 3.4% every year.
Members will know that I have spoken often about the acute trust that services my constituents—or rather, that lets them down on a regular basis, unfortunately. This matter is dear to my heart because the trust is one of the worst performing in the country. As the local MP, I inherited a flawed process that involved the removal of services from our local hospital, the Alex, before the trust as a whole was ready to take them on. We are coming to the end of that painful process and seeing more money being put into our local trust, with £16 million already delivered to it, but I want that trust to hurry up and get itself out of special measures. I consistently advocate that and lobby for it. I am meeting the trust and urging it to submit its business case so that it can give my constituents the good services they need and deserve.
To sound a note of positivity, there is capital investment in that hospital and a new urgent centre for the Alex. These steps are to be welcomed, but there is more to do, so I welcome the fact that money is coming into our NHS more generally.
I want to pick up in particular on the fact that we are focusing on technological investments in the NHS more widely. I would like the Health Secretary to come to Worcester and Redditch to see what we are doing there with the innovative bed capacity app. That is helping the flow-through of patients, which will of course help more patients to be seen more quickly at the front door.
The Government have made up to £10 billion more available for social care in the three years up to 2019-20. There are lots of pressures in Worcestershire in adult and children’s social care. There is rising demand in children’s social care. I note that local authorities are able to make bids for a fund, and I would like Worcestershire to be able to do so, as it has rising need and demand.
As the daughter of a dementia sufferer, adult social care is close to my heart, and I have seen how much pressure there is on that service. The number of people over the age of 85 needing 24-hour care in England is projected to almost double to 446,000 by 2035, so I welcome the fact that there will be a long-term solution in place following the Green Paper on health and social care.
Many colleagues have touched on mental health, and I am going to touch on one specific aspect, about which I have already spoken in the Chamber: the menopause. We had a fantastic debate on that subject not long ago in this very place, and it was a real pleasure to be supported by colleagues from all across the House. I pay particular tribute my hon. Friend the Member for Selby and Ainsty (Nigel Adams), who responded to the debate for the Government. In fact, two male MPs spoke, and they put a real focus on the issue of mental health at the time of the menopause. That focus is really welcomed by women up and down the country.
I would like to make a plea for some of the additional mental health funding to be used for issues relating to the menopause, because that is a time when women battle with mental health issues. Surely if two men in this Chamber can talk about the menopause, businesses and other organisations up and down the country can do so as well. I want to put on record my thanks to my male colleagues from all parties who have pledged to support me further on this so that we can stop the stigma of the menopause and stop it being a taboo subject. We need to raise awareness, because this affects people’s mums, wives and partners, and the women they work with. It is good that we are raising awareness around this critical issue.
There were a number of welcome announcements in the Budget, and I want to focus on the air ambulance service. I have been privileged to meet a wonderful woman called Jenny Ashman, who is a volunteer from Inkberrow in my constituency. She is known locally as “Jenny from the chopper”, because she has raised nearly £2 million for the midlands air ambulance services, and I am sure that she will be jumping for joy at the announcement of £10 million for the air ambulance services up and down the country.
There is a lot to welcome in this Budget, but as time is short, I shall finish by saying that the Budget speaks to the aspirations of middle England. It is a practical Budget that puts more money back into the pockets of my constituents in Redditch. We are seeing tax cuts for 30 million people, which will mean that they have more money to spend. That will put money back into the economy.
I have been dismayed to hear the negativity coming from the other side of the House. The Opposition have no answers to the problems facing our country. We remember the legacy that was left by their Government when they crashed the economy, and the note from their Treasury Minister that there was no money left. That was the legacy that we inherited, yet all they have come up with in the intervening time is a plan that would cost every man, woman and child in this country £3,500. They would load £1 trillion of debt on to our hard-working citizens, and they are still blind to the misery that they inflicted on my constituents. Their comments are outdated and patronising. People should come to Redditch. They would see that, although my constituents are not rich, they are rich in spirit. They come from all walks of life, and they will welcome this Budget.
I should like to highlight some of the facts and figures that the Chancellor missed yesterday before I move on to discuss some of the taxation and public spending measures. First, a record 8 million working people are now living in poverty. There are also 4 million children living in poverty, two thirds of whom are in working families. That number is going in the wrong direction. There are also 4 million sick and disabled people living in poverty—twice the number of non-disabled people. Our life expectancy is flatlining, and for women it is actually going backwards, but what do this Government do? They increase the state pension age. We also know that infant mortality has increased for the first time in 100 years, and that four in 1,000 babies will not reach their first birthday, compared with 2.8 per 1,000 in Europe.
Many epidemiologists have linked this reversal of the generations of health improvement with the austerity that this Government have wrought on the country as a whole and on people on the lowest incomes in particular. Resolution Foundation analysis published today and yesterday’s Budget book show that people on the lowest incomes will be hit disproportionately hard. The Government have not reduced inequalities. Have Ministers assessed the Budget’s impact on life expectancy? Will it continue to flatline, will it get worse or will it increase? I doubt they are able to say it is on the road to recovery.
On tax, I am pleased that small businesses, particularly those on the high street, will have their business rates reduced—that has been a particular issue for a number of my constituents—but what will that mean for councils’ revenue, and how will they be recompensed? My council has lost nearly half its budget from central Government. The digital services tax sounds great, but the OBR says it will affect around 30 tech giants, which will pay about £15 million each. How will that address the fundamental issue that, for example, in 2016, Google paid £36.4 million in corporation tax on declared UK sales of £1 billion, whereas according to its US accounts those sales were £6 billion?
On public spending, the Chancellor confirmed that the NHS would be given much-needed cash. That is welcome, but a range of think-tanks, from the King’s Fund to the Nuffield Trust, say it actually needs £30 billion by 2020. Again, the additional £2 billion for mental health crisis is welcome, but what about emphasising prevention? What about assessing the Government’s own policies on sanctions, work capability assessments and the personal independence payment process, which make the mental health of many claimants worse?
The £1 billion for social care is important, but it does not address the £2.5 billion funding gap since 2010 and does not help the 1.2 million people who need care but cannot get it. I worry that after the publication of the social care Green Paper, which is being consulted on, a new funding regime involving a social care insurance scheme will be announced. That would have disastrous implications for the NHS, as we see closer integration between the NHS and social care.
I could go on about the derisory figures for education and the fact that my local police force and our emergency services will receive nothing substantial, but I want to talk about homelessness, which is rising but was not mentioned in the Budget. We see rough sleepers on our streets in towns and cities up and down the country, but we hear nothing about the families who live in temporary accommodation or people who sofa-surf, as they are not deemed as having priority need for housing. That is the Government’s biggest shame. It epitomises their neglect of too many citizens and reflects not just their failure to ensure that enough houses are built for us all, with social and affordable homes as part of the mix, but their ill-thought-out social security policies, such as universal credit.
Universal credit has been a disaster from start to finish, and it has now been revealed to be driving homelessness. One shelter says UC is the reason why a third of its residents are in it. UC tenants of the housing association First Choice Homes in Oldham are in more than £2.5 million of rent arrears. Research suggests that nearly one in five people in Oldham struggles to pay a social rent. UC is part of that problem. Policy in Practice estimates that the changes to UC announced in the Budget will not have a significant effect. It says 345,000 more households will still be worse off and 29,000 will be no better off. Disabled people will still be worse off. People in employment will see some improvements, but self-employed people will see none at all.
My hon. Friend is a well-known expert in this area, which she has spoken up about many times. Does she agree that the Government’s inability to look at people in the round—particularly at their mental ill health, their disability, their poverty and their lack of access to work—drives some of the problems she highlights, including those with universal credit?
My hon. Friend hits the nail on the head. The human misery caused by such an inhumane policy cannot be underestimated.
L contacted my office recently after her UC was suddenly stopped because her son, B, has severe learning difficulties and L, who is the main carer, did not realise that he would have to make a separate claim once he had reached his 19th birthday. When the money stopped, L had nothing—she did not know why it had stopped and nobody contacted her. It was an absolute disaster for her, and she said:
“At times I just want to end it all…it’s just so hard and I get no support or respite.”
L is a candidate for the new mental health crisis fund that the Government have set out—a product of their universal credit policy. On top of this, the investment in UC does not offset other cuts to social security, with welfare spending set to fall in the next couple of years.
Most worrying are the cuts affecting disabled people, which have not been addressed in the Budget. In fact, according to the OBR, disabled people will be worse off. As the United Nations said last year, this Government are presiding over a “human catastrophe”. The Equality and Human Rights Commission estimates that families with a disabled adult and a disabled child will have lost 13% of their income—£5,500 a year—by 2022. This is on top of colossal cuts across other Departments. What about their help from the Chancellor? What about their bright future?
We have done a lot—the former Labour Government did a huge amount to improve life expectancy, and to lift disabled people and children out of poverty—but we need to do more. The inequalities in our society are getting worse, not better. These inequalities are socially reproduced, so they can be changed, and that should give us all hope. But political will is needed to tackle them, and I am afraid that this Government just do not have it in them.
May I start by apologising for being absent for much of this debate because I was chairing the Health and Social Care Committee? I also declare a personal interest, as three members of my immediate family are employed as NHS doctors.
We need to take a whole-system approach to health— to think of it not just as the NHS, but as a system including social care, public health, the prevention arm and training budgets. I return to a point that I made in an intervention: I wholly welcome the uplift in the NHS budget, but the increase in the NHS England budget that will take place between 2018-19 and 2019-20 is £7.2 billion, whereas the uplift in the wider health budget in the Red Book is only £6.3 billion. It concerns me that this might indicate that some of the uplift in the NHS England budget will come by way of being taken out of other aspects of the health budget, particularly the Public Health England budget, as we have seen in previous years. I hope that the Minister will touch on that in his response.
I think that the hon. Lady may have left the debate to attend her Committee when I re-emphasised her point directly to the Secretary of State, who told us that we would have to wait for the spending review. Would she share my disappointment if the Government tried to pull the same trick that they pulled three years ago, and actually misled us or gave us bogus figures for NHS spending that did not include public health expenditure, capital and training?
We need absolute transparency around health spending, and to take not only a whole-system approach but a long-term view.
Public health is the prevention arm of the system, and taking money out of public health has a serious impact on future spending and our ability to tackle health inequalities. It would be very troubling indeed if much of this uplift came directly from a public health cut. We need to be specific about that, and it is not sufficient to wait for the spending review to clarify that point; I hope that the Minister will be able to tell us further about what it means. People need to plan for the future, so if £900 million is going to be taken out of public health grants, we need to know that now.
When we ask the public which parts of the system they prioritise, public health tends to be at the bottom of the list. It is up to the Government to look at the evidence, and they must be clear that the evidence shows that we must focus unrelentingly on the prevention arm of healthcare. That is the right thing to do, and it is where we have the greatest chance of tackling the burning injustices of health inequality, so it is an important point to address.
The other aspect I want to touch on is social care. The Health and Social Care Committee has just had a sitting with the Care Quality Commission on its excellent “State of Care” report. The report comments on “fragility,” and the report of a couple of years ago talked about “a tipping point.” The CQC told us that that tipping point has been passed for many people in social care. The interaction between social care and the health service is so close that, if we do not focus on social care, we are simply tipping more costs on to the health service.
Of course it is welcome that there will be an in-year increase for adult social care of £240 million this year and £650 million next year, but it is widely recognised that, because of the extraordinary increase in demand and pressure—driven not just by the welcome fact that we are living longer but by the great increase in the number of people with multiple long-term conditions living to an older age and by younger, working-age adults living with multiple complex needs—social care needs more than £1 billion a year just to stand still, so we need to go further.
I recognise that much of this will come alongside next year’s social care Green Paper, which we are all looking forward to, but the system is under considerable challenge. I hope the Minister will recognise in his closing remarks that we are not there yet on social care. He needs to say what we are going to do in the long term to address our social care needs. As I have said before, we will require an approach that involves the Labour Front Benchers, too. We need to see political consensus, otherwise the politically difficult decisions on funding will not get through the House.
If there are to be cuts to public health, the Government will have an even greater responsibility to provide other levers in their public health policy to reduce demand in the system. The Chancellor specifically referred to wanting to reduce the tragedy of lives lost to suicide. Unfortunately, at the same time, the delay in the reduction of the maximum stake for fixed odds betting terminals means that we have passed up on an important opportunity to address the misery of gambling addiction. That is a hugely wasted opportunity. Likewise, there is a missed opportunity to look at what has happened in Scotland on minimum unit pricing to make sure we are addressing some of the key drivers of public health problems. The Government cannot duck that if we are to see cuts to the public health grant.
Finally, there is the impact of Brexit. The Chancellor has said that there will be £4.2 billion for preparations for a no-deal Brexit. I am afraid that the costs will be far higher. The Health and Social Care Committee recently heard from the pharmaceutical industry that it is having to plough hundreds of millions of pounds into preparing for no deal. That is phenomenal and inexcusable waste; it is money down the drain. I hope the Government will rethink their policy, because no version of Brexit will provide more money for the NHS. There is a Brexit penalty, not a Brexit dividend, and I hope both Front-Bench teams will come together and agree that, ultimately, we need the informed consent of the British people for whatever version of Brexit we come up with, with the option to remain and properly use the money instead for tackling austerity and improving the lives and the health of our nation.
It is a pleasure to follow the hon. Member for Totnes (Dr Wollaston), who made a characteristically thought-provoking speech. This year’s Budget, like last year’s, comes after my annual community consultation, where I use the three weeks of the conference recess to talk to people across the constituency. Last year, the view I shared with the House was:
“Like towns and cities across the country, Sheffield is at a tipping point.”—[Official Report, 27 November 2017; Vol. 632, c. 123.]
It was at a tipping point because of the collapse in the social fabric and in the ability of services to deal with the problems people were facing. So where are we 12 months on? In more than 60 hours of discussion at more than 40 events in this year’s consultation, all I found was greater concern and the feeling that we are closer to that tipping point. There was greater fear of the rise in violent crime and antisocial behaviour. We have some really impressive and committed police officers leading the fight against knife crime in Sheffield, supported by some great community groups, but we need to recognise the perfect storm that has been created by a combination of Government policies. Eight years of deep cuts to local services have decimated youth provision, led to rising school exclusions and seen falling police numbers—we have lost about a third of our police staff across South Yorkshire.
From the National Audit Office to the Police Federation, and to the Home Secretary himself, everyone agrees that police forces are underfunded. So when the Prime Minister promised the end of austerity, we might have anticipated that things would change in the Budget, but they did not change—not a bit. There was not a penny more for core police funding, nor were there any funds to rebuild youth services.
Nor was there an adequate response to the crisis in mental health, which was another significant issue raised right across my constituency. People told me of their difficulties in accessing services and of treatment waiting times that are simply too long. Young people in particular told me that they were waiting more than six months from referral to their first appointment with child and adolescent mental health services. So although I welcome the extra funding for mental health, we must recognise that it is simply mental health crisis provision, as the Chancellor described it. Of course, such provision needs to be properly funded, because we have a crisis in mental health, particularly for our young people. They want to know why they need to get to crisis point in their mental health before the system responds. A mental health crisis hotline is no substitute for proper face-to-face support. And what has happened to parity of esteem between mental and physical health? The £2 billion going to mental health is just 10% of the funding allocated to the NHS overall, so there is no parity of esteem there—in fact, we are moving further in the wrong direction, and that is a missed opportunity.
The Chancellor missed another opportunity to do the right thing by pushing back the start of the £2 maximum stake for fixed odds betting terminals to October 2019. That delay means that people will die—people like my constituent, Jack Ritchie, who took his own life aged just 24, having been, in the words of his mum Liz, “groomed by gambling companies”. Jack began gambling while at secondary school, playing on fixed odds betting machines at the nearby bookies. We all know, and the Government have admitted, that these machines are the “crack cocaine of gambling”, with players winning or losing up to £100 every 20 seconds. So what is the Chancellor’s answer for Jack’s grieving family, whose charity Gambling with Lives is to be launched here in Westminster in a couple of weeks? What is the explanation for the decision to push back the introduction of the lower stake? The Budget has no answer for Jack’s family, who are to be hugely commended for their work to try to prevent other young people from getting to crisis point. It has no answer for the young people who tell me that they have to get to crisis point before their mental health problems will even begin to be addressed, and it has no answer for my constituents who increasingly fear the violent crime and antisocial behaviour that corrodes our communities.
This is a cruel Budget, not only because of the lie that it marks an end to austerity, but because it fails the strivers and grafters of whom the Chancellor spoke, giving priority to higher earners. His tax adjustments reduce tax for basic rate payers by £130, but we MPs, like other high earners, will gain £860 a year. It is part of a pattern, as the Resolution Foundation has pointed out. In total, the tax and benefit changes since 2015 have given the richest fifth of households an extra £390 a year, while the poorest fifth have not simply gained less, but have lost £400 a year. Failing to end austerity and failing on social justice, this Budget fails our country.
It is a pleasure to follow my hon. Friend the Member for Sheffield Central (Paul Blomfield) in this important debate.
It is important that we pay attention to the fact that the Prime Minister announced the end of austerity, yet yesterday it was announced that austerity is “coming to an end”. Which is it and when will this be? Austerity was a political choice, not an economic necessity. How will the Government alleviate and redress the devastating impact of austerity? Austerity has not tackled the deficit; rather, the onus of who pays has been shifted to teachers, police and nurses. After eight years of this Government’s hard austerity, too many people are suffering and too many vital public services are in crisis.
Yesterday, we heard not a penny announced for the day-to-day costs of schools, even though school funding has been cut by 8%; not a penny for regular policing, even though 21,000 officers have been cut and violent crime is on the rise; and not a penny for local councils to close the funding gap of £7.8 billion by 2025—and they are facing cuts of £1.3 billion next year, too. The Government are not fixing the fundamentals. Must it always take a tragedy to effect meaningful change?
Take a look at our fire service: rather than fighting fires, it is having to fight for funding. It is beneath contempt not to pay those who work in our fire service properly. Indeed, real wages are lower today than they were in 2010, while CEOs are paid 143 times the wage of the average worker.
The late Audrey Hepburn once said: “As you grow older, you will discover that you have two hands: one for helping yourself, the other for helping others.” When will the Government stop and realise that? Rather than help, the Government have shown again through the Budget that they know the price of everything, yet the value of nothing. Once again, they are saying, “Your price is way too high; you need to cut it, cut it, cut it, cut it.” It is like the emperor’s new clothes: the emperor seeks to describe an elegant, flamboyant gown that he is wearing, but he is actually completely naked.
This Budget does not mark the end of austerity. The NHS has experienced the slowest spending growth in its history. When the Government created the Budget, clearly ignoring the issues caused by their austerity, it seems they had 99 problems but did not consider the state of the NHS to be one if they believed that £20.5 billion was sufficient to repair the damage caused by eight years of under-investment.
According to the Health Foundation, the £20.5 billion promised is simply not enough. The £2 billion that has been announced for mental health is welcome, but it is half what is needed, and let me be clear: this is not new money and these are not new resources. These financial gimmicks fool no one. The Health Secretary has said that it would take a generation to establish parity of esteem under this Government. However, people with severe mental health conditions cannot afford to wait five years for meaningful action from this Government. Too many people, including children, are already waiting months to access the treatment that they need, leading to a devastating mental health crisis.
In my constituency, there has been a real-terms cut of 10.6% in adult social care, almost double the national average, and the Government consider their announcement of £650 million for long-term adult social care services an accomplishment when it is less than half what the King’s Fund estimates is required to meet demand. Nearly 1.5 million elderly people are not getting the care that they need—an increase of 20% in just two years. The sum of £84 million over the next five years to expand children’s social care programmes is pitiful compared with the £3 billion needed by 2025. Services are over- stretched, and the recent trends in the level of funding are unsustainable and unacceptable. The needs of Peterborough —my constituency—have been attended to on the cheap for far too long. As a consequence, cracks are beginning to appear in our services. Our needs have not been properly or adequately assessed, or indeed addressed, and the current settlement is blatantly below par.
Does the hon. Lady agree that one of the biggest challenges facing Peterborough hospital, which serves her constituency and in which I work, is the financial burden of the PFI that was used to build the hospital? It is a beautiful hospital, but so much money was spent on it that we are burdened with this PFI. It was a Labour Government who did that and we are now having to pay for it.
I thank the hon. Lady for her intervention. Yes, I know that very well about the PFI, which is why Labour is seeking to end PFIs. [Interruption.] Before she says that we signed it, I would like to talk about now and the fact that PFIs actually came in under John Major. Talking about now, Government are pursuing efficiency to the point of ineffectiveness. I end on this poignant note: investment now is lower in relation to GDP and we are ranked 22nd in the world. The time for warm words is over. Austerity has dire consequences and a little extra just will not cut it.
Writing earlier this week in the Welsh edition of The Sunday Times, I labelled yesterday’s fiscal event a “fantasy Budget”. That is because, of course, it did not mention the big elephant in the room, which is Brexit. If the withdrawal agreement does not make it through the House of Commons—that is working on the assumption that there will be a withdrawal agreement between the British state and the European Union—the Chancellor will be back here in a matter of months with an emergency Budget. I hope that, in such a scenario, more sensible minds might prevail with a policy put forward based on extending article 50 coupled with a people’s vote at the end of it with remain as an option.
As always, the most interesting part of the Budget came with the accompanying OBR report. Its projections are based on the most optimistic Brexit scenario envisaged by the British Government, and, basically, it envisages no change in its growth forecasts. Indeed, page 9 of the OBR report shows the UK’s projected economic growth at the bottom of the advanced economies of the world. The Institute for Fiscal Studies, in its green budget, emphasised the decoupling that we have seen between the British economy and the other advanced economies of the world since the 2016 referendum. Growth is now at around half of pre-recession levels, and that is as a result of eight years of austerity, which has permanently sucked out demand from the economy, and now the Chancellor faces Brexit, all of which lead to anaemic levels of business investment.
The British Government are trying desperately to pivot away from their austerity narrative. They know now, in the new climate, that that is a political vote loser. However, yesterday’s spending commitments fell far short. The IFS puts the price of ending austerity at £19 billion per annum by 2022-23, and the Resolution Foundation puts it at about £30 billion. Yesterday’s spending commitments did not match those sorts of sums. Once extra spending on the national health service in England is stripped out, most other Departments faced a flatlining budget, if lucky, or real-terms cuts. We will have to wait for next year’s comprehensive spending review to have a full picture. I look forward to that fiscal event next year. Public expenditure as a percentage of GDP is now basically at the levels seen at the end of the Thatcher years—about 38%. Austerity has enabled the British Government to achieve their objective of remodelling the state but at a huge cost to public services and support for the most vulnerable in society. Far from ending austerity, austerity is now entrenched in the UK taxation and spending model.
Turning to Wales, the vast majority of spending decisions were England-only, highlighting the fact that the major fiscal event for my country is the Welsh Government’s budget. A huge amount of work needs to be done by politicians in Wales and by the Welsh media to promote that event to its rightful status. The BBC proclaimed a half a billion pound bonanza for my country, neglecting the fact that these were Barnett consequentials resulting from spending in England. A magic-money cash giveaway, as portrayed, it most certainly was not. The key point of interest is the remaining inherent unfairness in the Barnett formula as it applies to Wales. The Welsh Government responded by saying that the vast majority of the £500 million was old money previously published following the enhanced funding announcement for the NHS in England over the summer. Funding per head in London, the richest part of the European Union by a country mile, is higher than it is in Wales. The geographical wealth inequalities within the British state should shame Westminster, and there was little in the Budget that is going to lead to a meaningful rebalancing.
I was very disappointed that there was no announcement on the shared prosperity fund. The communities I represent form part of the West Wales and the Valleys European region. We receive £2 billion in convergence funding within the current EU multi-annual financial framework, which runs between 2014 and 2020. During the referendum, we were promised not a penny less. However, it looks increasingly likely that the communities I represent will be significant financial losers and that the British Government will take away powers from Wales over the use of shared prosperity fund money. I put the Treasury on notice that unless it honours the promises of the Brexiteers, it is walking into a political firestorm, and that political control of the powers over that money must reside in Wales.
The Budget highlighted the north Wales growth deal, with £120 million of funding, but neglected to mention that that accounts for only about 10% of the total funding. We saw a similar scenario with the Swansea Bay city deal, with only 10% of the funding coming from the Treasury. Therefore, 90% of the money associated with these growth deals comes from the Welsh public sector and the Welsh private sector.
It was interesting to see that there was no mention in the Budget of the Secretary of State for Wales’s pet project, the western powerhouse. I can only presume that it has gone down in the Treasury as it has in Wales—not particularly well—and I was glad to see its omission yesterday.
We saw the announcement of the £900 million business rates cut. The Secretary of State for Wales immediately called on the Welsh Government to match that promise. I have to be honest—I was completely unaware that tax cuts by the British Government for England led to Barnett consequentials for Wales, but perhaps that shows my lack of understanding of how the Barnett formula works. I would be very grateful if the British Government outlined whether there is indeed some compensation money for English local authorities for the loss of revenues they face as a result of those business rate cuts, because that would then lead to Barnett consequentials that could be applied to Wales.
A major brewing political storm today is the enhanced borrowing powers that were included in the Budget—some £300 million. The British Government are trying to tie that to the M4 relief road. It would completely undermine devolution if those borrowing powers were constrained by being limited to what the British Government want the Welsh Government to spend the money on.
It is a pleasure to follow the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards).
A little earlier, the hon. Member for Redditch (Rachel Maclean) accused Labour Members of being rather negative and sending out negative waves. Well, I have some positive waves, but they are radiotherapy waves, and some ideas. I am delighted that the Minister for Health, the hon. Member for North East Cambridgeshire (Stephen Barclay), is on the Treasury Bench; I am sorry he could not join us for the debate earlier, because there were some really good suggestions as to how we can improve the service.
I was disappointed that, despite numerous debates and questions on the cancer strategy, the Chancellor did not mention any further funding for advanced radiotherapy. He said in the statement:
“we agreed that the NHS would produce a 10-year plan, setting out how the service will reform, how waste will be reduced, and exactly what the British people can expect to get”—[Official Report, 29 October 2018; Vol. 648, c. 656.]
I declare an interest, as a cancer survivor who was successfully treated with both chemotherapy and radiotherapy. I am also now a vice-chair of the all-party parliamentary group on radiotherapy.
I am not alone in having benefited from radiotherapy. About one in four people receive some form of radio- therapy during their lives, and almost half of us will be diagnosed with cancer in the UK at some point in our lifetime. Those stark facts will, I hope, remind the Government how important it is that we invest in modern and accessible cancer treatments. Delivering the recommendations set out in the cancer strategy is crucial to improving care and support for thousands of people affected by cancer. I like to participate in the knockabout and the political point scoring as much as anyone, as Members probably know, but I am not trying to make a party political point about the nature of this policy. I am simply trying to emphasise that it requires resources, a plan, a strategy and commitment.
I have regularly raised advanced radiotherapy and its benefits and have advocated further investment in research into it. Given the cost, investment and research should be evidence-based, but there are some very exciting areas. I went to see the new proton beam therapy machine at the Rutherford Cancer Centre in Northumberland, in the constituency of my hon. Friend the Member for Wansbeck (Ian Lavery). I saw the installa