Charter for Budget Responsibility and Welfare Cap — House of Commons, 2022-01-10
Topic: Macroeconomics
James Stewart Murray (Labour, Centre-left): Today could have been a chance for Treasury Ministers to come to the House and set out plans to help people facing the rising costs of living in 2022. They could have come here to offer immediate help to people now, alongside a plan to invest what is needed in the long-term future of our country, but that is, sadly, not what we have seen. Despite widespread anxiety across the country about soaring energy bills, we have heard nothing on that front from the Government today Nor it seems did the Chancellor reflect over Christmas on the Government’s plans to ratchet up national insurance contributions in April. Treasury Ministers could have come here today to announce that they would not go ahead with the tax hike on working people and their jobs, but we have heard nothing from them on that front, either. Instead, we have seen Ministers defending their harmful and economically illiterate cap on investment in our country’s future Treasury Ministers should be using their first outing of the new year at the Dispatch Box to explain how they will help with the rising cost of living, which, as my right hon. Friend the Member for Hayes and Harlington (John McDonnell) and my hon. Friends the Members for Cynon Valley (Beth Winter) and for Liverpool, Walton (Dan Carden) all pointed out, is affecting so many of our constituents. If the Government do not know what to do, they are welcome to use Labour’s plans. As the shadow Chancellor, my hon. Friend the Member for Leeds West (Rachel Reeves), set out over the weekend and as my right hon. Friend the Member for Wolverhampton South East (Mr McFadden) set out earlier, our plan would bring energy bills down this year, partly funded by a one-off windfall tax on North sea gas and oil profits. It is a bold and balanced package that would help everyone in the country, and it is a fair and fully costed plan that would help families on low incomes the most The Government could also follow Labour’s lead when it comes to their national insurance increase on working people and their jobs. As we set out in September last year, that tax hike is wrong when the burden should be borne by those with the broadest shoulders. While the Conservatives’ failure to help people now will cause hardship for many in 2022, their failure to invest in our country’s future will cause damage for years to come. Their approach shows that they have learned nothing from their failures of 12 years in power. They are not listening to business groups and economists, who have made clear how vital they think investment in our country is, and they have learned nothing from countries overseas. Even if the Government get investment up to their 3% of GDP target, we will still be at the bottom of the OECD countries behind Ireland, the US and Mexico. Is that really their vision for global Britain The truth is that the Government’s position simply confirms that Ministers do not understand what our country needs for the future, and their failure to invest has a direct impact on people’s lives. Their failure to invest what was needed in the past 12 years in gas storage and additional energy sources has made the jump that we face in energy bills far worse. Their failure to invest in safe and affordable housing has made the housing crisis that we face far worse. Their cap on investment now means that they will fail to invest what is needed to decarbonise our economy, making the damage to our country in the long run far worse, too. Ministers could have come here today to follow Labour’s lead by committing to £28 billion of capital investment in our country’s green transition in every year of this decade. Our fiscal rules set out how we would make that investment in the future while balancing the books and getting debt falling. That level of capital investment is needed to tackle the climate crisis and to create jobs for the future, from insulating homes across the country to ensuring that wind turbines are manufactured here in Britain. However, that would not be possible under the Chancellor’s charter, which as a result will cost our economy and our country more in the future When the case for investment is so strong, why is the Chancellor so keen to stop it? We would ask him, but, as my right hon. Friend the Member for Wolverhampton South East drew to the House’s attention, he has not turned up. We wondered where he was and whether he was in California again. I can tell you, Madam Deputy Speaker, that he has been spotted in the building. He is so contemptuous of his own fiscal rules that he has not even bothered attending the debate. I suspect he has realised that he has called it wrong—the stunt has not worked—and, true to form, when he finds questions too uncomfortable or too difficult, he is nowhere to be seen. He may have thought it was clever to have a parliamentary vote to distract from the Government’s record of high taxes, high prices and high levels of waste, but his plan to cap investment will only make things worse by stunting the economy and trapping us further in the Tories’ low-growth cycle The Tories are putting up taxes on working people in 2022 despite energy bills being set to soar, and they are spending their time struggling to defend their damaging investment cap rather than tackling the climate crisis, creating jobs and heeding calls from business to invest in the future. The Opposition will not vote to lock us further into a low-growth, high-tax cycle. We will back British businesses and workers by supporting the investment needed in net zero growth to create jobs for the future, fund first-class public services and improve living standards for everyone in our country.