Tag: Speeches

  • Alison Thewliss – 2022 Speech on the Finance Bill

    Alison Thewliss – 2022 Speech on the Finance Bill

    The speech made by Alison Thewliss, the SNP MP for Glasgow Central, in the House of Commons on 28 November 2022.

    It is a pleasure to follow the hon. Member for Amber Valley (Nigel Mills), who gave a characteristically thoughtful speech. How strange it is that we agree on so many things in this debate, and yet on so few other things. It would be nice if those on the Government Front Bench listened to some of the considered and sensible remarks from their colleagues.

    This Finance Bill really does illustrate that we are all having to pay more tax, because of the very misguided steps taken by the former Prime Minister and her Chancellor, who crashed the economy in 26 minutes, leaving us all £30 billion worse off. That will have an impact on this broken UK economy not just now, but for many years to come.

    Let me start with the energy profits levy. That additional tax on UK oil and gas profits will increase from 25% to 35% from 1 January 2023. As the hon. Member for Amber Valley observed, this is being extended until March 2028, which illustrates the extent of the mess into which the UK Government and their Chancellors have got themselves.

    We think that the Government should go in a slightly different direction. They should look beyond just a levy on energy profits. They might want to look at a windfall tax that includes share buybacks as well. That is something that Biden has done in the United States. That has had the effect of bringing more money into the American Treasury’s coffers—Canada is also doing this—and encouraging firms to put more money into research and development, into investing in their companies and into investing in the UK, rather than spending all their excess profits on share buybacks, That seems like an entirely sensible thing to do, given the state of the UK economy. This year, BP has earmarked £7.15 billion to buy back its own shares. The Treasury should look at what more can be done here.

    The reduction in the investment allowance is to be welcomed, but that it exists at all remains a barrier to decarbonisation. The allowance creates a perverse incentive for companies to favour new oil and gas exploration over renewables by effectively offering them a tax break for doing so. Shell paid zero windfall tax under the previous scheme, as it invested heavily in oil and drilling instead of filing profits to be taxed against. That is hardly worth a candle compared with the net zero commitments that the Government tried to make at COP26 last year.

    We are also concerned about the decision to impose a 45% tax on electricity generators as that can then undermine investment into renewables at the same time as allowing oil and gas companies to drill more. The chief operating officer of SSE has said that the company may have to “give up” on some of its plans when the tax comes into effect. He said:

    “It’s going to take money away from us…and we won’t have as much to invest.”

    The CEO of Renewable UK also said:

    “Any new tax should have focused on large, unexpected windfalls right across the energy sector, instead profits at fossil fuel plants are inexplicably exempted from the levy.”

    Scotland has a significant renewables sector. It has been a great success story. Anything that makes that sector less profitable and more uncertain is something that we are deeply worried about.

    The ordinary rate of income tax is now frozen until April 2028. Significant stealth taxes are coming in, as the Treasury stands to raise considerable revenue due to inflation. The Institute for Fiscal Studies has estimated that this could raise £30 billion by 2026 due to high inflation rates. It is unacceptable for this money to be raised by taxing those already struggling with spiralling living costs. Of the many options available to the Chancellor, it would have been better to tip the balance more in favour of those who can afford to contribute more, by which I mean greater taxes on wealth and income made from wealth, and also taxes on the non-doms, which could bring in £3.2 billion to the Treasury’s coffers. It is unacceptable that the Treasury would turn down the chance to bring in £3.2 billion and instead choose to freeze the thresholds, so that people on lower and middle incomes will receive less in their pay packet each month.

    AJ Bell has found that if allowances are frozen rather than linked to inflation, an average earner on a salary of £33,000 in 2021-22, before the income tax threshold freeze began, will end up paying £2,600 more in income tax if the policy is extended to 2027-28. Someone on £50,000 will pay an additional £6,570 in tax because the allowances are frozen rather than being linked to inflation. I ask Ministers to consider the fairness of those measures.

    Moving on to the research and development expenditure tax credit rate, the scheme has provided tax reliefs to companies subject to corporation tax that carry out eligible R&D activities. I appreciate what has been said about the efficacy of R&D tax credits and whether they are useful. I hope that topic will receive more consideration in the months and years ahead, because the UK tax code is full of different types of credits, tax breaks and incentives—or disincentives—and we need to properly understand how effective they are.

    Small and medium-sized enterprises provide around three fifths of the UK’s private sector jobs and have historically been drivers of innovation and growth. They are a significant part of solving the UK’s productivity puzzle. SMEs are less likely than larger companies to have access to formal credits to fund R&D, and in the wake of the pandemic and with recession forecast across the next year, it is more important than ever that SMEs are supported in driving growth and investing in research and development.

    It is quite perplexing the Chancellor has prioritised R&D in larger firms, which are more likely to invest their profits elsewhere or perhaps invest them in share buybacks further down the road. The Chancellor has said that the aim is to reduce fraud, but reducing the R&D expenditure credit for all SMEs in an attempt to prevent its being abused seems a bit like throwing the baby out with the bathwater. It is quite poor targeting to affect all SMEs rather than just those that might be abusing the system.

    The Federation of Small Businesses has said that the cut to R&D tax credits, which the Government presented as a way of tackling fraud, would “crush innovation and growth”, creating a “doom loop” that

    “makes a mockery of plans for growth.”

    The Minister should listen carefully to the FSB when it raises such concerns.

    The current situation is quite worrying and will have significant impacts on the Scottish budget. The Fraser of Allander Institute has said:

    “The lack of any real ability on the part of the Scottish government to be able to flex its budget within year in response to unanticipated shocks remains a real limitation of the existing fiscal settlement…a strong case can be made for enhancing the Scottish government’s ability to borrow and/or draw down resources from its Reserve.”

    It concludes that

    “this level of inflexibility does not seem tenable.”

    The Scottish Government face a £1.7 billion shortfall this year as a result of inflationary pressures, and that is just this year’s budget. John Swinney has gone back and tried to strip out anything he can from the Scottish budget to try and deal with the problem, but that shortfall remains. The Chancellor’s answer to that was £1.5 billion in Barnett consequentials over the next two years—nothing for this in-year shortfall and half of what we need across two years. That is not going to fix the pressures that the Scottish Government face. It is not going to fix the significant issues with pay deals that trade unions are legitimately asking for in Scotland to support their members. If the UK Government does not come up with that money, it will cause extreme difficulties for the Scottish Government’s ability to meet their expectations of what they want to do.

    What we are seeing from the UK Government is something of a doom loop. The OECD says that the UK will contract more than any other G7 country and that, of the G20, only Russia will fare worse than the UK. We see stagnant growth and no plans to get the economy back on track. The Chancellor and the Government want to bring forward plans to try to cut their way out of recession. That will not work. As the hon. Member for Amber Valley pointed out, consumers see that, and it affects both consumer and business confidence. Unless we hear a lot more about investment rather than cuts, this Government are going to sink the economy and take Scotland down with them.

  • Nigel Mills – 2022 Speech on the Finance Bill

    Nigel Mills – 2022 Speech on the Finance Bill

    The speech made by Nigel Mills, the Conservative MP for Amber Valley, in the House of Commons on 28 November 2022.

    It is a pleasure to speak so early in the debate. It is also a great pleasure to have a Finance Bill that is so short. I must have spoken on a dozen of them in my time in Parliament and to have one that has only 12 clauses is some sort of miracle. During this week, we have probably about as much time as we normally have for one of several hundred pages, so we can really scrutinise the 11 substantive clauses. Perhaps that is progress, compared with what we normally expect.

    I start by comparing this Finance Bill with ones we had at the start of the previous recession a decade and a half ago and ones we had at the start of previous measures to tackle a large budget deficit. If I recall rightly, the single biggest measure we had 14 years ago was a VAT reduction at the start of the recession, which cost something like £15 billion. I am not sure it had the effect we wanted. Interestingly, as we sadly slip into a recession, which we hope is shorter and shallower than that one, what we have not seen in this Finance Bill is any attempt to boost consumer confidence. We can argue that we tried that in September and it did not go so well, and probably the right thing here is to focus on how we reassure the markets that we can keep borrowing under control and therefore not risk a rise in interest rates.

    However, if this recession looks like it might be any longer or deeper than the Government’s forecasts, I urge them to think carefully about how we get consumer confidence to turn around. I fear that what we will see in the new year is a big retrenchment in people’s personal spending. We will spend the money for Christmas because we have to, but people will then take a very cautious approach in the early part of next year, knowing that energy bills will go up in April and that tax changes are around the corner. We would not want them to go too far and retrench too fast. So I hope the Government will think about the role that tax can play in turning the economy around if we need that next year.

    The other interesting comparison is with the approach George Osborne took in his Budgets in the first half of the last decade to introduce austerity to tackle the big public deficit we had. Let us look at what he prioritised. He had a VAT increase, which we are rightly not doing in this situation, but he increased the personal allowance and reduced corporation tax to try to put more money into people’s pockets from work and to encourage business investment in the UK. Interestingly, the Government are doing the complete opposite now. I am not sure whether we have worked out that that plan did not work, but there is evidence to suggest that the lower corporation tax rates we had for a decade did not achieve the additional investment that we wanted them to and we are probably better off sticking at about 25% than going lower.

    I am slightly intrigued. The great claim we made was that we were taking people out of the scope of income tax. We are now at great risk of putting them all back into the scope of it again. I accept the Minister’s point that the personal allowance by the end of this five-year period will still be £2,000 higher than it would have been by inflation, but I think that is not enough of an increase. I hope that the Government regard these personal allowance freezes for another five years to be a kind of last resort and if we get any improvement in the economic outlook they can be reversed. Especially at the lower end of the level, keeping people out of tax, letting them keep more of the income and making sure that work pays are strong arguments. Frankly, I am not absolutely sure why we need to legislate for personal allowances in five years’ time. We will have another five Finance Bills before we get to those and we could have brought those into law at any point. I accept that we want to give the market a clear steer that we are serious about closing the budget deficit. If we need those measures, fine, they are probably less bad than a rate increase, but what is the point of legislating for them in this situation?

    There is another contrast with what we have done on national insurance this year. We chose to—and I accepted the argument that we needed to—increase the headline rate of NI, but the compensation for that, when it became clear that that was a real problem at the start of the economic downturn, was to increase the personal allowance for NI—the starting point at which someone pays that tax. Yet now, rather than increasing the headline rate, we are effectively holding back the starting points of those taxes. So we have a tax on income and a tax on wages where we are taking one approach, and on the other tax we are doing something completely different.

    As we go forward from what I accept are emergency measures that we need to use to fill a hole, the Government need to have a clear strategy for what our tax system should look like. They should consider the things we are trying to tax and the things we are trying to incentivise. They should try to give people some long-term stability so that they can plan and understand and we can get the behavioural changes and incentives that we want, rather than having a clear direction one way, and then doing a U-turn and wondering why people do not do the things that we would really like them to do. Now we are through the real firefighting, I hope the Government can produce a strategy and plan for where they think the tax system should go, so that people can understand it and respond accordingly. I think that that is what we had under the Gauke doctrine in 2010. We need to revisit that, now we seem to have changed our mind on so many of those things.

    The bleakest bit of news in this Finance Bill was extending the windfall tax to 2028. I was hoping that the energy crisis might be over quite a bit before then and we would not need to have those measures in place. The fact we have done that suggests we are not expecting energy prices to come back down any time soon. Clearly, the windfall tax is the right thing to do. I have always taken the view that this is a level of profit that nobody could ever have thought they could get. These companies are earning it from extracting our natural resources; they are not their natural resources. We have given them permission to extract them, and they have rightly made some profit from doing so. However, we should limit that profit and accept that those are our resources and that we should take the right return from them, rather than the exploiter doing so, so I hugely welcome the introduction of the windfall tax.

    I am quite intrigued by the research and development stuff. It is right, even at the most difficult time, to say that we want to make sure that we are incentivising R&D. That is a sensible, long-term measure that shows some long-term planning. I remember being at work as a young accountant when R&D tax credits were introduced—in 2000 for small companies and in 2002 for large companies. The journey they have been on, with rates going up and down and approaches changing—above the line, below the line, cash incentives and all those things—makes me wonder whether, 22 years on, we are really sure that R&D tax credits are delivering the outcome that we want. I suspect that the speeches in the Finance Bill debates in 2000 were that these measures would make us a science superpower in the next generation. I think that we are still giving those speeches, and we have not quite got the superpower bit. I wonder whether the Government should stop at some point and ask whether those are working. I know that there is an ongoing review on combining the reliefs, but are they triggering the right thing?

    One piece of data that did worry me was that a disproportionate amount of those are claimed by companies in London and the south-east and they are not spread around the country in the way we would like. Is there a way we can use these tax measures to encourage that kind of investment and those kinds of skilled jobs in the regions of the UK, and not just focus them in the most prosperous parts?

    I have expressed the view previously to many Treasury Ministers that, outside the EU, the one thing that we can do is take a regional approach to certain taxation to encourage activity in different parts of the country that we do not need to encourage in London and the south-east. I urge the Treasury to look seriously at whether we could take a regional approach to some taxes so that we can get those differentiating incentives to move wealth outside London and the south-east. That would fit entirely with our levelling-up agenda, but we have not chosen yet to be that creative with our tax system.

    Given that we have plenty of time for detailed questions on clauses on Wednesday, I will just say that I accept the need for this Finance Bill. I will support all the measures in it and I will happily vote for it later. I will not be voting for the Opposition amendment, which I suspect will not come as a great shock. I think I support ending non-dom status, but we should have temporary residence relief. If somebody comes here on a secondment or for a short period, we should not try to force them to move all their tax affairs here. We should tax them on the income that they earn here. There would be a big disincentive and it would be out of step with other countries if we did not have a short period where somebody had that different situation to reflect the fact that they are not ordinarily resident here.

    The fact is that a person’s non-dom status depends on where their father was born. In theory, they can become a non-dom even if they have lived here all their life and never been resident anywhere else in the world. That shows how ludicrous those rules are. I urge the Government to look at modernising all our residence tests, including that on non-dom status. They are all far too complicated. We could have a far more effective system that works better and would achieve the advantages of attracting investment here. There is a real problem with just scrapping non-dom status; it may drive some people we do want here to leave. On balance, a change is better and we should continue with the direction of travel that we had a decade ago of restricting the time period. I think that we could restrict it with a more modern relief that would achieve what we want without having the big downsides.

    With that, I will happily support the Bill and oppose the amendment if there is a Division later.

  • James Murray – 2022 Speech on the Finance Bill

    James Murray – 2022 Speech on the Finance Bill

    The speech made by James Murray, the Labour MP for Ealing North, in the House of Commons on 28 November 2022.

    I beg to move an amendment, to leave out from “That” to the end of the Question and add:

    “this House declines to give a second reading to the Finance Bill because, notwithstanding the importance of increasing the energy (oil and gas) profits levy, it raises taxes on working people through its freeze of the personal allowance threshold; because it fails to take advantage of other sources of revenue, such as ending non-domiciled tax status and further reducing the tax allowances available to oil and gas companies; and because it derives from an Autumn Statement which fails to set out plans to arrest the 7 per cent fall in average living standards forecast over the next two years, and to grow the UK economy, including through replacing business rates, supporting start-ups, giving businesses the flexibility they need to upskill their workforce, investing in clean and renewable energy, insulating homes across the country, and creating jobs in the green industries of the future.”

    After 12 years of economic failure from the Conservatives and 12 weeks of economic chaos, we now have this Finance Bill from a party that is holding Britain back. It is a Bill from a party that has, of course, lost any claim that it might once have tried to lay to economic competence; but more than that, it is a Bill that shows a party making the wrong choices time and again, and a party with no plan to grow our economy and halt the decline in living standards.

    As people across the country know, the Conservatives’ economic failure is hitting households hard. We are living through the longest period of earnings stagnation for 150 years, with real wages lower this year than when the Tories came to power in 2010. Living standards are forecast to fall by 7% over the next two years—the biggest fall on record, taking incomes down to 2013 levels. No wonder the director of the Institute for Fiscal Studies described the forecast drop in disposable income as “simply staggering”. This will truly feel like a lost decade for people across the United Kingdom: a decade of low growth, with incomes now set to fall back to where they were a decade ago.

    I know that Conservative Members are desperate to make out that global factors are entirely to blame for the economic reality of today, but although no one denies the deep impact of covid and of Putin’s invasion of Ukraine, it is simply not credible—and it is frankly insulting—to pretend that the occupants of Downing Street, now and over the past 12 years, have had nothing to do with the mess that we face. It was decisions taken by the Conservatives in office that left us uniquely exposed to the inflationary shock of oil and gas prices rising—they took misguided and damaging decisions to shut down our gas storage, to stall on nuclear power and to ban renewable technologies such as onshore wind—and it was decisions taken by the Conservatives in office that have denied the UK the opportunity to grow our economy over the past 12 years as we could and should have done.

    Richard Fuller

    Will the hon. Gentleman please check his facts? If he looks at the period from 2010 to just before the covid pandemic and compares the UK’s average rate of growth with that of our OECD competitors, particularly the G7, he will find that the UK outstrips all of them bar the United States and Germany.

    James Murray

    I seem to be engaging more with the hon. Gentleman now that he is on the Back Benches than when he was briefly on the Front Bench. If he looks at the statistics, he will see that, over the last 12 years, the UK’s growth rate has been a third lower than the OECD average, and a third lower than it was during the previous Labour years. I will take no lessons from him or his colleagues on the need for economic growth.

    I take this opportunity to give the previous Chancellor, the right hon. Member for Spelthorne (Kwasi Kwarteng), some rare credit. At least he took responsibility for the mess he inherited from his colleagues when he confirmed that our economy is stuck in a “vicious cycle of stagnation.” On that point, he was absolutely right.

    Over the Conservatives’ 12 years in power, as I said to the hon. Member for North East Bedfordshire (Richard Fuller), the UK economy grew a third less than the OECD average and a third less than during the previous Labour years. What is more, we are now the only G7 economy that is still smaller than before the pandemic. Over the next two years, we are forecast to have the highest inflation in the G7 and the worst economic growth of any country in the G20 except Russia.

    What is more, we are the only country in the G7 whose governing party chose to inflict profound damage on its own economy. Although the Prime Minister and the Chancellor refuse to take responsibility, the British people can see through them and will hold them to account. What the British people want and need is a Government who will get on and do the right thing without having to be pushed, dragged and forced into doing so. That is one reason why people across the country have been so exasperated by the Government’s reluctance at every turn to implement a windfall tax on oil and gas producers’ huge profits this year.

    My right hon. Friend the Member for Leeds West (Rachel Reeves) first called on the Government to bring in a windfall tax in January. It took five months of pushing the Government along a painful journey to get them to act. In those months, Conservative Ministers tried to defend their position, saying that oil and gas producers were struggling. They said a windfall tax would be “un-Conservative”, and the current Prime Minister said it would be “silly” to use this money to offer people help with their energy bills. Conservative MPs voted against a windfall tax three times, and then, when they finally realised their position was untenable, they did a U-turn.

    Even then, having been dragged kicking and screaming into introducing a windfall tax, the current Prime Minister coupled it with a massive tax break for the oil and gas giants. This tax break will be given to the oil and gas giants for doing the things they were going to do anyway, which helps to explain why some of them have paid zero windfall tax in the UK this year, despite record global profits.

    Despite having another go at windfall tax legislation with this Bill, the massive tax break is still there. It is set at a level that will, to quote the explanatory notes,

    “maintain the overall cumulative value of relief”.

    This tax break leaves billions of pounds on the table. These profits—the windfalls of war—could go towards helping people facing the difficult months ahead. This tax break is set to cost the taxpayer £80 billion over five years. This tax break was brought in by decisions that this Prime Minister took when he was Chancellor, and it is staying thanks to the decisions of the Chancellor he appointed from No. 10. What clearer evidence could there be that, no matter which Conservative goes through the revolving door of Downing Street, it is all more of the same?

    All we get from the Conservatives is the same vicious cycle of stagnation. This doom loop has been dragging wages down, forcing taxes up and hitting public services, all of which come round again and keep economic growth low.

    Jonathan Edwards

    I agree with many of the hon. Gentleman’s points. Much of the narrative around the autumn statement and the Budget is about restoring market credibility after the implosion of the previous Administration. In reality, the one thing we could do to restore market credibility is to have a more sensible trading relationship with the European Union. There is no hope from the Government, but will the Labour party offer us that hope?

    James Murray

    Later in my speech I will talk about our plan for growth, which will involve fixing the holes in the Brexit deal with which the Conservatives left the European Union. Alongside other measures, it is important to make sure that the deal has a proper plan for growth that is sorely lacking from this Government.

    This Finance Bill is a bill in more ways than one, because as well as being legislation, it represents a bill landing on working people’s doormats. It is a bill that working people are being forced to pay for the Government’s failure. Working people are paying for the Tories’ decisions that, for the last 12 years, have held back the economy, and for the last 12 weeks have crashed it.

    This Bill freezes the income tax personal allowance, which will leave an average earner paying over £500 more income tax a year by 2027-28. In the autumn statement, the Government announced a council tax bombshell that will force a £100 tax rise on families in the average band D house from next April. As a result of all the tax measures announced in this Parliament, middle-income households will see their tax bill rise by £1,400. That is what it looks like when working people are made to pay the price.

    It is all the more galling for people to be asked to pay more when the Conservatives are so slapdash with public money. Today, new figures show that the current Prime Minister wasted a staggering £6.7 billion on covid payments to businesses and individuals that were fraudulent or mistakes. Despite wasting public money so carelessly, he is now happy to put up taxes on working people across the country.

    It could have been different had the Government made fairer choices. The Government could have chosen to close the unfair private equity loophole that gives hedge fund managers a tax break on their bonuses. They could have chosen to reverse their tax cut for banks. Perhaps they have forgotten what their position is, having voted for the cut at the start of the year, before U-turning on it a few months ago and then, more recently, U-turning again.

    The Government could have finally chosen to scrap non-dom tax status, an outdated and unfair tax break that costs the taxpayer £3.2 billion a year. A tax break for non-doms should have no place in the UK in 2022. As if evidence were needed that this tax break belongs in a different era, the law makes it clear that people can inherit non-dom status only from their father, unless their parents were unmarried. More fundamentally, this loophole ignores the principle of fairness that should be at the heart of our tax system. If a person makes Britain their home, they should pay their taxes here.

    There are theories going around about why the Government are so reluctant to modernise the tax system and abolish the non-dom tax break. Perhaps the Minister will be able to confirm at the end of the debate, or in writing afterwards, whether the Prime Minister has been consulted on the option of abolishing non-dom tax status. Perhaps he can confirm whether the option was ever considered. When the current Prime Minister was Chancellor, did he recuse himself from discussions on this matter? I see the Exchequer Secretary to the Treasury acknowledging my request, so I look forward to his response either later today or in due course.

    We know that the Conservatives’ choices on tax are deeply unfair, but we also know that the lack of economic growth is the deep root of the rising tax burden in the UK. Over the last 12 years, the UK economy has grown a third less than the OECD average and a third less than during the previous Labour years. We are now the only G7 economy that is still smaller than it was before the pandemic, and over the next two years we are forecast to have the lowest growth of any country in the G20 bar Russia.

    A plan for growth has been missing for a decade, and its absence is having a greater impact than ever. In its report this month, the OBR confirmed that measures announced at the autumn statement will make no difference to growth in the medium term. The CBI’s director general, Tony Danker, put it starkly following the autumn statement:

    “There was really nothing there that tells us that the economy is going to avoid another decade of low productivity and low growth”.

    We cannot afford another decade like the last. We cannot afford another decade of being held back, another decade of lost growth. That is why Labour’s plan is so crucial to raising wages and living standards, supporting and sustaining public services and driving business investment and job creation in the decade ahead.

    Karin Smyth (Bristol South) (Lab)

    My hon. Friend is making an excellent speech, in stark contrast to what we have heard from the Conservative party. It is about people, working people and building back better. Does he agree that, for the people, particularly young people, who lost out so much during covid and are now facing another decade of low growth, we are particularly disappointed about the lack of support for further education and colleges to support the skills agenda for both 16 to 18-year-olds and adults who desperately need retraining and skills? That is starkly absent from what we have heard from this Government.

    James Murray

    I thank my hon. Friend for her contribution. She is a great advocate for investment in skills training and making sure that young people have opportunities in the decade ahead, which they have been denied in the last decade under this Conservative Government. The points she makes fit well within a wider plan for growth, which is at the heart of what Labour Members are proposing and pushing the Government to adopt.

    That plan is wide ranging. It covers business rates being replaced with a fairer system that makes sure that high street businesses no longer have one hand tied behind their back. It relies on us implementing a modern industrial strategy to support an active partnership of government working hand in hand with businesses to succeed. Labour’s start-up reforms will help to make Britain the best place to start and grow a new business. Small businesses will benefit from our action on late payments and we will give businesses the flexibility they need to upskill their workforce. As I mentioned, we will fix holes in the Brexit deal so our businesses can export more abroad. Crucially, our green prosperity plan will create jobs across the country, from the plumbers and builders needed to insulate homes, to engineers and operators for nuclear and wind. We will invest in the industries of the future and the skills people need to be part of them. That is what a plan for growth should look like. As John Allan, the chair of Tesco, said recently, when it comes to growth, Labour are the

    “only…team on the field.”

    The truth is that the need for an effective plan for growth has exposed the emptiness and exhaustion of the Conservative party. All we have to show from 12 years of Cameron, May and Johnson is chronic economic stagnation.

    Madam Deputy Speaker (Dame Rosie Winterton)

    Order. The hon. Gentleman knows that he should not refer to existing colleagues by name.

    James Murray

    I apologise, Madam Deputy Speaker. All we have to show from those three former Conservative Prime Ministers in the last 12 years is chronic economic stagnation. This autumn, the Conservatives tried desperately to make their economic strategy work, but their decisions crashed the economy, imposed a Tory mortgage premium, put pensions in peril and trashed our reputation around the world. Now they are trying again. We face tax hikes on working people, the biggest drop in living standards on record and growth still languishing at the bottom of the league. It seems that Conservative MPs are beginning to realise they have come to the end of the road and their time is up. In a timely echo of the popular TV show, hon. Members from Bishop Auckland to South West Devon are declaring: “I’m a Tory, get me out of here.” It seems the Conservative party is finally beginning to realise what the rest of us already know: the Tories are out of time and out of ideas, and Britain would be better off if they were out of office.

    Our amendment makes it clear that, although Ministers have been dragged, kicking and screaming, into action on oil and gas giants’ windfall tax, this Finance Bill fundamentally fails the UK economy and comes from a Government holding the British people back. Be in no doubt: the mess we are in is the result of 12 years of Conservative economic failure. With this Bill, they are loading the cost of their failure on to working people. The Government still have no plan to grow the economy and to stop the fall in living standards that is filling people across the country with dread. We need a Government with a plan to get our economy out of this doom loop, to support businesses to grow and to raise living standards again. We simply cannot afford another decade of the Conservatives. Now is time for change, now is the time for them to get out of the way, now is the time to let Britain succeed.

  • Mark Coxshall – 2022 Statement on the Financial Crisis at Thurrock Council

    Mark Coxshall – 2022 Statement on the Financial Crisis at Thurrock Council

    The statement made by Mark Coxshall, the Leader of Thurrock Council, on 29 November 2022. It follows the publication of the financial situation of the council.

    These are shocking numbers but the first stage to creating a good plan for recovery is to understand the full extent of the problem. I know that Thurrock residents will be concerned and rightly so about what this means for local services. Please rest assured that this report is the first stage of planning for our recovery.

    Everybody now has a fuller understanding of the gravity of the issues we face. We know the council cannot find a way to finance its expenditure in-year and will not achieve a balanced budget next year without external support.

    We will have to request exceptional financial support from the government over a number of years to stabilise our financial position and give us time to have balanced budgets. Alongside this support we will have to use other levers including asset disposal, efficiency savings, council tax increases and funding flexibilities from central government to recover our financial position.

    Although it is impossible for local authorities to go bankrupt, it is clear there will be incredibly difficult decisions to come. These are uncertain and unsettling times but there are no immediate changes to services for residents, and the council’s much valued staff will continue to deliver for Thurrock’s residents and be paid.

    I am absolutely determined to break the council’s past culture of secrecy with complete openness, honesty and transparency. Simply by publishing this information I am making it clear that is not how Thurrock Council intends to work going forward and that this takes place in a way that can be scrutinised by all councillors and the public.

    Further reports will come to Cabinet and update the position before setting a budget in February. Thurrock Council continues our work with the Commissioners to develop a plan that addresses the scale of this challenge and takes us towards a stable and sustainable financial position in the medium to longer term.

  • James Cartlidge – 2022 Statement on the Finance Bill

    James Cartlidge – 2022 Statement on the Finance Bill

    The statement made by James Cartlidge, the Exchequer Secretary to the Treasury, in the House of Commons on 28 November 2022.

    I beg to move, That the Bill be now read a Second time.

    In the face of challenging global headwinds, my right hon. Friend the Chancellor of the Exchequer delivered an autumn statement that was honest about the difficult decisions this Government will need to take to tackle the cost of living crisis and rebuild our economy. We are not alone in dealing with economic problems. One third of the global economy is forecast to be in recession this year or next. At the same time, while inflation is high in the United Kingdom, it is notably higher in Germany, at 11.6%, in Italy, at 12.6%, and in the Netherlands, at 16.8%.

    It is our duty to curb rising prices, restore faith in our country’s economic credibility internationally and, ultimately, to deliver growth. The independent Bank of England is responsible for controlling inflation. However, as the Chancellor set out in the autumn statement, monetary and fiscal policy need to move in lockstep. That means, for the latter, taking a disciplined approach and giving the world confidence in our ability to pay our debts. We have been clear that we will be following two broad principles in this consolidation: first, we ask those with more to contribute more; and, secondly, we will avoid the tax rises that most damage growth. With just under half of the £55 billion consolidation coming from tax and just over half from spending, the autumn statement set out a balanced plan for stability.

    Today, we are debating a small number of the tax measures that were announced last week. In order to provide certainty to markets and help stabilise the public finances, we are taking forward important tax measures in this focused autumn Finance Bill, ahead of a fuller spring Finance Bill, which will follow the Budget early next year as usual.

    Sir William Cash (Stone) (Con)

    During the autumn statement, I raised the point about High Speed 2 with the Chancellor, and I also wrote to the Chief Secretary to the Treasury and, indeed, to the Chair of the Treasury Committee, my hon. Friend the Member for West Worcestershire (Harriett Baldwin). According to the Office for National Statistics yesterday, annual inflation in the infrastructure sector was 18.1% in September, which is 80% higher than the consumer prices index for the same month. How can the Government continue to bankroll phase 2 of the HS2 project at a cost of more than £40 billion when all the independent advice suggests that it will make rail services to the north-west worse than could be achieved with merely phase 1 and the Handsacre link? Could I also have a reply from the Chief Secretary to the letter I wrote to him?

    James Cartlidge

    I am grateful to my hon. Friend and will of course check with the Chief Secretary’s office; my officials will have heard the point he makes and will ensure he receives a response. On inflation in infrastructure costs, obviously that will apply across the board and cannot in itself be a reason to reconsider such fundamental investment. There are strong views on this project; from the Government’s point of view, it creates thousands of jobs and apprenticeships and builds much greater connectivity. But of course, as the Chief Secretary himself has been clear—I am sure he will emphasise this in the letter to my hon. Friend—we need to see discipline on cost control whatever is happening to wider macroeconomic factors.

    Turning to the substance of the Bill and the specific measures, I shall start with the energy profits levy. Since energy prices started to surge last year there have been calls for the Government to ensure that businesses that have made extraordinary profits during the rise in oil and gas prices contribute towards supporting households that are struggling with unprecedented cost of living pressures. This Bill takes steps to do exactly that by ensuring oil and gas companies experiencing extraordinary profits pay their fair share of tax. We are therefore taxing these higher profits, which are due not to changes in risk taking or innovation or efficiency, but as the specific result of surging global commodity prices driven in part by Russia’s illegal invasion of Ukraine.

    The measure increases the rate of the energy profits levy that was introduced in May by 10 percentage points to 35%. This will take effect from January next year, bringing the headline rate of tax for the sector to 75%, triple the rate of tax other companies will pay when the corporation tax rate increases to 25% from April next year or 30% for the largest companies. The Bill also extends the levy until 31 March 2028, but as the Government have made clear, it is important that such a tax does not deter investment at a time when shoring up the country’s energy security is vital.

    Paul Holmes (Eastleigh) (Con)

    I thank the Minister for outlining the detail on the energy profits levy. Does he agree that the measures he has announced will raise £52 billion over six years? Although in previous debates the Labour party has said that that does not go far enough, it is more than Labour’s proposed energy profits levy would raise.

    James Cartlidge

    My hon. Friend is extremely astute: he has noted the significant contribution these taxes will make to the Exchequer. As I have just said, although this generous allowance is to ensure that we still encourage investment at a time when energy security is critical and where the long-term solution is having secure energy in this country, he is right to highlight the revenue being raised. After all, it goes a long way to funding the support that our constituents are receiving. In fact, they are receiving it this very week: payments are going out to support people facing these very high energy bills. The energy support guarantee this winter will save a typical household £900. We are putting in place extensive support, and as my hon. Friend says, a significant amount of that revenue comes from this new tax.

    Putin’s barbaric illegal invasion of Ukraine and the utilisation of energy as a weapon of war has made it clear that we must become more energy self-sufficient. That is why this Bill also ensures that the levy retains its investment allowance at the current value, allowing companies to continue claiming around £91 for every £100 of investment. This investment will support the economy and jobs while helping to protect the UK’s future energy security, and in future the Government will separately legislate to increase the tax relief available for investments which reduce carbon emissions when producing oil and gas, supporting the industry’s transition to lower-carbon oil and gas production. Together these measures will raise close to £20 billion more from the levy over the next six years. As my hon. Friend said, that brings total levy revenues to more than £40 billion over the same period—of course he added on top of that the electricity generators levy, which we will be consulting on. The Government are also taking forward measures to tax the extraordinary returns of electricity generators, as I have just said, but we will do so in a future Finance Bill to ensure that we can engage with industry on these important plans.

    The autumn Finance Bill also introduces legislation to alter the rates of the R&D tax reliefs. Making those changes will help to reduce error and fraud in the system, ensuring that the taxpayer gets better value for money while continuing to support valuable research and development needed for long-term growth. Over the last 50 years, innovation has been responsible for about half of the UK’s productivity increases. That is an extremely important statistic. We all know the value of R&D to all of our constituencies—I look in particular at my hon. Friend the Member for South Cambridgeshire (Anthony Browne), who will know of its importance in our university cities and all of our key clusters. R&D is a key way of raising productivity, which is why we have protected our entire research budget and will increase public funding for R&D to £20 billion by 2024-25 as part of our mission to make the United Kingdom a science superpower. These measures are significant, but ultimately businesses will need to invest more in R&D. The UK’s R&D tax reliefs have an important role to play in doing that.

    Richard Fuller (North East Bedfordshire) (Con)

    The Government are absolutely right on this point. The objective of giving taxpayers’ money to companies for use through R&D tax credits is to focus on improving productivity. There were real concerns, particularly in the smaller business segment, that the scheme was not working correctly. One aspect of the scheme that caused some concern to small businesses was the time that it was taking for some credits to be paid out, but I think that is improving. Perhaps in summing up later, the Financial Secretary to the Treasury could point to what recent progress has been made on that.

    James Cartlidge

    I am grateful to my hon. Friend. Of course, he was in the Department and has a business background, so he knows the detail and the importance of R&D tax reliefs. I am sure that my hon. Friend the Financial Secretary to the Treasury will have a chance to look at that later. I believe that we will be having a meeting about a separate issue of concern—a certain railway project that matters to him—when we can also discuss these points.

    I turn to the specific detail. For expenditure on or after 1 April 2023, the research and development expenditure credit rate will increase from 13% to 20%. The small and medium-sized enterprise additional deduction will decrease from 130% to 86%, and the SME scheme credit rate will decrease from 14.5% to 10%. That reform will ensure that the taxpayer support is as effective as possible. It improves the competitiveness of the RDEC scheme and is a step towards a simplified RDEC-like scheme for all.

    That means that Government support for the reliefs will continue to rise in cost to the Exchequer—from £6.6 billion in 2021 to more than £9 billion in 2027-28—but in a way that ensures value for money. To be clear, the R&D reliefs will support £60 billion of business R&D in 2027-28, which is a 60% increase from £40 billion in 2020-21. The Government will consult on the design of a single scheme and, ahead of the spring Budget, work with industry to understand whether further support is necessary for R&D-intensive SMEs without significant change to the overall cost.

    Richard Foord (Tiverton and Honiton) (LD)

    It was indeed welcome to hear the Chancellor talking in the autumn statement about additional money for research and development, but what seemed to be lacking was investment in skills. He talked about skills only loosely, and actually there was not one mention of colleges. Will there be any additional money for colleges as a result of the Bill?

    James Cartlidge

    I am grateful to the hon. Gentleman. In raising education, I hope he will have noted and strongly welcomed the fact that, despite the tough fiscal situation, the Chancellor was able to find additional spending for education—indeed, £2.2 billion this year and next year for our schools. I hope he agrees that that is crucial.

    Richard Foord

    Colleges?

    James Cartlidge

    The hon. Gentleman is right to raise further education. We also announced in the statement that there will be a review by Michael Barber looking at the many positive initiatives that the Government have in place for training and increasing technical and vocational skills—T-levels, for example. We want to see maximum support for such schemes, so we will be reviewing them to ensure that we deliver them as effectively as possible. He makes an important point.

    I turn to the measures on personal taxation. We know that difficult decisions are needed to ensure that the tax system supports strong public finances. To begin with, we are asking those with the broadest shoulders to carry the most weight. The Government are therefore reducing the threshold at which the 45p rate becomes payable from £150,000 to £125,140.

    Clive Efford (Eltham) (Lab)

    What consideration have the Government given to taxation of those who benefited during covid? The National Audit Office states that the Government invested £368 billion in the economy through furlough and various other pieces of support, but the people who received that money passed it on. Far from trickling down, the money has trickled up. During covid, the number of billionaires and millionaires increased to record levels in the UK. They have clearly benefited extraordinarily well from Government investment. Why are we not following the money?

    James Cartlidge

    The hon. Gentleman makes an interesting point. I, for one, would never resent the fact that someone is successful in life, particularly because of starting a business, working hard, investing in this country and creating wealth. We should always celebrate that. He says, however, that the money and expenditure during covid did not trickle down. On the contrary, speaking from my experience out in my constituency, businesses still express to me their gratitude for the grants and loans, for the £400 billion of support that we put in place that helped to carry the country through the pandemic—

    Clive Efford rose—

    James Cartlidge

    I will finish this point; the hon. Gentleman is welcome to come back at me on it. He will recall the estimates at the start of the pandemic that unemployment would be 2 million higher than it turned out to be. That is an entire depression’s-worth of unemployment that we saved through our measures, and he should be grateful.

    Clive Efford

    I absolutely agree with everything that the Minister just said, but the truth is that the money paid to people in furlough and to small businesses was passed on. That money was used to repay loans, to pay rent and to pay the lease. People have paid their mortgages. The people who received that money at the end of the day were those who were already wealthy, as the figures show. We should follow the money. We should not squeeze those people until the pips squeak, but we should make them pay their fair share.

    James Cartlidge

    By any objective assessment, that enormous support helped our country through one of the toughest challenges that we have ever faced—the biggest crisis outside war in recent memory. We have, of course, moved straight into another one. Across the House, there is recognition that the £400 billion of extra support that we put in place has benefited the country.

    The hon. Gentleman talks about business costs. Of course, businesses had costs that we had to help them with, but to protect public health, steps were taken to close parts of the economy. We faced an extraordinary contraction. To avoid that, the Government had to step in and, in so doing, we lost 2 million jobs fewer than were predicted to go.

    Clive Efford

    Will the Minister give way?

    Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)

    Will the Minister give way?

    James Cartlidge

    If the hon. Member for Eltham (Clive Efford) will forgive me, we have some interest from another part of the House, so will I take an intervention from Wales, from the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards).

    Jonathan Edwards

    I am grateful to the Minister. I welcome the announcement in the Bill that reduces the additional rate level to £125,000. The calculations I have seen show that somebody earning £150,000 will pay about 1% more in income tax, so this is definitely a step in the right direction. However, somebody earning £1.5 million will pay only 0.1% more as a result of the proposals. Does that not make the case for a further band to be created for those earning very high wages? My understanding, if my history lessons were correct, is that the Thatcher Government, for instance, had a 60% rate.

    James Cartlidge

    The hon. Gentleman makes an interesting suggestion. He will not be surprised to hear that I do not announce new tax bands from the Dispatch Box on Second Reading of a Finance Bill. I can confirm, however, that those earning £150,000 or more will pay just over £1,200 more in tax every year. That is the precise figure.

    For the final time, I give way to the hon. Member for Eltham.

    Clive Efford

    Any Government would have given the support that the Government gave at that time, so I accept everything that the Minister said about that, but where is the money now? There has been £368 billion paid into the economy. Who has it now? Who benefited from it? Should we not follow that money and make those with the broadest shoulders contribute?

    James Cartlidge

    The furlough scheme, on its own, protected 11.5 million jobs. Does the hon. Gentleman seriously think that the Government should expand some extraordinary array of resource to find out what those 11.5 million people did with the money that kept them in work when they could have been looking at unemployment, and we could have been facing the most staggering economic depression in our history? We avoided that and, instead, we reduced unemployment by 2 million more than was expected. We avoided that cut in jobs, which would have been absolutely devastating for communities across the country, and we should all be grateful.

    Richard Fuller rose—

    Paul Holmes rose—

    James Cartlidge

    I have already given way to both my hon. Friends, but I will go to Bedfordshire.

    Richard Fuller

    That is certainly the best place the Minister can go. He is always welcome in North East Bedfordshire.

    The Minister will remember that the additional rate of tax was introduced as a temporary measure by Gordon Brown. When the Conservatives came into government in coalition in 2010, we looked forward to its being scrapped—yet here we are today, proposing that more people on lower incomes, in nominal as well as real terms, be made to pay that additional rate of tax. With the basic allowance tapering off above £100,000, and with the introduction of this rate, does the Minister accept that people in this country who earn more than £100,000 now face effective tax rates of 60% or 50%?

    James Cartlidge

    As a Conservative who wants taxes to be lower, I do not stand here with any relish in putting forward a Finance Bill that will increase taxes. The Chancellor was very clear that we will have to pay more tax, but my hon. Friend understands the aggregate reason, I hope, which is the need for fiscal stability. The overall rate will have an impact of £1,200 a year, as I have said; I do not deny that it will be significantly impactful for our constituents. We want to cut taxes if we can, but before we do so we have to get on top of inflation.

    I give way to my hon. Friend the Member for Eastleigh (Paul Holmes).

    Paul Holmes

    I thank the Minister for giving way. It is a good job I can remember what I was about to say.

    The hon. Member for Eltham (Clive Efford) asked where the money has gone. The support that the Government have given has kept a lot of small businesses in business, as I know he recognises. Does the Minister agree that the money actually went to the medium-sized businesses that keep people in our constituencies employed and on the payroll? That is where the money went, thanks to the actions of this Government. Opposition Members should not pooh-pooh those actions, because they kept businesses going and people in work.

    James Cartlidge

    My hon. Friend is an absolute champion of small businesses and of businesses of all sizes in his constituency. We and our colleagues believe in free enterprise. We knew that the pandemic was an extraordinary situation in which, to keep businesses and free enterprise going, we had to step in an extraordinary way and be a force for maintaining aggregate demand and expenditure. My hon. Friend is absolutely right. What did those businesses do by staying in business? They maintained employment in our communities and maintained the services that they provide. We should all be proud of the extraordinary effort that was made.

    We have announced a reduction in the dividend allowance from £2,000 to £1,000 from April 2023 and to £500 from April 2024, as well as a reduction in the capital gains tax annual exempt amount from £12,300 to £6,000 from April 2023 and to £3,000 from April 2024. We have also announced that we are abolishing the annual uprating of the AEA with the consumer prices index and are fixing the CGT reporting proceeds limit at £50,000. The current high value of these allowances can mean that those with investment income and capital gains receive considerably more of their income tax-free than those with, for example, employment income only. Our approach makes the system fairer by bringing the treatment of investment income and capital gains closer in line with that of earned income, while still ensuring that individuals are not taxed on low levels of income or capital gains. Although the allowance will be reduced, individuals who receive a high proportion of their income via dividends will still benefit from lower rates of 8.75%, 33.75% and 39.35% for basic, higher and additional rate taxpayers respectively. These two measures will raise £1.2 billion a year from April 2025.

    We are maintaining the income tax personal allowance and the higher rate threshold at their current levels for longer than was previously planned. They will remain at £12,570 and £50,270 respectively for a further two years, until April 2028. This policy will have an impact on many of us, as I said to my hon. Friend the Member for North East Bedfordshire (Richard Fuller), but no one’s current pay packet will reduce as a result. By April 2028, the personal allowance, at £12,570, will still be more than £2,000 higher than if we had uprated it by inflation every financial year since 2010-11.

    I reiterate that these are not the kinds of decisions that any Government want to take, but they are decisions that a responsible Government facing these challenges must take. I remind the House that this Government raised the personal allowance by more than 40% in real terms since 2010, and that this year we implemented the largest ever increase to a personal tax starting threshold for national insurance contributions, meaning that they are some of the most generous personal tax allowances in the OECD. Changing the system to reduce the value of personal tax thresholds and allowances supports strong public finances. Even after these changes, as things stand, we will still have the most generous set of core tax-free personal allowances of any G7 country.

    Let me now turn to the subject of inheritance tax. As we announced in the autumn statement, the thresholds will continue at current levels in 2026-27 and 2027-28, two more years than previously announced. As a result, the nil-rate band will continue at £325,000, the residence nil-rate band will continue at £175,000, and the residence nil-rate band taper will continue to start at £2 million. That means that qualifying estates will still be able to pass on up to £500,000 tax-free, and the estates of surviving spouses and civil partners will still be able to pass on up to £1 million tax-free because any unused nil-rate bands are transferable. Current forecasts indicate that only 6% of estates are expected to have a liability in 2022-23, and that is forecast to rise to only 6.6% in 2027-28. In making changes to personal tax thresholds and allowances, the Government recognise that we are asking everyone to contribute more towards sustainable public finances, but—importantly—we are doing this in a fair way.

    I am almost there, Madam Deputy Speaker, but I will be assisted by an electric vehicle, because I am now moving on to that method of transport. Earlier this month I attended COP27, where I met international finance Ministry counterparts and reaffirmed the Treasury’s commitment to international action on net zero and climate-resilient development. The Government welcome the fact that the transition to electric vehicles continues apace, with the Office for Budget Responsibility forecasting that half of all new vehicles will be electric by 2025. Therefore, to ensure that all motorists start to make a fairer tax contribution, we have decided that from April 2025, electric cars, vans and motorcycles will no longer be exempt from vehicle excise duty. The motoring tax system will continue to provide generous incentives to support electric vehicle uptake, so the Government will maintain favourable first-year VED rates for electric vehicles, and will legislate for generous company car tax rates for electric vehicles and low-emission vehicles until 2027-28.

    These are difficult times, but that does not mean we will shy away from difficult decisions; it means we must confront them head-on. Today the Government are tacking forward specific tax measures in this Bill to help stabilise the public finances and provide certainty for markets. This is an important part of the Government’s broader commitments made in the autumn statement on fiscal sustainability, ensuring that we take a responsible approach to fiscal policy, tackling the scourge of inflation and working hand in hand with the independent Bank of England.

    We will do this fairly; we will give a safety net to our most vulnerable, we will invest for future generations, and we will ensure that we grow the economy and improve the lives of people in every part of the United Kingdom. The measures in this autumn Finance Bill are a key part of those plans, and I therefore commend it to the House.

  • Iain Duncan Smith – 2001 Speech on Care Homes

    Iain Duncan Smith – 2001 Speech on Care Homes

    The speech made by Iain Duncan Smith, the then Leader of the Opposition, on 12 December 2001.

    Thank you all for coming here today. Improving our public services is at the heart of my policy agenda, and improving the way in which we treat the sick and elderly is my personal priority.

    It is becoming clearer with every day that Labour’s mismanagement of the NHS has plunged both the care of the elderly, and care homes in particular, into crisis.

    It is clear to anyone with any common sense that a thriving care home sector is pivotal to the overall well-being of the health service. There are patients lying in hospital who are fit enough to be discharged, but remain in hospital solely because there is nowhere to discharge them to.

    And why is this the case? Because under Labour, a combination of ineptitude and mismanagement has seen the closure of almost 50,000 care home beds since 1997. At any one time, over 6,000 hospital beds are occupied by patients whose discharge has been delayed. The Department of Health state that 680,000 patients have their discharges delayed every year.

    That patients remain in hospital when they could – and should – be elsewhere means that they occupy, through no fault of their own, precious beds that would otherwise be given to patients requiring operations. No wonder the waiting lists remain stubbornly high: Not only is there a queue to get into hospital, but Labour have now brought us the queue to get out of the hospital.

    It speaks volumes about their approach to health more generally. They will never deliver necessary reform because they have a deep-rooted antipathy towards private providers.

    The Government seems unable to understand that the system of healthcare in this country needs reform.

    They talk about working with the private sector, but here is an area in which there is a longstanding relationship between the public and private sectors, and the Government is making a mess of it.

    Massive over-regulation, and a cavalier disregard for the basic economics of operating care homes, have seen care homes close at an alarming rate. Homes have faced financial ruin because of the extra costs imposed as a result of the Care Standards Act. Homes that cannot comply with the new regulations have had to close, and the number of available places will continue to diminish at an alarming rate. It is widely known that the costs of a place in a local authority home can be significantly higher than those in privately-run homes.

    No wonder we have a situation where in some health trusts, such as Brent and Harrow or North & Mid Hampshire, over 18% of their beds are blocked.

    Labour seem to have forgotten that ‘care’ is about treating people with the dignity to which they are naturally entitled, and not about quibbling over square inches and room sizes. The nature of a person’s care and treatment must be determined by their need, not by the administrative convenience of the Labour Party.

    Labour’s only solution is to spend more money. But they will do so without reforming the system: indeed they will make it worse through constant interference from the centre. We will all pay more, but get less.

    Health care in Britain, and long term care in particular, needs fresh thinking, and it is that fresh thinking that the Conservative Party is going to provide. The crisis in the care homes sector, and its implications for the care of the elderly generally, is one of our top priorities.

    Unlike Labour, we are not bound by dogma, nor will we handcuff ourselves to a status quo which becomes daily more indefensible. We are free to find solutions which address the real problems people face, not the fantasy view of the NHS which ministers seem to have. We need solutions which deliver better care, not more problems.

    I sincerely hope that by working with the experts gathered here today, we will be able to work together for the benefit of everyone who relies on the NHS and social services.

  • Iain Duncan Smith – 2002 Speech in Birmingham

    Iain Duncan Smith – 2002 Speech in Birmingham

    The speech made by Iain Duncan Smith, the then Leader of the Opposition, in Birmingham on 17 January 2002.

    Some people say that the world changed on September 11th. They say that we have entered a new era – that a period of peace and order has been shattered by a wholly new and unexpected threat.

    And they say that out of this, a different world must be born. A world in which everyday behaviour must change. A world which demands a seismic shift in the powers between Government and people. A world that requires the dissolution of old alliances and their replacement with new ones.

    They also say that it is a world that promises a new order. One in which the threat of terror can finally be subdued in favour of a permanent peace. In which alliances that have been forged to root out a specific enemy can be turned to a broader and permanent purpose.

    I do not see September 11th in those terms. I don’t believe that the world before September 11th was as benign as others, then or now, would have us believe. The end of the Cold War did not represent the triumph of reason and goodwill but a victory for a decades-long policy of credible and effective opposition to those who would destroy us. A victory for practicality, not pipe dreams.

    And as the communist threat ended, it was replaced by a myriad of other threats. That’s why, when fashionable opinion regarded a policy of strengthening our defences as being somehow unnecessary I was more determined of the need to defend against different threats. I have spoken often about the threat of rogue states and their connection with terrorism. I have also pointed out that their terror feeds off organised crime and, as a result, links right through to the drug dealers on our street corners and schools.

    And because I don’t believe that the period between the end of the Cold War and September 11th ushered in a new era of consensus, ‘the end of history’ as some have put it, I am concerned that there are some who say a new global settlement should be the principal goal of the Government.

    Conservatives take the world as it is, not as we would prefer it to be. Those on the Left are always prone to policies that rely on a view of the world as they would wish it to be. So-called ethical foreign policies, or public dreams of pivotal roles take us nowhere if they are built, not on a shrewd understanding of the world as it is, but on a refusal to contemplate a world that eludes attempts to control and order it.

    “Instead of aiming for an all-encompassing consensus built on a vision of a new world order, my instincts are always to build from the bottom up: to derive policy from the instincts and values of the people we represent, guided by our own values.

    To me the grandeur of the response to September 11th lies in the sum of instinctive reactions by a whole host of unrelated people and groups whose behaviour is impelled more by their values than by the deliberate enactment of an ambitious plan. The dying who sustained the lives of their loved ones with a final telephone call. The firefighters who instinctively plunged into the burning buildings to rescue others.

    The Mayor and the President who, in very different ways, found in themselves the ability to lead their people. The ties of history that caused Britain instantly and unswervingly to commit our help to our American friends in the fight against terrorism.

    Perhaps most of all the way sovereign nations came together for a singular, and very specific, purpose that has been conspicuous in its success.

    The steps that these thousands of individuals took were not grounded in some abstract theory, but in values and instincts expressed through actions.

    In Britain today the Government seems to be constantly finding ways to prevent people’s own instincts and values from guiding their behaviour. Whether it is in the public services, in companies or in local and national government, people’s actions are increasingly justified by, or even dictated by, policies with which they must comply. If there’s a single word that has gained currency over the last 30 years, and encapsulates much of what is going wrong, it is ‘compliance’.

    It is dangerous for at least two reasons. First, the more pervasive is the compliance mentality, the more we degrade the capacity of our employees and our neighbours to exercise personal influence and responsibility. We dumb down the individual.

    Second, it implies that the official view that replaces individual discretion will be wiser and more effective. We need more, not less discretion, as individuals, as teachers, as doctors, as social workers, as neighbours.

    My colleague Oliver Letwin, the Shadow Home Secretary, spoke last week about how we need to support and help families, schools, and communities in building the values that sustain a neighbourly society. An ethos of public service is one such value. Labour claim that the value of public service is incompatible with the private sector. But it is their own remorseless centralisation that is the gravest threat to the notion of public service. Our teachers, our nurses and our police officers will progressively lose their sense of vocation if all they are permitted to do is to follow detailed instructions from Whitehall. Labour are destroying, not building, the neighbourly society by not allowing people the freedom to express their values through their actions.

    At the heart of my politics is a belief that people’s values should be free to drive their behaviour. That applies to political parties as it does to individuals.

    I was recently asked in an interview whether there is a Conservative equivalent of Clause IV in the Labour Party’s constitution: an article of faith that we have to repeal to be seen as a modern party.

    The answer is that it is unimaginable that the Conservative Party should be faced with such a dilemma, because the idea of a Clause IV is inconceivable for us. Labour draw their policies from a blueprint for society. They have a top-down approach to policy which leaves them always susceptible to the glamour of grand schemes and global solutions.

    Blair may have removed Cause IV from Labour’s constitution, but he could not remove it from their hearts. He executed a coup de theâtre – milking the applause that were given to a symbolic clash of personalities, the repudiation the old and its replacement with the new.

    Characteristically, though, all of his efforts were focussed on changing the superficial expression, rather than the underlying instincts. Labour remain hostile by instinct to solutions that do not involve heavy state direction. It is no surprise that when Labour’s policies are tested by crisis they fall apart amid chaos and recriminations.

    Stephen Byers, once New Labour’s leading cheerleader for modernisation, now says that there is too much private sector in the Third Way.

    The Health Secretary, Alan Milburn said that he would ‘come down like a ton of bricks on anyone who has anything to do with the private sector’. He said, just six months ago, ‘thankfully we have one monopoly provider and that is the National Health Service and as long as there is a Labour government in power that will remain the case’. On Tuesday, in blind panic at the impossibility of delivering health improvements, he said that he wanted to see the end of the NHS as a ‘centrally run, monopoly provider of services’. When their rhetoric rails against their own instincts it is inevitable, that they should suffer the political equivalent of a nervous breakdown. They have no basis of principle for their policies, so they have nowhere to go, nowhere to turn. So they barricade themselves against reality with 5, 10 and even 20-year plans – each one more ludicrous than the last.

    John Prescott unveiled a 10-year plan for the railways in 1999. In 2000 we had a 10-year NHS National Plan. Last November the Chancellor announced a 20-year plan for the NHS. On Monday Stephen Byers rushed in another 10-year plan. Two year, two portfolios, four 10-year plans.

    Always a new plan – they never get shorter, and the Government never talks of being four years into a plan.

    They also have a cynical purpose. They take refuge in the abstract to distract people from what is all too real. They go to enormous lengths to prevent themselves from being judged.

    David Blunkett tries to turns the clock back to zero by blaming their failure on crime on his predecessor, Jack Straw. John Prescott said ‘judge us on transport after 5 years’. Five years come and Stephen Byers says it will take another 10. If anyone personifies Labour’s failure to hide behind plans rather than take responsibility it is Stephen Byers.

    This whole approach is alien to Conservatives. We have never believed in new world orders or domestic blueprints. We have always been the practical party, because we have never tried to cut ourselves loose from our principles, but instead have expressed them through our policies.

    Conservatives have been successful when we have articulated a clear view of the problems that Britain faces, and have found ways to solve them that rely on empowering people rather than pushing them around. ‘Trust the people’ has always been a powerful Conservative rallying cry. It has never let us down in the past, and it will not now. We have embarked on the most far-reaching renewal of our policies for a generation. It is our opportunity to refresh our sense of purpose, and to make connections way beyond our usual supporters.

    The first thing this requires is to be clear about our priorities. We can’t concentrate on everything at once, and nor should we. To govern is to choose, and as we prepare for government we will not flinch from making choices.

    We choose to concentrate on the issues that make most difference to people’s lives. So our efforts will be focussed on solving the crisis in our public services – the health service that makes people afraid to fall sick; schools that deprive millions of children of the opportunities that a first class education offers; a transport system that makes travelling in or between our cities an ordeal.

    And we will focus on the problems – and they include our public services – that are hardening the arteries of our economy turning it from one of the most flexible and dynamic in the Western world into one of the most overburdened, conformist and bureaucratic.

    We understand instinctively that the quality of our lives is influenced more by our families, our communities and our environment than by the economic forces that those on the Left think determine our well being. So we will sweep aside Labour’s ludicrous assertion that Britain’s streets are becoming safer than ever. We all know from experience that is not true, and we will look for the means to revive the neighbourliness that stops the conveyor belt of crime from ever taking hold. And we will address the concerns of a new generation for the condition of our environment. It is fertile territory for Conservative thinking. The best traditions of Conservatism are about our duties as stewards of an unending inheritance, rather than revolutionaries seeking to impose a new order.

    During the years ahead, people can count on the Conservatives always to have, at the forefront of our minds, the same concerns that they do.

    As we renew our policies we will not be content to listen only to the usual voices. I mean to expand the range of people and organisations that influence us.

    But the way we develop policy will be characterised by leadership and direction, and based firmly on Conservative values. Our values have stood the test of time. The problems may have changed, but the values that underpin our solutions are as relevant as ever.

    By their nature, Conservative values are not easy to capture in distilled form. Their true expression is through our policies and how we conduct ourselves. But as we renew our policies, and expose the failures of this government, these are the themes that will be consistently expressed.

    The first is that our policies will clearly help people to be more independent of the state. Labour is making Britain a nation of supplicants. Every time the Chancellor presents a budget, he draws more people into dependence on his largesse.

    Forty per cent of our fellow citizens will rely on means-tested benefits by 2003 – up from 25 per cent in 1997. When more and more people have to rely on the Government for their living we compromise their dignity and damage our economy and our democracy.

    We in Britain do not save enough – and societies saving as little as ours are heading for long-term welfare dependency.

    And we must go further. It’s not just a matter of increasing people’s independence, our policies must reduce the power of the state over people – and that is our second principle. Because I trust the people, I want people to have more freedom to shape their own lives.

    We have a Government of control freaks. For Labour, control is not a means to an end, but an end in itself.

    It was explicit in the old Clause IV, and is implicit in everything they do in Government. Their first instinct was to take the railways back into state control – without any idea of how this would help or even of what to do next. The chaos and misery that passengers are suffering is as nothing to them, compared with the self-satisfaction they feel from being in control.

    They bombard our teachers with orders and directives, and destroying their ability to act according to their instincts as professionals and as individuals. They attach so many strings to taxpayers’ money spent on health that hospitals have even less money to spend according to doctors’ priorities than before.

    And they take every opportunity to emasculate the institutions, like Parliament, that exist to hold them to account.

    Our policies will reduce compulsion by the state, and ensure that whenever the government exercises power it is effectively scrutinised, and that the rights of individuals are protected.

    As we reduce compulsion, so we increase the choices available to our citizens – and that is our third principle.

    Because Labour cannot bring themselves to trust people’s instincts, they are against choice. Among their first acts was to remove choice in our education system, by banning Grant Maintained schools – themselves established by parental choice – and scrapping the assisted places scheme.

    As a country, we have always been stubbornly varied. Our great cities still find their characters in the urban villages that make them up. Our counties are proud of how they differ from their neighbours. They embody a diversity that runs with the grain of Britain’s history and our character. But that diversity cannot be imposed. That is why the Government’s bogus regional agenda seeks to replace what is organic and historical, with something that is alien and unworkable. The only diversity that this Government will permit is one of its own design – a diversity that is not the outcome of choice, but its reverse – the attempted imposition of order.

    Choice does not equal insecurity. Indeed the opposite is true, which is why the fourth characteristic of our policies must be that they provide greater security for our fellow citizens.

    As we have grown more prosperous as a nation, we have lost some of the things that made us feel secure.

    It is a paradox that many of the very institutions that were meant to increase our sense of security have become some of the prime sources of insecurity in our lives. The NHS was conceived as a safeguard on which we could all rely. But for many – especially our most vulnerable citizens – the possibility of falling seriously ill and having to rely on the NHS is a nightmare. It adds to their worries, rather than reduces them.

    The Prime Minister said in the House of Commons last week that crime is falling. That is not the experience of millions of our fellow citizens, who feel less and less secure in our streets. Muggings are up by 40 per cent. Violent assaults are up by 20 per cent. And, as with our public services, it is the most vulnerable in our society who bear the brunt of the effect of crime.

    The only credible solution is decisive action to tackle at source the causes of these insecurities. Palliative measures offer only false comfort. In the late 1970s we recognised that the growing power of the trades unions was a source of increasing national insecurity – compromising our ability to earn a living. A decade of policies to mollify the threat of ever worsening industrial relations failed absolutely to resolve the insecurity that it bred. People predicted that the consequences of decisive action would be destabilising. They did the same when we reformed the British economy during the 1980s.

    But in both cases, the result of decisive action to address the causes, not mitigate the symptoms, was to restore a more fundamental security to our national life.

    Essential to the confidence that comes from competitiveness is our fifth principle – that our policies should remove obstacles to enterprise, both at home and abroad.

    Our businesses resent the fact that in more and more areas they must, in effect, obtain a licence to trade from the Government. It sometimes seems that what is not illegal is becoming compulsory.

    A government which says it sees the virtue of eliminating rules, taxes and regulations on international trade is oblivious of the fact that precisely these measures are taking over our own domestic economy. They have identical effects: impediments to trade whether in Britain or internationally impoverish us all and our policies will be characterised by removing them.

    The CBI itself puts the increased burden of business taxes at £5 billion a year. The Institute of Directors has put the added cost to business of regulations at a further £5 billion. And in the year 2000 alone 3,864 new regulations were introduced – the highest figure on record. No wonder our businesses have to struggle harder and harder to compete.

    The Government says it wants a new relationship with the private sector to pay for public service projects. But it will never work because they lack the basic instincts to avoid interference and control. Just look at the railways.

    Four things are needed when private capital is brought into public projects: clear information, on which customers and suppliers can make a choice; freedom for customers to choose; freedom for providers to manage their businesses; and sanctity of contracts.

    Labour lacks the most elementary appreciation of each of these. Take the health service, for example. Information about cost and performance is not available.

    Customers – GPs or patients are not free to choose their health provider. Private providers are not free to manage their businesses, but have to abide by NHS practices. Characteristically, the Government insists on total control.

    And if private capital providers can’t rely on the Government to keep to the terms of the deal – if the Government doesn’t hold to the sanctity of contracts – then there will be a huge risk premium on providing capital for public projects. After the Railtrack debacle what is the risk premium on dealing with this Government now?

    All of our policies will be informed by a vision of what our country is like at its best. They will be marked by more self-confidence in Britain than any of our opponents dare display.

    This Government has always been embarrassed by our traditions and our ways of doing things. They have tried to promote bogus makeovers for Britain as a nation – do you remember ‘Cool Britannia’? And when that failed, they have tried, as in their approach to Europe, to submerge the things that make us distinctive as a nation.

    Conservatives are confident about Britain’s future because we are comfortable with our past. Labour is neither.

    People don’t want grand schemes and elegant theories. What people want, in fact expect, from our democracy is something much more simple and yet far more difficult to achieve. They want us to give them the freedom to make life better, to help them when required and to get out of the way when we are not.

    So our policies will result in less politics in people’s lives, whereas the Government wants more. Policy renewal is inseparable from effective opposition. Our first duty is to expose the problems people in Britain face, especially where, as in so many areas, the Government attempts to disguise the scale of its failure by a culture of deceit.

    But the way that we oppose must also convey our own principles, and exemplify, rather than detract from, our own approach.

    Oliver Letwin’s analysis of crime is based on precisely the Conservative principles I have described of recognising the importance of allowing people’s values to govern their behaviour. He is showing that our approach is principled, intelligent and humane. The proposals that we announced this week to replace the House of Lords with a directly-elected Senate, standing above political patronage, shows that our principles can have striking expression. They underline the fact that we can recognise when the time has come for change, and we will embrace it in a way that reflects principle, not self-interest.

    In the months to come more flesh will be put on these bones of these principles for a distinctively Conservative approach to government. But within that skeleton, this backbone will be particularly important. For even before our far-reaching policy review has come up with its results, Labour will certainly try to discredit it, and us.

    Of course, that’s what politics is often about. And there’s nothing wrong with heated debates, or even the occasional polemic, as long as the issues are fully exposed as a result. But my distaste for New Labour’s political style is quite different.

    The Prime Minister used to say that the problem with Old Labour was that it confused means with ends. The problem with New Labour is that it its only purpose is to stay in power.

    This Government has impoverished politics. They have weakened all the institutions that could check or effectively scrutinise their actions – the Lords neutered, the Commons ignored, the media alternately cosseted and intimidated.

    The Prime Minister has appointed more peers more quickly than any holder of his office in history.

    Wasn’t it typical of New Labour that their plan for the House of Lords was to take the 80 per cent appointed House they created in 1999 and offer to turn it into an 80 per cent appointed House, with a further 20 per cent chosen by party bosses through closed lists?

    No wonder the sense of alienation with politics grows by the day.

    I am determined that the next Conservative Government will not just implement different policies that reflect our principles. Our whole approach to government will be fundamentally different. We will check the obsessive media manipulation, the suppression of debate, the erosion of constitutional checks and balances. We will stop burying bad news, adjusting targets and double counting public spending figures.

    We seek power for a purpose, we will pursue policy based on principle, and this will give our government clear direction.

    And we will conduct ourselves in opposition as we mean to conduct ourselves in government. Honest, principled politics is important. Because we trust people, we know the importance of persuading them to trust us.

  • Diane Abbott – 2022 Speech on Manston

    Diane Abbott – 2022 Speech on Manston

    The speech made by Diane Abbott, the Labour MP for Hackney North and Stoke Newington, in the House of Commons on 28 November 2022.

    Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)

    I am grateful to the Minister for coming before the House with his statement, but does he not agree that it should not have taken a death to make Ministers focus properly on issues relating to infectious diseases at Manston? It is not as if the possibilities relating to infectious disease have not been raised and written about. Does he not agree that it is quite wrong that it took a death for him to come before us and talk about new guidance: new guidance that nobody presenting with symptoms will be progressed on; new guidance about ensuring that asylum accommodation providers get the very latest public health advice; and new guidance about co-operating with the French about infectious disease in northern France? It took a death for the Minister to come before us with that new guidance.

    The Minister has also said that there is no risk to the wider population and the House is grateful to hear that. However, does he not accept that, whether these people are deemed to be legal or illegal, we have a basic responsibility for their health? It should not have taken Ministers so long to focus on the well-reported dangers of infectious disease.

    Robert Jenrick

    I respect the right hon. Lady’s point of view and experience, but it has not taken a death for the Home Office to focus on this issue. This individual’s death is deeply regrettable, but we have been working on, and alive to, this issue for many months—indeed, for years. The Home Office has had in place procedures to deal with covid since the start of the pandemic. The hotels I mentioned earlier, which we will use to transfer people with diphtheria symptoms, were the locations the Home Office used for those who tested positive for covid.

    The UKHSA has been publishing guidance on the treatment and support of asylum seekers and refugees for many months—it may even be years. The latest guidance on this issue was published by Dame Jenny Harries and her colleagues two weeks ago, prior to the sad death of this individual. I am afraid that the connection that the right hon. Lady seeks to draw is not correct. We do not take this issue lightly, and we will continue to follow it and to put in place whatever measures we need to.

  • Pope Francis – 2022 Comments on Russian Invasion of Ukraine

    Pope Francis – 2022 Comments on Russian Invasion of Ukraine

    The comments made by Pope Francis in an interview published in America Magazine on 28 November 2022.

    When I speak about Ukraine, I speak of a people who are martyred. If you have a martyred people, you have someone who martyrs them. When I speak about Ukraine, I speak about the cruelty because I have much information about the cruelty of the troops that come in. Generally, the cruelest are perhaps those who are of Russia but are not of the Russian tradition, such as the Chechens, the Buryati and so on. Certainly, the one who invades is the Russian state. This is very clear. Sometimes I try not to specify so as not to offend and rather condemn in general, although it is well known whom I am condemning. It is not necessary that I put a name and surname.

  • David Lammy – 2022 Speech to Christian Aid’s Annual Lecture

    David Lammy – 2022 Speech to Christian Aid’s Annual Lecture

    The speech made by David Lammy, the Shadow Foreign Secretary, on 22 November 2022.

    It is a great honour to give this lecture at Christian Aid.

    An organisation that fights injustice, supports victims of humanitarian emergencies, and defends human rights.

    The Christian faith that my mother taught me has always been, and will always be, central to my values.

    And I’ll tell you why. It’s because in the example of Jesus we learn of a man willing to challenge power.

    Not simply saying ‘this is sad’ but ‘this is wrong’.

    Someone who sought to end cruelties and injustices because he saw in every single one of us one of his Father’s children.

    I believe it was in this spirit that in 1952, a group of Labour MPs, led by future Labour Prime Minister Harold Wilson, published a pamphlet called the ‘War on Want’.

    It set out a challenge not only for the UK, but for the whole of the Global North and our allies.

    “Transcending all our immediate problems,” the War on Want group said a year before, “the gap between the rich and the poor of the earth is the supreme challenge of the next 50 years.”

    Let me say that again. The gap between the rich and poor of the earth is the supreme challenge.

    Because here too were individuals recognising that gaps – in wealth, in dignity, in power – offend us on a moral level just as much as suffering touches us on an emotional one.

    And that is what I want to talk to you about tonight.

    About how we can have a new development approach, fit for the 2020s, that addresses questions of power and inequality, just as vigorously as the last Labour government sought to tackle the very worst forms of poverty we then faced.

    It would be wrong to fail to recognise the progress the world has made since Harold Wilson was launching his war on want.

    In 1950, nearly two-thirds of the world were living in extreme poverty.

    Today that figure is estimated at around 9%.

    Hundreds of millions have been lifted out of the most dire poverty.

    Smallpox was eradicated.

    Infant and youth mortality has vastly reduced.

    Vaccinations rates for preventable diseases have soared.

    Extraordinary progress has been made.

    And yet few look upon the world with optimism at present.

    Today, we face enormous challenges – old and new, immediate and long term.

    The world today is facing acute humanitarian crises.

    Not only stubborn poverty and pervasive inequality, but famine, conflict, climate change, refugee and migration flows and global health insecurity.

    Earlier this year I was sitting in a classroom in district 17 on the north-west outskirts of Kabul with a group of women helping children displaced by war.

    One told me she was considering selling a kidney so she could put food on the table for her family.

    Another explained she was having suicidal thoughts.

    A third asked me: “Two or three generations have suffered. Will another generation suffer? Should we have hope or is it just hopeless?”

    In Afghanistan alone, more than 18 million people are facing potentially life-threatening food insecurity.

    But this is just one pocket of desperation in a world that is becoming increasingly insecure.

    Drought is gripping the Horn of Africa.

    Up to 26 million people will face food shortages in Kenya, Ethiopia and Somalia over the next six months.

    In Lebanon, real terms food inflation has spiked to 72 per cent.

    According to the World Food Programme, 345 million are facing acute food insecurity in 82 countries.

    A new global coalition – Hungry for Action – of which many of you in this room are a part, has been formed to campaign against this outrage, standing in a long tradition from the anti-apartheid struggle to Jubilee 2000 and Make Poverty History.

    But while this new effort shares its heritage with those great campaigns of the past, it is also new because , for the first time, it brings the worlds of development and domestic poverty together, something I know Christian Aid has been keen to do for some time.

    Because it cannot be right to say to my constituents in Tottenham that their pain, in this terrible cost of living crisis we are facing, somehow matters less than that of our brothers and sisters overseas.

    That the sleepless nights of a worried mother who knows there is nothing to give her children for breakfast matter if they are spent in Hargeisa but not in Haringey.

    The answer to those who say ‘charity begins at home’ cannot be ‘you don’t know how lucky you are’.

    No. It must be ‘we stand together, because no child should be hungry anywhere at any time, when we live in a world of plenty and a century of promise.

    Charity might begin at home, but it shouldn’t end there.

    So this idea that we must stand together as people experiencing inequality wherever we are in the world is one of many ways that the world has changed since Labour came into power 25 years ago in 1997.

    It is not the only thing that is different.

    On the one hand Covid, the Global Financial Crisis, the global energy crisis, the climate emergency show that the world is more interdependent than ever – with our fates more closely intertwined.

    On the other hand our world now is more divided.

    More aggressive, more transactional, more short-termist, more dangerous.

    In 1997, the UK economy was almost double the size of China’s.

    Today, China’s economy is roughly six times the size of the UK.

    Where economic gravity has shifted, international institutions have been put under strain.

    The UN remains vital, but Russia’s veto on the Security Council limits its power.

    Populists and autocrats are blocking the path to progress, pursuing narrow nationalist interests and fanning the flames of division.

    Our problems require collective solutions, but collective action seems harder than ever.

    As we neglect the multilateral institutions that have been at the heart of so much progress, China is intent on reshaping and in some cases replacing them creating their own institutions through which to make investments and deliver aid.

    Western development assistance is just one part of shifting financial flows.

    ODA from donor countries – totalling $180bn last year – is dwarfed by remittances which were $773bn last year, more than four times bigger.

    And funding and debt from authoritarian states are reshaping the development map.

    These funds come without the restraints and expectations of development assistance, but with other strings attached.

    It is no coincidence which countries in the Global South have abstained at UN votes instead of condemning Putin’s illegal invasion.

    The role of the IMF is now rivalled by Chinese investment, which is now the largest official bilateral creditor in more than half of the world’s 73 poorest countries.

    Visit the capitals of the developing world and it is glaringly obvious the sheer scale of investment and construction from China.

    We are still working out how to compete in this current reality while remaining committed to our values, but we do not have time to waste.

    In the decade ahead, these trends reshaping the world will only intensify.

    The most significant of all is the climate emergency – the greatest challenge the world faces.

    The UN warned recently that the world is on course for a catastrophic 2.8C of warming, in part because the promises made at COP26 a year ago have not been fulfilled.

    This would deliver devastating consequences for our natural world and dangerous, destabilising effects for all countries.

    It would usher in an era of cascading risks as the uncontrolled effects of global heating result in more frequent extreme heat, sea level rises, drought and famine.

    This will end up hitting us in the UK too. We are seeing its effects already with floods and heatwaves becoming the norm not the exception.

    Global heating will hurt us all.

    But the truth is that developing countries and people living in poverty are the most exposed to the worst consequences of the climate emergency.

    I have just returned from COP27 in Egypt, where the issue of loss and damage was front and centre.

    The agreement to create a new fund is an important step forward in recognising the consequences of the climate crisis for the world’s most climate-vulnerable countries.

    This is a matter of solidarity, and the reality that those most likely to be affected by climate change are the least able to afford to adapt to it.

    The UK government already supports poorer countries to cut emissions, and to adapt to climate change.

    Loss and damage is about coping with the disastrous effects.

    But on the necessary actions to keep global warming to 1.5 degrees yet again we hear the unmistakable sound of the can being kicked down the road – and as a result it is now at grave risk.

    Too many countries were clearly resistant to what is required, including on fossil fuels.

    And the government’s leadership has been weak, with the Prime Minister having to be embarrassed into even showing up.

    We need a government that can step up – delivering cheap, home-grown zero-carbon power at home so we have the credibility to pressure other countries to fulfil their obligations and play their part.

    Given what is at stake, it is easy to be pessimistic.

    But I still believe that multilateralism – incremental and imperfect as it may be – remains our best hope to face our common challenges.

    The rise of geopolitical competition just makes it harder.

    And we need to work much harder to show that multilateralism works in the interests of the whole world, not just its most prosperous nations.

    Development and diplomacy are our best tools in the fight against poverty, conflict, and climate change.

    But instead of straining to make multilateralism work I am afraid our government has sometimes seemed intent on breaking our relationships and trashing our reputation.

    12 years of Conservative government has left Britain disengaged, forgetting that sharing vaccines and investing in global health makes our citizens less likely to experience deadly pandemics.

    Forgetting that tackling climate change will stop sea levels rising and submerging British towns.

    Forgetting that reducing key drivers of the refugee crisis – poverty and conflict – will make a more secure world for everyone.

    Under this government the Conservatives have knocked down the pillars upon which Britain’s development leadership was built.

    First, they retreated from Britain’s commitments – cutting our development target from 0.7 to 0.5, and stripped billions from vital aid programmes in the process.

    They lost credibility by failing to meet promises on climate and covid.

    Then, they undermined delivery, overseeing a bungled merger between DFID and the Foreign Office – deprioritising development, sapping morale and pushing out expertise.

    Now, they are projected to spend £3 billion of the development budget here, in the UK, to cover the costs of incoming refugees.

    Meaning billions in foreign aid never leave Britain.

    Their retrograde strategy for development, takes a transactional approach to aid which risks repeating the worst mistakes of the past.

    The improvement in the UK’s credibility on aid after the horrors of the Pergau Dam was not a matter of chance, but of choice.

    The choice to untie aid and focus it on the goal of poverty eradication.

    The Conservatives’ approach to trade is today a shameful shambles, as none other than George Eustice has recently found the courage, after office, to concede.

    It reflects not so much a mindset of “Global Britain” but “Little England”.

    The Tories fail to understand that neglecting the challenges of climate, conflict, famine and global health makes all of us less safe, and will work against Britain’s national interests in the long term.

    This shift towards making aid transactional is not only damaging our reputation for development, it reduces our diplomatic influence.

    When we had a clear moral purpose, focused on helping those most in need, there was far less suspicion about our own agenda.

    The time for post imperial delusions is over, it’s time for a new and more effective approach.

    And this brings me back to where I started, with the idea that we shouldn’t have any sort of hidden agenda, but a public and radical one.

    Our ambition should be nothing less than redistributing power to people – particularly women and girls – at the sharpest end of inequality at home, and around the world.

    For Britain’s development to get back on track, we need a Labour government.

    You only need to look at history to know that we are the party that can be trusted as a force for good.

    What has today become known as international development arose originally from a plan to extract even more profit from the colonies.

    After World War One, Britain experienced large-scale unemployment.

    UK politicians reasoned that if British colonies were given loans for capital projects that required British imports, unemployment at home would reduce.

    The 1924 Trade Facilities Act did just this.

    By 1929, the colonial Development fund was established for 10 years of up to £1 million per year.

    The fund was predominantly targeted at the West Indies and Africa, and it was presented as in Parliament as in the interests of Britain rather than the colonies themselves.

    It was not until the 1950s that Britain’s thinking towards international development began to mature.

    This happened for two reasons.

    First, Britain’s empire was rapidly collapsing.

    Second, there was growing international recognition that richer countries would need to assist poorer countries on their journey to economic and social progress.

    The US, which at the time provided two-thirds of resources to developing nations, demanded fairer burden sharing.

    And the issue moved up the agenda of the UN.

    But it was not until the Labour government of 1964 that a Ministry of Overseas Development was created.

    Harold Wilson, who had helped write the ‘war on want’ pamphlet, finally got his wish.

    In 1997, Labour created the department for international development, which became renowned around the world.

    More important than the structural model of delivery was the seismic shift in ambition that Labour brought to development policy.

    Under the leadership of Tony Blair and Gordon Brown we set our sights on an eventual target of 0.7%.

    It was one of the greatest successes of our last period in office.

    Through international aid, Labour helped lift 3 million people out of poverty each year.

    1.5 million people got improved water and sanitation services.

    3 million more people got access to drugs for HIV and AIDs.

    We helped 40 million extra children go to school.

    And we made huge progress on eradicating polio.

    At Gleneagles in 2005, Labour led an international campaign to cancel 100 per cent of multilateral debts for the world’s poorest countries while securing an extra billion dollars of aid.

    In September 2008, the UK played a key role in the Millennium Conference making progress on malaria, food, education and health.

    And we supported an Environmental Transformation Fund, anticipating the urgent action needed to tackle climate change.

    One of Labour’s lasting achievements had been to forge a new political consensus around development that it was in Britain’s interests, that it should be rigorous and transparent, focused on effectiveness and value for money, and that it was something that Britain should truly be proud of.

    To their credit, David Cameron and George Osborne sustained that commitment, keeping Britain on the path to 0.7% that Labour had set it on.

    And while there is much that I disagree with them on, this was an important area of broad cross-party consensus.

    Under the numerous Tory prime ministers since then… Boris Johnson, Liz Truss and Rishi Sunak that consensus has broken down.

    At the time when – as I described earlier – humanitarian need is soaring not falling, and the challenges of famine, conflict and climate threaten our security.

    Labour made Britain a world leader in development before and we can do it again.

    In a world of global challenges, and political divides, we need both the long-term transformational agenda of development, and the political nous of good diplomacy.

    Both will be essential as we continue that hard work towards the ambitions of the Sustainable Development Goals and beyond.

    We must be able to lead by example – not break our word or commitments.

    That goes for the treaties we sign with our closest partners in Europe or the promises we made to deliver climate finance to the developing world.

    It means not reducing our focus on development while asking others to do more.

    It means not preaching to others about Net Zero without a credible plan to get there ourselves.

    It means rediscovering the core principles that should guide us: our commitment to human rights, democracy and the rule of law.

    But our approach to development must also evolve with the world we are living in.

    We must be realistic about the role and contribution of Western donors.

    Development finance and policy are vital but they are not the only – or indeed the main driver – of global economic development.

    Overstating our own influence downplays the other profound forces at work and undermines the agency of developing countries themselves.

    Instead, we must be focused on where we can really make a difference.

    We must adapt to a world where lower and middle income countries across Africa and Asia have greater economic weight, and greater political influence.

    Our approach should be grounded in a deeper understanding of our own history, and the way people in many countries in the Global South view the historical role of the UK.

    It must be sensitive to the criticisms of aid as patronising or paternalistic, and build instead modern relations of equals, two-way partnerships based on respect and mutual trust.

    I think of the example of the development sector’s understandable pre-occupation with the fair distribution of vaccines around the world.

    It is of course an injustice that millions of Europeans were vaccinated many times over while much of the world waited for a first dose.

    All because a few wealthy nations stockpiled more vaccines than they could ever use.

    This cannot happen again.

    But our goal must be even bigger: for intellectual property and manufacturing capacity to be shared around the world so that countries are producing their own vaccines, not waiting for our leftovers.

    That’s what I mean when I talk about power. The old slogan was ‘justice not charity’.

    I want us to go further and think not about justice bestowed but power claimed.

    The power for people to chart their own futures.

    Development policy must be rooted in the aspiration for lives of dignity and opportunity across the world.

    I’m sure that everyone in Britain shares this aspiration, and we must show them that being a good partner to low-income countries is not only a great British tradition but an opportunity for our growth and prosperity too.

    Our development agenda must respond to the vast need for financial investment across the developing world, from a range of sources.

    Development should support the role of effective public services in the developing world to help support capable, accountable governance.

    We must work alongside our trade union movement and partners overseas to strengthen workers’ rights and fair labour practices.

    I am convinced that we can do more to share the experience of Britain’s most beloved institution at home – the NHS – to support the goal of universal health coverage abroad.

    And it must address the twin drivers of climate change and conflict – championing the green energy transition, climate finance, and supporting peace building and conflict prevention.

    Let me explain some of the ways Labour would set about doing this.

    First, we will become one of the world’s leading conveners.

    Our new foreign and security policy pact with the EU will enable a constructive working forum with our European partners.

    We will use our deep relationship with the United States to strengthen collaboration on development.

    We will use our membership of the UN Security Council, the G7 and the G20 to move development further up the international agenda.

    And the Commonwealth provides a unique opportunity to partner with the Global South.

    As my great colleague Ed Miliband has outlined, we will build a clean power alliance of developed and developing nations committed to renewable energy.

    If we prioritise development in all of these fora, Britain can become one of the world’s best connected and trusted leaders on aid.

    And Labour will be strategic in its approach to forming new partnerships with African nations.

    There is far more the UK can do to support aspirations in the most climate-vulnerable continent, but also the continent with the greatest potential for increased development and prosperity over the coming century.

    Second, we will use the power of example to extend the UK’s soft power.

    From our leadership on development to the brilliance of the BBC World Service and British Council, our credibility abroad starts from the strength of our support at home for these vital instruments of UK soft power

    Not by exchanging aid for trade. That would do the opposite.

    But by offering the best of Britain as partners in their own development.

    We need to offer an alternative to Chinese physical infrastructure – and link it to British innovation in education, governance and healthcare to support their own development.

    Third, yes, we will get Britain back on track to meet its commitment to the UN’s 0.7% development target, as soon as possible as the fiscal situation allows.

    Let me address today why even at a time of real economic hardship and fiscal constraint, I believe it is unequivocally in the UK’s national interest to restore the UK’s leadership in international development.

    For me, the answer is deep and deeply personal, the roots of my politics are nourished by the belief in the equal worth of every human being.

    A world this unequal and divided offends that fundamental belief.

    It demands a response based on solidarity, not simply sympathy.

    It demands a response based on justice, not charity.

    It demands a response based on dignity, not dependence.

    And it demands a response that recognises that in the UK we have a real national interest in a world that is more equal, more sustainable and more stable.

    So, for me, the case for UK leadership in international development combines a moral and a strategic dimension.

    It is not only the morally right approach. It is also the strategically smart approach.

    It’s about who we are, and the world we want to leave to our children and grandchildren.

    And we will target this development assistance for the most impact.

    Prioritising early, smart and innovative development interventions.

    Getting people into decent employment using locally driven information.

    Restoring the role of our trade unions in supporting development policy and programmes, through their partnerships with sister labour organisations across the world.

    And using private sector finance where interests align.

    For example, the International Rescue Committee’s partnership with Google in Nigeria which uses satellite imagery to trigger cash payments to communities in advance of extreme weather events.

    We will set up a new taskforce to coordinate private sector support for development finance in line with the government’s priorities.

    Fourth, learning the lessons of the government’s bungled merger we will create a new model for international development to meet the challenges of the 21st century.

    Labour has always maintained that development and diplomacy are related but distinct, and our new model will have the independence needed to reflect those important differences and empowers both to meet the challenges of the 21st century.

    We are working at the moment on what are the best structures of delivery to restore transparency, value for money and focus to the UK’s international development.

    We are consciously and purposely looking outwards not inwards, and forward not back in undertaking this work.

    We are looking at best practice in the sector internationally and looking at what are the challenges of the coming decades.

    In this task, development organisations like Christian Aid have a crucial role and we want your help.

    As we continue this work, we want to hear your fresh thinking on how we met the development challenges of tomorrow.

    Just as in the past, it will fall to an incoming Labour Government to once again move the UK’s development efforts back into a position of international leadership so we’re determined to do the work, look at the evidence and reach the correct outcome.

    Fifth, we remain committed to a feminist development policy.

    Away from the world’s gaze, millions of school age girls across Africa face forced marriage, with all the dangers and humiliations it wreaks on a child’s life.

    But we’ve seen the shameful deletion of references to protecting women and girls’ reproductive rights in the Government’s statement on freedom of religion or belief and gender equality.

    As we approach the 16 Days of Activism against Gender Based Violence, Labour reaffirms its commitment to the UN Sustainable Development Goals of reaching gender equality.

    And sixth, we will recognise the inextricable link between tackling the climate crisis and global development for all.

    A Labour government will campaign for climate action to become a fourth pillar of the UN, and push for a new international law of ecocide to criminalise the wilful and widespread destruction of the environment.

    And as our excellent Shadow Cabinet Minister for Development, Preet Gill, set out at conference, Labour will legislate to make sure that Britain’s aid budget makes climate action a priority.

    The world today is increasingly insecure.

    Too many people live under authoritarian regimes, denied the dignity of democracy.

    I know many of us will have been praying for and thinking of the women of Iran in particular in recent days.

    Too many are still in poverty, while the gap between them and the super rich grows.

    Covid and Climate Change show how disease and disaster know no borders.

    International rules, multilateral institutions and political leadership are needed more than ever.

    Throughout our history, Britain has played a leading role in establishing this system.

    Helping to create institutions like the UN and NATO.

    But today our leaders in government are jeopardising it.

    Acting outside of the rule of law for domestic, short-term reasons.

    Undermining the system that keeps our people safe in a lame effort to protect their own jobs.

    The Conservatives have focussed more on protecting themselves than protecting others.

    Britain can be better than this.

    Britain must be better than this.

    It is time to repair our relationships with our allies around the world.

    Revitalise our nation’s soft power, influence and impact with a renewed strategy for modernising international development.

    Restore the influence of multilateral institutions like the UN.

    Once again reach the target of 0.7% because it is the national interest for Britain to be a force for good.

    Only by playing our role in fixing the problems around the world will we be able to provide security and prosperity at home.

    In a dark age of authoritarians and populism Labour will shine a light for democracy, the multilateral system and human progress once again.