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  • Ursula von der Leyen – 2022 Speech on her Official Visit to Albania

    Ursula von der Leyen – 2022 Speech on her Official Visit to Albania

    The speech made by Ursula von der Leyen, the President of the European Commission, on 27 October 2022.

    Thank you very much, dear Prime Minister, dear Edi,

    It is very good to be back here in Tirana. So much has happened since my last visit. It is just a year ago, I think, since I came last time to Tirana. In July, you started the accession negotiations with the European Union. And I was very glad to be with you in this historic moment. It was a touching moment, a very special moment. But let me repeat what I said at that time: It is your success. It is the result of many years of hard work done by Albania and the Albanian people. Years of patience, too. I remember that vividly, of course. You maintained a very strong focus on the European path, on the process. And therefore, this is now paying off with the accession negotiations. You have shown time and again your commitment to the values of the European Union. You are fully aligned with the European Union’s response to Russia’s brutal war of aggression. I must say it is exemplary how Albania has been actively defending the rules-based international order in the UN Security Council. I really thank you for this clear commitment. This honours you. It shows time and again that we are a community of shared values.

    Albania is now firmly moving forward on its European Union’s path. The screening process that has started is on track. The latest enlargement report that has just recently been published shows all the progress that Albania is making. You are strengthening the rule of law, with important reforms of your judicial system, for which you actually managed to build a cross-party consensus, and I really thank you for that. Because we know by experience that this is a precondition, but it is not easy, it takes a lot of strength to do that. And it is the right way to go forward. You have adopted new measures to ensure equality and inclusion in your society. Your economy has come back strong after COVID. These are all very tangible and very visible achievements. And these are achievements in a very challenging time. I am talking of course about Russia’s war of aggression against Ukraine, the terrible cruelty and destruction that it is bringing to the Ukrainian people. Russia is breaking international law and disrespecting the UN Charter. And we also see and feel that Russia is using energy as a weapon, and by that it is manipulating the market. And of course, we all feel the knock-on effects of the rising energy prices and the unstable security of supply of energy. Fortunately, as you have said, Albania is completely independent from Russian gas, due to your hydropower system. But of course, the electricity that comes to Albania is influenced by the disturbances that we see in the energy market – the skyrocketing prices. And thus, it is also affecting your country; it is also affecting Albania. In the European Union, we have decided that the only possible response is unity and solidarity. As we are in this together, the response, together with Albania, is unity and solidarity.

    We are in an Energy Union already. We are putting forward now an energy support package for the Western Balkans. We are doing the same in the European Union. It includes, first of all, direct budget support to address the impact of high energy prices that it has on families and businesses as you have said. There will be EUR 80 million of grants. And if I understood it correctly, you have a system in place that is good to support families and small and medium enterprises in this difficult time. The second part is not looking at the immediate support that will be accessible from January on. But the second part looks into the mid and long term – the support for the energy system: Here, we are talking about EUR 500 million in grants to invest in energy infrastructure for the whole region. It is going to be channelled through the Economic and Investment Plan for the Western Balkans. And it is already at work here. Indeed, I saw the beginning of the railway that is being built. But for me, it is also very important that we invest in renewable energy. Because renewable energy is home-grown; it gives us independence; it creates good jobs here in the region; and it is good for the climate. Investment will go into the floating solar power plant in Vau i Dejës. The modernisation of the Fierza hydroelectric power plant. I was stunned to see that it produces one quarter of the overall electricity production, and also to see for example the energy renovation of the campus of the University of Tirana. These are only few examples. But they show the direction of travel.

    Dear Prime Minister, dear Edi, I think, once again, Albania can be proud of its achievements. Because indeed, from your words, but more from your deeds, you prove that your people have shown not only vision but also resilience. You are on track on your way to the European Union. And therefore, from my part also: Congratulations to the fact that on 6 December, we are going to meet again, here in Tirana, with the European Council and we will have the Western Balkans Summit here in Tirana. It is going to be a very important meeting. I am very much looking forward to that. And many thanks again for the hospitality today.

  • Ursula von der Leyen – 2022 Press Conference at International Expert Conference on the Recovery, Reconstruction and Modernisation of Ukraine

    Ursula von der Leyen – 2022 Press Conference at International Expert Conference on the Recovery, Reconstruction and Modernisation of Ukraine

    The press conference held by Ursula von der Leyen, the President of the European Commission, in Berlin on 25 October 2022.

    Good morning,

    This is a very interesting conference. And thank you again, Chancellor, for enabling us to organise it together. It’s a pleasure, Denys, to have you here. It’s very important for us to approach the reconstruction of Ukraine in a structured way. And that is why this conference is so important in order to bring together – and learn from – the world’s very best experts on reconstruction on such a scale, which is a colossal task.

    It’s pleased me greatly that we agree on so much at this conference. And, above all, on the three main themes. Firstly, the here and now: what is important in order to support Ukraine. Above all, there is a strong consensus that Ukraine now needs regular, grass-roots financial support. That means, quite simply, salaries for teachers, doctors, but also soldiers and police officers, for example, as well as the pensions that have to be paid – in other words, the absolute minimum. But things that are necessary. And that is why we, within the European Union, have been discussing – and will continue to discuss – how we can make our fair contribution to this. I know, Prime Minister, dear Denys, that it is very important for you that a reliable and stable financial contribution is possible from January onwards, so that Ukraine can be confident that it can bear the financial burdens of everyday life in these days of war.

    Secondly, all of us here at the conference are of course aware that we cannot wait for this terrible war to be over to begin the reconstruction. Some of it has to start right now. We call it ‘rehabilitation’ because we can see that President Putin is specifically targeting civilian infrastructure in order to paralyse Ukraine and terrorise its people. We will not let that happen. So we are also looking at what can already be repaired, schools for example. Many schools have been so devastated that the pupils have had to be moved far away. So we are providing school buses, for example – very practical things. We are also providing support and funding to repair the energy infrastructure that Russia is targeting with its bombs, and support for the winter too, for example, creating accommodation for people who have lost their belongings, their home and a roof over their head.

    Then the third big task is indeed to rebuild. The aim of this conference is above all to shed light on what the best structure is for getting as much as possible into this platform, how to organise the platform to ensure that it is reliable and predictable and that the funding is used well and properly. And lastly to decide which step we need to take first and where, and then to build on that for the further recovery.

    It is heartening to see the broad consensus we have reached, because the fact is that we need everyone on board. This is a huge task. And the right approach is to invite all friends of Ukraine. Because we all know that the brave people of Ukraine are fighting not only for freedom and independence and the integrity of their country, but also for our values. They are fighting for compliance with international rules. They are fighting to ensure that the UN Charter is observed. In other words, they are fighting for all of us. And so the least we can do is to stand by them and support them for as long as necessary.

  • Ursula von der Leyen – 2022 Closing Remarks at the International Expert Conference on the Recovery, Reconstruction and Modernisation of Ukraine

    Ursula von der Leyen – 2022 Closing Remarks at the International Expert Conference on the Recovery, Reconstruction and Modernisation of Ukraine

    The closing remarks made by Ursula von der Leyen, the President of the European Commission, on 25 October 2022.

    Ladies and Gentlemen,

    This was an excellent conference and I really thank you for all the contributions, all the wisdom, all the expertise that you brought to the table. The main message of the day for me today is that Ukraine has everything it takes for a successful reconstruction. It has determination; it has a vibrant civil society; many friends around the globe who want to support – this was visible today; and an impressively resilient economic base despite this atrocious war – for example the Ukrainian banking sector or the IT sector.

    For me, dear Denys, the level of digitalisation that you have in Ukraine is always impressive. Listen to this: After Estonia, Ukraine is probably the most digitised country in Europe – and that is something. This really allows public services to function despite the war. And this is our daily experience in the Commission when we work together with you: You have a functioning administration despite a war around you. This is basically because you are so much digitised. I do not want to reflect on the topics that we have mentioned this morning in the welcome addresses anymore. But allow me to focus on a few takeaways from today’s discussion.

    The first one is: Give ownership to the locals, creating trust in the reconstruction process. It was interesting for me to hear that the original Marshall Plan was successful because independent experts were embedded into ministries. They ensure transparency over key decisions. And we know money cannot solve everything, you need the right institutions. So scrutiny is not only needed to ensure good governance but also – and that was interesting for me – to monitor the influence of donors. And Ukraine’s civil society is well equipped to take over this role.

    My second takeaway: To tap into the full power of Ukraine’s human capital and to accelerate the green and the digital transition, there should be continuity of decentralisation. Because the regions and the municipalities are also economic powerhouses. This decentralisation, together with the necessary judicial and anti-corruption reforms, would of course also facilitate private investment across the country.

    The third point: Reconstruction linked with a dynamic EU accession process can function as a catalyst, as it was said here today, for necessary reforms and at the same time – and this is certainly true – as a strong motivator to implement these reforms. Because there is a goal you want to go to and therefore you understand why you have to do these reforms.

    The fourth point, which is self-explanatory, a new Marshall Plan for Ukraine has to match the European Green Deal. This is the opportunity to leapfrog into a modern, competitive and sustainable economy.

    I like the fifth point that I came across: Donors’ coordination should prevail over donors’ competition. And the better the reconstruction plan is explained, the easier it is for donors to contribute.

    Finally, today, and that is absolutely clear, we saw that we will be in this for a long time. Support fatigue might be a challenge. But one participant brought up an interesting counter-argument, it is about the importance of communication. She mentioned that politics cannot and should not be separated from the reconstruction process.

    Putin’s brutality is causing tremendous suffering and destruction in Ukraine. But at the same time, these ruthless deeds are backfiring. People’s disgust with Putin is a powerful recruiter for Ukraine’s rehabilitation efforts. It fuels the new Marshall Plan. And Denys, I must say that, when I listened to you this morning, I was again really moved and touched by the pictures, the videos you showed us. This is the reality on the ground that you are experiencing every day. But when you see it again, it really touches you. And the way President Zelenskyy and you are communicating to the public is contributing a lot to keep Ukraine on top of the world’s agenda and to mobilise lasting support for your country on the world stage. And Ukraine deserves it.

    Slava Ukraini.

  • Ursula von der Leyen – 2022 Opening Remarks at the International Expert Conference on the Recovery, Reconstruction and Modernisation of Ukraine

    Ursula von der Leyen – 2022 Opening Remarks at the International Expert Conference on the Recovery, Reconstruction and Modernisation of Ukraine

    The opening remarks made by Ursula von der Leyen, the President of the European Commission, on 25 October 2022.

    Herr Bundeskanzler,

    Herr Bundespräsident Cassis,

    Prime Minister Shmyhal, dear Denys,

    Prime Minister Morawiecki,

    Ministers,

    Excellencies,

    Ladies and Gentlemen,

    Distinguished friends of Ukraine,

    We want to discuss the reconstruction of Ukraine today. Thousands of destroyed houses. Several hundred schools turned to rubble. Countless bridges, roads, power stations, railway infrastructure and industry bombed. For Ukrainians, these are not just statistics. This is their everyday experience. It is about having a roof over their heads, a warm place in the winter and classrooms where their children are safe. It is about going to work, bringing food home, and making a living. These are hard, scary and painful days for Ukrainians. But Ukrainians are showing us that they have hope and confidence in the future, and they will keep fighting for it. And it is their future that brings us here today.

    Europe has been supporting Ukraine from day one. We can never match the sacrifices Ukrainians are making every day. But we can stand by their side. We have introduced the toughest sanctions against Russia. Overall, the European Union, Member States and European financial institutions have provided Ukraine with more than EUR 19 billion in assistance, and this is without military assistance. We are working hard to increase Ukraine’s access to our Single Market, because this creates revenues for Ukraine. And what is more, Europeans have opened their hearts and their homes to more than eight million Ukrainians who have fled Putin’s bombs and four million Ukrainians who asked for temporary protection in our Member States. And I would like to thank the millions of citizens who are giving the most noble help to their neighbours in need. This is Europe at its best. Today, we want to discuss how to step up our ongoing support for Ukrainians, and how to make the reconstruction of their beautiful country a resounding success.

    For me, three points are key. First, we need to make sure that Ukraine at all times gets the support it needs – from relief, to rehabilitation, to long-term reconstruction. Second, we need the right architecture in place to make support as broad and as inclusive as possible. And third, as Ukraine has achieved candidate status to access the European Union, we need to firmly embed Ukraine’s reconstruction efforts as part of its path towards the European Union.

    Let us have a look at the first point: And that is Ukraine needs relief, fast rehabilitation and reconstruction. Relief for the daily survival. To be able to pay the bare minimum every single day: salaries for military and security forces, salaries for teachers and doctors in the hospitals and in the countryside, pensions for the pensioners and other indispensable payments. According to the international financial institutions and Ukraine, there is a need of EUR 3 to 5 billion a month just to cover these recurrent running costs. Here, reliable support is needed from the European Union, from our friends in the United States and of course from the international financial institutions. I believe it is only right if the European Union assumes its fair share. I am working with our Member States so that the Union could support Ukraine with up to EUR 1.5 billion every month of the war, which would be in sum round about EUR 18 billion in 2023.

    In parallel, Ukraine needs fast rehabilitation right now, as we speak, especially as Russia is deliberately leading targeted attacks on civilian infrastructure with the very clear aim to cut off men, women and children of water, electricity and heating as the winter is approaching. These are pure acts of terror, and Russia tries to paralyse Ukraine. But we will not let this happen. In addition, we know that there are around 11 million internally displaced people in Ukraine. They need shelter, heating, water and electricity. Their children need to go to school. Therefore, we need to repair houses, schools and infrastructure already right now. As European Commission, we have announced to support this rehabilitation of damaged Ukrainian schools or the repair of electricity infrastructure. And through the Union Civil Protection Mechanism, we have provided tents and over 600,000 items for shelter. But we all know that more has to be done. This phase of fast rehabilitation is essential to ensure that life can continue in Ukraine.

    This brings me to our overall important topic of today, and that is the reconstruction effort. At the Lugano Reconstruction Conference, representatives from more than 40 countries and international organisations agreed on the so-called Lugano principles: Ukraine owned; reform focused; transparency, accountability and rule of law; democratic participation; gender equality and inclusion; and sustainability. I think these are very good principles. But now we have to fill them with life. For doing that, we need the best and the brightest on reconstruction. That is why we have invited you.

    Now it is time to bring the platform to action, together with the international donors, international businesses and, of course, civil society. We have no time to waste. The scale of destruction is staggering. The World Bank puts the cost of the damage at EUR 350 billion. This is for sure more than one country or one Union can provide alone. We need all hands on deck. The G7, the European Union, Europe, strong partners like the United States, Canada, Japan, the UK, South Korea, Australia, New Zealand and many more. And of course, we need the expertise of our partners from the European Investment Bank and the EBRD to the World Bank and the IMF. We will discuss today how to involve these sectors and actors, how to map investment needs, how to coordinate action, and, of course, how to channel resources in a reliable and accountable way. The coordination platform that the international community has been discussing in the past months needs to get off the ground as soon as possible, preferably before the end of the year or early next year. We stand ready to offer the European Commission to provide the secretariat to the platform. We want the work to start and to be done.

    That leads me to my final point. Ukraine will be in the lead. I think this is paramount. Because our action will be driven by the aspirations and the desires of the Ukrainian people. And Ukraine has a very clear vision and decided to become member of the European Union. Ukraine has achieved candidate status. And with the ongoing relief and rehabilitation, Ukraine will combine investment and reforms with the aim to become a vibrant part of Europe’s sustainable and digital future. With the laws and institutions in place, to uphold the rule of law, to fight corruption and to have good governance standards of all partner countries and our European Union. Because the road to reconstruction is at the same time Ukraine’s path towards its vision. It is a strong anchor to become a modern and prosperous country.

    Ladies and Gentlemen,

    For all this, we need you. We need you and your expertise, your insights that are key for us to succeed. This is why I am specially looking forward to this Conference today. From the bottom of my heart, I thank you for being here with us. Every euro, every dollar, every pound, every yen we spend is an investment in Ukraine but it is also an investment in the democratic values around the globe. And all this is urgently needed. But it is also a statement, if we are successful with that. It is a statement that the free and democratic nations of this world stand together, and that we stand up for our values. The courageous Ukrainian men and women are fighting for their independence but they are also fighting for the international order. And we will stand by their side as long as it takes.

    Slava Ukraini. Long live Europe.

  • Ursula von der Leyen – 2022 Speech at the Grand Challenges Annual Meeting

    Ursula von der Leyen – 2022 Speech at the Grand Challenges Annual Meeting

    The speech made by Ursula von der Leyen, the President of the European Commission, on 24 October 2022.

    Dear Prime Minister De Croo,

    Dear Bill Gates,

    Distinguished guests,

    It is so good to see you again Bill, because the last time we met was just a month ago in New York at the Global Goalkeepers event. I was very moved by your foundation’s recognition of Europe’s leadership on global health and the fight against the COVID-19. The award is truly a collective one. It belongs to all Europeans who showed such dedication during the pandemic – from the frontline workers in our hospitals and essential services, to the scientists who developed the life-saving vaccines.

    Today, we are joined by many of you here, from around the world, who are committed to global health and equity. So I would like to use this occasion to reflect on the experience of the pandemic, not from a medical point of view but from the point of view of a policymaker. And I would like to give a sober assessment of what I think went well and where we need to do better in future. I have six lessons that we took.

    The first lesson, not surprisingly, is the utmost importance of solidarity and cooperation. Let me start with the European experience. When the COVID-19 virus made landfall in Europe, things got really tough at the beginning. Some Member States chose to close their borders for life-saving material and equipment. There was painful competition for protective equipment, ventilators and other medical supplies between the different Member States. Vaccine nationalism became the norm around the world. I can tell you – we Europeans had our tough and painful public discussions. But at a certain point, the European Union decided to take a different path – the path of solidarity and openness. We convinced Member States not to close their borders but to share equipment and personnel. We decided to buy vaccines together and not to compete with each other. We started the vaccination campaign on the exact same day in all our 27 Member States – yes, we started with low numbers, and that was heavily criticised, but we had a fair distribution. Regardless whether you are a larger Member State or a small one, a wealthy one or a not so wealthy one. We decided not to close our borders for vaccine exports but to introduce a transparency mechanism. And at this point, many, many thanks to you Prime Minister, dear Alexander De Croo. You have been insisting on staying open for exports because you knew how important that is for the trust of the pharmaceutical industry, depending on where they are located. Today, over 80% of the European Union’s adult population is fully vaccinated. While at the same time, we have exported two-thirds of the vaccines produced in Europe to the rest of the world. Solidarity and openness were the absolute pre-conditions to this success.

    My second lesson: Science does not exist in a vacuum. I believe it was no coincidence that the safest and most effective vaccines were developed and rolled out rapidly in open societies. Science depends on cooperation, it depends on education, on the protection of intellectual property rights, of course on proper data sharing. But it also depends on individual mobility for example, freedom to move, and of course on the regulatory environment and on translating results into products, services and policies. All these factors empower scientists to do their best work, and enable society to reap the benefits. My colleagues and I benefited enormously from the collective wisdom of scientific advice – from you, Professor Peter Piot, you were my personal COVID-19 advisor, the way you gave me guidance and advise on a daily basis was outstanding; from my group of COVID-19 science advisors, handpicked by you, Peter; and also from the platform of 27 Member State government advisors we created. So it is transparency and accountability, our freedom of speech and the freedom of science that enable good policymaking and innovation. These are the values that democratic societies depend on and nurture. So it was democracies that developed the life-saving effective vaccines and that were best able to support their citizens when they needed our help the most.

    My third lesson is about the miracle of vaccines themselves. As a medical doctor by training, the importance of research and development is not news to me. But the pandemic made it very real for all of us. As you know, the outstanding mRNA vaccines did not come out of the blue. Their discovery, like all innovation, relies on long-term investment in scientists and their research. In fact, the European Commission had been investing in mRNA vaccine research since the early 2010s. However, in Europe we did not have a BARDA, like in the United States, which prepares for the case of an emergency. I must say, this was an obvious disadvantage. So we learnt it the rough way. And during the pandemic, we created HERA to anticipate threats and potential health crises. HERA works closely with our Horizon Europe research programme to close the circle from blue sky discovery all the way to scaling up life-saving measures.

    Global cooperation in research and development is crucial for discovery. That is why, for example, HERA and CEPI – the Coalition for Epidemic Preparedness Innovations – have recently signed a letter of intent. They will cooperate on developing next generation vaccines, including for COVID-19, as part of our Vaccines 2.0 Strategy. Horizon Europe is providing on a yearly basis contributions of EUR 35 million. And I am very pleased that our clinical trials partnership for HIV/AIDS, tuberculosis and malaria between European and developing countries has recently agreed to co-run calls for proposals with the Bill & Melinda Gates Foundation.

    Which takes me to lesson four: manufacturing capacity. Having safe and effective vaccines is not enough – we all know that. We badly needed manufacturing capacity, as well as open supply chains. I vividly remember that, at the height of the pandemic, we saw shortages of all kinds across the whole vaccine value chain, from bioreactor bags to vials, from lipids to even syringes. So we set up a Task Force to work with industry, with global partners, to remove these bottlenecks. This helped ramp up the monthly production capacity in the European Union, from 20 million vaccine doses per month at the beginning of 2021 to around 300 million vaccine doses per month by the second half of the year. Having learnt this lesson, we have now set up the EU-FAB, which is an ever-warm network of production capacities to quickly ramp up vaccines production in the future.

    Ladies and Gentlemen,

    So far Europe has sent more than 2.5 billion COVID-19 vaccine doses to 168 countries worldwide. This is our fifth lesson: cooperation and solidarity must be global. At the start of the pandemic, there was no appropriate global framework to allow for fair sharing of vaccines and other medical countermeasures. So we helped set up the ACT-Accelerator and COVAX, which we financed with EUR 3 billion, and we donated half a billion vaccine doses to lower-income countries. But clearly, this was not a sufficient approach, more had to be done and more can be done. This is why we took a different approach now. We are supporting developing countries directly: through financing, through regulatory capacity-building, and technology transfer, to build up their own vaccine manufacturing capacity. We are working with Senegal, Rwanda, South Africa and Ghana to produce mRNA vaccines that are made in Africa, for Africans. And we are taking a similar approach now with Latin America. They have been asking us to do the same. And of course, we responded positively. Because this is the way to go. Regional resilience is the solution that builds global health resilience.

    The sixth and final lesson concerns, indeed, the global health system. Over the years, global health has been consistently underfunded and neglected. Not by the likes of the Bill & Melinda Gates Foundation, which is doing exemplary work, but by the governments. The key is to be prepared, and this means keeping up the investment and keeping the focus in global health, at all times. Even now, in these difficult times, with a completely different focus. I am glad that we finally agreed to create a Pandemic Preparedness and Response Fund. The European Commission, together with the United States, have each committed USD 450 million. And this is just the start. With this reinforced funding, we will step up globally the surveillance of cross-border health threats, the strengthening of health systems, and most importantly the support in training and education.

    Ladies and Gentlemen,

    I know we still have a long way to go, but thanks to all of you and your dedication to global health and equity, I believe we are on the right track. Next month, the European Commission will bring forward the EU Global Health Strategy – it is our proposal to the world on how to work better together in partnership, to advance the common goal of global health. And of course, it will draw on the lessons I have just outlined to you. I look forward to continuing our close work together. And I wish you a rewarding and thoughtful conference.

  • James Bethell – 2022 Speech on the Growth Plan (Lord Bethell)

    James Bethell – 2022 Speech on the Growth Plan (Lord Bethell)

    The speech made by James Bethell, Lord Bethell, in the House of Lords on 10 October 2022.

    My Lords, I join many others in welcoming the return of my noble friend the Minister to the Front Bench; I thoroughly support her sentiments, which she put very well, about the critical importance of growth. I put on the record that no one in the UK Government has ever talked of trickle-down economics—I checked and it is just not the case.

    I want to emphasise the significant contribution that public health improvements can make to the wealth of the nation and to achieving the important 2.5% growth goal referred to by my noble friend the Minister. My noble friend Lord Wolfson said that the growth Statement was slightly short of supply-side suggestions, and I agree with him. I am speaking to persuade noble Lords that investment in public health can not only save millions of lives from preventable disease and epidemics but allows us to live longer, accomplish more and contribute more to the economy. Public health also helps reduce inequalities by ensuring that people are not needlessly prevented from fulfilling their potential or contributing to the economy because of illness, disease or premature death.

    However, the public health of the nation is not contributing enough to the wealth of the nation; quite the opposite. There is a great exodus from the workforce due to ill health. In a report published today, the Health Foundation noted that economic inactivity in the UK has increased by 700,000 people since before the pandemic; that includes 300,000 people aged 50 to 69 years who are at greater risk of never returning to work. This increase in poor health and economic inactivity restricts our labour supply and our economic growth. The recent OBR report estimates that this contributes £2.9 billion to welfare bills, and I think it probably undercooks that number.

    The country’s poor health is also driving up costs for the NHS. Even though it consumes 40% of public expenditure, it is overwhelmed with demand and its costs are growing. Late-stage acute healthcare is the wrong part of the economy to be growing. We should be investing in prevention, not cure. That is the way to grow the economy. If we do not, we are failing to take advantage of the technological revolution that can use genomics, big data, artificial intelligence, modern vaccines and the latest diagnostics to help assess health risks, identify disease and get people on the road to recovery more quickly than ever before.

    It was disappointing that the Chancellor did not refer to health in his plan for growth and a shame that my noble friend the Minister did not do so either. I ask the Minister responding to please reflect on the significant link between health and wealth in his comments. In particular, I urge the Treasury to appoint a commission—armed with an economic slide rule rather than a scientist’s microscope—to look at the nation’s health, much as Nick Stern looked at climate change, as an economic threat rather than a scientific phenomenon, so that we can hammer out a plan to get out of the economic cul-de-sac of an increasingly unhealthy population.

  • Edward Razzall – 2022 Speech on the Growth Plan (Lord Razzall)

    Edward Razzall – 2022 Speech on the Growth Plan (Lord Razzall)

    The speech made by Edward Razzall, Lord Razzall, in the House of Lords on 10 October 2022.

    My Lords, I can answer the noble Lord’s question as to why a number of us are questioning this after 12 years of Tory government. After 12 years of Tory government, the UK economy is currently a basket case. First, our growth is forecast to be the worst in the G20 apart from Russia over the next 12 months. Secondly, we are the only G7 country whose economy has not recovered to pre-pandemic levels. Thirdly, our productivity is significantly worse than that of our major competitors. Fourthly, we have the damaging effects of Brexit.

    What are the Government doing about it? We have learned a number of things from their recent announcements and comments from government hangers-on. First, apparently it is all Putin’s fault. If that is so, why are we doing worse than all our major competitors? Secondly, it was apparently perfectly satisfactory to make a significant fiscal statement without the usual verification of numbers by the OBR, so why were the Government surprised by the gilt market reaction? What is worse, we now know that the Chancellor had a draft report from the OBR on his desk on his first day in the office. He refused to publish it, presumably because it did not support his numbers, and now he has been forced to bring forward his fiscal statement and the OBR report, noticeably on Halloween day. Thirdly, apparently the Government will generate growth through tax cuts, as the noble Lord, Lord Howard, indicated. But however you describe it—Reaganomics, the Laffer curve or Donald Trump in 2017—there is no evidence that it works. As the noble and learned Lord, Lord Clarke, who is sadly not in his place, memorably said last week, it is the sort of thing tried by South American banana republics and it does not work.

    I will not spend my time intruding on the private grief of the Government’s incompetence in the handling of the recent announcements—others have and will—but will confine myself to a number of questions to the Minister. First, will he explain why the Government are so set against a windfall tax on oil companies to help fund the extra borrowing necessary to protect householders from energy price rises? These excess profits are entirely a windfall and had no connection with management activity. All that will now happen, presumably, is that huge dividends will be paid to shareholders—mostly institutions resident outside the United Kingdom.

    Secondly, do the Government accept that during the period after 1949, when growth averaged 2.5%, 2% of that came from productivity gains and 0.5% from increasing immigration? If the Government want growth, will they confirm that the latter will be acceptable to the Home Secretary?

    Thirdly, if, as the Prime Minister says, all government policy should be to generate growth, there are a number of things that the Government could do to alleviate the damaging effects of Brexit. Will they take the advice of the noble Lord, Lord Frost, to negotiate improvements with the EU? For example, will they negotiate to help the shellfish producers who can no longer sell into Europe? Will they help the creative industries by helping the musicians who find it impossible to tour in Europe, therefore depriving us of substantial export revenue? Will they negotiate to help the many SMEs who have stopped selling to Europe because of pointless bureaucracy?

    The economy is a disaster. Brexit has proved a disaster. The Government are a shambles. Surely it is time for this Government to go.

  • Greville Howard – 2022 Speech on the Growth Plan (Lord Howard of Rising)

    Greville Howard – 2022 Speech on the Growth Plan (Lord Howard of Rising)

    The speech made by Greville Howard, Lord Howard of Rising, in the House of Lords on 10 October 2022.

    My Lords, I find it difficult to understand the fuss over the Chancellor of the Exchequer’s plan for growth. With the start of money printing in 2008, inflation and the higher interest rates were built into the system before there was a Conservative Government. The 40% rate of tax was in place up until the last days of the previous Labour Government. Most major currencies have fallen against the dollar, with the yen down 50% and the Japanese authorities intervening. The Government can hardly be blamed for the invasion of Ukraine and the resulting fuel crisis. They can take credit for acting promptly to help people.

    Instead of applauding the outstanding plan for growth, which will result in greater prosperity, we hear a cacophony of unjustified abuse from the anti-growth coalition, made up of those who believe that if nothing changes and the handouts are kept going, all will be well. I tell them to face up to reality. You have to create wealth to spend it, and that is what this Budget is about. The other complainers are the metropolitan elites and the bien pensants who believe they can decide better what to do with other people’s money than those people can decide for themselves. That just does not work either morally or economically. People should be entitled to the fruits of their labour and to get what they work for, not have it confiscated for fashionable projects.

    Economically, high taxation and redistribution by government is inherently inefficient and results in massive waste. Everyone wants better roads, a better health service and other essential services. These cannot be achieved by living in the cloud-cuckoo-land of believing that all you have to do is tax more to be able to spend more. You cannot. It does not work; the tax take shrinks. By lowering taxes and removing stultifying regulations, a framework is created that will allow the genius of the people of Great Britain to deliver growth in the economy. This will permit government debt to be repaid and public services to be enhanced. It will inevitably take time, but the reality is that if the top-class public services we would all like to see are to be delivered, there is no other choice.

    Taxes are at their highest level for many years and must be reduced for the economy to grow. Money left in people’s hands grows; they do things with it. Governments consume wealth; they do not create it.

  • John Hendy – 2022 Speech on the Growth Plan (Lord Hendy)

    John Hendy – 2022 Speech on the Growth Plan (Lord Hendy)

    The speech made by John Hendy (Lord Hendy) in the House of Lords on 10 October 2022.

    My Lords, it is a constant theme of Conservative economic policy that the rich are incentivised to be more productive by increasing their incomes whereas the poor are incentivised by threats to reduce theirs. The growth plan is full of examples, such as, at paragraph 3.22, the removal of the higher rate of tax from those earning more than £150,000, which has now of course been abandoned and, at paragraph 4.9, removing the limit on bankers’ bonuses. On the other hand, paragraph 3.24 proposes more conditions on eligibility for universal credit: “intensive conditionality”, the Chancellor calls it. It is specifically aimed at

    “claimants who are in work and on low earnings”.

    We know that most claimants are, in fact, in work. Universal credit is, in fact, a subsidy for employers who pay the lowest wages.

    Average wages are rising by 5.2% per annum, while the consumer prices index rose by 9.9% in the year to August. The value of earnings from wages is therefore falling by an average of nearly 5% per annum. That is a huge hit to the living standards of working people. Consequently, demand in the economy is shrinking. That cannot be redressed by giving a few thousand high earners more money, but, if the incomes of ordinary working people rise, that money will be spent and demand will increase.

    The differential between earnings and prices has another impact. Notwithstanding the Government’s energy price cap at twice last year’s rate, working people are becoming desperate. That is why there is a wave of strikes, with overwhelming ballot mandates. But rather than address the catastrophe facing working-class people this winter, the Government propose further restrictions on the only leverage that working people have to protect their standard of living when persuasion fails—industrial action. Not content with the most restrictive laws on trade unions in the western world, the additional restrictions of the Trade Union Act 2016, raising this year the limit on damages payable by trade unions, and enabling agency strike-breakers, also this year, the Government now propose yet further restrictions on the right to strike in paragraph 3.28 of the Growth Plan: minimum service levels for transport services, and every employer’s offer to be put to a ballot of employees.

    The objection is not just one of principle—these restrictions are in breach of the conventions of the ILO and the European Social Charter, from which the Government undertook not to regress in Article 399 of the trade and co-operation agreement at the end of 2020; there are also problems with practicalities. If the minimum service requirement is, say, 10% of train services, who will select the train services to run and on what basis? How are those who are to staff them to be selected and forced to work? Ten per cent of train services will require near 100% of signallers and most of the station staff. Are they to be denied the right to strike?

    In relation to balloted offers, must there be a ballot for an offer of a penny extra an hour when the members have voted unanimously for an extra £5? If they reject the offer, can the employer then further postpone the strike by offering another penny, and so on until the statutory duration of six months for a strike ballot is exhausted? How are the workers to be balloted? Presumably, as for strike ballots—and unlike the ballot for the Prime Minister—by post only, not online. That takes weeks. Who will pay for it?

    Instead of attacking workers trying to defend their standards of living, I commend to the Government the restoration of the system of sectoral collective bargaining that was a feature of our economy when it was successful. It is a feature of the successful economies of Europe and is currently the subject of legislation in New Zealand and the fast food industry in California. It gained support only last week—

    Baroness Bloomfield of Hinton Waldrist (Con)

    The noble Lord has exceeded the advisory speaking time by some margin.

    Lord Hendy (Lab)

    —in the OECD Employment Outlook 2022. Those are my last words.

  • Simon Wolfson – 2022 Speech on the Growth Plan (Baron Wolfson of Aspley Guise)

    Simon Wolfson – 2022 Speech on the Growth Plan (Baron Wolfson of Aspley Guise)

    The speech made by Simon Wolfson, Baron Wolfson of Aspley Guise, in the House of Lords on 10 October 2022.

    My Lords, I declare my interest as a serving chief executive of a FTSE 100 retail company, a post I have held for 21 years. Understandably, today’s debate has focused on recent government events and the mini-Budget, but it is important to stand back a little from that and reflect on the fact that the pound had devalued from $1.37 in just a year to $1.15 before the Chancellor spoke. Interest rates were rising and were always going to rise.

    Although the Government’s recent actions undoubtedly exacerbated the situation, it is important to remember that the cost of living crisis we are experiencing at the moment is rooted in a chronic shortage of goods, fuel and labour. It is essentially a supply-side problem. The pandemic paralysed the world’s manufacturing and disrupted global freight routes. The war in Ukraine piled energy price rises on top of what was already a fragile global economy. To get us through the pandemic it was quite right that we had borrow-and-spend remedies. They were not only desirable but essential to prevent economic collapse, and today they are essential to prevent people suffering too much from the energy crisis. However, demand measures can only target the symptoms of supply-side inflation: they cannot deliver a cure and there is always a price to pay.

    If we are to solve the cost of living crisis, it will require bold supply-side measures, and while I welcome the Government’s rhetoric on supply-side reform, I share the concerns of the noble Lord, Lord Newby, and many other noble Lords about the lack of detail. The noble Lord, Lord Kerr, and many others are right that tax cuts alone—although they are in my view welcome—are not going to stimulate growth. Fortunately, there are a number of very powerful measures that can make an enormous difference. Contrary to what I have heard some noble Lords say today, businesses are not in the habit of sitting back and relaxing and not bothering to invest. Believe it or not, we do not need a lot of encouragement, incentives or tax breaks to invest. What we really need is for Governments to stop preventing us investing.

    Here, the measures that the Government can adopt are numerous. There is the radical overhaul of our planning system. Here I share the cynicism of the noble Lord, Lord Macpherson, about government’s ability to deliver on this. There is no doubt that the delivery of the homes people want to live in in the places where they want to live and work can do more to stimulate growth in this country than any other measure alone.

    The intelligent relaxation of controls on economic migration, as pointed out by the noble Lords, Lord Shipley and Lord Birt, could do an enormous amount to stimulate the economy, perhaps, as I have suggested elsewhere, through a visa tax that would ensure that UK employers employ overseas workers only where there is really no UK alternative.

    Stemming the flow of new business regulation and quasi-regulation that wastes so much time and so much money for so little good would do an enormous amount to stimulate growth. Here I stress that I hope that the Government understand that it is stemming the flow of new regulation that will really make the difference; not some imaginary bonfire of existing regulation that we have already learned how to cope with. There is also the liberalisation of trade rules and the repeal of needless tariffs that do nothing to protect British industry.

    In addition to these essentially liberating measures, the Government can also save money. The cancellation of HS2 would reduce borrowing and release much-needed materials and skills back into the UK economy. With HS2 costs so much higher than appraised and the benefits so implausible in an online world, surely now it must go.

    Supply-side reforms are the key. They will accelerate long-term growth but will also do something else. A determined, reasonable, carefully thought through plan for supply-side reform will do much to restore market confidence in the United Kingdom. The markets will reward this country for the right steps as quickly as they punished us for the wrong measures that we took a few weeks ago.