Dame Harriett Baldwin criticises the Budget as full of broken promises to the electorate; more taxes, more public spending and more borrowing which do not lead to growth. She says the only way to deliver true, genuine, sustainable economic growth in this country is through productivity and investment by the private sector.
Dame Harriett Baldwin (West Worcestershire) (Con)
It is a pleasure to follow the hon. Member for Gower (Tonia Antoniazzi). I do not wear quite as many hats as her, but it was interesting to hear her perspective on the Budget. I have a different perspective.
My issue with the Budget is not the political choices that the Chancellor has chosen to make—clearly she has the mandate to make any changes that she wishes to make—but the fact that it is a Budget of broken promises to the electorate, which is a dreadful thing to do for trust in politicians. I will also highlight the economic choices that I think the Chancellor has got wrong.
The first broken promise is one that the Chancellor made during the election campaign, when she said time and again that she would not “fiddle the figures.” Today, she has clearly broken that promise. She has announced a multi-billion pound change to the UK’s borrowing, and she announced it overseas, not first to Parliament—I know how angry you and Mr Speaker are about that, Madam Deputy Speaker. As we all know, and as the IFS has said, borrowing is not a free lunch; it will mean that there is more debt and more debt interest spending. I have not yet had a chance to question the Office for Budget Responsibility in detail on its numbers, but from an initial look at its charts, the amount of additional borrowing that was announced today by far exceeds anything in the mini-Budget in late 2022. The Treasury Committee will ask the Office for Budget Responsibility about that.
The second broken promise that the Chancellor made during the election campaign was that her plans were fully funded, and that she had no plans to raise taxes, beyond those listed in the manifesto. In fact, colleagues have counted that she and the Prime Minister made that utterance 50 times. I believe that that promise has been soundly broken today, and that a deliberate political choice has been made to announce the biggest unforced tax-raising Budget ever.
Blair McDougall (East Renfrewshire) (Lab)
Unforced?
Dame Harriett Baldwin
Unforced. During the election campaign, the Chancellor told the British public that taxes were too high. She said that she wanted to bring taxes down. She has roundly broken that promise today, because the Budget increases tax for every household in this country, possibly by up to £10,000 over this Parliament. That is way beyond the £2,000 figure that we warned about during the election campaign—a warning that the Prime Minister said on national television was a lie.
The Chancellor campaigned on a general election strategy that I believe was deliberately designed to mislead the electorate. Her plans, and those of the Deputy Prime Minister, end up giving us German taxes with French labour laws—a recipe for higher unemployment if ever I have seen one. The scale of the tax changes announced today for small businesses that employ more than four people is astonishing. Labour Members should let that sink in.
Torsten Bell (Swansea West) (Lab)
Will the hon. Lady give way?
Dame Harriett Baldwin
I will not give way to the hon. Gentleman, who so often gave evidence to the Treasury Committee. I recall that I had to press him on the fact that NHS productivity has not yet returned to its pre-pandemic level. He told us on the record that if it did, that would be worth £20 billion in additional NHS output.
The Chancellor promised that she wanted to focus on growth. That is her mission, but I believe that more taxes, more public spending and more borrowing do not lead to growth; if they did, Venezuela would be one of the most prosperous countries on earth. What the Chancellor was planning all along, together with her Cabinet colleagues —who have no experience of working in the wealth-creating, job-creating, tax-paying private sector—is a Budget of the public sector, by the public sector, for the public sector. She cannot blame us, because in her first 25 days as Chancellor she announced £25 billion of additional new spending, whether that was for Great British Energy, a national wealth fund, or inflation-busting backdated union pay rises with no productivity requirements.
I also want to speak up for my farmers in West Worcestershire.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
Will the hon. Lady give way?
Dame Harriett Baldwin
Does the hon. Gentleman want to stand up for my farmers? My farmers are some of the most productive and hard-working people in this country. They are the ones who put food on our tables, and they are soundly disappointed with today’s Budget. There was no help or certainty for them in the Budget—no help for them through the agricultural property relief that allows them to hand on the family farm to the next generation. Labour Members should know that this Budget will mean that many family farms will be broken up, unable to be handed on to the next generation.
Nesil Caliskan (Barking) (Lab)
Will the hon. Lady give way?
Dame Harriett Baldwin
As the hon. Lady can see, I am not giving way at the moment.
As you know, Madam Deputy Speaker, the only way that we get true, genuine, sustainable growth in this country is through productivity and investment by the private sector.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
Will the hon. Lady give way?
Dame Harriett Baldwin
I am not giving way at the moment. I am going to allow more time for others later on.
Several hon. Members rose—
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. The hon. Lady has made it very clear that she is not giving way, so please allow her to continue.
Dame Harriett Baldwin
Thank you, Madam Deputy Speaker. Anyone who has ever worked in business knows that they need to increase the productivity of their business, and investment in that business is linked to its profitability, profits that will fall as a result of the measures that have been imposed on business today. When we work out the numbers, I think those measures will equate to about 4p on corporation tax. This is a Budget of broken promises that will end up giving the British people less growth. Members do not have to listen to me to hear that: they can listen to the Office for Budget Responsibility, which forecasts a short-term boost to growth but a longer-term reduction in the sustainable growth rate of the British economy thanks to the measures that the Chancellor outlined today.
In the months since the Chancellor took office, we have seen the evidence. We have already seen businesses shutting at double the rate they were a year ago. We are already seeing a plunge in business confidence, and we have heard the former chief economist of the Bank of England say that the socialist narrative we have had since the election has generated
“fear and foreboding and uncertainty”.
This is a Budget of broken promises—a straightforward breach of promises to the British public—and it is a dreadful day for the British economy.
Dame Harriett Baldwin (West Worcestershire) (Con)
I congratulate the hon. Lady on her unopposed election as Chair of the wonderful Treasury Committee. Does she share my concern that the individual who has been appointed to the office for value for money was previously on the board of HS2?
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The hon. Lady is a former Chair of the Treasury Committee and I welcome her being a member of it, as she will add great value. As she knows, we will have the opportunity to raise questions with the Chancellor at next week’s hearing. She has now been forewarned that the hon. Lady may ask about this issue. It is important that we recognise good people who provide support in the public sector by watching our public finances, and I always take people on good faith unless I have a reason not to do so. We have an opportunity to explore this issue elsewhere.