Contribution
Labour Members try so hard, but the hole in their Budget is gaping wide open. The problem is that it is not just us on the Opposition Benches who can see that hole, but our adversaries around the world, leaving ourselves open. Not properly funding our armed forces is not going to scare anyone in Moscow and it will not deter Tehran.
The Defence Secretary has resigned once before, so we know he is not against resigning. Perhaps he could resign again on principle today. We on this side of the House are used to Labour breaking their promises, but to break the promises they made to our armed forces is a new low. If the Chancellor had any dignity, he would have resigned yesterday.
Despite their failure to fund defence, the Government have still raised the tax burden to the highest level on record—higher than in the aftermath of world war two and higher than even the right hon. Member for Leeds West and Pudsey (Rachel Reeves) raised it. Who remembers how this Government had no plans to put up taxes? How is that working? For the third Budget in a row, the tax burden is set to rise. All told, taxes are going up by a total of £75 billion a year: higher next year, higher the following year and higher in every single year of the forecast. Even the Prime Minister’s former economic adviser, Andy Haldane, now says that Britain is “taxed out”. He also called the Chancellor “penny wise, pound foolish”. I am not even sure about the penny wise bit, to be honest. And where will that money come from? Families, small businesses, the self-employed, farmers, the people who work hard and want to get ahead. Why? To pay for those who do not—those who could work, but choose not to.
The damage does not just stop with the tax bill itself. It is the disincentives in the economy that do the most harm. Two years ago, the then Chancellor stood at that Dispatch Box and raised taxes on jobs. Now, we are in a jobs crisis, with over 170,000 jobs lost since July 2024, all because Labour does not understand that if you tax something, you get less of it. Now it is raising taxes on the banks, which provide mortgages, loans to small businesses and pay interest to savers. The Chancellor might think it is just a bank tax, but we know that, like every tax, it will end up being paid by ordinary working people: higher mortgages, lower returns on savings and bank branch closures in every constituency and every high street, and fewer jobs in this country.
The Budget also contains a vindictive tax rise on people who have done the right thing, those who have done what Governments have always told them to do and what this Government want them to do: save money. Yet for many, up to 49p in every pound of interest on hard-earned savings will now be taken by the Chancellor. It is the same story with landlords, who have already come under attack from this Government, and the OBR says that rents will go up as a result.
Of all that the Budget was missing, the lack of welfare reform stands out the most. Or at least, so we thought—because this morning the Chancellor told the BBC that there will be welfare cuts before the election. Perhaps a Treasury Minister could come to the House and clean up the Chancellor’s mess. His Budget has not even survived 24 hours.
Last week, the Prime Minister called the benefits bill a moral outrage; he was right then, but he is not doing anything about it now, because Labour Members are too afraid to say, “Enough is enough.” They do not have the courage to get a grip on welfare, because they are worried that it would cost them their jobs. Thanks to the TaxPayers’ Alliance, we know that for more than half of all Labour MPs, the number of benefit claimants in their constituencies is larger than their majority. It is true for the Chancellor, it is certainly true for the Defence Secretary, and it is true for the Economic Secretary to the Treasury. They will not get welfare under control because it would cost them their seats—they are putting their own interests before the country’s. [Interruption.] I am making progress. Don’t you worry—I am doing very well, Madam Deputy Speaker.