PARLIAMENTARY DEBATE
Economic Growth - 7 September 2026 (Commons/Commons Chamber)

With permission, I will make a statement on the Government’s plan to deliver good growth in every postcode.

At the G20 in North Carolina last week, the Chancellor and I met Finance Ministers from leading economies to discuss our shared economic challenges. Global instability, conflict and trade frictions are continuing to drive up inflation and interest rates around the world. While these shocks are international in nature, their impact is also being felt here in the UK—from the cost of the weekly family shop to the cost of Government borrowing.

Britain has shown resilience in the face of these pressures and the economy is now turning a corner: our growth was the fastest in the G7 in the first half of this year, Government borrowing fell to its lowest level in six years last year and interest rates have been cut six times since the general election. We are building on our strengths—our world-class universities and our world-leading sectors, such as life sciences, defence, technology, creative industries and financial services—and, because of the choices that this Labour Government have already taken, we are in a stronger position today to capitalise on the opportunities for growth across our economy.

In the context of a more uncertain world, we must continue to make responsible choices. Fiscal discipline will underwrite every promise this Government make. Both the Prime Minister and the Chancellor have made clear their commitment to meeting the fiscal rules, with a buffer against uncertainty. We will address the long-term pressures on our public finances to put debt on a sustainable downward path. As the Chancellor said earlier today, there is nothing progressive about spending £1 in every £10 on debt interest.

In his statement to this House last week, the Prime Minister laid out a clear diagnosis of what has gone wrong in our economy: political power was centralised, the economic fundamentals were privatised or outsourced, and our country was de-industrialised. The solution is a fundamental shift in the way our country works. No. 10 North and the Treasury are working together to build a stronger, more strategic centre of government and a more active state. Together, we will support the ambitions of local leaders and exert public influence and direction over the essentials, including transport and housing. We will devolve power and resources to local leaders. London is of course an economic powerhouse, but if our city regions could emulate the success of second cities in France and Germany, growth in our country could be transformed.

The Chancellor has instructed public investment institutions to focus on regional growth. To build on our high growth areas, the Oxford-Cambridge corridor and the northern growth corridor, he has today announced a new £150 million northern scale-up fund, delivered by the British Business Bank, to back the most innovative and fast-growing firms from Liverpool to Newcastle. The new Northern 500 will also bring together 500 of the north’s most ambitious mid-sized businesses into a single growth community, focused on scaling, investment and productivity. The National Wealth Fund will establish new strategic partnerships with South Yorkshire, the Liverpool city region, the north-east and Cardiff, giving those areas support to build their investment pipelines. At the Budget next month, the Government will go further, with a road map for fiscal devolution—a permanent transfer of power and resources from Whitehall to our regions. This plan will drive economic growth and productivity in three key areas: supporting investment, boosting innovation and getting more people into good jobs.

First, I will turn to investment. Business investment has increased by nearly 5% since the general election, but in a highly competitive world we must do more to reduce the barriers that firms face. The Government will tackle the thicket of consultation, litigation and administration that is holding up private investment, including by extending our reforms of judicial review from energy to all major infrastructure. We will bring an end to the consultation culture across Government, supported by new guidance from the Attorney General on legal risk to give Ministers confidence to make decisions. As the Chancellor has set out, we will make further changes to the Treasury’s Green Book, reducing the discount rate from 3.5% to 3%, to ensure that the Treasury rulebook does not go against key regional infrastructure projects and that places across the country get a fairer hearing in spending decisions. Work is already under way to progress place-based business cases in Plymouth, Birmingham, Liverpool and Port Talbot, and at the Budget we will publish guidance to allow more areas to do the same.

The second driver of growth is innovation. The UK has a fantastic record on innovation. We are world leaders in frontier technologies, quantum computing, nuclear fusion, space technology and AI. But too often, ideas born here have to go elsewhere to find the capital they need to scale. Today we are setting out a new ambition to double the number of unicorns in this country. The Government will identify and back these high-potential firms, providing them with the necessary capital to scale. New cross-economy sandboxing powers will also enable firms to test frontier technologies safely. Building on the important work already taking place in defence and sovereign AI, the Chancellor will work with Government Departments to earmark new, dedicated funds to back British innovation.

The third vital driver of growth is jobs. Our objective is to get more people into good, highly skilled jobs, and to make the most of the untapped talent that exists across the country. That is why, two weeks into office, the Prime Minister set out a bold new plan to transform technical education, and why, this autumn, Alan Milburn will set out his full recommendations to Government on how to address the blight of youth unemployment. This is our moral duty—not only our fiscal duty—because it cannot be right that so many young people are stuck on benefits.

The plan for growth is underpinned by fiscal discipline. It will hand power to local leaders and unlock the potential of our regions. It will build a strong, strategic centre of Government and enable greater public direction and influence over the essentials. It will back British business, goods and exports, creating wealth and prosperity in all parts of the country. It is a plan to build hope and optimism across our economy, and to drive good growth in every postcode. I commend this statement to the House.

I call the shadow Chief Secretary to the Treasury.

I thank the Minister for her statement and for early sight of it. On a day when the country was listening for a message of change, it was the same old, same old: a continuity Chancellor, with continuity policies and a continuity team of Ministers in the Treasury. Does the Minister recognise the harsh irony that—given the Government could find plenty of money to hire 14,000 more civil servants in SW1—the Chancellor chose to go to the west midlands, just a few miles away from Jaguar Land Rover, but had nothing at all to say about it?

The Minister talked about Government borrowing falling to its lowest levels, but I wonder: can she also talk about the cost of Government borrowing? Can the Minister confirm that the cost of Government borrowing for 30 years is now at its highest rate for 28 years? The Minister talks about there being nothing progressive about spending £1 in every £10 on debt interest—well, amen to that—but why then did this Government choose to increase borrowing by £500 billion over the course of this Parliament? The Minister talked about the northern scale-up fund, which is an interesting initiative, but can she advise us who will be making the investment decisions and assure the House that they will not be subject to political direction?

The Minister talks about a National Wealth Fund with new strategic partnerships and a permanent transfer of power and resources from Whitehall to the regions. Did she listen to the Secretary of State for Housing, Communities and Local Government say that local government reform is on hold? Can she confirm to the House what proportion of the country will qualify under that measure to be part of Labour’s largesse? My fear is that many parts of the country will not.

The Minister did talk, smartly, about removing the thicket of consultation and looking at judicial review and the consultation culture. The Opposition will be supportive of measures that she comes forward with in that regard. But then, after a brief moment of common sense, the Minster talked about reducing the discount rate from 3.5% to 3%. Can she confirm that the cost at which the Government are borrowing is going up and up—5.9% for 30 years—yet she has chosen this moment to reduce the rate at which the Government expect to get money back from 3.5% to 3%? Can she explain how those numbers add up?

Then, of course, there is the final cherry on the parfait: the Government will “identify and back” unicorns in this country. How will the Government identify those unicorns, and can the Minister explain how that is different from the discredited policy of Governments picking winners?

The Minister then returned to common sense with the announcement that Mr Milburn will set out his recommendations to the Government. Will she please advise the House—many Members will be concerned about this—on what date Mr Milburn will make his recommendations?

Today, the Government—the Minister and the Chancellor—had an opportunity to at least have mentioned the high cost of energy that is crippling British manufacturing. They could have ruled out tax increases, providing more certainty for businesses that they can invest. The Government could have said that they would take up the offer from the Conservative Leader of the Opposition to work together on meaningful reform and reductions in welfare, so that we make work pay. But we did not hear any of that. Instead, we are heading to a Budget where a Labour Government have again run out of money and where a Labour Government will once again increase taxes to cover their fiscal incompetence—same old continuity Labour.

It is a great pleasure to be opposite the hon. Gentleman again, as we were earlier in this Parliament. I will address his points, but I say kindly to him that I would rather be continuity Labour than continuity Liz Truss.

The hon. Gentleman was right to mention Jaguar Land Rover. It is a concerning time for the workforce, and the Business Secretary is working closely with the chief executive and the leader of the trade union Unite, bringing them together tomorrow to discuss the situation. Jaguar Land Rover has made clear that it faces competitive global headwinds, but we have done a lot to support the automotive industry, and Jaguar Land Rover in particular, given the loan guarantee that we provided last year in the wake of its cyber-attack. The Business Secretary and the Government are also providing help to the automotive sector to bear down on the cost of energy.

I think the hon. Gentleman said that he agreed with me in some areas, which is always good to hear. We can agree that there is nothing progressive about spending so much money on servicing our debt. As a Government we are committed to fiscal discipline and the fiscal rules because we want to bring down the cost of Government borrowing, but we are not immune to the global instability that means that the cost of borrowing is also increasing for every other G7 country. However, we have the fastest growth in the G7, and we are cutting our deficit faster than any other G7 country; business confidence and investment are up; productivity is up; interest rates have been cut six times since the election; and consumer confidence is up. While the hon. Gentleman talks down our economy, me, the Chancellor and the whole ministerial team will be talking up the British economy.

The hon. Gentleman asked a serious question about the northern scale-up fund. The British Business Bank will make those decisions independently of Government, as should always be the case. He is right to ask for reassurance about that, and I have provided it. We are a Government that are serious about devolving power to every part of the country. We will have more to say about that at the Budget and will set out a fiscal devolution road map as well.

The hon. Gentleman accused me nicely of talking smartly about the thicket of consultation, saying that I had some common sense, and I thank him for that. He has been in Government too, in the Treasury, and I fondly remember our meetings together back then. It is good that there is agreement across the Chamber that we need to ensure that those sorts of things do not gum up the system, that Ministers are able to take decisions, and that we are able to get infrastructure built in this country.

I respectfully disagree with the hon. Gentleman on the Green Book discount rate. We say proudly that we are reducing the discount rate to 3%, because there have been times in the past when the Treasury has stood in the way of good regional infrastructure projects that have a long-term benefit. I am proud that we are ensuring that those projects get a fairer hearing.

The hon. Gentleman will know that we have made changes to tax to support unicorns in last year’s Budget, and we are opening up opportunities to public procurement. I think he mentioned pudding at the end—parfait, I think it was—and although I am a big fan of pudding myself, I will not respond to that.

On the serious question of the Alan Milburn review, I cannot give the hon. Gentleman a timeline, but I will repeat what I said in my statement: it is our moral duty as a Government to ensure that we have more young people back in the labour market. That is why we have already introduced the youth guarantee, so that young people who have been out of work for longer than 18 months will get a paid placement by the Government, as well as introducing a grant for businesses that take on unemployed young people. It is a very serious issue, and one that we will address.

I welcome the Chief Secretary’s statement and her commitment that the British Business Bank’s new fund will not be interfered with politically, because when the Treasury Committee looked at the National Wealth Fund, we were very clear that it needed to be able to get on and do its job crowding in that private investment. There should not be a chop-and-change approach to the policy; it should not be a delivery vehicle for different Government policies, as Governments can change.

I have spent my career backing devolution, but there is a challenge here, is there not? The Chief Secretary has to ensure that the money that taxpayers give to Government to spend is spent well, but there is a gap, with our regionally elected mayors, in the oversight and scrutiny of that public spending. Devolution is a good thing, but what is she going to put in place to ensure that those mayors and the devolved authorities can report back about how well they are spending taxpayers’ money, and if they are not spending it well, what will the consequences be?

I thank the Chair of the Treasury Committee for her question, and I agree with her: public financial institutions must make independent decisions about the businesses that they support. The Chancellor has talked today about new strategic priorities for the NWF, and that is also the right thing to do. That goes in parallel with what my hon. Friend was saying.

On oversight of mayoral strategic authorities, my hon. Friend is right that if we are going to devolve more power and, critically, more resources, there should be more oversight. The First Secretary of State has talked about the role of others, including Members of this House, in holding mayoral strategic authorities to account when they receive those new powers.

I call the Liberal Democrat spokesperson.

I thank the Chancellor and the Minister for their speech and statement. We know that the Conservatives’ Brexit deal has hit national GDP by as much as 8%, costing the country up to £90 billion a year in lost tax revenues. Will the Government now pull the largest zero-cost growth lever available to them by negotiating a growth and defence partnership with the EU, including joining the single market and a new customs union, rather than clinging to the same failed red lines, which are costing businesses billions every year? Being outside the single market and the customs union directly links to the 13% fall in the UK’s export of goods since 2022, which has hit traditional manufacturing regions the worst—the same places that the Government’s reindustrialise-the-north agenda claims to prioritise. I would like to understand whether she acknowledges the reality of that linkage or not.

I welcome the Chancellor’s emphasis on the importance of fiscal credibility and, linked to that, meeting the fiscal rules. However, the reality is that those rules have been easily gamed by successive Governments, with our budgetary process being summarised as speculation without scrutiny, short-term headroom chasing and gaming the system, with an approach of jam today, which is spending, and pain tomorrow, which is tax, but tomorrow never arrives. The result is that it has been more than 25 years since we had a balanced Budget, and our national debt is now six times larger than 20 years ago.

Will the Chief Secretary demonstrate that she is serious about tackling our debt and agree that a key way to do that is to grow our economy? Will she consider what we can learn from how other countries such as Switzerland, Sweden and New Zealand have addressed and solved their budget process problems?

I thank the hon. Gentleman for his questions and will try to do them justice in the short time available. The Chancellor said this morning that Brexit has hammered British exports. I agree with the hon. Gentleman that there is a link between the fall in exports and the barriers the previous Conservative Government put up with our nearest and biggest trading partner, which is exactly why this Government are renegotiating a reset with our European partners. We promised in our manifesto that we would not join the single market, but we will bring down those barriers at the border, particularly with the sanitary and phytosanitary agreement that we are currently negotiating with the EU—there will be further announcements on that in due course—which will benefit our agrifood industry by making it easier to export to the European Union.

The hon. Gentleman asked about the fiscal rules. I do not agree with his analysis: we have brought forward the fiscal rules to apply over three years to get around some of the gaming that he talks about. We are serious about tackling our debt and, as I said in my statement, we are reducing our deficit at the fastest rate in the G7.

I am always interested to learn from other countries; I think we should always be open to that. I would be interested to hear more about what the hon. Gentleman had in mind.

Order. We have the Health Bill debate later on today, so we are pressed for time. I ask colleagues to keep their questions short and the Minister to be on point.

I thank the Minister for her statement and agree that London is indeed a powerhouse for growth. However, as a Member of Parliament for an outer London borough, I know, and she will recognise, that that wealth is not felt by every Londoner. With industrialisation and job creation being priorities for the Government, will the Minister reassure us that those priorities will reach the postcodes of my constituency?

I absolutely agree. As the Chancellor stressed this morning, and as the Prime Minister has repeatedly said, this Government will drive good growth in every postcode. My hon. Friend is right that the situation in London is not simple; it is an economic powerhouse, but there are high levels of poverty in many parts of London. I assure her that we will focus on Barking and other parts of London, too.

Last week, the Prime Minister boasted in the same breath that we had the fastest growth in the G7 and that the decade of slow growth was caused by Brexit. If we are ahead of the pack, it cannot be caused by Brexit, can it?

We could be even further ahead of the pack.

I strongly agree with the Government’s policy on devolution and better technical and scientific education, but all that will be for nought if we do not do something about the cost of energy. We cannot grow and compete as an economy when we have higher energy costs than our major industrial competitors. We have closed more than half our oil refineries in the past 20 years, which means we are now importing a majority of our energy. Will my right hon. Friend do something about those destructive policies?

My hon. Friend is right to raise this matter. The cost of energy for UK businesses is higher than for those elsewhere. That is why the Business Secretary, working hand in hand with the Treasury, is bearing down on that cost through the British industrial competitiveness scheme, particularly for the industrial strategy’s eight growth sectors—we have done that for automotive, aerospace and other sectors that are key to driving economic growth.

Is it not the case that the bond markets are losing faith in the Government’s economic policies, and that the cost of borrowing, as we have heard from the shadow Minister, is at an 18-year high? That means, of course, that mortgage rates will increase, putting even more financial pain on many of our constituents. What does the Minister say to my constituents, who are likely to see three or four mortgage rate increases over the next 12 months?

What the right hon. Gentleman is observing underlines the need for the Government to stick to our fiscal rules. The Chancellor is right to say that fiscal discipline is the bedrock of our economic security and national security. That is why we have committed to meeting those fiscal rules. In fact, we are meeting one of them early.

The Chief Secretary to the Treasury’s comments about regional growth and the active state are music to my ears, but rather than simply picking winners or de-risking private investment, how will she ensure that we get detailed local industrial strategies that build our domestic productive capacity and supply chains?

I am glad to know that some of what I say is music to my hon. Friend’s ears. I can reassure her that that will be for mayoral strategic authorities to take forward. She is in a part of the country that has had great success in taking forward devolution and using those powers to drive economic growth. I am sure that her area will thrive under this Government, too.

The Minister spoke about global instability. There is no doubt that energy costs are having an impact on the cost of doing business, but this summer, local businesses told me that domestic Government had raised the cost of doing business, through national insurance and business rates rises. Will the Chancellor do something about that in the next Budget?

The hon. Gentleman invites me to write the next Budget, and I am not going to do that.

The Chief Secretary to the Treasury is right that the UK has a vibrant ecosystem of innovative companies, but too many are looking to go overseas to realise their scale-up potential and become globally consequential companies, so I very much welcome the focus on using the state as a strategic partner to help them do that. That was exactly the message I heard from the chief executive officers and founders of companies whom I met in the summer. How will the Treasury work across Whitehall and the wider public sector to help drive that cultural mindshift?

I thank my hon. Friend for his question and his work on this agenda. I reassure him that, as the Chancellor set out this morning in his growth speech, we will work across Departments to ensure that we open up public procurement to smaller and start-up businesses, so that they stay here, rather than go elsewhere when they scale up?

Does the Minister believe that putting up taxes is good or bad for economic growth?

Sometimes it is necessary, in order to fund improvements in our national health service and to fill the £22 billion fiscal black hole that we inherited.

Can I make a pitch to the Minister for a part of the country called the midlands, which I know that she knows well? Not everything is about the south or the north. There is a swathe of counties that form a band of engineering and manufacturing prowess in this country, from Shropshire through to Lincolnshire. They do not have the powerful mayors of the north or the economic growth that the south has had. In my constituency, the chemical industry talks to me about UK REACH double regulation, the steel manufacturers talk about the tariffs, and ceramics industry talks about access to the British industrial competitiveness scheme and the supercharger. If she wants good growth in every part of the country, including the midlands, how will we overcome those immediate challenges?

Being from Wolverhampton, I agree with my hon. Friend that the midlands is a very important part of the country. He is a really powerful advocate for his area, and he will know that we have put forward a ceramics support package to ensure that his area, and others in the region, thrive.

I welcome the reference that the Chief Secretary to the Treasury has made to the Oxford growth corridor and localising power and resources, but my constituents are deeply concerned about ensuring that infrastructure comes before the many developments that the Government have in mind. Can she confirm that along the Oxford-Cambridge growth corridor there will be an “infrastructure first” approach, and can she let me and my constituents know which Minister now has responsibility for that corridor?

As the Chancellor set out this morning, we are determined to speed up infrastructure provision. Frankly, compared to other countries, we are just too slow at building high-speed rail and other types of rail. We are determined to press ahead and ensure that we speed up infrastructure provision, so that we can develop other areas. I also have an interest in the Cambridge-Oxford growth corridor, because my constituency is not very far away.

We are now on the fourth round of consultation on East West Rail, the latter rounds of consultation consulting on the outcomes of the earlier rounds of consultation. At the same time, we are in the middle of building the most expensive nuclear power station in the history of the human race because of the four rounds of consultation required for Sizewell C. When we tried to build the lower Thames crossing, the total consultation for the development consent order process was 359,000 pages. That is 250 times the length of “War and Peace”. It is right to go to war on these consultations, but can the Minister tell us how she will stop at nothing to ensure that we get infrastructure projects built more efficiently, so that we can save taxpayers far more money and drive economic growth?

I share my hon. Friend’s impatience. I want to get things done, and so does the Chancellor. The Attorney General will provide guidance to Ministers, so that we can make quicker decisions. She will advise on where we need consultation and where we do not. My hon. Friend is absolutely right to be impatient for change; I am too.

Is it not bizarre that just a few hours after the Secretary of State for Housing, Communities and Local Government came to the House to pause local government reorganisation on the basis of legal risk, so that she can have more consultation, the Chief Secretary to the Treasury said, “We will bring an end to consultation culture and, with guidance from the Attorney General on legal risk, give Ministers the confidence to make decisions”? Will they have a greater appetite for legal risk, or will they pause to have more consultations? The two Ministers are saying opposite things.

We have to get local government reorganisation right, so I make no apology for the Secretary of State coming to the House to update colleagues—for a couple of hours; it was a very long statement. I know that lots of Members from across the House have strong views on the issue, but it is important that the Government get this right.

I will ask a slightly different question from the one I originally intended to ask. Every time we come to this Chamber to discuss the economy, we spend a lot of time debating public spending, but we never seem to discuss our trade deficit. We have not been in surplus since 1998. What will the Government do to ensure that we start paying our way in the world again?

My hon. Friend is right to talk about the trade deficit. When I was at the G20 in North Carolina last week, there was a discussion about global trade imbalances, and that is something that we are considering putting on the agenda for our G20 presidency.

Labour promised £200 million for Grangemouth, none of which has materialised. Labour promised 1,000 jobs for GB Energy, and it turns out that a third of the 130 delivered so far are not actually in Scotland. If the Prime Minister’s localism project is not just for Manchester, what extra powers will be devolved to Scotland as a result of the decisions being made?

Can I say gently to the hon. Lady that Scotland has rightly had plenty of devolution, but that does not mean that the two decades of SNP Government have been successful?

On that note, after two decades of failed SNP governance, 29% of children in Clackmannanshire are living in poverty. The Labour Government have lifted the two-child benefit cap, which will reduce that figure and help life chances. Improving economic growth is, of course, laudable, but could we go for some classic Labour redistribution of wealth, and also look at taxing multimillionaires and billionaires?

I agree with my hon. Friend that it is simply not acceptable that we live in a country where children are in poverty. The last Government plunged 900,000 children into child poverty. We are proud to be the Labour Government who lifted the two-child limit and lifted 450,000 children out of poverty.

On a day when Jaguar Land Rover has announced 4,000 job losses, how many more jobs have to be lost before the Government change course?

As I said in response to the shadow Minister, the Business Secretary is working closely with the chief executive and leadership of the company. Jaguar Land Rover employs 30,000 people in different parts of the country. We supported the company last year in the wake of its cyber-attack. We are supporting automative with £4 billion in capital and research and development funding to manufacture zero-emission vehicles. My thoughts are with the workforce; this is a very difficult time. As I understand it, the company has said that, by and large, this will be done by voluntary redundancy as much as possible, and over two years.

Since 2020, Governments, Prime Ministers, Ministers, UK Research and Innovation and businesses have all supported the BioYorkshire project, which will address issues to do with the environment and the climate crisis, as well as providing good-quality jobs and a return for the Treasury. However, the Government have not been able to get money out of the door, so can the Minister say more about how she will invest and spend that money?

I profoundly believe that we have to drive a win-win. We can deliver good infrastructure and good jobs and limit the number of consultations, and have an eye to the impact on the environment. I will come back to my hon. Friend on her specific question.

Imagine that you are a worker at JLR worried about your future, and you have the misfortune of watching the Chancellor’s speech, which contains searing economic insights like,

“I want to see businesses make a profit.”

There was nothing about scrapping electric vehicle mandates, bringing down energy costs by getting rid of net zero targets, or bringing down the cost of employing people by getting rid of the increase in employers national insurance. Is it not the truth that it is the Government who are killing the British car industry, and they need to wake up and take action?

No, that is not the truth.

Like many parents all over the country, this month, my wife and I will drop off our child at university for the first time—in this instance, to begin an engineering degree. What assessment has the Minister made of the economic benefits of helping more young people into secure work? What assurance can she give all our young people starting in education or training this month that the Labour Government are alive to their fears about rising costs, technological changes and global uncertainty, and are working hard to ensure that economic conditions mean that they have a job when it is time for them to enter the jobs market?

The Government are on the side of young people—both young graduates and those who pursue technical education. As the Prime Minister set out in his first two weeks in power, we want to ensure parity between technical education and university education, and to drive good growth in every postcode, including in my hon. Friend’s constituency.

As the Chief Secretary to the Treasury will know, many of those Jaguar Land Rover employees live in my constituency, but they are across the whole midlands. In August, the Government committed to consulting on the zero emission vehicle mandate. Will she undertake to ensure that the consultation is as quick as possible, so that we can give our car manufacturing firms the best chance to compete globally?

I thank the right hon. Member for his question. We were once parliamentary neighbours, so I understand the concern that he is expressing. Over the weekend, I spoke to the Business Secretary about this issue. We are holding a consultation, which will be a quick one.

I heartily welcome my right hon. Friend to the Dispatch Box in her new role. In 1954, the Co-operative Permanent building society opened its office in Peterborough. In the 70 years since—now as Nationwide—it has provided advice and support for lenders and people buying a house. There are few better examples in this country of a commitment to our high streets and to growth in every postcode than building societies and the mutual movement. We have a manifesto commitment to double the size of the co-operative and mutual economy. We talk about growth in every postcode; will my right hon. Friend reassure me that the Government will do everything they can to ensure that the building society movement can play its part in rebuilding our country?

I can absolutely do that. May I thank my hon. Friend for the work he does to further the cause of co-operatives and mutuals? When I was Economic Secretary, I very much enjoyed working with the sector, because building societies often offer more innovative products—to first-time buyers in particular—and do sterling work.

The rhetoric might have changed a bit under the new Prime Minister, but it seems that we have a continuity Chancellor on the policy front. The Minister talks about the failures of privatisation, but where is the action to bring water back into public hands? She talks about the need for an active state, but where is the action to tax wealth fairly, so that we can invest in the services we need? Fundamentally, we cannot get good growth unless it is both green and fair. We will not build sustainable prosperity by trashing nature and the climate.

I do not believe in trashing nature and the climate either, but if we want to tackle climate change, we cannot stop every renewable project from going ahead, which is what the Greens would have us do, just as they would prevent the building of new nuclear power.

My right hon. Friend talked about good growth in every postcode, which I welcome, as well as the £150 million scheme with the British Business Bank, but there was nothing for the midlands, which was ironic given where the Chancellor delivered his speech. The truth is, the midlands is being squeezed from the north and from the south. Will she help me to revisit the limit, resurrect the previously canned scheme on the A46, and meet me to discuss investment in our region?

May I reassure my hon. Friend? One of our trailblazer projects in the place-based business cases is with Birmingham, which is obviously the beating heart of the west midlands.

The Chancellor promised growth in every postcode, which must include rural communities such as Glastonbury and Somerton, and not just our cities and towns, yet rural England’s productivity sits at just 69% of the non-rural rate, costing our economy billions in lost revenue every year. That is not just a rural problem but a national one. What is the Chief Secretary doing to create opportunity in the countryside and unleash the full potential of rural Britain?

The hon. Member will know that rural communities are close to my heart, given my previous ministerial role and because I have a semi-rural constituency. There is huge potential in rural communities. The Prime Minister visited rural Cornwall in his first few weeks in the job. We will do more, and we are doing more, to improve local transport and rural connectivity, including the £2 cap on bus fares. She is right to say that there is great potential, which we must realise.

Too often decisions have been made in Westminster with an assumption that investment, opportunity and growth flow naturally to the south, but in reality Portsmouth has been ignored and faces real pressure on housing, transport and education. Will the Minister work with me to ensure that my city and the people of Portsmouth are no longer an afterthought but at the heart of the Government’s plan for growth and opportunity?

I can absolutely give my hon. Friend that reassurance. The Government are intent on driving good growth and job creation opportunities across the country—in the north, the south, the midlands and every other part, too.

The Government insisted on applying the social time preference rate to the disastrous Chagos deal to make an appalling deal look slightly better. Will the Minister confirm that the changes she has announced today as part of her Green Book revision will increase the cost of that deal by £288 million, which is 10 times the amount that she proposes to cut from the Army training budget this year?

The Green Book discount rate is a tool of economic analysis. It does not change the cost of the deal.

Will the Minister confirm that the reforms to judicial review of infrastructure will apply to the West Yorkshire mass transit project? Does she consider that project to be nationally significant infrastructure?

We are working with the mayor on that issue. Our colleagues will get back to you on that.

Hopefully they will get back not to me, but to the hon. Member.

I am sorry, Madam Deputy Speaker.

The Sea Shanty café on Ynys Môn is desperate for hope. Paying 20% VAT is simply unsustainable. Hospitality is a major employer on the island, but our businesses are being squeezed by rising costs. Cutting VAT to 10% would be a quick win, driving growth by giving businesses some breathing space and protecting jobs. Will the Chief Secretary consider that?

The Prime Minister is clear that the hospitality sector is close to his heart. It is one that he worked closely with when he was Mayor of Greater Manchester. Earlier this summer we announced the business rate reductions for pubs, social clubs and live music venues, and we will go further in the Budget.

The Minister will know from her previous ministerial role that the cost of fuel is the single most important business cost for rural businesses. I am not asking her to write the Budget today, but will she convey to the Chancellor the importance of continuing the fuel duty freeze for rural businesses beyond the end of December?

As I outlined to the hon. Member for Glastonbury and Somerton (Sarah Dyke), it is right that we focus on rural communities as well as urban areas and city regions. I will convey that message to the Chancellor, but I will not be writing the Budget right now.

The Government talk a lot about how they will create economic growth. There is no way for them just to legislate their way to growth; there are, however, plenty of ways to legislate against it, as small rural businesses in North Norfolk know only too well. Will the Minister tell those rural businesses what she is doing to help them grow? More importantly, what things that get in their way will she stop doing?

As I said to the hon. Member for Glastonbury and Somerton (Sarah Dyke), we take the economic success of rural communities really seriously. We are improving connectivity, whether digital connectivity or local transport connectivity, to ensure that the areas are more successful, but there is obviously more to be done.

For some years I have known the proprietor of a small to medium-sized aviation company that has come up with revolutionary aircraft designs with both civilian and military applications, but every time the Government of the day have ended up supporting the big operators in this field. How will the right hon. Lady’s new policy towards unicorns benefit somebody like that?

The right hon. Gentleman is right to raise this issue. As I have said, we have given strategic steers to the public financial institutions to ensure that they are focusing on regional growth, and that is also about opening up opportunities for the kinds of businesses that he has mentioned.

The Chancellor has rightly identified trade frictions as a major impediment to economic growth. As a result of the Windsor framework, the internal market in the UK has been severely disrupted by EU-imposed restrictions on trade, which mean customs unions, mountains of paperwork and physical barriers. What steps does the right hon. Lady intend to take to remove this barrier to economic growth in Northern Ireland?

I can reassure the right hon. Gentleman that when I was Environment Secretary I visited the port of Belfast and saw the kinds of checks that were going on there. The sanitary and phytosanitary agreement that we are negotiating with the EU will help to reduce that friction.

The Chief Secretary talks about £150 million for investment in the north. How much of that funding is actual new capital expenditure from this Government, or is it simply a repackaged, reannounced sum of money for the north?

It is money that already sits with the British Business Bank, but the change is the focus on the north, on scale-up businesses, to ensure that we unleash their growth potential. We are not announcing new funding; we never said we were.

Dewsbury and Batley is the capital of furniture, bed and upholstery manufacturing in the UK, but after Brexit it lost a lot of its export business. What are the Government going to do to support furniture, upholstery and supply chain manufacturers in Dewsbury and Batley as part of their investment in the north?

The trade deals that we are doing, and also the reset of the relationship that we are taking forward with the EU, will bring down barriers with our biggest and closest market.

The Minister cites our world-class universities and an ambition to double the number of UK unicorns that run frontier technologies such as quantum and AI, but does she recognise that those breakthroughs often come from the curiosity-driven frontier physics research in our universities, and that that research base now faces a £700 million funding gap?

UKRI—UK Research and Innovation —invests in that sort of research, and the Government will continue to do that through UKRI.

I, too, am a bit concerned that the Minister is missing a page of her statement, because there has been no mention of the east midlands. The Prime Minister was right when he blamed Margaret Thatcher for picking winners and abandoning whole regions, and that appears to be happening to the east midlands this time. In my constituency, Leicestershire and Rutland receives a grand total of zero pounds in infrastructure investment. On skills funding, Leicester gets £11.30 per head, compared with £52.10 in Greater Manchester and £66.19 in the west midlands, which is six times more. Can she reassure me, the people of the east midlands and my constituents in Leicester South that we will not be left behind?

I can reassure the hon. Gentleman; the east midlands and the west midlands are really important. The changes that the Chancellor outlined to the discount rate today will benefit places such as his constituency, because they will ensure that we value the longer-term benefit of regional investment projects more fairly. As we have said, we will drive growth in every postcode and that includes his constituency.

The concept of devolution and localisation is to empower local communities by bringing the decision-making process closer to them. In Birmingham, the city council is being forced to relinquish its planning powers to the regional mayor. That is anti-devolution. Does the Minister agree, and what will she do to ensure that the council does not lose its planning powers?

I would disagree, because the mayoral strategic authorities are about local authorities coming together in a combined authority and working together across the borders of the west midlands—an area I know extremely well. This is about driving growth and driving good decisions across the region.

We are working in close partnership with business, and the hon. Gentleman is right to say that we have to unleash talent and business investment in his own constituency and elsewhere, but as I said to the Chair of the Treasury Committee, the way that the public financial institutions work is by independently assessing the potential of firms and then backing them. That is what the Chancellor was talking about today. We set the strategic priorities and those independent economic organisations assess projects for their potential.