PARLIAMENTARY DEBATE
Topical Questions - 3 September 2024 (Commons/Commons Chamber)

This Government have inherited a £22 billion black hole in the public finances, and rectifying the situation requires tough choices. We will also clamp down on egregious spending and halve Government spending on consultancy, which will save £500 million next year. Increasing consultancy spend has been rife across Government for the past four years. It is up 55% at the Department for Transport, 137% at the Foreign, Commonwealth and Development Office, and a staggering 416% at the Home Office. It is no wonder taxes are so high and public services are so poor when the last Government frittered away taxpayers’ money with no concern. I will treat taxpayers’ money with respect, and we will fix the foundations of our economy so that we can rebuild Britain and make working people better off.

I welcome the Chancellor to her place. Notwithstanding what she has just said, can she tell the House why she has made the political decision to scrap the commitment to spend at least 2.5% of GDP on defence, undermining our support for Ukraine, and has instead prioritised giving her union paymasters inflation-busting pay rises that have only led to more unions calling for more strikes and more pay?

Let me respond directly on the issue of Ukraine. In my first couple of weeks in this job, I had the pleasure of meeting Minister Marchenko from Ukraine, and made a commitment to him to go ahead with the extraordinary revenue acceleration programme. It is important that we work together across the House to support the Ukrainian people against the Russian invasion. In the previous Parliament, Labour always supported the Government when they took action to support the Ukrainian people, and I hope that that cross-party support can continue.

Can I remind everybody that this is topical questions? I have a big list to get through. Rachael Maskell will give us a good example.

The basic state pension is worth £900 more than it was a year ago, and will go up again in April next year because of the triple lock, which we have committed to for the duration of this Parliament. We have already written to York council and are working with local authorities across the country to boost take-up of pension credit, because this Government, unlike the last Government, are determined to ensure that 800,000 people entitled to pension credit actually receive it.

I call the shadow Chancellor of the Exchequer.

When the Chancellor was sitting on the Opposition Benches she repeatedly attacked cronyism, so will she tell the House whether she told the Treasury permanent secretary that Ian Corfield had made a donation to her before she got him appointed as a director in the Treasury—yes or no?

All Governments appoint people to the civil service. The donation from Ian Corfield was declared over a year ago in the proper way, and we answered all the questions in the right way that the civil service asked when we made that appointment. Ian Corfield is supporting this Government in hosting the international investment summit, which will bring hundreds of global investors to the UK next month.

I think that means the answer is no. The ministerial code states:

“Ministers must ensure that no conflict arises, or could reasonably be perceived to arise, between their public duties and their private interests, financial or otherwise”.

That did not happen. Will the right hon. Lady tell the House why cronyism is wrong under the Conservatives but acceptable under Labour?

The right hon. Gentleman has a bit of a brass neck criticising this Government, after the appointments and the partying at Downing Street that we saw under the last Conservative Government, and the billions of pounds’ worth of contracts handed out to friends and donors of the Conservative party. That is why this Government are appointing a covid corruption commissioner to get that money back for taxpayers; because unlike the last Government, we are determined that taxpayers’ money is treated with respect, and not handed out to donors of the party.

Yes, absolutely; pension credit can be backdated by up to three months, and we will ensure that that happens. We are also working closely with Liverpool city council to ensure that the constituents in Liverpool Wavertree, and indeed in all our constituencies, are getting the support that they entitled to. The poorest pensioners, who are entitled to pension credit, should get it. It is a travesty that 800,000 missed out under the last Conservative Government. We will ensure that pensioners entitled to support get it.

Before I became a Member of Parliament I was an economist at the Bank of England and I respect the independence of the Bank of England. The previous Government undermined that independence. That contributed to the economic chaos that we saw under the last Conservative Government. This Government will never go down that route.

I welcome my hon. Friend to this House, because he brings a great deal of expertise on green steel from his previous career. This Government’s plan to launch the national wealth fund is precisely to create investment across the country in some very important strategic industries, and that includes decarbonisation of steel and the steel industry.

Water companies are commercial entities. It would therefore not be appropriate for me to comment on that. It is for the company and its investors to resolve their possible issues.

I championed this issue in the last Parliament as Chair of the Business and Trade Committee. I am pleased to confirm that I am working with colleagues across Government to make progress, and I will update the House further in due course.

The Government are reviewing the new hospitals programme as part of our spending review. We will undertake a full and comprehensive review while continuing to deliver the most advanced and most urgent hospitals in a realistic timeframe.

The Conservative party crashed the economy and then wrecked the public finances, leaving us with a £22 billion black hole. The shadow Chancellor is not willing to be straight about the damage he did, and is now trying to pass the buck to independent civil servants. I will always be honest about the public finances and take the tough decisions that we need to fix the foundations of our economy.

In July, borrowing stood at £3.1 billion, well ahead of the OBR’s forecast of £0.1 billion. Does the Chancellor agree that she could have reduced the national debt had she chosen not to reward her trade union paymasters by spending £10 billion on inflation-busting pay rises?

As the hon. Gentleman knows, Government borrowing is running at £4.7 billion higher than the OBR forecast because the previous Government made unfunded commitments without any idea of how they were going to be paid for. The previous Government set the mandate for the independent pay review bodies, and we have honoured the recommendations of those bodies to ensure that our armed forces, our police officers, our nurses and our teachers got a pay rise. I think that is the right thing to do. If he does not, I wonder how he justifies that to public sector workers in his constituency.

As Ministers, we greatly value and respect trade unions and the work of trade union representatives in supporting their members. While it is not appropriate for me to comment on individual cases, I will look into this matter further and respond to my hon. Friend in due course.

The Chancellor’s decision to cut the winter fuel payment is forecast to save £1.5 billion. Can she advise the House what other options she considered for making savings in the Department for Work and Pensions budget before deciding to make this cut?

The black hole we inherited was £22 billion. We announced in the statement on 29 July £5.5 billion of savings to reduce the size of that black hole, but the hon. Gentleman can see there is still work to be done and we will be setting out further measures in the Budget on 30 October to get a grip of the public finances.

A forthcoming Transparency International report has identified 28 contracts worth £4.1 billion that were awarded to parties with direct political connections to the Conservative party, so can the Chancellor update us on the progress in appointing the covid corruption commissioner and whether they will take evidence from corruption campaigners such as Transparency International?

We are appointing a fixed-term covid fraud commissioner through an open competition that is now running as of this morning. The commissioner will make sure everything is done to return money owed to the taxpayer. It will report to the Chancellor, working with the Secretary of State for Health and Social Care, and will report to Parliament in due course.

The economic potential of the Brigg and Immingham constituency and the wider Humber region is heavily dependent on the renewable energy sector. However, there is a cloud on the horizon, with the future of Scunthorpe steelworks in doubt. Can the Chancellor give an assurance that if there are redundancies at Scunthorpe, there will be a generous package of support for workers and investment through the local authority to redevelop the area?

The hon. Gentleman speaks powerfully about the huge opportunities at Immingham and on the whole east coast through renewable energy and carbon capture and storage. Part of the reason for the national wealth fund is to invest in industries such as CCS, but also in our crucial steel sector, which is important to so many of the other Government ambitions on growing our economy. We are determined to support the steel sector through that investment from the national wealth fund.

The Chancellor’s plans for growth are welcome in Cornwall, but in the meantime we are relying upon shared prosperity fund and towns deal money. The deadlines for the completion of those schemes are March 2025 and March ’26. To ensure that investment is not lost, will the Chancellor consider extending the deadlines for completion of those schemes by up to 12 months?

I thank my hon. Friend for that question and welcome her to her place. She speaks powerfully on behalf of the people of Cornwall. The spending review will be the appropriate time to look at the shared prosperity funds and what resource we can give to the people of Cornwall, and I am sure my hon. Friend will work with the relevant Secretaries of State to ensure those representations are heard.

The Chancellor would have known, in advance of the cut to the winter fuel payment and the stripping of £160 million from pensioners in Scotland, that Scottish pensioners suffer the lowest temperatures, rural Scottish pensioners live in some of the oldest houses on these islands, and most Scottish pensioners in rural areas are off the gas grid. Knowing that, what discussions did she have with her 37 new Scottish Labour MPs about pushing Scottish pensioners into fuel poverty?

I would just note that the Scottish Government have decided to mirror what the wider UK Government are doing rather than using the tax powers that they have. That is a decision the Scottish Government have made given the fiscal situation they face; we face a similar issue with a £22 billion black hole in the public finances.

I thank my hon. Friend for the question and welcome him to his place. As a former local government leader he knows the huge opportunities there are to build the homes our country desperately needs. We have made a commitment to build 1.5 million homes during the duration of this Parliament. That will require making choices to call in planning decisions, as we have already done in our first week in office with regard to four specific housing developments.

Thousands of pensioners in my constituency have worked hard all their lives and are now worried at the prospect of losing their winter fuel payment, upon which they rely. Will the right hon. Lady reconsider and reverse her decision?

The increases in the basic state pension mean those constituents are £900 better off than they were a year ago, and of course energy bills are lower this year than they were last year. But it is important that we ensure that the 800,000 people who missed out on pension credit under the previous Conservative Government now get access to that support, because they are the poorest pensioners and at the moment they are living in poverty because the previous Government failed to sign them up to pension credit.

As Departments are preparing their spending review submissions, will the Chancellor and her team consider allowing the international development budget to be on the same footing as the research and development budget, and looked at over 10 years, so that we can get back to the 0.7% figure? Will she be willing to meet me and a delegation to discuss the benefits of that approach to such an important budget?

The Government’s spending review is currently under way. All decisions on official development assistance spending will be taken in the round as part of that process. I would be delighted to meet my hon. Friend and her colleagues to discuss this issue.