A week ago, on Wednesday 30th October, history was made when Rachel Reeves stood at the despatch box to deliver her first Budget Statement. As the first women to hold the office of Chancellor of the Exchequer, this should have been a seminal moment in British politics. Instead, it will be remembered as a Budget which failed to support our businesses, failed to support our pensioners, and failed to support our farmers.
However, this is not just my assessment of the Budget. The independent Office of Budget Responsibility has given its own damning verdict on the Government’s plan, and it is a triad of despair: taxes up, borrowing up, inflation up.
Politics, by its very nature, is a tribal affair. The Budget is a time for opposition parties to challenge the government of the day on their fiscal plans. There is naturally some parliamentary theatrics that goes along with it. However, there is, I would hope, no member of parliament, on either side of the House, who would want our country not to succeed. Therefore, it pains me to write that this Budget will stifle growth and reduce productivity.
During the General Election, Sir Keir Starmer and Rachel Reeves assured the British public that their spending plans were fully costed and would not require tax increases. Yet, when it came to delivery, the Chancellor has chosen to change the fiscal rules, to allow her to borrow billions of pounds more, and imposed £40 billion in new taxes. The cost of these fiscal decisions will inevitably be passed on to future generations.
Following the Budget announcement, I organised a virtual roundtable with Council Leader Ian Courts for Solihull West and Shirley’s business community. The meeting was a crucial opportunity to hear from local business leaders, who echoed concerns about the Budget’s failure to provide stability or growth. Combined with the Employment Rights Bill, this all brings about uncertainty for small and medium sized businesses in particular.
But it is not just businesses that have been hit by the Government’s plans. Here in Solihull Borough, more than 40,000 pensioners will lose their Winter Fuel Payments. Speaking with residents across the constituency, I know how deeply concerned they are about this decision. For many it is quite simply the choice between heating and eating this winter.
In addition, the announcement that unused defined contribution pension pots will count towards one’s estate for the purposes of inheritance tax, will be a major concern to many. This change will have a significant impact upon the financial planning and decisions made by a large number of residents.
Following the boundary reviews which came into effect at the last election, I am proud that 30% of the constituency of Solihull West and Shirley now comprises of agricultural land. Farmers are the backbone of our country, putting food on our tables. They have faced huge pressures in recent years and deserve our resolute support. It is therefore deeply troubling that the Government has also renegaded on its prior commitments to the farming community – abandoning Agricultural Property Relief. This will have a devastating effect on so many family farms up and down the country, including here in Solihull Borough. It is a shameful decision by the Government and risks our nation’s food security. Therefore, I want to reassure local farmers that I will be speaking up on their behalf in Parliament to ensure the long-term future of family farms is assured.
Budgets are never easy for any government. They inevitably involve making difficult, and sometimes unpopular, decisions. Labour should not be embarrassed in getting a decision wrong and correcting course. However, if they fail to acknowledge their errors, they will quickly lose the trust of the British people.
