Rachel Reeves' response to the Chancellor’s Autumn Statement

Rachel Reeves MP, Labour’s Shadow Chancellor of the Exchequer, responding to the Chancellor’s Autumn Statement in the House of Commons on Thursday 17 November, said:

Thank you to the Chancellor for his statement.

So here we are. Approaching the end of 2022. Three prime ministers, four chancellors, and four budgets later.

And where do we find ourselves?

In an even worse place than where we started: inflation spiralling, growth plunging and living standards falling.

Britain is a great country, with fantastic strengths. But, because of this government’s mistakes, we are being held back.

What people will be asking themselves at the next general election is this: Am I and my family better off with the Tories?

And the answer is no.

The mess we are in is not just a result of 12 weeks of Conservative chaos, but 12 years of Conservative economic failure:

– Growth dismal

– Investment down

– Wages squeezed

– Public services crumbling.

And what does the Chancellor have to offer today? More of the same – with working people paying the price for his failure.

The Chancellor should have come here today to ask for forgiveness. At the very least he could have offered an apology. But no.

Instead he says that his predecessor was correct in his analysis at the mini-budget – the mini-budget that put our economy into free fall.

All the country got was an invoice for the economic carnage the government has created. Never again can the Conservatives claim to be the party of economic competence.

It’s been clear for weeks what their plan is.

Step two – pretend the disastrous mini-budget was nothing to do with them.

Step three – portray the Chancellor and the Prime Minister as the people who can clean up the mess of their own making

Step four – play politics by attempting to lay so-called ‘traps’ for the Labour Party

They’ve even had George Osborne in to advise them on how to party like its 2010.

But this isn’t a game. This is about people’s lives and people’s livelihoods. It’s about their ability to pay the mortgage, the rent and the bills.

It’s about 12 years of stagnation which has left our country so much worse off.

It’s about the fact that when global storms hit, we are uniquely exposed to them because of the choices the Conservatives have made.

Nobody doubts that the Covid pandemic and war in Ukraine have had profound implications. And the whole house is united in its condemnation of the latest Russian aggression.

But Britain’s problems started well before the pandemic struck and started before Russia’s illegal invasion of Ukraine.

The UK has grown by an average of 1.4% under the Tories compared to 2.1% in the Labour years before that. We are the only G7 country that is still poorer than before the pandemic.

As the Governor of the Bank of England told the Treasury Select Committee yesterday, the US has grown by 4.2% since the pandemic, the GDP of Eurozone countries is 2.1% higher, and yet the UK economy is 0.7% smaller than at the start of the pandemic.

We aren’t recovering, we’re heading to recession. The Governor described this difference as “dramatic” and “stark”.

How would the Chancellor describe it? How would he explain it?

This is the price of a decade of Tory choices and economic failure. And it is set to continue, with the IMF forecasting that the UK will have the lowest growth of any advanced economy over the

next two years.

The Chancellor says he is being honest today, so let’s be honest. No-one was talking about cuts to public spending two months ago.

And no other advanced economy is cutting spending or increasing taxes on working people as they head into a recession.

This government has forced our economy into a doom loop – where low growth leads to higher taxes, lower investment, squeezed wages, and the running down of public services.

All of which hit growth again. And instead of learning from the mistakes of the last decade, they’re simply repeating them.

We need to break free from this vicious cycle of stagnation, with fairer choices and a proper plan for growth.

The Chancellor and Prime Minister are trying to convince us that the problems Britain faces are nothing to do with them.

That the mini-budget, which imposed a Tory mortgage penalty, put pensions in peril, and trashed our reputation around the world, was all just a bad dream.

It’s their ‘Bobby Ewing’ strategy. Downing Street as Dallas, old cast members return as if nothing has happened, with tangled plot lines to try and keep the audience.

But the truth is it has lost all credibility – and everyone knows it is long past time the series was cancelled.

And the problem for British people is this: this is not a dream. This is the everyday nightmare of Tory Britain.

The Conservatives would have us believe that they are not responsible for the last 12 years of failure.

In doing so, they take the British people for fools. Millions are already worried sick about how to make ends meet, are now facing the added stress of mortgage payments rising.

The prospect of home ownership becoming more and more remote. And rents going through the roof. What does that mean?

Family holidays cancelled, savings depleted, hopes for the future replaced by sleepless nights.

And all this on top of the fact that the average worker is earning less in real terms than when the Tories came to power 12 years ago.

This government has presided over the biggest wage squeeze in centuries.

This was a crisis made in Downing Street, and it is working people paying the price.

As I was coming into Westminster today, I read a timely warning from the police about pickpockets in the area.

They warn, ‘you may have an idea of what a pickpocket looks like, but they’re far less likely to stand out in a crowd than you might think.’

‘They may work in teams to distract the target’ and ‘one of their tactics is where a thief will appear to be overfriendly while pickpocketing you.’

I must report that in the last hour the Conservatives have pocketed the purses and wallets of the entire country as the Chancellor deployed a raft of new stealth taxes taking billions from working people.

A Conservative double whammy that sees frozen tax thresholds and double-digit inflation erode the real value of people’s wages.

Just one of those freezes – in the personal allowance – will cost an average earner more than £600 a year – making it even harder to make ends meet.

At the same time, the government is forcing local authorities to put up council tax.

The Chancellor appears to have confirmed a council tax bombshell worth £100 for a typical band D property, taking their council tax above £2000 for the first time.

Local people – including those with Conservative councils – will be forced to pay more because of the destruction that the Tories have wreaked on our economy.

And this at a time when councils are already in dire straits because of a lack of support from central government.

Now, they probably sat around their table in Downing Street, thinking this was some clever trick: make the councils take the blame.

But no one is to blame for this except the government that’s been in power for 12 years. More taxes. More inflation. Higher mortgages.

And instead of tricks and stealth taxes, why don’t they have a proper economic plan for Britain that puts working people at its heart?

And why do they refuse to have a real industrial strategy that gives businesses certainty, unlocks investment, and means Britain can once again lead the world in the industries of the future.

The Chancellor is trying to claim that this statement is fair.

Yet today we learn that of all the things he could save from the wreckage of the kamikaze budget he chooses to press ahead with the plan lift the cap on bankers’ bonuses.

At a time when he’s urging wage restraint on everyone else, how can he possibly claim that this is fair?

And after weeks of this ‘will he, won’t he’, we learn today that the Chancellor won’t after all be taking action to clamp down on non-doms.

Tax free income for millionaires, while millions face frozen tax allowances and Council Tax hikes.

How can he possibly claim that this as fair?

He refuses to act, and I wonder why. Maybe that was the one policy that couldn’t get signed off by Number 10.

I say: if you make Britain your home, you should pay your taxes here too.

And what about the private equity fund managers earning millions, and who benefit from a tax break on their bonuses which means they pay far less tax as a proportion of their income than ordinary workers?

Did the Chancellor choose to close the loophole, and make sure they pay their fair share of tax?

He did not. He made working people pay instead.

Because time and again we’ve seen how quick the Conservatives are to raise taxes on working people.

The Chancellor has even compared himself to Scrooge. He’s asking working people to take the hit, with less money in their pockets not just this Christmas, but for years to come.

But if you’re a banker, a non-dom, or a private equity fund manager, don’t worry, Scrooge isn’t cancelling your Christmas.

And that’s before we even get onto the energy giants

After months of resistance, including from this Prime Minister, the government has finally been dragged kicking and screaming to extend the windfall tax that Labour first called for in January.

Yet still they leave billions of pounds on the table, profits that are the windfalls of war.

Because they have failed to close a huge loophole that they created, that hands out massive tax breaks to those oil and gas giants for doing things they were going to do anyway.

For those wondering why some energy giants have paid no windfall tax in the last quarter, despite record profits and eye-watering bills for the British people, the answer is the decisions this Prime Minister made when he was made as Chancellor – confirmed today by the current Chancellor – let the energy giants off the hook once again.

The government has announced plans for energy bills next year, but bill-payers will still see prices go up next spring, leaving far too many people wondering how they’ll make ends meet.

For every pound of windfall tax left on the table, ordinary people are forced to pay the price. And the Tories’ failure on energy goes back further. They closed down gas storage, blocked onshore wind and solar and slashed support for home insulation.

Now today he says he will act on energy efficiency but I’m afraid it is all far too late.

We called for the insulation of 2 million homes a year more than 12 months ago to cut bills by up to £1,000 not just for one year but for every year.

And they did nothing.

Insulation levels in 2021 were twenty times lower than 2010 because of their neglect. And now he proposes to wait until 2025 for them to act.

Why, when people are facing a bills crisis now?

Years will have gone by while he sits back, millions of families that could have been helped and they have not been.

And still they block renewable power like onshore wind that would bring bills down, create good jobs in all parts of the country, and ensure Britain can lead the world in the industries of the future.

Clean power is the right solution to the energy price crisis – but yet again the Conservatives have failed.

Failed to protect us from future shocks.

Failed to tackle the cost of living crisis

And failed to take the decisions in our country’s national interest.

It is because they have failed to grow the economy that they are having to bring forward yet another statement with tax rises and spending cuts.

The last Prime Minister and Chancellor embarked on a reckless sugar rush that abandoned fiscal rectitude.

But the current Prime Minister and Chancellor have given up on growth altogether.

How do we know? Because the Office for Budget Responsibility has seen their plans and downgraded growth in the months and years ahead.

Achieving the levels of growth this country needs isn’t like flicking a switch.

We need a serious long-term plan to get our economy growing again – powered by the talent and effort of millions of working people and thousands of businesses. And we need a fairer, greener, and more dynamic economy, creating jobs across every part of the country in homegrown renewables, green hydrogen, and carbon capture and storage.

With a modern industrial strategy where government works hand in hand with business, properly fixing business rates so that small businesses and our high streets thrive again, fixing the holes in the government’s Brexit deal so that our businesses can trade on the global stage, and ensuring Britain is the best place in the world to start and grow a business.

That’s what Labour will do.

While our public services are struggling, and working people are being stretched, the rampant waste and cronyism from this government continues apace.

It does not seem to concern the Chancellor that his government has dished out £3.5 billion of contracts to friends and donors of the Conservative Party.

And the latest Prime Minister, spent so much time as Chancellor practicing his signature for his glossy Instagram graphics that he failed to put even the most simple checks on covid support schemes.

That is why former Treasury Minister Lord Agnew described the current Prime Minister’s fraud failures as ‘schoolboy errors’.

The Prime Minister left the doors to the vaults wide open to organised criminals and drugs gangs. They helped themselves to £6.7 billion of public money.

Money that this government is failing to retrieve. And last month it was slipped out that the ‘Taxpayer Protection Taskforce’ set up to get this money back is being wound down.

The government’s given up. And the Conservatives are turning yet again to our crucial public services to make up the money.

The fraudsters may think they have got away with it, but a Labour government will hunt them down for everything they have taken from the taxpayer.

The country is sick of being ripped off by the Tories. We want our money back.

Because of Tory failure, our crumbling public services are set to suffer even more. Ordinary people lose yet again.

Never before have people paid so much in tax, and got so little in return.

At the weekend the Chancellor admitted the NHS was already on the brink of collapse.

With 7 million people on NHS waiting lists, how much longer will that list get?

Three in ten are leaving education without a pass at English and Maths

What will this do to our society and future economy?

By their actions it is clear, the government does not value our public services – and the contribution of those working for them.

And now, we hear that the Chancellor, who had previously said one of his biggest regrets as Health Secretary was failing to fix social care, has today further delayed the government’s much promised social care cap.

This is yet another broken promise after 12 years of Tory failure on social care.

The Tories have trashed our public services and the statement today will do nothing to turn that around. The Conservatives have crashed our economy, given up on growth and sent inflation through the roof. And as usual it is working people left to foot the bill.

It is a familiar tune. Every mortgage they raise. Every cut they make. Every tax they hike. The Conservatives are costing you. And what have we heard today?

Yet more excuses and unfair choices. They have failed to tackle the cost of living crisis. They have failed to show how they will fix our public services. The have failed to show how they will deliver growth.

And they have no plan for the future of our country. After everything we have heard today, and after 12 long years, the only conclusion we can come to is this: