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.
T4. In York, the average rent rise of 11.9% exceeded the state pension rise by £380 this year. With the loss of the cost of living payments and winter fuel payments, and the increase in the energy price cap and cost of living, pensioners are frightened about how they are going to keep warm this winter, as am I. In changing the eligibility for the winter fuel payment, how will my right hon. Friend protect pensioners above the pension credit threshold to prevent cold, ill health or worse this winter?
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.
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.
T5. Age UK reports that there are around 1 million pensioners who just miss out on the winter fuel payment. These are people living on modest incomes, within £50 of the poverty line, who will miss out due to a tiny occupational pension, and they include many in Liverpool Wavertree. We have heard about the campaign to take up pension credit, but can my right hon. Friend tell us specifically whether that pension credit will be backdated?
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.
T2. It is estimated that the Bank of England will require a further £110 billion of taxpayer subsidy to cover long bond sale losses through to 2030. So why is the Chancellor clobbering pensioners to save £1.5 billion a year when she could be challenging the Bank of England to save tens of billions of pounds a year?
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.
T7. Will the Chancellor of the Exchequer confirm that her decisions are targeted at winning new investment in green industry in places such as Billingham in my constituency?
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.
T3. The prospect of the financial collapse of a major utility company such as Thames Water should cause us all grave concern given not only what it would mean for consumers in my constituency and many constituencies like it, but the wider implications it would carry for our economy and the Government finances. Does the Chancellor therefore agree that putting Thames Water into special administration and reforming it would protect not just consumers, including my constituents, but the wider economy?
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.