11:52 Ed Miliband (Labour)

The hon. Lady is completely right about that. She anticipates my next point brilliantly; it is a useful segue. If we want to understand why growth is so anaemic, she is right that we need look no further than the Chancellor’s failure to seize the opportunities for green growth. This is an important point: the prudent and responsible economic call—I suspect the Business Secretary agrees—for economic growth is to invest at scale in the transition to a zero-carbon economy. Let us be honest, it is now a completely open secret that the problem is that the Chancellor is not a believer, and it showed yesterday. As we prepare to host the most important international summit ever on climate change, as delegates gather from all around the world, and as the eyes are on Britain, what did he unveil as his flagship measure yesterday? To cut air passenger duty for domestic flights. You literally could not make it up. People want good and affordable rail services, but the plan for rail seems to have been postponed again, and instead there will be 400,000 more domestic flights as a result of that decision. Once again, that shows that the Treasury is not signed up to the agenda.

to net zero—

“remain significant and their apportionment between businesses, households, and government…remains largely unclear. This leaves the costs associated with the transition to net zero as a major source of longer-term fiscal risk.”

As I was saying, not acting increases the cost, so the prudent responsible choice is to invest. I will mention some key sectors, because again, there has been a deafening silence. I come back to the steel industry, which is such a litmus test. It needs about £6 billion of investment to get to net zero by 2035. The view is shared on both sides of the House that it needs to get to net zero and that it is a foundational industry that we need and that is incredibly important to communities across the country. There are 20 demonstration projects around Europe but none here at the moment. It requires a partnership of the public and private sectors and needs both sides to invest. There is a crucial role for the Government in that.

My apologies, Madam Deputy Speaker. Does the right hon. Gentleman agree that he would have more credibility on the issue if he had not backed Labour’s 2030 net zero target, which even his own unions did not support? He has no credibility on that point.

On green investment, a philosophical difference is emerging. I worry that the Government will increasingly leave individuals and industries on their own to face the costs. I do not think that is true of the whole of Government, but the Treasury remains a fundamental block to the green investment that we need. There was a whole saga about its net zero review and the fact that it emphasises short-term costs rather than long-term gains. Frankly, that is a big problem for our country.

Labour would deliver a climate investment pledge of £28 billion extra every year for the rest of the decade. That is an investment in bringing down energy bills; delivering affordable public transport and cleaner air; and backing British industries with a real plan for jobs and wages. That is what real action on the climate emergency and industrial strategy looks like.

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12:40 Alison Thewliss (Glasgow Central) (SNP)

All eyes are on my constituency of Glasgow Central this month for COP26. This Budget and spending review fell woefully short of the ambition required to tackle the global climate challenge: nothing for carbon capture in Scotland and nothing on our need to grow and scale up the renewables industry in Scotland, not just wind farms but tidal and wave.

The hon. Gentleman makes an excellent point. This is an industry with a future. Climate change is the most significant challenge we face and investing in those industries now will set us up for the future. Carbon capture and storage in Scotland would have employed 20,000 people, a pipeline of jobs in an area that much needs it and a transition from the old to the new. The Government ought to be investing in that or giving us the powers in Scotland to do it in our own right.

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12:58 Andrew Jones (Harrogate and Knaresborough) (Con)

The Budget is strong on investment in infrastructure, with £35 billion for rail infrastructure, which includes opening some of the closed lines, and £31 billion for roads, to remove bottlenecks. We can add to that the investment in broadband, so infrastructure will clearly get a significant benefit. One issue that does not get quite so much coverage is bus networks, to which we are seeing big changes around the UK. In implementing the Bus Services Act 2017, we are seeing people move towards enhanced partnerships or possibly franchising. We have seen Budget funding go towards zero-emission buses. These are very positive developments. They are about connecting people to jobs, making it much easier for larger cities in particular to develop sustainable transport plans, which we all know is the right thing to do, and making it easier overall to move people and goods around the UK.

The infrastructure provisions are positive. However, having spent much of my time here talking about infrastructure and being at the Department for Transport, I actually think that skills policy is the most significant thing that we can use to improve the levelling up around this country. That is how we will improve the productivity of our nation. Big changes will be required in the skills environment. Our economy is going digital, and that trend has been compounded by the pandemic. We are transforming our economy as we go to net zero. The number of jobs required in new industries will be fantastic, so this is a transforming moment. It is also clear that the Secretary of State for Business, Energy and Industrial Strategy, the Chief Secretary to the Treasury and the Chancellor clearly recognise that, which is why we are seeing a 26% overall increase in the skills budget across this Parliament. Other areas matter for levelling up—we have discussed the levelling-up funds—but all these measures add up to a strong performance on a difficult issue.

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13:45 Nick Fletcher (Don Valley) (Con)

It is clear that this Budget puts the levelling-up agenda at the heart of decision making. No longer can levelling up be accused of being a mere slogan. Instead, thanks to the £22 billion of R&D investment, industries will be created directly out of the net zero fund, the future fund and the R&D tax credits regime, to name just a few. This will ensure quality jobs are provided to people across the country, not just down in the south-east. As much as I want Oxford, Cambridge and London, the so-called golden triangle, to continue to succeed and be a beacon of innovation, it is time for a new golden triangle in the north that connects not just our great northern cities but our ambitious northern towns, such as Doncaster, to opportunity and investment. With the multifaceted packages of support provided to businesses, communities and educational institutions yesterday, the creation of a northern powerhouse is a real possibility.

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14:02 Richard Fuller (Conservative)

Every Budget must be presented within the context of what is going on, and none more so than this one. We are coming through the covid period and through the Brexit transition. Even today, a French Minister has said that the only thing the British understand is force. That is unwelcome language. We do not want to have opposition from France or from any other member of the EU, but there will be issues about the Brexit transition that will affect the economy. We have spoken a lot today about climate change, but not so much about the changing relationship with China and what that does to supply chains. The other contextual factor is the OBR forecast itself. It is ambitious in its forward growth projections in the near term. All of those issues provide the context for the Budget.

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14:11 Jessica Morden (Labour)

On the theme of missed opportunities, with COP26 beginning on Sunday, there was little in the Budget to suggest that the Government are willing to invest in tackling the climate crisis. Climate action must start at home, and Britain’s credibility as holders of the COP presidency rests on the example that we set. There was little in the Chancellor’s speech to suggest that the Government will invest in delivering the benefits of the green transition to households and to industry, and certainly nothing to match Labour’s ambitions and the achievable demand for an investment of £28 billion every year until 2030 to tackle the climate crisis.

Crucially, as other hon. Members have said, there was nothing in the Budget this week for steel, an industry that would be a beneficiary of and contributor to the creation of a net zero economy. My right hon. Friend the Member for Doncaster North (Edward Miliband) set out that case brilliantly. Steel should be at the heart of the green recovery from the pandemic, and I say that as the Member representing Tata’s Llanwern site and Liberty Steel in Newport. UK Steel has rightly said that this Budget is a “triumph of complacency” and “a missed opportunity” ahead of COP26. Indeed, in the Chancellor’s statement, there was no hint of action on the sky-high industrial energy costs.

We heard a hugely weak response from the Secretary of State earlier in the debate that will deeply disappoint the industry, when he said that he is “in active conversations” and “watch this space”. We have been talking about this for many years. It is a really big burden on our industry that holds back British steel manufacturers against continental competitors. There was also no allocation of funding to the clean steel fund or wider decarbonisation support for the sector. The steel industry has highlighted that, of the 10 points in the Prime Minister’s plan for the green industrial revolution, eight relate to industries or goods that depend on steel or support the decarbonisation of steel. Either the Chancellor has forgotten that or the Government’s industrial strategy was not worth the paper that it was written on in the first place.

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14:29 Anna McMorrin (Labour)

In the week of COP, it beggars belief that the Chancellor thinks it is okay to come to this House and make domestic flights cheaper. Will he really be going to COP next week and telling world leaders in his speech that that is what he has done? What an embarrassment! They are a Government who talk the talk on climate action, but when it comes to it, they just do not deliver. Where were the announcements on tackling the huge energy efficiency crisis we are facing? We have rising energy costs, cold houses and homes, and people unable to afford the weekly shop, let alone Christmas. This Government are letting working families down. Labour has pledged £28 billion a year to climate investment right up until the end of the decade. Our Labour Chancellor would truly be a green Labour Chancellor, investing in the jobs and skills of the future.

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14:35 Paul Howell (Sedgefield) (Con)

I welcome the funding for the British Business Bank. As a last point, because I do not think anyone should forget it, climate change is important but we need to make sure that we do things in context. There is no point in stopping doing things that nobody wants to do—I will use an easy example of the Cumbrian mine—only to then import coal from the other side of the planet and pay all the carbon costs that go with bringing it in from elsewhere.

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14:43 Barry Gardiner (Labour)

Let me now turn to the way that is required. It is to be regretted that the Chancellor does not use public transport when in London. Were he to do so, he would have seen the poster campaign that says, “The world is looking to you, COP26.” One of those posters says, “Secure our priceless planet. Or argue over cost.” Yesterday, the Chancellor could truly have given us a Budget of optimism: a Budget that addressed the infrastructure needs of our country, the skills development required for a just transition to a net zero economy, and the basis for sustainable economic growth. He failed, and did so in a way that displayed such an astonishing lack of awareness of the problem and what one can only call contempt for the reality of the crisis that it appeared a deliberate provocation to all those about to meet this weekend in Glasgow for COP26.

The Chancellor referred to the tax super-deduction of 130% allowances for capital investment. He failed to mention that these have no environmental or climate filter and that some of the biggest fossil fuel companies will be able to use them to receive from the taxpayer not only the entire cost of their polluting capital investments but a bonus 30% for doing so, in projects like the Cambo oil field,. This incentivises the very behaviour COP26 is trying to curtail.

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14:52 Kieran Mullan (Conservative)

I am conscious that Department for Business, Energy and Industrial Strategy colleagues are leading today’s debate, so I want to mention an area that will be important for job opportunities in Crewe and Nantwich, which I have been talking to the Secretary of State about—the geothermal industry. We saw earlier in the year the difficulties of over-relying on solar and wind power when it comes to our renewable energy drive. Geothermal is an under-utilised opportunity in this country. Unfortunately, earlier in the year, just as the industry wanted to invest, we removed the tariff that would give it a guaranteed return. That has obviously had a devastating impact on investment in geothermal. We see it rising across Europe and across the world, but it is not rising in this country because we do not have that guarantee. I will continue to work with BEIS colleagues to see whether we can do something about that.

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15:02 Ben Lake (Plaid Cymru)

On the climate theme, I echo and share the bemusement of the right hon. Member for Doncaster North (Edward Miliband). In his opening remarks, he called into question the Chancellor’s commitment to net zero and the decarbonisation of the economy. In response, the Secretary of State referred the House to the net zero strategy that the Government announced last week as evidence of the Chancellor’s credentials. However, questions remain unanswered. The Institute for Government has suggested that the net zero strategy lacked detail on who will pay and offered only vague hints about a tax strategy to support the transition to net zero. In advance of COP26, we had hoped to see a bit more of that detail in yesterday’s Budget, but we did not receive it.

We all acknowledge that the freezing of duel duty—I might even get plaudits for this from those on the Treasury Bench—is an incredibly expensive policy. We cannot deny that and it is reasonable to suggest that, in the not-too-distant future, we may need to reconsider whether the fuel duty policy is sustainable, not least for financial reasons, but also given our decarbonisation commitments. Should we come to that politically prickly and technical discussion, we should perhaps look to extend schemes such as the rural duty relief scheme so that those living in rural areas, who, at the moment, do not have the benefit of a sophisticated public transport infrastructure, should not have to shoulder the burden of unrealistic costs. That would also perhaps introduce an incentive, for areas that have the luxury of fantastic public transport, to choose to use public transport more often than cars. In rural areas, however, as I think hon. Members would acknowledge, there is not that level of choice at the moment, and, sadly, using a car is still a necessity. Whether they are nurses working in hospitals or teachers going to school, people need to use cars. In approaching the big questions of decarbonisation, we need to think about how to ensure that there is investment in public transport in rural areas so that abandoning cars is an option, but for the time being, 80% of commutes in Wales are still by car.

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15:28 Stephen Timms (Labour)

I am pleased to follow the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone). I attended the reception he hosted yesterday for young people working in the renewable energy sector. He mentioned the reception in a couple of his earlier interventions, and I agree with those points.

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15:51 Rachael Maskell (Labour)

Although, obviously, I welcome the reannouncement of the funding for the National Railway Museum, as I have welcomed it each time the Chancellor has mentioned it, we need more investment in our city. That is why I was disappointed that York’s response to the green new deal, BioYorkshire, did not get a mention yesterday. It would bring forward, ahead of COP26, a proper green new deal and transition, as well as vital regeneration and crucial jobs for the future to my city.

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16:00 Catherine West (Labour)

Many hon. Members have mentioned the missed opportunity on climate ahead of COP26. We could have seen much more funding for basic measures: for example, we could have asked local authorities to retrofit homes and provide state-of-the-art new boilers. That could have provided the opportunity to train up the 180,000 workers we will need to install heat pumps. Our local authorities would have been grateful for the opportunity to do their bit; instead, they are still scrimping and saving, despite the small increase in local government funding. Much more could have been done.

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16:13 Jim Shannon (DUP)

I very much welcome the Government’s innovation targets, which the Secretary of State referred to earlier. On green energy, I made a point about hydrogen. I will be meeting him shortly with my hon. Friend the Member for North Antrim (Ian Paisley). We will put forward some ideas on hydrogen to create jobs and boost the economy, so we can look to the future. Again, those are some of the good things.

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16:25 Pat McFadden (Labour)

The Government ditched their industrial strategy out of ideological spite. The transition plan for net zero produced just last week was a damp squib. One of the biggest challenges that we face is how to transform the heating in our homes, yet their plan would partially cover just one in 250 of the replacement boilers needed. The long-term reform of business rates, which several Conservative Members said they supported, has been ditched once again. Time after time it is ditched. And the Government have only just discovered the importance of early years education, a decade after taking a wrecking ball to Sure Start and setting back a good start in life for millions of children around the country.

There is a better path. There is a better future and a different way, and that is to put our efforts into raising medium-term growth prospects and to get out of this bind of high inflation, high taxes and poor growth that 11 years of Conservative Government have left us in. That is the better path to prosperity and security. That is the path to ensuring that talent is used and to making the most of the UK’s potential. On the Labour Benches, we want to work with business, not treat it as a scapegoat for every problem that comes along. We want a fair deal for the workers in business, with good pay and decent conditions. We want to support wealth creation every bit as much as we support fair wealth distribution. We want to invest in the skills and talents of all our people, whatever their circumstances, from the youngest age possible, and we will have a net zero plan that meets the challenge of the moment and gets the best possible economic and employment benefits for the country. That is a better plan than the high-tax, high-inflation, low-growth model that the Conservative party has been pursuing, not for two years, not for one year but for 11 long years. It is that failure that gave rise to yesterday’s Budget and the tax burden being imposed on the country by this Chancellor and this Government.

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