Today saw the Chancellor deliver his Autumn Statement, which brought very encouraging news.
We heard that following Quarter 3’s extremely encouraging growth figures of 0.6%, the Office for Budget Responsibility has revised up its growth forecasts. The OBR now expects the UK economy to grow 1.4% this year, up from 0.6%, and next year by 2.4%.
The underlying structural deficit has been revised down by the OBR to 6.8% and is expected to be 5.6% next year, falling to 4.4%, 2.7% and 1.2% in the subsequent financial years. For the first time in decades, we will be running a fiscal surplus in 2018-19 – this is particularly encouraging because it will fix the roof while the sun is shining. Never again should we enter a downturn while running a deficit.
While these figures are encouraging, it’s important to recognise the scale of the task. We will borrow £111bn this year, so our work here is not done. We need to find savings of £1bn each year, in each department apart from health and education, for each of the next three years. This will help us reduce borrowing figures and consequently eliminate the deficit, which will start to reduce national debt.
Other services exempt to further spending cuts are the security services, which are incredibly hard-pressed dealing with the threat of terrorism, and HMRC, which is embarking upon a tax evasion and avoidance clampdown. The Chancellor expects it to raise £9bn over the next five years from these efforts, which is welcome news.
Owing to the Chancellor’s successes on the economy, we have been able to make progress in further helping families with the cost of living.
We have scrapped Labour’s fuel duty escalator, which would have added 20p to fuel per litre by next September. This is great news as it’s something I’ve been campaigning hard for since I was elected. Train fares will rise in line with inflation, not the planned RPI + 1%.
Small shops and pubs here in Amber Valley with property value of less than £50,000 will receive £1,000 off business rates next year, and we’ve capped rises on other businesses at up to 2%. Businesses moving in to vacant properties will receive a 50% rate cut.
Good for business too is the doubling of the export finance capacity to £50bn – this will help create more jobs in Amber Valley, where we have plenty of exporting businesses.
On energy, whilst we can’t control global energy prices, we can control what Government does to inflate utility bills, so we’re rolling back some of the levies we add to bills. This will save the average family £50 per year while protecting supply and vulnerable people.
The state pension will increase by £2.95 per week from April next year. Pensioners are now better off by £800 under this Government. Regrettably we saw that the state pension age is to increase to 68 in mid 2030s and 69 in the late 2040s, which is due to increasing life expectancy.
We’re helping young people by funding an additional 20,000 apprenticeships over the next two years, and lifting the cap on university places and increasing science, technology and engineering funding. Employer contributions for National Insurance are to be scrapped on 1.5 million jobs for young people, which will further help reduce youth unemployment.
We will also ensure that young people are equipped with the skills necessary to work – those that are aged under 21 and claim benefits without basic English or Maths will be required to undertake training from day one or lose their entitlements.
The Chancellor also confirmed that we will legislate to cap welfare spending per year in 2015. This would mean that spending on welfare payments like child benefit and housing benefit would have to be set at the start of a financial year, and the Chancellor would have to seek Parliament’s permission to increase the amount spent on it if he or she deemed it necessary.
The Labour Party said that all this wasn’t possible, and that our deficit reduction programme would create mass unemployment and cause economic chaos. The reality is quite the opposite – our plan has seen three jobs created in the private sector for every one lost in the public sector, growth revised up, and mortgage rates have been kept at least £1,000 per year lower than Labour’s plan by ensuring market interest rates remain low. In short, our plan is working, and we must stick to it.