As we mark the third anniversary of Russia’s invasion of Ukraine, Jesse Norman welcomes the proposed increase in defence spending, but raises concerns that the increase was overstated, details were leaked to the media prematurely, and muddled by aggregating the intelligence services budget into the defence budget, potentially hiding cuts.
Jesse Norman (Hereford and South Herefordshire) (Con)
Mr Speaker, it is my happy task to open by saying that today sees the retirement of Dawn, a stalwart of the Tea Room. I am sure that I speak for the whole House in wishing her a very happy retirement.
On a very different note, this week also marks the third anniversary of Russia’s invasion of Ukraine. We wish the Prime Minister every success in his meetings at the White House today. The Government have come in for some fairly punishing criticism from me at the Dispatch Box in recent months, and rightly so. They came to power loudly advertising their virtue and careful planning, but instead, as the House will know, we have seen a series of entirely avoidable resignations, blunders and mishaps. The Government have talked about growth, but their decisions have managed to reduce the Bank of England’s forecast from 2% to 0.75% growth for this year. It is little wonder when one considers the £25 billion increase in national insurance contributions and the imposition of an Employment Rights Bill with an up-front cost estimated at £5 billion, among much else.
Most bizarre of all has been the lack of foresight in financial planning. The Chancellor talked grandly in her Mais lecture last year about “securonomics”—whatever that is—and the importance of economic security, but as many commentators have noticed, her fiscal rules and other decisions have left her very little room for manoeuvre. After all, it was obvious in the autumn that there could be tariffs on trade and, as Ministers have since acknowledged, an inevitable rise in defence spending. It is almost as though Labour never imagined, or perhaps never wanted to believe, that President Trump would be re-elected. As a result, the Government may be forced to have a mini-Budget next month and then a spending review, which has been so delayed that they will have gone a full year from their election without having any settled spending plans. Meanwhile, they prefer to import oil and gas from abroad, rather than use less expensive domestic energy supplies. Forget securonomics; this is a recipe for insecurity, as well as increasing carbon emissions.
However, it is important to give credit where credit is due. I reported in December that genuine signs of reality were starting to break through in the Government’s so-called plan for change. In it, the Prime Minister said:
“In 2010, the incoming government inherited public finances in desperate need of repair.”
He said that the UK needed
“a profound cultural shift away from a declinist mentality, which has become so comfortable with failure”.
Finally, and most notably, he said that
“we cannot tax our way to prosperity or spend our way to better public services.”
The Prime Minister was right on all three counts, and he is right now to increase defence spending. It is not untrue to say that he is visibly becoming more conservative before our eyes.
Unfortunately, the real numbers in the defence statement were in fact half what he claimed, as the Institute for Fiscal Studies quickly made clear, and I am sorry to say that the statement was insulting in other ways to this House. It appears to have been leaked to the media, who ran the headline before the Prime Minister had even stood up. Perish the thought that the statement was deliberately redacted so that MPs would be kept in the dark and could not hold the Government to account. The Prime Minister has emphasised all the planning that was involved in this decision. Even so, he was repeatedly unable to answer the simple “yes or no” question of whether funding for the Chagos Islands deal was included in the total.
What is worse is that, in his statement, the Prime Minister tried to aggregate the intelligence services budget into the defence budget. That is grossly misleading, because those budgets are, and have long been, kept separate. What is worse still is that the Prime Minister’s claim that the combination of the two budgets would be 2.6% of GDP seems to imply a cut, not a rise, in the budget for the intelligence services, which currently stands at over 0.15% of GDP. This cannot be correct. Even if the Leader of the House cannot address my question now, I would be grateful if she could write to me with the details in order to answer it for the record and for the benefit of this House.