Securing a strong economy is one of the main reasons why I entered politics. Economic success is crucial for delivering more or less all the important goals for our community, such as social justice, improving quality of life, keeping the cost of living down, funding our public services, keeping taxes low, and protecting our environment.
In the nine years since the Conservatives returned to office in 2010, we have delivered a strong economy and the public finances have been repaired. So we have been able to support people with the cost of living.
In that period, borrowing has been cut by over four fifths as a share of GDP, down from a post-war high under the last Labour Government. There have been nine consecutive years of growth with the economy growing by 18.9%. The IMF’s latest World Economic Outlook forecasts that the UK will grow as fast as France, and faster than Germany, Italy and Japan in 2019 - and faster than all four in 2020.
The inflation rate is stable and low at 1.7%, below the Bank of England’s target of 2%.
Around 1,000 new jobs a day have been created since 2010. That means 3.6 million more people in work, with the security of a wage to take home to their families. The employment rate is at a near record high. There are more women in work than ever before.
Unemployment has fallen by 1.2 million. The unemployment rate is close its lowest level for over four decades. The proportion of low paid jobs is at its lowest since records began in 1997. The number of unemployed 16-24 year olds has fallen by 47% since 2010, and over 80% of 16-24 year olds are in work or full time education. The gender pay gap (hourly pay, excluding overtime) is at a record low (17.3%).
The Government has cut income tax for 32 million people since 2015/16 – saving the typical basic rate taxpayer £380 and taking 1.74 million out of income tax altogether. Supported by the National Living Wage (NLW), the lowest paid saw their wages grow by 8% above inflation between April 2015 and April 2018. The NLW increased by 4.9% in April to £8.21, increasing a full-time minimum wage worker’s annual pay by over £2,750 since its introduction
Fuel duty has been frozen for nine consecutive years, so the average driver will have saved a cumulative £1,000, compared to pre-2010 plans inherited from Labour. The doubling of free childcare for eligible working parents of 3 and 4 year-olds will save parents who take up full entitlement up to £5,000 a year per child. Real household disposable income per person is above its pre-crisis peak, and it is 11.2% higher than at the start of 2010 – meaning people have more money to spend. Income inequality is lower now than it was in 2010, and is lower than in 12 years of the last Labour Government.
The top 1% of income taxpayers pay over 29% of income tax – higher than at any time under the last Labour government. Compared to 2010, there are over one million fewer workless households, and the number of children living in workless households is down by 730,000 – both record lows.
We have been working to improve productivity too. The Conservatives have improved technical education by reforming apprenticeships and developing new T-levels for delivery from September 2020.
We have supported business and enterprise with lower taxes. The UK has the most competitive corporation tax rate in the G20 at 19%. Since Budget 2016, the Government has announced reductions to business rates worth more than £13bn over the next five years. I pressed them to do this in order to help local businesses and town centres.
This year’s Spending Round funded an extra £750 million investment in policing in 2020-21 to begin delivering the Government’s commitment to recruit 20,000 additional officers by 2023 (up to 6,000 officers will be in place by the end of 20-21). It also gave the green light for further health investment, building on the commitment the Conservatives made last year to give the NHS a cash increase in funding of £33.9 billion by 2023-24 (compared to 2018-19).
Because of the strength of the economy, in the Spending Round the Chancellor was able to announce the largest cash increase in public services since the Second World War. That includes a cash increase in schools spending of £2.6 billion in 2020-21, rising to £7.1 billion in 2022-23, compared to 2019-20; and £400m extra to train and teach 16 to 19 year olds to get the skills they need for well-paid jobs in the modern economy.
Over recent years, I have repeatedly called for action to combat aggressive tax avoidance by large multinationals. I have helped persuade the Government to take action. David Cameron was the first leader to put this issue firmly on the global agenda when he made it the centrepiece of the G8 summit the UK hosted in Fermanagh in 2013 (a summit which I oversaw as Northern Ireland Secretary).
The Conservatives have taken unprecedented action to make sure people and businesses pay their fair share of tax. We have introduced over 100 measures to tackle tax evasion, artificial avoidance schemes, and other forms of non-compliance. To be certain that big companies have to pay their taxes, we need action at a global level, and the UK is leading work on this in the OECD. Alongside HMRC’s compliance work, the measures introduced by the Conservatives have secured and protected an additional £200 billion in tax revenue which would otherwise have gone unpaid.