Politics latest news: 'Strong case' to cut taxes in Autumn Statement, says Lord Hague

Thank you for joining me for today’s politics live blog. 

I will be back tomorrow morning to guide you through the Autumn Statement.

Foreign Secretary David Cameron joked that the House of Lords was a “significant upgrade” from his “now-infamous shepherd’s hut”. 

Lord Cameron said: “It is truly an honour to stand here at this despatch box and make my maiden speech in this House. I have always respected the work that is done here, so often a patient, diligent and considered compliment to the other place.

“And I hope to play a full part in your Lordships’ House.”

He added: “When I look at the ornate, carved wooden panels that surround us and compare them to my now-infamous shepherd’s hut, I can tell you this is already a significant upgrade.”

Lord Cameron said the UK needed to address the challenges it faces on the world stage from a “position of strength”. 

He told the House of Lords: “It has never been more clear that our domestic security depends upon global security and we must approach these challenges from a position of strength. 

“Our Foreign Office, diplomatic service, intelligence services, our aid and development capabilities, these are some of the finest assets of their kind anywhere in the world and I have seen it first hand the professionalism, the passion, the patriotism of the people who staff them.”

Lord Cameron also said that as prime minister he had learned the “respect we command overseas also depends on success at home”.

Lord Cameron, the Foreign Secretary, has just delivered his first remarks in the House of Lords after formally taking his seat in the upper chamber yesterday. 

The former prime minister opened the debate for the Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill’s second reading.

Lord Cameron of Chipping Norton said choosing his title had been an easy decision. 

He said: “I take my seat bearing the title of Chipping Norton. In fact the first message I received after my appointment was from the vicar’s wife making sure that I would take the town’s name. 

“But I am not claiming divine intervention. It was an easy choice., this beautiful place is one of the West Oxfordshire towns which I represented in Parliament, it is the place where I brought up my children and the place our family still considers own.”

Tomorrow’s Autumn Statement will inevitably be seen through the prism of the next general election. 

Pre-election tax giveaways are nothing new. But do they work? 

My colleague Benedict Smith has taken a look at six pre-election giveaways from recent history and assessed how politically effective they ended up being. 

You can read the piece in full here.  

Nadhim Zahawi has urged Jeremy Hunt to use tomorrow’s Autumn Statement to make full expensing for businesses permanent and abolish inheritance tax, writes Dominic Penna. 

Mr Zahawi, a former chancellor and ex-Conservative Party chairman, told the Telegraph Politics newsletter: “The Chancellor absolutely recognises the need for fair and workable taxes if we want to see economic growth and increased business investment.   

“Conservatives understand that hard work should be rewarded, people know best what to do with their own money, and that cutting taxes is both morally and economically right. 

“The Chancellor now has the opportunity to champion Conservative values in the Autumn Statement, including by abolishing the hated ‘factory tax’ and making full expensing permanent, abolishing inheritance tax and cutting income taxes for hard-working Britons.”

The Chancellor is expected to introduce a pension “pot for life” in tomorrow’s Autumn Statement, allowing consumers to combine their savings for later life.

Jeremy Hunt is set to unveil a number of further reforms in order to increase the amount of money in British pensions invested in the economy.

The measures expected tomorrow will give savers the right to nominate the scheme into which their employer pays contributions, rather than join their employer’s default arrangement.

You can read the full story here. 

Rishi Sunak is “actively” looking at measures to cut legal immigration to the UK ahead of figures this week expected to show a further increase in the numbers arriving.

The Prime Minister is under pressure from within his party to reduce net migration and the 2019 Tory manifesto promised the “overall numbers will come down”.

But figures from the Office for National Statistics on Thursday are expected to show a record high for the year to June 2023.

The Prime Minister’s Official Spokesman said that “obviously we want to see legal migration fall” and added: “This is something that we are actively looking at, about what more can be done to reduce legal migration.”

Telegraph readers are discussing Lord Hague’s remarks that there is a “strong case” for reducing taxes on small businesses and people on middle incomes ahead of the Autumn Statement tomorrow.

Ian Bagster said: “Incorrect, there is a strong case for cutting wasteful public expenditure and the size of the State, so that you do not need high taxes in the first place.”

However, M Oro wrote: “I have to agree with Lord Hague there is a very strong case to cut taxes. It is the only chance the Tories have got of avoiding a complete drubbing.”

You can have your say in the comments section below. 

The Government has borrowed almost £17bn less than official forecasts predicted so far this year, according to data released a day before Jeremy Hunt’s Autumn Statement.

In the final set of figures before the Chancellor rolls out expected tax cuts on Wednesday, the Office for National Statistics (ONS) said public borrowing stood at £14.9bn in October.

This is higher than the £12.8bn predicted by economists and was driven by a record £7.5bn jump in debt interest payments.

However, surging tax receipts this year also means the Government has borrowed £16.9bn less than the Office for Budget Responsibility (OBR), the Government’s tax and spending watchdog, predicted in March.

The OBR is expected to reflect this improvement in future years, giving the Chancellor more room to cut taxes than previously thought.

You can read the full story here. 

Downing Street said the UK had “no doubts” about the status of the Falkland Islands after Argentina’s newly-elected president suggested efforts should be made to “get them back” (see the post below at 11.31). 

The Prime Minister’s Official Spokesman said: “The UK has no doubts about the sovereignty of the Falkland Islands and indeed South Georgia and the South Sandwich Islands. 

“The UK Government will continue to proactively defend the Falkland Islanders’ right to self-determination.” 

Rishi Sunak’s emergency migration legislation and new treaty with Rwanda are not expected to be published this week, The Telegraph understands. 

The Prime Minister said he would legislate to designate Rwanda as a “safe” country and sign a new treaty with the county after the Supreme Court ruled the Government’s original deportation scheme was unlawful. 

Mr Sunak has made clear he wants the new law and treaty to be finished quickly but it is not yet clear when the texts of either will be published.

Grant Shapps said it is “undeniable” that the Falkland Islands are British after Argentina’s newly-elected president suggested efforts should be made to “get them back”.

The Defence Secretary tweeted: “The Falkland Islands are British. That is non-negotiable and undeniable.

“99.8% of islanders voted to remain British and we will always defend their right to self-determination and the UK’s sovereignty.”

Mr Shapps appeared to be responding to comments made by Javier Milei, who won a resounding victory in Argentina’s presidential election on Sunday. During his presidential campaign, Mr Milei reportedly said Buenos Aires had “non-negotiable” sovereignty over the Falklands. 

Lord Cameron has threatened to get tough on European human rights judges if they move to thwart the Government’s Rwanda plan.

The Foreign Secretary sought last night to reassure anxious Tory MPs of his stance on the controversial European Court of Human Rights (ECHR).

Sources said he stressed the importance of pushing on with Rishi Sunak’s new plan for emergency legislation and a new treaty - and then take on Strasbourg if required.

His comments came as he faced the 1922 backbench committee of Conservative MPs.

You can read the full story here.

Rishi Sunak will use the Autumn Statement on Wednesday to kickstart a Thatcherite tax-cutting drive as he tries to revive his premiership, writes Ben Riley-Smith. 

The Prime Minister has been considering plans to cut National Insurance, raise the 40 per cent income tax threshold and reduce inheritance tax between now and the general election.

Measures that would boost economic growth without fuelling inflation, such as a business investment tax cut and tax changes to support workers, are being prioritised in the announcement.

Others are expected to be unveiled in the Budget next spring, ahead of an autumn general election.

You can read the full story here. 

The UK and South Korea are to launch talks on a new trade deal and sign a diplomatic accord as part of Korean President Yoon Suk Yeol’s state visit.

Business and Trade Secretary Kemi Badenoch will begin negotiations with her Korean counterpart Bang Moon Kyu at the UK-Korea Business Forum at Mansion House tomorrow.

They will also announce £21 billion of investments committed by Korean businesses in green energy and infrastructure projects across the UK.

The UK secured a free trade deal with South Korea in 2019, with the agreement largely aimed at keeping trade flowing post-Brexit and removing uncertainty.

The UK hopes to secure modern digital provisions in a new upgraded deal because most of its services exports to Korea are delivered digitally.

Lord Hague suggested the Universal Credit benefits system had contributed to more people making sickness claims. 

The former Tory leader was asked why sickness claims had increased after the pandemic. It was suggested to him that either sickness levels had gone up or the nation was guilty of pathologising illness more than it did previously. 

Lord Hague told Times Radio: “Well, no, it can be another thing. Those things can have contributed to it. But this is also affected by benefit changes and I think since Universal Credit came in which has been a very good thing overall because it gets rid of most cases where people are better off not working than working, it nevertheless has been associated with a big rise in sickness claims.

“It has basically been easier to make those claims than in the past. So I think the generosity or rules of the benefits system do have an effect on the number of people who end up off work sick.” 

Helping more benefit claimants back into work is an “urgent thing” for the Government if it is to “balance its books”, Lord Hague said. 

A back to work drive and a clampdown on out of work benefits are expected to be at the heart of tomorrow’s Autumn Statement. 

Asked if there were actually effective policy solutions to get more people back to work, the former Tory leader told Times Radio: “You are right. This discussion has been going on for decades. It has become more urgent because there are a lot of people now who don’t work because they are sick and claim benefit because they are sick for one reason or another. 

“That has been much higher after Covid so it has become an urgent thing, if the Government is going to balance its books in any way, to address that.”

Lord Hague argued there is a “strong case” for reducing taxes on small businesses and people on middle incomes ahead of the Autumn Statement tomorrow.

The former Cabinet minister said he believed “it is right” for governments to cut taxes when they have the space to do so. 

Asked if it was sensible to cut taxes at a time when government borrowing is still very high, the former Tory leader told Times Radio: “Recent years have seen huge rises in government spending and in taxation. 

“Taxation overall is the highest since the 1940s. So it is right when you have got some space to help people, particularly small businesses, particularly people who, some people on middle incomes pay very high marginal tax rates, they lose more than half the extra income they earn. 

“I don’t know whether that will be part of what the Chancellor does tomorrow, but there is a strong case for reducing taxation when you can on people like that.”

Chief Secretary to the Treasury Laura Trott claimed Rishi Sunak is making progress on all five of his original policy pledges.

When it was put to her that the Prime Minister had failed to deliver on most of the promises he made at the start of the year, Ms Trott told LBC Radio: “I would refute that.”

She said halving inflation was “a really important delivery”, that “over the course of the year we have seen growth”, and that small boat crossings “are down significantly”.

“They were not easy targets, but they are ones where we have made progress on every single one,” she said.

Mr Sunak’s five pledges, first made in a speech in January, were to: Halve inflation, grow the economy, reduce debt, cut NHS waiting lists and stop the boats. 

Jeremy Hunt said the Government was focused on “being responsible with the nation’s finances as he responded to this morning’s borrowing figures (see the post below at 08.13). 

The Chancellor said: “We met our pledge to halve inflation, but we must keep on supporting the Bank of England to drive inflation down to two per cent. That means being responsible with the nation’s finances.

“At my Autumn Statement tomorrow, I will focus on how we boost business investment and get people back into work to deliver the growth our country needs.”

Government borrowing was higher than expected in October, largely pushed up by uprated benefits and cost-of-living payments, according to official figures.

The Office for National Statistics (ONS) said public sector net borrowing stood at £14.9 billion last month, £4.4 billion more than a year earlier and the second-highest October borrowing since monthly records began in 1993.

It was more than the £13.7 billion expected by the UK’s fiscal watchdog, the Office for Budget Responsibility (OBR), marking the first time it has overshot the official forecasts this financial year.

The ONS said financial year-to-date borrowing stood at £98.3 billion, £21.9 billion more than a year earlier, but less than the £115.2 billion forecast by the OBR in March 2023.

The Autumn Statement is expected to include a major push to get more people on benefits into work. 

Laura Trott, the Chief Secretary to the Treasury, said this morning that the Government believed people who can work, should work. 

She told Sky News: “Ultimately there is a duty on citizens that if they are able to go out to work that is what they should do. 

“I think this is a decision which was taken in the way that all benefit decisions are taken with the Department for Work and Pensions… you have got some brilliant civil servants there who are working very hard to make sure our welfare system is supporting those who need support but those who can work, can contribute, should contribute and that is the principle that we must keep throughout all of this.”

Laura Trott, the Chief Secretary to the Treasury, said she believed the economy had “turned the corner”, with tac cuts now widely expected at tomorrow’s Autumn Statement. 

Ms Trott was asked during an interview on Times Radio this morning if she would acknowledge that National Insurance levels were chaotic last year, with three changes made.

She said: “I have got to be very careful. I have only been in this job a week. I don’t want to get into trouble in my first week. But I think on taxation, I think the Prime Minister set out very clearly the story of our national economy at the moment which is that we were in a very, very difficult spot a year ago. 

“The Prime Minister and the Chancellor had to make some extremely difficult decisions, decisions which no government would want to take, no Conservative government certainly would want to take. But we have turned a corner, inflation has halved, that is really significant for people at home, we know how tough things have been. 

“Real wages are for three months now ahead of inflation. That is really important to making a difference to how people feel. So we can now talk about tax cuts and focus on growth and that is what we are going to be doing.”

The Conservative Party fell to its lowest level of poll support since March in the wake of the sacking of Suella Braverman, the Cabinet reshuffle and the Rwanda ruling last week.

A new survey conducted by Redfield & Wilton Strategies on November 19 put the Tories on 24 per cent of the vote and Labour on 43 per cent, giving the latter an overall lead of 19 points.

Labour were unchanged when compared to the company’s previous poll conducted on November 12 but the Tories were down by three points.

Support of 24 per cent tied the lowest level recorded for the Tories since Rishi Sunak became Prime Minister at the end of October last year.

The last time the Tories were as low as 24 per cent was in March this year. Mr Sunak will be hoping tomorrow’s Autumn Statement, which is expected to include some tax cuts, will help to deliver a boost to his party.