Mr Speaker,
Let me start by saying a few words around the circumstances around today’s statement.
We are in uncharted waters.
I understand the strong feelings around the House on these important questions.
But Mr Speaker, we cannot allow that uncertainty to distract us from delivering on the people’s priorities
So today, we give certainty where we can.
I announce our spending plans for Britain’s first year outside the European Union.
We are turning the page on austerity and beginning a new decade of renewal.
A new economic era needs a new economic plan, and today we lay the foundations…
…with the fastest increase in day to day spending in 15 years.
The plans I announce today mean that we will be able to build a safer Britain where our streets are more secure.
A healthier Britain where we can care for people throughout their lives.
A better educated Britain where every child and young person has the opportunity to succeed, no matter where they came from or who their parents are.
We will build a Global Britain where we walk tall in the world with more, not less, of a presence on the international stage.
A modern Britain where we will embrace diversity as a strength.
An enterprising Britain where we will be proud of our scientists, our inventors and our entrepreneurs.
A prosperous Britain where we will live within our means and growth comes from every corner of this union.
Today we lay the foundation for a stronger, fairer and more prosperous future for our great country.
Mr Speaker,
It’s been three years and three months since the British people gave us their instruction to leave the European Union.
If people are going to have faith in the ballot box again, we absolutely have to follow through on that instruction.
That is why we have set a deadline of 31 October – just 57 days away.
The government still believes that the best outcome would be to leave with a Deal.
And we could not be more serious in negotiating for such an outcome.
My RHF the Prime Minister has set out our position, and our central ask is very clear – to remove the anti-democratic backstop from the Withdrawal Agreement.
But without the ability and willingness to walk away with No Deal, we will not get a good deal.
And I know that some businesses and households are concerned about what a No Deal outcome would mean for them.
I recognise that, and I understand that the uncertainty around Brexit is challenging.
But this is ultimately a question in trust in our democracy.
In the end a strong economy can only be built on the foundation of a successful democracy.
So let me reassure people of this:
If we leave with No Deal - we will be ready.
Within my first few days as Chancellor, I provided £2.1 billion of extra funding for Brexit and No Deal preparedness.
And today I can announce that we provide a further £2 billion for Brexit delivery next year as well.
That means more Border Force staff, it means better transport infrastructure at our ports, and more support for business readiness.
I’ve tasked the Treasury with preparing a comprehensive economic response to support the economy if needed. And we’ll work closely with the independent Bank of England to coordinate fiscal and monetary policy.
Sensible economic policy means we should plan for both outcomes.
And we are doing so.
But we should be careful not to let our focus on planning and preparedness distract us from the opportunities that lie ahead.
Brexit will allow us to reshape the British economy and reaffirm our place as a world-leading economic power.
We’ll have the opportunity to design smarter, more flexible regulation.
Or to cut red tape that stifles innovation.
We’ll be able to replace inefficient EU programmes with better, homegrown alternatives.
Even if we leave with No Deal…
…I’m confident we will be able to secure a deep, “best in class” free trade agreement with the EU…
…and we will be able to pursue a genuinely independent free trade policy with the rest of the world.
Deal or No Deal, Mr Speaker – I’m confident that our best days lie ahead.
Mr Speaker,
While the immediate outcome of the talks may still be uncertain, there are some things that we can be certain about when it comes to the economy and our ability to set out what we can afford to spend.
As we look towards our future outside the EU, we can build on some extraordinary economic strengths.
At its heart, this country is an open, outward-looking trading nation. We are at our best when we look out to the world beyond our shores.
That’s not just a slogan – we are the number one destination in Europe for inward investment.
Our language, our location, our legal system and most of all our people make the UK a global hub for business.
We’re the home of world-class businesses.
A stream of ideas and innovations flow from our brilliant universities and research institutes…
…making the UK the second only to the US in all-time rankings for Nobel Prize winners.
And we have an economic landscape that’s being watched over by long standing, well-respected institutions.
And all of that will continue as we forge a new economic relationship with the EU.
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Mr Speaker,
When I first took my seat as a Member of Parliament for Bromsgrove the economy was in a very different position and since then we’ve had to work hard to restore our public finances.
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My two immediate predecessors took the difficult decisions that we need to bring the deficit under control that allows us to have the spending that we have today.
They didn’t do that for ideological reasons.
But because running an enormous deficit meant our debt was rising at an unsustainable rate…
…making our economy vulnerable to shocks, and passing on a huge burden to the next generation.
The deficit now Mr Speaker is 1.1% of GDP.
For the first time in a generation public sector debt is falling sustainably as a share of our national income.
And we’ve boosted our credibility around the world and built confidence in the UK economy again.
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Thanks to those difficult decisions…
…and the hard work of the British people…
…we can now afford to turn the page on austerity…
…and move forward from a decade of recovery to a decade of renewal.
Mr Speaker,
Our careful management of the public finances means we can now afford to spend more on vital public services.
So today I am deciding to set the real increase in day-to-day spending next year at £13.8 billion.
Delivering on the people’s priorities across the NHS, education and police…
…and giving certainty to all departments about their budgets for next year…
…clearing the decks for a government to focus on delivering Brexit.
I’ve always believed in the importance of living within our means.
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So even with the extra spending we are still meeting the current fiscal rules.
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Boosting wages and raising living standards – which have stagnated for too long.
Leveling up across the regions and nations. .
And we need to raise our productivity – the amount that’s produced every hour worked.
That isn’t just some technical term.
Slower productivity means lower wages and uneven growth across the country.
If productivity had continued to grow at its pre-crisis levels, then average annual wages would be £5,000 higher.
That pressure on people’s pay packets speaks to a wider sense of disillusion and unfairness…
…especially in so many towns and cities outside London and the South East.
Even as the economy has grown, the people have worked hard, and not everyone feels that they’ve benefited.
There’s a real sense of anxiety that’s emerged over recent years.
A sense that politicians aren’t listening.
And that the system isn’t working.
That the free market model isn’t living up to its promise.
We’re seeing divisions emerge throughout society.
Between regions and communities, rich and poor, rural and urban, young and old.
And addressing those concerns will be a serious effort.
And that’s what will be shown in these spending plans today.
So we will develop a new economic plan for the years ahead.
A plan that moves beyond the last decade of economic recovery and looks forward, to a decade of renewal.
A plan that invests more in the future growth of this country.
So Mr Speaker,
We can afford to invest more because our economy is growing and our public finances are strong.
And we are also deciding on our fiscal approach at a time when the cost of government borrowing is at record lows.
Interest rates have been low for many years, and in recent weeks the cost of government borrowing has fallen below 1% across all maturities.
In the years after the financial crisis many expected interest rates to swiftly rise to pre-crisis levels.
But structural factors have kept interest rates low…
…not just in the UK but across the developed world…
…increasing our confidence that we will be able to continue to see low rates for a number of years.
So it is my judgement today that with a strong fiscal position and record low cost of borrowing, we can invest more in growing our economy.
That doesn’t mean we can borrow more forever and ever.
The sustainability of the public finances depends on wider factors, not just the cost of borrowing:
Our population.
The global economy is slowing.
The challenge of decarbonisation is real.
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We won’t be able to afford everything, and we’ll need to prioritise investment in policies that deliver real productivity gains and boost economic growth in the long term.
We’ll still need to make difficult choices about our national priorities, within a clear set of rules to anchor our fiscal policy and keep control of our national debt.
So, Mr Speaker,
Today I can announce that ahead of the Budget later this year I will review our fiscal framework…
…to ensure it meets the economic priorities of today – not of a decade ago.
Mr Speaker,
The first priority of our new economic plan will be to rebuild our national infrastructure.
High quality and reliable infrastructure is essential to how we live, we work and travel.
But the truth is that across many decades governments of all colours have under-invested in infrastructure.
The quality of our infrastructure means we’ve fallen behind our competitors.
We’re the fifth largest economy in the world.
It isn’t good enough that we’re so far behind on infrastructure.
It isn’t good enough that so many commuters spend their mornings staring at a delayed sign at their train platform.
It isn’t good enough that our small business owners waste so much time because of slow internet speeds and poor mobile communications.
We’re going to change that.
We want faster broadband for everyone in the country.
Quicker mobile connections and better signal coverage.
Cleaner energy, greener transport, and more affordable fuel bills for our homes and offices.
We want more trains and buses to connect the great cities of the north.
We want to build world class schools and hospitals.
We want to push the frontiers of science and technology and turbocharge our ambition on research and development.
We want to build and invest in every region and every nation of this great United Kingdom.
From the motor highway to the information highway…
…we’ll settle for nothing less than an infrastructure revolution.
Mr Speaker, to keep spending under control we will of course set a high bar for funding projects, and they’ll have to show real value for money, with credible delivery plans and budgets…
…starting with the government’s rapid review of HS2.
We’ll target that investment at national priorities like regional growth and decarbonisation.
And let me take this opportunity to thank my HF the Member for Chelmsford for her tireless work as Chair of the All-Party Group on Infrastructure.
So yes – we’ll use the government’s resources to kickstart the infrastructure revolution.
But we’ll also do more to give private investors the confidence to back these projects, too.
We want all this to be underpinned by strong and independent institutions.
We set up the National Infrastructure Commission in 2015, and we’ll continue to rely on its expert advice…
…as we look carefully at other institutional reforms that might be needed.
So our infrastructure revolution will be strategic and carefully planned.
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Mr Speaker,
Today we lay the foundations of a new economic plan.
We’re turning the page on a decade of necessary work to fix the public finances…
…and writing a new chapter in our public services.
Health and education aren’t just the names of departments.
They’re lifelines of opportunities, just as they were for me when I was growing up.
The teachers and lecturers who persuaded me to study economics in the first place.
The police officers who kept us safe when the street I grew up in became a centre for drug dealers.
The NHS that cared for my dad in his final days.
These aren’t just numbers on a spreadsheet.
These are the beating heart of our country.
And we invest today to support them.
Mr Speaker,
As I turn to the detail of today’s announcements…
…let me first thank the dedicated officials in the Treasury for all their hard work…
…delivering what I’m told is the fastest SR in history.
And let me particularly thank my RHF, the Member for Richmond, who takes the approach to spending you would expect from an adopted Yorkshireman.
He’s displayed his typical mix of energy, courtesy and rigour - let’s just say there’s no productivity problem in the Chief Secretary’s office.
Mr Speaker,
Next year I will add £13.4 billion to the plans for total public spending, including £1.7 billion added to capital spending.
These extra funds take the real increase in day-to-day spending to £13.8 billion, or 4.1%.
That means I’m delivering the fastest increase in day to day spending for 15 years.
That funding allows us to start a new chapter for our public services and fund the people’s priorities.
Our decisions today have been guided by our ambition to build a safer Britain, a healthier Britain, a better educated Britain, and a more Global Britain.
Mr Speaker,
My family grew up on a road in Bristol that a national newspaper described back then as “Britain’s most dangerous street”.
But to us, it was just home.
After we left, my brother became a policeman and has been in the force for over 25 years.
So I’ve seen the impact the job has on the lives of those that are courageous enough to do it.
So today I pay tribute to the bravery, courage and dedication of our hardworking police officers.
As Home Secretary, I saw first-hand how the demands on our police forces are changing and increasing.
Yes – traditional crime is down by a third since 2010.
But the threats from terrorism have escalated and evolved.
The internet is changing how criminals operate and break the law.
And we’ve seen too many horrifying stabbings on Britain’s streets.
So with our frontline officers reporting that they are overstretched, it’s clearly time to act and do more.
and today I can announce a 6.3% real terms increase in Home Office spending.
The biggest increase in 15 years.
That means £750 million to fund the first year of our plan to recruit 20,000 new police officers.
With an extra £45 million this year so that recruitment can start immediately, getting the first 2,000 officers in place by the end of March.
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The threats facing our police officers are evolving too - so the way we resource them will have to evolve, in three areas.
First, Serious and Organised Crime is the most deadly national threat faced by the UK, costing the nation at least £37 billion each year.
The scale and complexity of this threat means that we need to do more to develop our response.
So I’m announcing today a formal review to identify the powers, the capabilities, governance and funding needed, ahead of a full Spending Review next year.
Second, this year, sadly, has seen more attacks on Places of Worship, including mosques and synagogues.
That’s unacceptable in a diverse, open, tolerant society like ours.
So to protect our religious and minority communities, I’m announcing today that I will double the Places of Worship Fund next year.
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Finally, today I’m announcing £30 million of new funding to tackle the scourge of online child sexual exploitation.
Mr Speaker,
A better resourced police force will deliver better outcomes for the British people.
And it will increase the demands on our already overstretched criminal justice system.
So today we invest more in our criminal justice system to manage that increasing demand…
…with a 5% real terms increase in the resource budget for the Ministry of Justice…
…an increase in their capital budget to £620 million next year…
…and an extra £80 million for the Crown Prosecution Service.
Taken together, today’s Spending Round will dramatically improve the functioning of the criminal justice system.
With more prosecutors.
A reformed probation system.
Better security in prisons.
And funding to begin delivery of 10,000 new prison places.
Mr Speaker,
The Spending Round is delivering on the people’s priorities.
And there is no higher priority than the NHS.
Last year, we increased NHS spending by an extra £34 billion a year by 2023/24.
That was the single largest cash increase in our public services for more than seventy years.
Today we reaffirm our commitment to the NHS with a £6.2 billion increase in NHS funding next year.
We’re investing more in training and professional development for our Doctors and Nurses…
…over £2 billion of new capital funding – starting with an upgrade of 20 hospitals this year…
…and £250 million for ground breaking new artificial intelligence technologies to help solve some of healthcare’s biggest challenges today.
Like earlier cancer detection.
Discovering new treatments.
And relieving the workload of doctors and nurses.
Mr Speaker,
We can’t have an effective health service without an effective social care system, too.
The Prime Minister has committed to a clear plan to fix social care, and give every older person the dignity and security that they deserve.
So I can announce today that councils will have access to new funding of £1.5 billion for social care next year.
Alongside the largest increase in Local Government spending power since 2010…
…and on top of the existing £2.5 billion of social care grants…
…that’s a solid foundation to protect the stability of the system next year…
…and a down payment on the more fundamental reforms the Prime Minister will set out in due course.
But that’s not the only action that I’m taking today to support vulnerable people.
On any given night, there are too many people sleeping rough on our streets. The human cost of that is too high.
Today we do more - with £54 million of new funding to reduce homelessness and rough sleeping, taking it to a total funding of £422 million.
That’s a real terms increase of 13%.
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Mr Speaker,
A healthy environment is a precondition for a healthy population – that’s why we’ve set out an ambitious 25-year plan for the UK’s natural environment.
And today we go further.
Leaving the EU provides an opportunity to set world leading environmental standards, and we’re giving DEFRA £432 million of funding to do so.
We’re providing £30 million of new money to tackle the crisis in our air quality.
And another £30 million for biodiversity, including an expansion of our Blue Belt programme…
…a vital part of our campaign to protect precious marine species like turtles, whales and seabirds.
We’re stepping up our leadership on climate change, with new funding for BEIS to develop new programmes to help meet our net zero commitment by 2050.
And we’ll set out further details of our plans for decarbonisation in the infrastructure strategy later this year.
Keeping our promise to be the first government in history to leave our environment in a better condition than we found it.
Mr Speaker,
Alongside providing for the health of our population, the most important task of a government is to educate the next generation.
Education and skills are at the heart of our vision for national renewal.
The economy isn’t just about GDP or PSNB – there are many broader tests that matter, too.
Our children, are they growing up to be better off than their parents?
Do hard work and talent matter more than where you are born?
A good school, and inspirational teachers, are the most effective engine for social mobility that there is.
That’s why today we are delivering on our pledge to increase school spending by £7.1 billion by 2022-23, compared to this year.
Next year, we’ll make sure that day-to-day funding for every school can rise at least in line with inflation and rising pupil numbers…
…with the schools that have been historically underfunded benefitting the most.
Every secondary school will be allocated a minimum of £5,000 for every pupil next year.
And every primary school will be allocated at least £3750, per pupil, on track to reach £4,000 per pupil the following year.
This funding will mean that teacher’s starting salaries can rise to £30,000 by 2022-23, so that we can attract more of the best graduates into teaching.
We’ve allocated nearly £1.5 billion per year to contribute to teachers’ pensions.
And we’re providing over £700 million to give more support to children and young people with special educational needs – an 11% increase compared to last year.
Nearly every other department I am announcing today will be funded for just one year.
But we recognise the importance of schools being able to plan.
So we are announcing today a full three year resource settlement for schools.
Leveling up education funding.
Improving standards.
And giving every young person the same opportunities in life – wherever they live in our great country.
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Mr Speaker,
The education system is about more than just schools.
For too long, further education has been a forgotten sector.
Over one million young people continue their education beyond the age of 16 at colleges or sixth forms.
I know, because I was one of them.
I went to my local FE college.
If I hadn’t had the teachers and lecturers that I did, I wouldn’t be standing here today as Chancellor.
Further education transformed my life…
…and today we start transforming further education…
…with a £400 million increase in 16-19 education funding next year.
The base rate will increase to £4,188 - a faster rate of growth than in core school funding.
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The Government will also increase early years spending by £66million…
…to increase the hourly rate that’s been paid at maintained nursery schools and other childcare providers who deliver on the government’s free childcare offers.
Mr Speaker,
Our young people deserve high quality services and support even after the school day is over.
Earlier this year I visited the fantastic Onside Youth Zone in Barking…
…a brilliant example of how much Britain’s network of youth centres add to our communities.
Getting young people off the streets and changing lives for the better.
So today I’m asking DCMS to develop proposals for a new Youth Investment Fund…
…and to set out plans to build more youth centres, refurbish existing centres, and deliver high quality services to young people across the country.
Better schools, higher pay for teachers, more youth centres – that’s how this government will improve social justice and create opportunity for all.
But our ambitions for a truly national renewal don’t stop there.
We are a One Nation party and this is a One Nation government, so at the heart of our new economic plan is the need to level up across this country.
Every region and nation in the United Kingdom will benefit from new funding that I’m providing today to police, schools, health social care and much more.
Today we confirm funding of £3.6 billion for the new Towns Fund - providing a wave of investment to our regions and places.
And better transport links across the country will be a crucial part of levelling up across the country.
We’ve already allocated a total of £13 billion for better transport across the north…
We’ll fund the Manchester to Leeds route of the Northern Powerhouse Rail…
And will set out far more details in the autumn on our new infrastructure strategy.
Mr Speaker, you might not know this, but my Dad was a bus driver.
Having watched him work, I know that local buses can be a lifeline for many communities.
Today we put the wheels back on the Great British Bus with more than £200 million to transform bus services around the country.
We’re funding ultra-low emissions buses and will trial new, on-demand services to respond to passenger needs in real time.
We’ll set out more details of our new buses in due course…
…once my RHF the PM has finished his painting models of them.
Mr Speaker,
Our new economic plan won’t stop at the borders of England – it will be a plan for all the nations of the United Kingdom.
In Scotland, decisions taken in today’s Spending Round will provide over £1.2 billion of extra funding for next year.
And we are taking a further step today to support Scottish Farmers.
In 2013, when the UK government allocated the Common Agricultural Policy funding within the UK, Scottish farmers lost out.
Today we correct that decision, making available an extra £160 million for Scottish farmers…
…something I know my Honourable Friends on these benches from Scotland will be pleased to hear.
In Wales, today’s Spending Round means an extra £600 million of funding for the Welsh Government.
And in Northern Ireland we are providing an extra £400 million from today’s announcements.
I welcome the case made by the DUP for improved hospice care, and support for those that have been tragically wronged in the contaminated blood scandal.
Those are rightly devolved matters, but I sincerely hope that the Northern Ireland Administration will use some of the new funding we’re providing today to address those issues.
Taken together, today’s announcements will give the devolved administrations the biggest spending settlement for a decade.
Mr Speaker,
Throughout our history, Britain has always been at its best when we are open, global and outward looking.
Trading with the world beyond our shores has always been key to Britain’s economic prosperity.
And as we seize the opportunities of Brexit, we can establish new partnerships and trade relationships across the globe.
For too long, we’ve let those trading relationship wither.
And as my RHF the Trade Secretary will be the first to acknowledge – This. Is. A. Dis-grace.
So today we invest in securing Britain’s influence in the world.
We support diplomacy, with £90 million of funding for 1,000 new diplomats and overseas staff, and 14 new and upgraded diplomatic posts.
We’ll boost trade with £60 million to extend the GREAT campaign for next year, and if you’re in any doubt about Britain’s important role on the world stage, just look at the bonanza of international festivals and events that I’m funding today.
In December, we’ll welcome the NATO leaders meeting.
Next year, we’ll host the COP26 discussions, if our bid is successful – thanks to the leadership of my RHF the Member for Devizes.
In 2021, we’ll host the G7.
And in 2022, we’ll host the Commonwealth Games in Birmingham.
Today I can confirm the government’s total commitment to this celebration of sport will be over half a billion pounds.
The Games will be a huge boost for the West Midlands – and I’d like to congratulate Andy Street for his leadership he has shown in that region.
One of my personal highlights of the summer was meeting the England Cricket Team in the Downing Street gardens.
That World Cup winning side showed us the importance not just of talent and hard work, but of diversity, too.
A skipper from Ireland, a bowler from Barbados, an all-rounder from New Zealand.
As with our cricket team, so with our country – we are the most successful multi-ethnic democracy in the world.
And I’m proud to live in a country where someone with my background can be Chancellor of the Exchequer.
This Spending Round embraces modern Britain in all its diversity…
…and we make available an additional £10 million to continue the Integration Areas programme that I first announced in 2018 as Communities Secretary.
That fund will support thousands of the estimated 1 million adults in the UK who do not speak English well or at all.
Openness to talent from around the world matters for our economy too.
Once we’ve left the EU, we’ll be able to create a points-based immigration system that meets the needs of the UK economy and the British people.
We’ve already dropped arbitrary immigration targets.
We’ve recently announced a new, highly flexible fast-track visa for scientists.
And today I’m putting funding in place to give victims of the Windrush scandal the compensation that they deserve.
All part of confirming once and for all that Britain will always be open to the world’s brightest and the best talent.
Nowhere are our values of openness and tolerance better expressed than in international aid.
The UK Aid logo can be seen around the world.
On health clinics.
School books.
Emergency food suppliers.
And so today we protect our commitment to spending 0.7% of our national income on Aid.
Global Britain is about projecting our values into the world.
But we know that hard power matters too.
Britain already spends more on our defence and national security than any other country in Europe.
We are one of only seven countries to meet the 2% commitment to NATO.
Today we will go further still, with an additional £2.2 billion of funding for the MOD.
And a real terms increase of 2.6% for their budget next year.
Increasing again the share of our national income we spend on defence and national security.
This year is the 75th anniversary of the D-Day landings.
We pay tribute to the sacrifices of the extraordinary generation of British soldiers who fought and died during that campaign.
And today I can announce £7 million of funding for the Normandy Memorial Trust to complete their memorial overlooking Gold Beach where so many troops came ashore.
And we will also support the veterans of today’s wars as well, as we confirm the funding today for the new Office of Veterans’ Affairs.
Mr Speaker,
I’ve set out today a big increase in public spending.
That will pay for more police and safer prisons.
More nurses and better hospitals.
More money for schools and further education.
But I now turn to the remaining departments across Whitehall - those that have not been protected over the last decade.
Investing in the people’s priorities inevitably means difficult decisions elsewhere.
Every Spending Review presented to this House over the last 15 years has had to find cuts from those departments.
This party has never shied away from the difficult decisions to make sure we live within our means.
Those decisions were tough…
…but they have paid off.
And so I can announce today that no department will be cut next year.
Every single government department has had its budget for day-to-day spending increased at least in line with inflation.
That’s what I mean by the end of austerity, Mr Speaker.
Britain’s hard work paying off.
A country living within its means.
Able to spend more on the things that matter.
Mr Speaker,
I am delivering today’s Spending Round in unusual circumstances.
Understandably much of our attention - and the attention of our country - is focused on the important matters before this House later today.
But we must not forget that Brexit is not all that matters to the British people.
It is not the only topic at the dinner table.
Today’s Spending Round makes sure that if you fall ill you can get the care and the support that you need.
That when you drop off your child at the school gates you can trust that they will get the best possible education.
That when you walk down the street you can feel safe and secure.
And today, we move from a decade of recovery to a decade of renewal.
Yes – we will keep control of the public finances.
But we will invest, too, in the long-term growth of this country.
It was just six weeks ago today that this new administration took office.
The PM promised that we wouldn’t wait until Brexit day to deliver on the people’s priorities.
And today we meet that promise.
With a new chapter for our public services.
A new plan for our economy.
And a new beginning for this country.
I commend this Statement to the House.
