Britain today faces many problems. It has a debt problem. It has a growth problem.
And it has now a Healy problem. Labor inherited the first two but immediately made them worse. They chose to add 260 billion pounds of debt over the course of this parliament.
They chose to impose the highest tax burden since records began. And in just 40 days time now on the 20th 8th of October, we fear it's about to get worse. Because rather than change, we have another chancellor who's out of his depth.
This week, we've been reading his latest excuse that he never understood the numbers that Rachel Reeves handed over to him. Now, I admit I didn't think Rachel Reeves' numbers made sense either, but I didn't spend two years sitting next to her around the cabinet table. A man who was a Treasury Minister under Gordon Brown didn't even once think to look at the Treasury numbers.
No wonder that government left behind that famous note that there is no money left. Markets smell weakness and as a result today government borrowing costs to be paid by all of us are at a 28y year higher than Italy higher than Greece and our interest bill is now more than twice what we spend on defense. Kem and I have set out our plan for how we would fund the difficult decisions to fund defense.
But John Healey prefers to continue outofcontrol welfare spending. Even his own economic advisers are telling everyone who will listen what a disaster this government already is. Andy Haldane said this week, "This is a traditional tax and spend socialist government with better Tik Tok videos.
" And Jim O'Neal, the very man lined up to be Burnham's chief economic adviser, has warned the very last thing that should be going on is more taxes on business. He's right. So, let me be clear.
Businesses are already suffering enough. The Chancellor must end the uncertainty today and rule out any new taxes. He must rule out increasing taxes on small businesses and the self-employed.
And he must rule out an exit tax, the mere rumors of which are already causing Britain's wealth creators to flee the country. But like his predecessor, I fear the chancellor isn't listening. He's Rachel Reeves without the rhetoric.
And unlike even the smallest business, he's never had to balance the books in his life. If history is any indication of what it means to have a chancellor named Healey during a fiscal crisis, then we should all wrap up warm this winter. We've seen this movie before, 50 years ago this month.
And nobody wants a sequel. Instead, we need an economic revolution, a comeback. And we Conservatives have a plan to make our country prosperous again.
lower and simpler taxes, cheaper energy, less red tape, getting people working and backing the risk takers, the businesses, the entrepreneurs, the small businesses that really create growth. The Conservative Economic Unit will pursue that plan relentlessly. We're working as a team with Claire Catino as my deputy and Richard Fuller with decades of private sector experience as shadow chief check secretary to the treasury finding the savings that will allow us to cut the deficit and taxes responsibly.
This is my first speech as shadow chancellor and Angela I chose your college today for a reason. Location matters. Rachel Reeves's first speech was to the Labor Party conference promising to be the first green chancellor.
Remember that as your energy bill saw this winter. Gordon Brown, it was a conference organized by the European Commission. I've tried to find records of what he said, but it seems that nobody other than Gordon remembers.
And for Jeffrey How in 1975 it was a television address responding to the nation after a disastrous budget by a chancellor whose name was Healey. So my first speech then is here a technical college producing the next generation of plumbers, construction workers, hairdressers and many more. typical of the millions of small businesses and selfmployed.
Like most of the Labor cabinet, I came to Parliament after a 26-year career in business. Like Kem, I'm not a career politician. I am here to fix our country.
And whilst my experience is not unique, it is far too rare in Westminster. And nobody knows that better than the small businesses and self-employed on who the legislation and tax burden falls the hardest. I understand.
Conservatives understand that you grow an economy from the bottom up, not the top down. There are 4 million self-employed people in Britain. [clears throat] There'll be young people here today dreaming of working for themselves.
Over 5 million small businesses. and together they employ 13 million people. Pound for pound, more jobs, more growth will be generated by small businesses and the self-employed than anyone else.
If each could hire just one more person, that would be millions of extra jobs. So if you're serious about growth as more than just a talking point, you don't start in Whiteall. You get out and you start and you come to places like this.
To run a business or to be self-employed in my eyes is to be an economic hero. Getting up at the crack of dawn, open up, pick up stock or tools, deal with customers and suppliers. Often the last home at night.
Sundays spent doing the staff rotor or completing a VAT return. Sacrifices made, risks taken. And when things go wrong, taxes go up, supply chains are disrupted, orders are down, it's those risktakers that face the consequences.
Not for them the million pound severance payments afforded to Whiteall Mandarins who've never built a business in their lives. Any government worth its salt would do everything it could to help them. Because whilst not every acorn grows into a mighty oak, we need green shoots that are nurtured, not trampled upon.
It's why Conservatives will scrap Labour's family business and family death farm death taxes entirely in my first budget. It's why we've promised to take thousands of independent high street firms out of business rates entirely. And that is why we are going further because the burden of regulation on small and medium-sized businesses today stands at an incredible 36 billion pounds.
According to the latest small business survey conducted by the Federation of Small Businesses, a third now expect to close, sell up, or shrink in the next 12 months. And for the self-employed, many of whom will have started out in colleges such as this, there is this special torture of making tax digital, making tax difficult, uh, as it's often known. Instead of getting on with the job, they're forced to spend time and money being tracked and traced by HMRC, filling four extra reports a year before they've even started their tax return.
Then there's IR35, a regime which crushed the dreams of so many self-employed people to be able to work for themselves and regulate their own affairs. Freedom, responsibility, hard work. These are conservative values and yet I know that many felt badly let down by IR35 and our party's role in that tax policy must never be for the administrative convenience of the tax man at the expense of the hardworking man and woman.
That ends with me when the Conservative Party returns to government. I want to be a chancellor for small businesses and the selfmployed. That is why I'm here.
What will that look like? Well, I'm committing today that the next Conservative government will replace IR35. Not reform it, not review it, but replace it with a new system that respects the right of the self-employed to choose their status and only prevents actual abuse.
And we won't stop there. We'll do what previous governments have failed to do. will finally bring down the cost of red tape.
The burden of compliance, the billion spent not even on tax but just filling in the forms around tax. Corporation tax return has 985 boxes. That's far too many.
But you don't need me to tell you that. As shadow business secretary, I made it my mission to fight red tape. I committed to repealing all of the job destroying measures in Labour's back to the 1970s unemployment act.
And with Culia Lopez and Clare Catino, our determination is that Conservatives will bring lower and simpler taxes for businesses, too. But I can't do it alone. So, I'm delighted this morning to be announcing two advisers to help me.
Both have spent years campaigning to lower the burdens on business and get Britain growing again. The first is Craig McKinley, Lord McKinley of Richborough, also known as the Bionic Lord. Rare in Parliament today, he like me is a chartered accountant, but he's also a chartered tax adviser who brings decades of realworld experience.
and throughout his entire career, he's been a passionate advocate for small businesses and the self-employed. Craig will be joined by Robert Kovville, the outgoing director of the Center for Policy Studies, the intellectual home of Thatcher's Economic Revolution. Robert has already done extensive work to identify the burdens on small businesses and how we remove them and get Britain growing.
I'm so pleased they've agreed to serve our country's small businesses and self-employed by leading our work in this area. Their advice will form the basis of the changes the next Conservative government will make. How taxes can be made lower and simpler.
Why past attempts to cut regulation and compliance failed and how we can do it successfully this time. where exactly HMRC's performance is failing and what can be done to finally improve it. What are the worst complexities in our tax system of returns and reliefs and forms and how we fix them?
And looking beyond the UK to see what other countries are doing and to recommend a replacement for IR35. Craig and Robert will look at these areas and more and responsibility for the decisions will remain with Kem, the economic unit and my shadow cabinet colleagues and they will always be in line with our fiscal duty, our first priority of living within our means. There's one more thing.
To date, the current roll out of making tax digital has been a disaster. Conservatives are not against efficient government if it works and if hardworking taxpayers have a choice. But HMRC should never export their problems onto the self-employed who already facing the burdens of high tax and a sluggish economy.
The government's own data showed that 400,000 taxpayers missed the first reporting deadline, meaning they're facing bills for expensive software to try and meet the next one. And many chancellors shy away from matters of administration of the tax system. Despite making the lives of hundreds of thousands of people miserable, they send out a junior minister to defend the indefensible.
That's not right. That's not leadership. Therefore, I'm calling today for the chancellor himself to pause the roll out of making tax digital at his budget next month and to review how the same objective can be achieved at lower cost and less pain to businesses.
Finally, I want to thank Angela and Capital City College again for hosting us. Every person who comes here to learn unlocks a world of opportunity, skills that will carry them through life. That path may lead to their own business.
It may lead to self-employment, working for themselves, work, financial independence, responsibility. Either way, college like colleges like this are factories of success. And I want everyone to know that the Conservative Party is on your side.
Thank you.
