division_name: Charter for Budget Responsibility and Welfare Cap
motion: <p class="indent" pid="b366.1/2" pwmotiontext="yes">That the Charter for Budget Responsibility: Autumn 2021 update, which was laid before this House on <phrase class="date" code="2022-01-05">5 January</phrase>, be approved.</p>
  
  <p class="indent" pid="b366.2/2" pwmotiontext="yes">That the level of the welfare cap, as specified in the Autumn Budget and Spending Review 2021, which was laid before this House on <phrase class="date" code="2022-10-27">27 October</phrase> 2021, be approved.</p>
  
  <p class="indent" pid="b366.3/3" pwmotiontext="yes">&#8220;the path of discipline and responsibility&#8221;.&#8212;[Official Report, <phrase class="date" code="2022-10-27">27 October</phrase> 2021; Vol. 702, c. 275.]</p>
  
  <p class="indent" pid="b366.3/5" pwmotiontext="yes">&#8220;impressive, coordinated, and extended policy response&#8221;,</p>
  
  <p class="indent" pid="b367.5/2" pwmotiontext="yes">&#8220;In the absence of perfect foresight, fiscal space may be the single most valuable risk management tool&#8221;</p>
  
  <p class="indent" pid="b367.5/8" pwmotiontext="yes">&#8220;Countries that have followed a debt rule have typically managed to reverse a jump in debt...significantly faster than other countries&#8221;,</p>
  
  <p class="indent" pid="b367.5/10" pwmotiontext="yes">&#8220;new fiscal rules have anchored fiscal policy well&#8221;.</p>
  
  <p class="indent" pid="b369.1/3" pwmotiontext="yes">&#8220;my goal is to reduce taxes. By the end of this Parliament, I want taxes to be going down, not up.&#8221;&#8212;[Official Report, <phrase class="date" code="2022-10-27">27 October</phrase> 2021; Vol. 702, c. 286.]</p>
  
  <p class="indent" pid="b370.0/9" pwmotiontext="yes">&#8220;many of the interventions carried out by government are either not evaluated robustly or not evaluated at all. This means government&#8230;has little information in most policy areas on what difference is made by the billions of pounds being spent.&#8221;</p>
  
  <p class="indent" pid="b376.0/6" pwmotiontext="yes">&#8220;Just a 1% interest rate rise could easily wipe out the Chancellor&#8217;s headroom.&#8221;</p>
  
  <p class="indent" pid="b376.0/8" pwmotiontext="yes">&#8220;The fiscal mandate was missed by &#163;274.7 billion (13.1 per cent of GDP).</p>
  
  <p class="indent" pid="b376.0/9" pwmotiontext="yes">The supplementary debt target was missed by 12.5 per cent of GDP.</p>
  
  <p class="indent" pid="b376.0/10" pwmotiontext="yes">Spending subject to the welfare cap is on course to exceed the legislated cap in 2024- 25 by &#163;7.9 billion and to exceed the cap plus margin by &#163;4.1 billion&#8221;&#8212;</p>
  
  <p class="indent" pid="b376.0/12" pwmotiontext="yes">&#8220;The legislated fiscal objective is on course to be missed by &#163;46.4 billion (1.7 per cent of GDP).&#8221;</p>
  
  <p class="indent" pid="b376.0/14" pwmotiontext="yes">&#8220;In our central forecast, the proposed fiscal mandate and all three supplementary targets are more likely to be met than missed&#8221;.</p>
  
  <p class="indent" pid="b376.0/17" pwmotiontext="yes">&#8220;The risk of having the target for it to fall is that there can be an incentive to get it to rise in the first two years, so you can get it to fall in the third.&#8221;</p>
  
  <p class="indent" pid="b376.0/20" pwmotiontext="yes">&#8220;has been raised at each of the four occasions that it has been substantively reset: twice under Chancellor Philip Hammond (in Autumn Statement 2016 and in Autumn Budget 2017); and twice under Chancellor Rishi Sunak (in Spring Budget 2020 and in this Budget).&#8221;</p>
  
  <p class="indent" pid="b376.0/23" pwmotiontext="yes">&#8220;The cap will only be breached if, at the point of formal assessment, spending within scope is forecast to be above the level of the cap and margin for any reason&#8221;,</p>
  
  <p class="indent" pid="b376.0/28" pwmotiontext="yes">&#8220;The combination of substantial tax increases and big increases in prices, particularly energy prices, will be a larger shock for households on average earnings than anything at least since the financial crisis and possibly for a long time before that.&#8221;</p>
  
  <p class="indent" pid="b376.0/30" pwmotiontext="yes">&#8220;the rise would reduce family discretionary spending by nearly 7 per cent for the poorest households, almost 4 per cent for people in the middle of the income scale&#8221;,</p>
  
  <p class="indent" pid="b376.0/32" pwmotiontext="yes">&#8220;2 per cent for the richest.&#8221;</p>
  
  <p class="indent" pid="b376.0/35" pwmotiontext="yes">&#8220;it is a bit of a blunt instrument and you end up cutting fuel bills for people who don&#8217;t need the same help.&#8221;</p>
  
  <p class="indent" pid="b379.0/11" pwmotiontext="yes">&#8220;The Treasury&#8217;s objective in relation to debt management policy is&#8230;to minimise, over the long term, the costs of meeting the government&#8217;s financing needs, taking into account risk, while ensuring that debt management policy is consistent with the aims of monetary policy.&#8221;</p>
  
  <p class="indent" pid="b379.0/13" pwmotiontext="yes">&#8220;Against their long term context, currently depressed sovereign real rates are in fact converging &#8216;back to historical trend&#8217;&#8230;real rates could soon enter permanently negative territory.&#8221;</p>
  
  <p class="indent" pid="b385.0/4" pwmotiontext="yes">&#8220;Everyone in the House wants to bring down welfare spending, because welfare spending is the price of Government and social failure&#8230;This benefits cap is arbitrary and bears no relationship to need, as our benefits system should.&#8221;&#8212;[Official Report, <phrase class="date" code="2022-03-26">26 March</phrase> 2014; Vol. 578, c. 389.]</p>
  
  <p class="indent" pid="b390.0/7" pwmotiontext="yes">&#8220;The rationale for a rolling target is that it provides flexibility should the economic situation change.&#8221;</p>