The Spending Review Daily Politics

George Osborne wants Britain to live within its means.

His critics say he's cutting public services to the bone.

We'll find out what the Chancellor has in store for us all

in an hour when he tells us how he's going to spend our money over

Welcome to this BBC News special on the Chancellor's combined

Spending Review and Autumn Statement for 2015, which will help define tax

and spend in this country for the rest of the decade.

He wants to spend more on health, defence, security and now housing,

all while balancing the books - which means big cuts

That's not to mention the little matter of rowing back

I'm here at this brand new shopping centre in Birmingham, the city

at the heart of what the chancellor calls the Midlands Engine.

We'll be getting reaction from businesses, local government,

We'll also be in our virtual Treasury courtyard to look

at where the chancellor can find the ?20 billion of savings he says

I'll be here outside Parliament getting reaction from from

across the political spectrum to a speech that could define

And you can follow the story and find all the best analysis

on the BBC news website, throughout the day.

Did I mention best analysis? Of course I did.

for the next four hours by the BBC's political editor Laura Kuenssberg,

our business editor Kamal Ahmed and, in his farewell lap before he

leaves the BBC, our outgoing economics editor Robert Peston.

We'll be frisking him before he leaves

the studio to check he's not running off with any of the stationery.

So it's a big day for the Chancellor - and for the country.

It's Mr Osborne's thirrd Spending Review since he entered

At its core, he will set how much is to be spent on Government

departments and public services over the next four financial years.

Cumulatively, we're talking about well over ?3 trillion.

And if that's not enough excitement for one day, this year he's combined

his Spending Review with his annual Autumn Statement, which sets out

the latest official forecasts for inflation, employment, borrowing and

other key indicators for the course of our economy through 2016.

So a lot riding on today for the economy,

our public services, our national and economic security -

and, of course, for George Osborne himself.

We have seen George Osborne leave the Treasury a few minutes ago. He

made the trip safely. But the Prime Minister's car had a nasty prank

this morning outside Number Ten Downing St.

Do you think the Prime Minister was inside? I'm sure government

ministers will be hoping that is not a harbinger of things to come.

Laura, the Chancellor is under particular financial pressure, he

has promised to get us into surplus by the end of the decade. Every time

he turns a corner someone says, I want more money for this?

Absolutely. Today is where the rhetoric smashes up with reality and

their big aspiration is also their big faculty. How do you make a set

of hard-fought decisions, hefty cuts to many departments, look like they

are a programme, a coherent programme that matches the

priorities of the millions of voters in the middle, the floating voters

the Conservatives did not just want to get in this year, but want to

secure with an even bigger majority next time round. That is what it is

all about. The difficulties, with more money for health and housing,

less money to local council, cuts to social care and cuts to the police.

The most acute demonstration to this dilemma of all, what on earth will

he do to tax credits? Significant cuts to people who are already in

work. He had to signal a humiliating U-turn. The detail will be crucial

today. And he is a Chancellor only halfway through his deficit

reduction strategy which he started in 2010, he should have finished it

by now. And yet on health, security, tax credits, defence, he is being

asked to spend more money. lopsided approach to actually

balancing the books, which lopsided approach to actually

significant. There are people in lopsided approach to actually

Conservative Party think the ring-fencing of health and other

departments was fundamental strategic mistake. Instead of

looking at the books starting from zero, they are looking at the books

in a way which makes it completely lopsided and therefore making the

sums add up in a way they have lopsided and therefore making the

promised to do, it makes it almost impossible. OK.

promised to do, it makes it almost We should point out no one was

injured in the making of that crash, if crash is

Today's statement is fundamentally about finding

the further ?20 billion of savings the Chancellor says is needed to

eliminate the deficit and move into modest surplus by 2019-20.

We'll look in a moment at where he might find those savings.

First, Robert take us through the Osborne plan.

First, Robert take us through this school rules. Let's look at the

deficit he forecast for this this school rules. Let's look at the

in the July budget. -- famous fiscal rules. We already know he's going to

miss the deficit of ?70 billion. Over the course of the parliament in

the last budget, he saw that deficit declining and actually achieving a

surplus, I think you have already mentioned, of ?10 billion in

2019-20. My expectation is that surplus will be revised down,

because of the sort of surplus will be revised down,

have been talking to Laura about, the pressure just Ben Moore on

priorities like security and housing. So, let's put that now into

the context of the national debt, a whopping ?1.5 trillion in round

numbers. In percentage terms, that began the last Parliament just under

70% of GDP, or national income. It has risen progressively, painfully

since then, and is currently a bit over 80% of GDP. In that last

budget, the Chancellor made a big thing about how this would be the

peak year for debt as a percentage of GDP. He might not achieve that.

Let's see what the OBR says and we will have to wait until April am

frankly, to find out the truth of that. Borrowing is not going quite

as well as he would want. That said, he will make a priority of trying to

get the debt down significantly over the parliament. The last set of

forecasts saw the debt falling as a share of GDP to about 72% of our

national income. The background to all of this, it matters to him and

all of us, it is what happens to the economy in the round. He started the

last Parliament with very weak growth. It was 0.7% at its weakest

in the last Parliament. But then it grew progressively. It accelerated

progressively to 2.9% last year. That was the fastest GDP growth of

the big developed economies, almost back to where we were before the

crash, but growth has weakened since then. We expect it to be about 2.4%

this year, and actually, we don't expect it frankly to accelerate much

from that in the coming years. It could even weaken the bit. Why?

Because of what is happening on the other side of the world. You and I

have talked a lot about the slowdown in China. It is the big economic

event right now. We cannot rule out a Chinese crash. If that were to

happen, of course, everything we hear today becomes irrelevant. The

shock to the global economy in those circumstances would be significant.

He is making great play of making friends with China. He is assuming

the slowdown in China will be gradual and manageable. We will have

to wait and see. We will indeed. Thank you.

Today's Spending Review will set spending limits for every Whitehall

department for each of the next four financial years.

The Chancellor has been locked in discussions with his Cabinet

colleagues for weeks to agree the figures.

The meetings have taken place at the Treasury, just across the

The Chancellor claimed on Sunday the negotiations have been amicable.

That's not the word ministers whose departments

We'll find out who is bruised, bloodied or unbowed today.

At the heart of the Treasury is a circular courtyard - you might

recognise it because it's often used as a location for filming, including

the latest James Bond, which means it's now famous across the globe.

Now, we couldn't get Jo Coburn inside the real courtyard, despite

her being pretty famous - but here she is to tell us more about

Welcome to our virtual Treasury courtyard.

Now, they don't have one of these in the real courtyard,

but it represents everything that the Government is due to spend this

I'm going to start by highlighting a few of the most significant parts

You can see the ?217 billion that goes on social security.

That includes everything from jobseeker's allowance

And there's the ?35 billion the UK is due to spend this year

George Osborne says that's a figure he's is determined to bring down.

Now, the focus of today's statement is the money that goes on

administering and delivering public services - departmental spending.

You can see it's just under half of the total the Government spends.

Now, we're going to delve into the budgets of a few of the most

It's the NHS that accounts for the biggest chunk

Now, the Chancellor isn't going to find any of his savings here,

because he has promised to increase NHS funding in England

The Government has also promised a real-terms increase

That's part of its commitment to meeting the Nato target of spending

The Government has also committed to spending 0.7% of GDP

on overseas aid, meaning that budget is also protected.

So, the Chancellor is not going to find any of his ?20 billion

of savings says he he needs to make from either health, defence or aid.

So, where could it come from instead?

Well, what about from the education budget, a big part of what the state

Here, the Conservatives have promised

a cash increase per pupil in schools.

That means savings from here would be limited, although

the rest of the budget doesn't have any guaranteed protection.

Here is the money that goes to English local authorities.

This was one of the first departments to agree to big savings

The Home Office, on the other hand, took longer

The single biggest thing Theresa May's department spends

money on is the grant it gives to police forces in England and Wales,

although they also get some of their money from other sources, including

Some of the other departments that are going to have to find

big savings over the next four years are

the Departments of Business, Transport and Justice.

Let's go back to that big part of Government spending I mentioned

Of course, that is where a lot of the focus has been in the weeks

Now, again, here there is plenty the Chancellor won't touch.

The state pension is a massive part of the Budget.

But the Government has a long-standing promise not to cut it,

The other areas of big spending the Government has had to look to

are housing benefit, disability benefits and incapacity benefits.

And you can see that big sum of money, ?30 billion,

that is due to be spent on personal tax credits this year -

an area where the Chancellor has found that making savings can prove

Net speak to the BBC business editor now. One business that seems to be

very happy because of what was leaked by the Treasury, the

apparently 400,000 affordable homes, as the Chancellor calls them. This

morning, house-building shares went through the roof? They did indeed.

Listening to Laura and Robert, what is interesting is how it much the

Government need the private sector to support delivery. The strategic

purpose of George Osborne is to take pressure off microstate provision,

give it to the private sector and say, go on, help us provide the kind

of country and economy we want. In house-building, the centrepiece of

David Cameron's Conference speech, he said he didn't want Generation

Rent, he wanted to help people into affordable homes, that is an example

of that. The Government have struggled with the supply-side

problem. The issue they have had is that they have been constantly

increasing demand. So, the help to buy policy increases demand, the

support that we are hearing will be in the Autumn Statement that will

help people buy affordable homes, that increases demand. They are also

going to put some direct money into housing companies for them to build

affordable homes. The problem is that housing new-builds are down

slightly. That is because there is a real skill shortage in housing. Go

country, they can't find enough country, they can't find enough

in London, it had closed down by Thursday night, the builders had

their money for the week and they took Friday off. House-building

companies are building as many houses as they feel comfortable

with, and their profits are up hugely, 40%. The other thing to

watch for is how will social care changes, moving taxes down to local

authorities to provide support for social care, how will that have an

impact? The private sector provide the bulk of social care homes, they

have been complaining about the rise to the National Living Wage

affecting their business. They are being squeezed by having to pay more

for workers, a lot of them on minimum wage, and getting less money

from local authorities? Yes, those things, companies like Four

Seasons, the biggest provider in the UK, has been saying it is no longer

profitable to provide social care. It has become difficult. Sajid

Javid, the Business Secretary, one of the unprotected departments, how

much of an attack on his department will there be?

If you've just joined us on BBC2 and the BBC News Channel,

you're watching our coverage of the Spending Review and Autumn

Let's join Jane Hill now, who's outside the House of Commons.

Good morning, thank you very much. Let's get the thoughts of two of the

new intake of MPs. With us in a blustery House of Commons, Oliver

Dowden for the Conservatives and Rebecca longline for Labour. It is a

Spending Review, are we going to be looking at headlines about cats? Are

those the headlines that George Osborne is comfortable with? The

headlines he will be comfortable Osborne is comfortable with? The

with, remember we are still in a situation where the Government is

spending far more situation where the Government is

That means we are borrowing, and every pound of that is

future generations. We are determined to get that under

control, run a surplus by the determined to get that under

the parliament so that when the next crisis hits, we are spending less

than we earn and we are in a better position to deal with that. I think

that will be the central thrust. We know that is the thrust, but there

are plenty of economists, including the very respected IFS, who say that

the Chancellor has locked himself into a corner, and given the date,

he has boxed himself in? It's important we have a date, by 2019,

when we aim to run the surplus, the economy, hopefully, will have been

growing for ten years. If the economy has been growing for ten

years and we can't grow a surplus, how would we be able to cope when

the economy, inevitably, falls into another recession? We don't believe

boom and bust has been abolished. So it is just our custody, that has to

be cuts for those reasons? I agree with Oliver on the fact that we need

to reduce the deficit, but it needs to be done in a long term,

sustainable way. He has missed his financial targets time and again. He

referred the IFS making comments about it. They have stated in order

to meet its targets this time, he has to make cuts of an unprecedented

scale. The cuts are no doubt going to fall on areas of key economic

growth, such as education, skills, business investment. We need to

start planning the infrastructure, investment, manufacturing strategy.

I doubt we will have any of that from the Chancellor today. Our

business editor was just saying that share prices are up in

house-building companies, if we get lots of positive news about

house-building, is that going to be the one positive that even your

party would agree with, the desperate need for housing? I think

that the Chancellor is definitely a shrewd political operator, he will

offer some sweeteners to lessen the blow. In terms of house-building,

the devil is always in the detail. I welcome the pledge to build 400,000

more houses. We want to see where those houses are going to be and if

they are going to be put in the social rented sector. A quick

thought about a more political side to it, this is about George

Osborne's personal ambitions, he's got to shake things so that the pain

comes soon, so by the time he has his eyes on a even bigger job, the

bulk of the cuts have gone? I think his ambition is on turning his

country around. It is interesting what Rebecca was saying about

investment. One of the decisions he has taken is to protect things like

investment in schools, so it is maintained every year, per pupil. On

housing, the massive investment in housing to make sure young people

get on the housing ladder. The Chancellor wants to make sure that

everybody gets the best start in life, investment in schools, housing

in young people or for old people, so when they have worked hard all

their lives, they get dignity and security in retirement, which is why

there has been a big increase in the state pension. That is where his

efforts are focused. We must leave it there, thank you very much. Much

more from the once we have heard from the Chancellor.

George Osborne's going to be talking a lot

We'll hear a lot about his Northern Powerhouse and, now,

At the heart of that is the city of Birmingham.

Jo Coburn has left her virtual Treasury courtyard and is already

Who needs HS2 when you have the magic of television?

Yes, I am at Grand Central. Not New York, but the shiny new shopping

centre in Birmingham. I'm here to talk about the Autumn Statement and

George Osborne's five-year spending plan. First to talk to us, a

representative from Unison and from the Taxpayers' Alliance. The

announcement that extra cash to the NHS would be front loaded, welcome

news? Any extra money is to be welcomed, but it is too little, too

late. The real issue is the chronic underfunding of social care. It

means elderly patients cannot be discharged quickly enough back into

their homes, which means they are taking up beds and we are definitely

going to end up with a real crisis in A this winter. There will be a

lot of focus on savings and cuts that George Osborne has pledged to

make in the Spending Review and over the course of the parliament. Does

he really want to be known as the Chancellor of austerity? He ought to

be known as the Chancellor that balances the nation 's books. If

he's to do that, he has to make savings. This year, the Government

is spending ?70 billion more than it raised in revenue. That means

borrowing and the national debt is going up and we are paying more debt

interest payments and we are spending on defending the nation,

the defence Budget. That is unacceptable. He needs to balance

the books, get the nation living within its means to ensure future

prosperity. Lets get a little bit more about growing the economy.

Let's talk to somebody from the Greater Birmingham Chamber Of

Commerce. We were talking about austerity against growth. What is

more important to businesses? Got to be a mix. We recognise that the UK

deficit is out of control, the Government spending more than the

defence Budget servicing the interest on the debt. It really does

need to be put in line, but it can't be at the expense of facilitating

business growth. That is what we are looking for today, how the

Chancellor was going to help businesses, which helps grow jobs

and, in turn, helps increase the tax receipts to get the deficit down.

What particularly would you like to see him do? We would like some

clarity on a number of points, the apprenticeship levy, how it is going

to work. Businesses are really keen to boost the skills and

employability of youngsters in the region, but we don't know how the

funding is going to work. Clarity would be fantastic. We would like to

see further announcements on business rates. The Chancellor was

going to devolve spending on that, but we need reform and more

certainty on whether there will be small business rates relief into

next year. Henrietta, thank you. One of the things that will be most

important to people as they are starting to think about Christmas

shopping is personal finances. Their financial security. So, who better

to talk to than our personal finance expert, Annie Shaw? One thing is

people were worried about is cuts to tax credits. George Osborne run into

problems with those plans, and there are expectations he will soften that

in some way. If he does, where else could he get savings? This is the

big question. Is he going to go back to the same people and try to get

the money out of them in other ways? Things like cuts to housing benefit,

that would be affected by cuts to their tax credits. Is he going to go

around the periphery? I think I would be slightly worried about

these pensions... Pension scene. He said he won't do any major pension

reforms until after the Budget, but I think there could be some measures

stopping the buy now while stocks last, people doing last-minute

avoidance things like stuffing pensions now. I would watch out for

tinkering with pension issues. If you have any questions to put to our

guests saw any stories, if you are in Birmingham, you can e-mail us,

tweet us or you can send us a text message. It's too much for me to

remember without my Hundi -- handy iPad.

And you can also take advantage the BBC's range of expert analysis

and all the latest developments on the BBC website.

It's coming up midday here at Westminster -

very soon we'll go over to the House of Commons

and that will be followed by the Chancellor's statement.

First, let's look at some of the measures that have been

already announced, and others we're expecting to hear today.

The biggest was the announcement earlier this week, we were told the

NHS in England, equivalent spending will be for Scotland, Wales and

Northern Ireland, it needs to get an extra ?4 billion above inflation

next year, part of the frontloading that the NHS has been asking for to

get the money in now as it rises towards an extra ?8 billion towards

the end of the parliament. Schools and foreign aid are protected

departments, so no cuts expected in these areas. Defence was not

protected, it is now, indeed, it got an extra ?12 billion earlier this

week to spend on defence equipment over the next five years, taking the

total on defence equipment to 178 billion. Locked in, like foreign

aid, as a percentage of GDP, 2%. Tax credits, the Chancellor came out

with a number of cuts in the July Budget. It is only November, but

he's already having to roll back on that. It will cost him money and we

will look to see how he does it. We expect tax credit changes to be

eased. The latest thing to be leaked by the Treasury leak machine is the

idea that the Government will encourage, preside over the building

of 400,000 affordable homes at a cost of ?7 billion. There

of 400,000 affordable homes at a an alert on these, a warning, the

Government often set is kind of targets, whether they meet them is

another matter. Because central government spending and local

government spending has been squeezed, the Chancellor will allow

local authorities to raise council tax by 2%, provided the money, and

only if the money, goes to social care, because of the move from NHS

hospitals and so on into care in the community. Whether that will be

enough is another matter. Whether those areas that need social care

most, it tends to be the poorer areas, we'll get that much from a 2%

rise in council tax, those are all things we will be keeping an eye on

and discussing as this three and a half hours goes on. Laura, we have a

pretty fair idea what he's going to do, they have helpfully leaked a lot

of it! do, they have helpfully leaked a lot

is the rabbit? I'm not do, they have helpfully leaked a lot

going to be a rabid today. There will be surprises, I'm

understanding, but I don't think, or I have

understanding, but I don't think, or be led back to their

constituencies... Which he has been be led back to their

famous for? Indeed he has, I don't think we will see it. There will be

surprises, cunning wheezes, but I'm not too sure about that. May be like

a little mouse, rather than a rabbit? He has an astute political

as well as economic brain. On this occasion, the judgments are similar

for him personally. We are still relatively early in Parliament.

Personally, he has had a bit of a popularity dip as a result of the

tax credit debacle. I think he will be thinking what I need to do is to

make some quite tough decisions, because the last thing he wants is

for things to go wrong when he is running for the Tory party

leadership. Everyone in this House and everyone

watching at home know from Yes, Prime Minister, the central role

that Bernard plays in the life of the Prime Minister and Number Ten

Downing St. This morning, my Bernard, my principal private sector

we died of cancer. Chris Martin was only 42. He was one of the most

loyal, hard-working, dedicated public servants I have come across.

I have no idea what his politics were but he would go to the ends of

the Earth and back again, for his Prime Minister, for ten and the team

we work for. Today, we are leaving the seat where he used to sit empty,

as a mark of respect to him. We think of his wife, Zoe, his family,

the wider Number Ten family, because it is like a family, and we feel

like we have lost someone between a father and brother to all of us, and

whatever happens, we will never forget him.

Mr Speaker, this morning I had meetings with ministerial colleagues

and others, and in addition to the duties of the House, I will have

further meetings today. Can I firstly echoed the prime Mr's

sentiments regarding the passing of Chris Martin. I'm sure all members

will have heartfelt thoughts and prayers today and we would be

grateful if they could be conveyed to the family at this time. The

Prime Minister is a champion of family life, so could he confirm

that the announcements he will make today will pass the family test for

vulnerable people? Can I thank the honourable member for her words.

Families are the best welfare state we have. They teach us the right

Phileas, they bring up our children and they care for us when they are

sick and unwell. We will boost the national Living Wage, delivered tax

cuts and crucially help with childcare. All of these policies

should pass the test of helping Britain's families.

Jeremy Corbyn. Thank you, Mr Speaker. On the half of the

opposition, could I also express my condolences regarding Chris Martin.

The Prime Minister told me how it will he was on Remembrance Sunday

and I'm glad he could visit him at that time. Many members of

government appreciates the work he did in the very highest and best

traditions in the civil service of this country. If our condolences

could be passed on, I think that would be very helpful.

This week, 55 Labour councils has made a commitment for their areas to

be running entirely on green energy by 2050. With the Paris climate

talks just days away, with the Prime Minister commend those councils? I

certainly commend councils for wanting to promote green energy and

we have had green tariffs and other measures to help, particularly solar

power and also wind power. We will be taking part in the Paris climate

talks because it is absolutely vital to get that global deal, but we have

to make sure we take action locally as well as globally. I would make

the point that if you compare the last Parliament, to the previous

parliament, we saw something like a trebling of the installation of

renewable electricity. The commitment of those Labour

councils is a bit of a contrast to the Prime Minister's performance. He

used to tell us that his was the greenest government ever. Does he

remember those days? Does he agree with the Energy Secretary that

Britain is likely to miss its target of getting 15% of our energy from

renewables by 2020? First of all, I believe that the

last government does rightly claim that record, the world's first green

investment bank, pioneered in Britain. The trebling of renewable

energy, a meeting of all our climate change targets contributing to an EU

deal that means we go to the climate change conference in Paris, with a

very strong European record and the ability to say to other countries

that they should step up to the plate. It was in the last

Parliament, we spent record sums helping developing countries to go

green, and in the next five years, we will be spending $9 billion on

helping other countries, which will be crucial to building the Paris

deal next week. The problem with the prime and is

the's answer is, the gap between Britain's 2020 target and our

current share of renewable energy, is the biggest in the European

Union. Some of his decisions he has made recently, such as cutting

support for solar panels on home and industrial projects, scrapping the

green deal, cutting support for wind turbines, putting a new tax of

renewable energy, increasing subsidy for diesel generators, is it any

wonder that the chief scientists of the United Nations environment

programme has criticised Britain for going backwards on renewable energy?

The facts paint a different picture. As I said, trebling of wind power in

the last Parliament. That is an enormous investment. Also, he makes

the point about solar panels. Of course, when the cost of

manufacturing solar panels plummets as it has, it is right to reduce the

subsidy. If we don't reduce the subsidy, we ask people to pay higher

energy bills, something I seem to remember the Labour Party in the

last Parliament making a lot of. I think if you look for the

secretaries climate change's speech, you can make the right

balance between affordable energy and making sure we meet our green

targets. That is what we are committed to. In addition to that,

building the first new clip power station for decades in our country,

something the Labour Party talked about a lot in government but we are

putting into action now we are in government -- first new nuclear

power station. In the past weeks, thousands have

been lost in solar companies in Britain as they have gone bust. I

have a question from some apprentices solar fitters. They say

cutting feed in tariffs means you are stopping solar projects that

they need to help our environment give us jobs. They asked the Prime

Minister this: Wide you want to throw all this away? We are doubling

investment in renewable energy in this Parliament and as for solar

panels, I think I am right in saying, in the last Parliament, over

a million homes were fitted with solar panels. It is right we go on

supporting that industry, but we should do it recognising that the

cost of manufacturing solar panels has plummeted, and so therefore the

subsidy should be what is necessary to deliver solar power, not as what

is necessary to pump up the bills of hard-working families.

That is not much help to those who are losing their jobs in the solar

industry at the present time. However, I would like to ask the

Prime Minister something else. Today is the International Day for the

elimination of violence against women. On average, two women a week

are killed by a current or former partner, and domestic violence

accounts for a quarter of all violent crime. Can the Prime

Minister explain why one third of those referred to women's refuges in

England are now being turned away? We have put more money into refuges

and the Chancellor will have something to say about funding

women's charities in his Autumn Statement today. The fact is, when

it comes to rape crisis centres that we protect or domestic violence

centres that we fund, this government has a good record on

helping women and making sure that the crime of domestic violence is

properly investigated by the police and prosecuted in our courts. 20, Mr

Speaker. The late Denise Marshall who was chair of a domestic violence

charity put this throw well when she said, if you are a woman who has

experienced some form of violence, I believe you have the right to the

very best service and the community owes you a right to recover. In

2012, the Prime Minister's government signed the Istanbul

convention on preventing and combating violence against women.

This would make women's support services statutory and would have

stopped the closure of Eve's. Will the primers to tell the House when

he will ratify the Istanbul convention. We are going further

than that. We will be putting more money into women's charities,

including charities which fight domestic violence, which fight rape

and make sure we cut out these appalling crimes in our country. In

addition to that, we have also done more than any previous government,

in terms of preventing forced marriage and preventing the horrors

of FGM which do not just happen in Nigeria and countries in North

Africa, they happen here in our country as well. I don't think any

government before this one has a stronger record on those grounds.

Thank you, Mr Speaker. I have many constituents and Lewis who come to

my surgery desperate to end their own home. Many of them are on a low

income and they recognise that a monthly mortgage payment would be

significantly lower than that current monthly rental payments.

Does my right honourable friend share in the excitement of any of my

constituents, towards the starter homes initiative contained in the

housing bill which will see affordable housing lower than the

monthly outgoings of many people in this country?

I do share my honourable friend's enthusiasm for that. Clearly there

are lots of individual interventions like help by which has basically put

buying homes in the of many more people by reducing the deposits they

need. We can help people to save which we do with our Help to Buy ISA

will stop our biggest contribution we can make is by building more

housing which we will be doing during this Parliament, and

crucially by maintaining during this Parliament, and

secure and stable economy with low interest rates so people can afford

to take out a mortgage. May I begin by associating the

Scottish National Party with the condolences of the Prime Minister.

Having spoken to him last condolences of the Prime Minister.

aware of how much a personal loss it is to him and also to

aware of how much a personal loss it Martin's family and friends. The

fatal dangers of Martin's family and friends. The

consequences and escalation in Syria, are clear for everybody to

consequences and escalation in see in these days. It is agreed that

an air campaign alone will not lead to the ultimate defeat of Daesh on

the ground and ground forces will be needed. How many troops and from

which countries does the Prime Minister having his plan for Syria?

Firstly, can I thank the right honourable gentleman for his

comments on Chris Martin who I know helped all members of this House

when they had enquiries. Let me deal with the issue of Syria.

I am not for one moment arguing that action from the air alone can solve

the very serious problem we have with Isil. Clearly we need a

political settlement in Syria and government in Syria which can act on

pensively with us against Isil. The question for the House that we need

to address tomorrow and in the to come, can we afford to wait for that

political settlement before we act? My view is, we cannot wait for that

political settlement. Should we should work as hard as we can for it

but we should be acting now with our allies, because it is about keeping

our own people and our own country safe. He asked specifically about

ground troops. There are troops in Syria. The three Syrian army and the

Kurdish forces that would work Syria. The three Syrian army and the

us to help eliminate Isil, but the full range of ground troops will

only be a valuable when there is a political settlement in Syria. The

question is simple, can we wait for that political settlement before

taking action to keep our people safe at home, and my answer is, we

cannot afford to wait. The United Kingdom spent 13 times more bombing

Libya then investing in its reconstruction after the overthrow

of the Gaddafi regime. We construct in Syria will be essential to

of the Gaddafi regime. We construct restore stability and allow refugees

to return. How much does the Prime Minister estimate this will cost and

how much has he allocated from the UK?

We have one of the largest development budgets anywhere in the

world as is the support that we have given to Syrian refugees which

stands at one of the largest development budgets anywhere in the

world as is the support that we have given to Syrian refugees which

stands at ?1.2 billion in demonstrates. Part of our plan will

be to help fund the reconstruction and rebuilding of Syria alongside

the political deal that we believe is necessary. I would far rather

frankly spend the money reconstructing Syria, than in

supporting people kept away from their homes, kept away from their

country, who do you want to return. I know that my right honourable

friend was aware of the growing cause of concern surrounding the

conviction of Alexander Blackman, the former Royal Marine

non-commissioned officer who shot an insurgent in 2011. If there is

indeed new evidence and many feel that has been a miscarriage of

justice, would my right honourable friend agree with me that it is

right that this matter should be looked into again? This is exactly

what the Criminal Cases Review Commission is there to look at,

where there may have been a miscarriage of justice. We gave the

internal report of the Naval services to Sergeant Blackman's

legal advisers. There is proper disclosure in this case and the

legal team have said they look at the option of applying to the

Criminal Cases Review Commission. Let me say while we are on this

point that our Royal Marines have a worldwide reputation as one of the

world's elite fighting forces. They have made an success, and incredible

conservation to our country and we should pay tribute to them. The

Government's handle of child sexual abuse inquiries has done little to

instil public confidence so far. The Gothard inquiry announced they had

accidentally and permanently deleted all of the victim testimony

submitted through the website over an 18 day period, without anyone

from the inquiry ever reading now. These victims deserve justice, and

for their voices to be heard. Can the Prime Minister please tell the

House what independent investigation has taken place to establish the

cause of the data loss and to establish whether or not there was

any criminality behind it? I am sure the whole House will welcome the

fact that the Goddard inquiries about running. The best way to get

justice for these victims is to make sure we have the full independent

inquiry. The specific issue she raises, it is a matter for the

inquiry, if there is further details, I will write to her, what

matters is that it is up and running. 3000 jobs in Newark were

lost and a Labour. This month, we celebrate the 10,000 new job in

Newark since 2010. Does the Prime Minister agree that once again

Newark leads the way to a strong economy, high employment, higher

wages and lower welfare? I'm delighted to hear that Newark has

met this landmark and it is worth remembering that these 10,000

figures, they are 10,000 people, each with a job, with a livelihood,

with the chance to support their families. I well remember visiting

my honourable friend's constituency. I can't promise to visit as many

times in this Parliament as the last, but I do recognise a business

that we visited announced the creation of over 200 jobs. I am sure

others will follow. Has the Prime Minister ever heard of Alan

Cartwright, Stefan Appleton? Teenagers that were stabbed to death

on the streets of Islington last year. Vaso was murdered just two

days ago. Given the growing culture of drugs, guns and violence in my

borough and many others like it, does the Prime Minister really think

it is in the interests of my constituents, for their safety and

security, to cut the Metropolitan Police? First of all, every life

lost in a way that she talks about is a tragedy. Many of these lives

have been lost because of drugs, gangs and because of my crime.

Overall, knife crime has come down over the last few years, which is

welcome. There are still too many people carrying a knife and not

recognising that not only is it against the law, it is also an

enormous danger to themselves and others. We will continue with the

tough approach on knife crime, with the work we're doing to disband and

break of gangs and the work to try to deal with the problems of drugs.

When it comes to policing, what we have seen in London is an increase

in neighbourhood policing. The Metropolitan Police have done a good

job at cutting back-office costs and putting police on streets. After

many years of neglect under Labour, Cornwall is once again seeing

investment in roads, railways, airport and in tourism. But Cornwall

is ambitious to diversify its economy and become a centre for the

UK aerospace industry. Indeed, Newquay airport is to be the

forerunner for the creation of a UK spaceport. Could the Prime Minister

provide an update on the decision, and does he agree with me that

Newquay would be the perfect place for it? It is good in this

Parliament we have such strong voices for Cornwall speaking up for

that county and making sure that it makes the resources it needs. I'm a

strong supporter of the airport, not just as a user, but also I think it

provides the opportunity for a hope of great businesses in Cornwall. We

want to become the European hub for space flight, which will attract

further investment into the UK and create jobs. There are a number of

other airports in the running, I wish them all well and I can tell

him we are aiming to launch selection process next year. The

Government and I disagree on much of what constitutes progress on gender

equality, but I agreed with the Prime Minister when he pledged to

change the law to include mothers on marriage certificates. I have heard

nothing since. I wondered if the Prime Minister agreed with me that,

with the fast approaching birth of my daughter, I would like to be

valued as equally in her life as my husband. Will the Prime Minister

take this important, symbolic step to ensure that mothers are not

written out of history? This is an area where the honourable lady and I

agree. My understanding is that the proposals for legislation have gone

to the relevant committee in Government and she has made a very

articulate case for why that bill should be included in the next

session. Will the Prime Minister join with me in commending the

French government for facing down terror are continuing with the

climate summit in Paris next week, and will acknowledge the important

role of legislators such as at the Globe Summit on the fourth and 5th

of December, does he agree with me that his personal presence in Paris

sends a message out to the world about our continuing commitment to a

lasting climate deal? I am grateful for what my honourable friend says.

I will certainly be going to Paris to the start of this vital

Conference, to set out what Britain and the European Union will be doing

to bring about this deal. What we put on the table in terms of climate

finance, nearly $9 billion over the next five years, is one of the most

generous offers made by any country anywhere in the world. The good news

about the Paris Conference is that we are going to see China and

America as signatories to a deal. That means that much more of the

world's emissions are going to be covered by the deal. What we have to

make sure we achieve is to make sure it is a proper deal with proper

review clauses, to make sure we keep to 2 degrees. Nobody should be in

any doubt that Britain is playing a leading role, and has lead by

example and with money. Mr Speaker, there will never be a future where

we do not need steel, but the Government is spending millions of

pounds to compensate for the use of you... -- loss of UK steel-making.

Guy Aston Prime Minister he will send a clear signal that he will do

whatever it takes to back a sustainable, cutting-edge UK steel

future? We want to see more steel across the world stamped with made

in Britain. I completely agree with the honourable lady. We want to

support the steel business, which is why we are taking action on

procurement. When we look at what we have done through the Royal Navy,

what we can do through Railtrack and other organisations, we can back

British Steel. We are also going to be exempting users like British

Steel from energy usage charges. It does go to the questions asked by

the leader of the position. If we endlessly pressure builds for

everybody else, it costs more to exempt the high users. Everything we

can do to help British Steel, including a very clear

infrastructure plan you will be hearing about in a minute, is all to

the good. In 2010, unemployment in my

constituency stood at 5% of the population. It has now dropped to

just 1.6%. I am sure my honourable friend agrees with me, to help those

people still unemployed and boost productivity and wages in places

like wire forest, we need to offer more opportunities for skills

training. Does my right honourable friend agree with that, and what

more can the Government offer in order to help places like Wyre

Forest? All young people should have a real choice of being able to take

on in chilly an apprenticeship, or to be able to go to a university. We

don't want everybody left behind. Everybody should have that choice.

He is right that unemployment has fallen in his constituency, as

around the company. The fact is, Britain, over those five years, has

grown as fast as any other G-7 country in terms of economic

performance. You can now look back and see that the decisions made in

2010, 2011, 2012, difficult decisions, but they laid the

platform for decisions, but they laid the

growth and jobs. Education in Bradford is facing a funding and

school places crisis and we remain at the bottom of the league tables.

Bradford's children cannot be failed any longer. Will the Prime Minister

support my call for a Bradford Challenge, based on the highly

successful London Challenge? Will he stop the dangerous changes to the

schools funding formula that will drag the children Bradford further

into the land of inequality, despair and neglect? We made commitments at

the last election about funding our schools, funding school places. We

will be keeping all of those commitments, not just the revenue

that we provide for schools, where we will not be reducing the amount

per pupil, but also spending much we will not be reducing the amount

more on new school places in this Parliament than in the Parliament

that preceded Parliament than in the Parliament

Minister. We are also helping with building new academy chains and free

schools, they are available for his constituency, as for others. Does my

right honourable friend the Prime Minister agree with me that the

turmoil in northern Iraq and Syria gives opportunities to resolve

long-standing international disputes, not least with Russia?

Does he agree with me that the attack on the Russian bomber,

something that never happened in the whole of the duration of the Cold

War, was disproportionate, and we need to make sure absolutely that we

do not get into conflict with Russia over Syria? What I would say to my

honourable friend is, look, I think there are opportunities for sensible

discussions with Russia about the agenda in Syria, which is about a

political transition, so there can be a Government that represents all

of the people of Syria. I have that conversation with President Putin

last week. He mentions the issue of the downed Russian jet. The facts on

this not yet clear. I think we should respect Turkey's right to

respect its airspace, as we defend our own. I think we have to get to

the bottom of what happened. The Prime Minister very often tells us

that the first duty of any government is to protect the

public. Will he give an undertaking to restore the cuts to the police

and emergency services to ensure that the public in this country are

protected? I think this Government has a good record of protecting the

public, not least because we protected counterterrorism policing

and we had a funding situation with the police that enabled them to help

in a cut of crime of 31% since I became Prime Minister.

Thank you, Mr Speaker. John Wharton, a good driver, destroyed the lives

of Amy Baxter and Hayley Jones, with Miss Baxter being so severely

injured she is paralysed from the neck down and in hospital 16 months

later. He was sentenced to just a 3 month driving ban, a fine and a 20

week tag. Weeks later he successfully applied to Bolton

Magistrates' Court for his type to be removed so he could go on holiday

to a stag party. Would my right honourable friend looked to issue

guidance to magistrates that a tag, when part of a sentence, should

never be removed to allow criminals to go on holiday? I think my

honourable friend makes a very powerful point and I will look at

this very carefully. Let me first of all express my sympathy to the

victim and her family, in what is, undoubtedly, a very distressing

case. It is always very difficult to comment on specific cases, I was not

sitting in the courthouse and here all the arguments that were made,

but the point he makes seems to be very sensible, a punishment as a

punishment and he's making a case. The Middle East is increasingly

resembling the central Europe of a century ago, minorities, linguistic,

religious or sexual, find themselves under more pressure than ever. I, my

constituents and the Scottish National Party understand the threat

posed to these groups by Daesh. How is the Prime Minister planning to

prosecute a bombing campaign that does not alter the demographic map

of the Middle East, preventing Ross Hill becoming the new Budapest? We

will set up the items tomorrow, but there is a clear and present danger

to the United Kingdom of Isil, based in Syria, planning attacks against

our country today. We don't live in a perfect world and we can't deliver

a perfect strategy, but we can deliver a clear, long-term strategy

that can work. He talks about the lessons we learned from the last

century. One of the lessons I say we should learn from the last century

is when your country is under threat, when you face aggression

against your country, you cannot endlessly sit around and dream about

a perfect world, you need to act in the world we are in. Will my right

honourable friend join me in congratulating all the staff at a

local birthing unit. They scored 100% on their friends and family

survey for satisfaction and care. The commitment of midwives is only

matched by the Conservatives' commitment to the NHS. With two

elections in a row, we have promised and delivered greater investment in

our National Health Service than Labour.

Can I say to my honourable friend, she is absolutely right to highlight

the friends and family test. It is a simple way of measuring whether our

hospitals are delivering great care. As well as good schemes to make sure

you would want your friends and family treated in a hospital, we

need to provide the resources for that hospital and that is what we

are doing with the spending figures announced today. Crucially on

childbirth, it is not often I stand here" the Daily Mirror, but it is

worth looking at what they are raising about the importance of a

seven-day NHS and making sure we have high standards across our NHS

every day of the week. As well as the extra money this government is

putting into the NHS, a seven-day NHS would also mean a much stronger

NHS. The big lottery fund supports local

projects in my constituency, including the Gate, a small children

was a playground and a women's project which plays a vital role in

supporting the vulnerable people this Parliament has left behind.

Would-be Prime Minister join me in congratulating these local projects

on their work, and reassure the House that this government will

protect the lottery funding earmarked for charity and community

projects? We will certainly protect the big

lottery fund. It does an excellent job. One of the things the United

Kingdom brings is a bigger National Lottery, a bigger pot which can

support Scottish charities and let me just make this point, following

what has happened to the oil price, if there was a Scottish November

Autumn Statement, it would be a statement that was about cuts, cuts,

cuts, taxes, taxes, taxes and no relief from the National Lottery.

Order. Order. Mr Brendan McNeill. Mr Angus Brendan McNeill. Calm

yourself. You may be a cheeky chappie, but you also an

exceptionally noisy one. Statement, the Chancellor of the Exchequer.

Mr Speaker. This Spending Review delivers on the commitment we made

to the British people that we would put security first. To protect our

economic security by taking the difficult decisions to live within

our means, and bring down our debt. And to protect our national security

by defending our country's interests abroad and keeping our citizens safe

at home. Economic and national security provide the foundations for

everything we want to support. Opportunity for all. The aspirations

of families, the strong country we want to build. Five years ago, when

I presented our first Spending Review, our economy was in crisis,

and as their letter said, there was no money left. We were borrowing ?1

in every forward is spent, and our job then was to rescue Britain.

Today, as we present this Spending Review, our job is to rebuild

Britain, build our finances, build our defences, build our society, so

that Britain becomes the most prosperous and secure of all the

major nations of the world. And so we leave to the next generation a

stronger country than the one we inherited. That is what this

government was elected to do, and today we set out the plan to deliver

on that commitment. Mr Speaker, we have committed to running a

surplus. Today, I can confirm that the four-year public spending plans

I have set out are forecast to deliver that surplus, so we don't

borrow forever, and are ready for whatever storms lie ahead. We

promise to bring our debts down. Today, the forecast I present shows

that after the longest period of rising debt in our modern history,

this year, our debt will fall and keep falling in every year that

follows. We promised to move Britain from being a high welfare low-wage

economy, to being a lower welfare are higher wage economy. Today I can

tell the House that the ?12 billion of welfare savings we committed to

at the election will be delivered in full, and delivered in a way that

helps families as we make the transition to our national Living

Wage. We promised that we would strengthen our national defences,

take the fight to our nation's enemies, and protect our country's

influence abroad. Today, this Spending Review delivers the

resources to make sure Britain, unique in the world, will meet its

twin obligations to spend 7% of its income on development, and 2% on the

defence of the realm. At this Spending Review not only ensures the

economic and national security of our country, it builds on it. It

sets out far-reaching changes to what the state does and how it does

it. It reforms our public services so we truly extend opportunity to

all, whether it is the way we educate our children, train our

workforce, rehabilitate our prisoners, provide homes for our

families, deliver care for our elderly and sick, or the way we hand

back power to local communities, this is a big Spending Review by a

government that does big things. It is a long-term economic plan for our

country's future. Mr Speaker, nothing is possible without the

foundations of a strong economy. Let be turned to the new forecast

provided by the independent Office for Budget Responsibility and let me

thank Robert choked and his team for their work. Since the summer budget,

new economic data has been published which confirms this, since

new economic data has been published economy in the G7 has grown faster

than Britain -- Robert Chote. We have grown three times faster than

Japan, twice as fast as France, faster than Germany and the same

rate as the United States. That growth has not been fuelled by an

irresponsible banking boom such as in the last decade.

irresponsible banking boom such as investment has grown twice as fast

as consumption. Exports faster than imports and the North

has grown faster than the south. We are determined that this will be an

economic recovery felt in all parts of our nation. That is already

happening. In which area of the country are we seeing the strongest

jobs growth? Not just in our capital city, the Midlands is creating jobs

three times faster than London and the south-east. In the past year we

have seen more feeble in work in the Northern Powerhouse than ever

before. And where do we have the highest employment rate of any pout

of our country? In the south-west of England. Our long-term economic plan

is working. But the OBR reminds us today of the huge challenges we

still face at home and abroad. Our debts are too high and our deficit

remains. Productivity is growing but we still lag behind most of our

competitors. I can tell the House that in today's forecast, the

expectations for world growth and world trade have been revised down

again. The weakness of the eurozone remains a persistent problem. There

are rising concerns about debts in emerging economies. These are yet

more reasons why we are determined to take the necessary steps to

protect our economic security. That brings me to the forecast for our

own GDP. Even with the weaker global picture, our economy this year is

predicted to grow by 2.4%. Growth is then revised up from the Budget

forecast in the next two years, to two years, and two x 5%. If then

starts to return to its long-term trend with growth of 2.4% in 2018

and 2.3% in 2019 and 2020. That growth this more balanced than in

the past. Whole economy investment is set to grow faster in Britain

than in any other major advanced economy in the world, this year, the

next year, and the year after that. Mr Speaker, when I presented my

first Spending Review in 2010, I set this country on the path of living

within its means. Our opponents claimed the growth would be choked

off, and million jobs would be lost and inequality would rise. Every

single one of those projections has proved to be completely wrong --

predictions. So too did the claim that Britain had to choose between

sound public finances and great public services. It is a false

choice. If you are bowled with your reforms, you can have both. That is

why when we have been reducing government spending, crime has

fallen, and million more children have been educated in good and

outstanding schools and public satisfaction with our local services

has risen. That is the exact opposite of what our critics

predicted. And yet now, the same people are making similar claims

about this Spending Review, as we seek to move Britain out of deficit

and into surplus. They are completely wrong again. The OBR has

seen our public expenditure plans, analysed our effect on our economy.

Forecast today is that the economy will grow robustly every year,

living standards will rise every year, and more than a million extra

jobs will be created over the next five years. That is because sound

public finances are not the enemy of sustained growth, they are its

precondition. Our economic plan puts the security of working people

first, so we are prepared for the inevitable storms that lie ahead.

That is why our charter for budget responsibility commits us to

reducing the debt to GDP ratio in each and every year of Parliament,

reaching a surplus in 2019-20, and keeping that surplus at normal

times. I can confirm that the OBR has certified that the economic plan

we present delivers on our commitment. Mr Speaker, that brings

me to the forecast for debt and deficit. As usual, the OBR has had

access to published and unpublished data and has made its own assessment

of our public finances. Since the summer budget, housing associations

in England have been reclassified by our independent Office for National

Statistics, and their borrowing and debts have been brought on to the

public balance sheet and that change will be backdated to 2008. This is a

statistical change and therefore, the OBR has recalculated its

previous budget forecast to include housing associations, so we can

compare like with like. On that new measure, debt was forecast in July

to be 83.6% of national income this year. Now today in the sort and

statement, we forecast debt to be lower at 82.5% -- now today in this

Autumn Statement. It then falls every year... Order, order. Mr

Lewis, get a grip of yourself, man! Calm, take up yoga, you will find it

beneficial, man. The Record shows that the Chancellor stays for a very

considerable period after his statement, to respond to questions,

and members will always find the chair a friend if they wish to

question the Minister. Yes, they will. Those who have questions to

ask will be heard. Meanwhile, the Chancellor will be heard. The

Chancellor of the Exchequer. Mr Speaker, I am looking forward to

it. Now, on that new measure, debt was forecast in July to be 83.6% of

national income. Now today in this Autumn Statement they forecast debt

to be lower at it then falls every year down to 81.7% next year, down

to 77.9%, then 77.3%, reaching 71.3% in 2020, 2021. In every single year,

the national debt as a share of national income is lower than when I

presented the Budget for months ago. And this improvement in the

nation's finances is due to two things. First, the OBR expects tax

receipts to be stronger, a sign that our economy is healthier than

thought. Second, debt interest payments are expected to be lower,

reflecting the further fall in the rates we paid to our creditors.

Combine the effects of better tax receipts and lower debt interest,

overall the OBR calculates, aiming to 27 7p improvement in our public

finances over the forecast period compared to where we were at the

Budget. This improvement in the nation's finances allows me to do

the following. First, we will borrow ?8 billion less than we forecast,

making faster progress towards eliminating the deficit and paying

down the debt, fixing the roof when the sun is shining. Second, we will

spend ?12 billion more on capital investments, making faster progress

to building the infrastructure our country needs. Third, the improved

public finances allow us to reach the same goal of a surplus, while

cutting less in the early years. We can smooth the path to the same

destination. That means we can help on tax credits. I have been asked to

to help in the transition as we move to the higher wages, lower welfare

society that the country wants to see. I have heard representations

that these changes to tax credits should be phased in. I have listened

to the concerns, I hear and understand them, and because I have

been able to announce today an improvement in the public finances,

the simple thing to do is not to phase them in, but to avoid them

altogether. Tax credits are being phased out anyway as we introduce

Universal Credit. What that means is that the tax credit tabor rate and

threshold remain unchanged, the disregard will be ?2500. I propose

no further changes to the Universal Credit taper or the work allowances,

beyond those passed through Parliament last week. The minimum

income floor in Universal Credit will rise with the National Living

Wage. I set a lower welfare cap in the Budget. The House should know

that helping with the transition obviously means we will not be

within that lower welfare cap in the first years, but the House should

also know that, thanks to the welfare reforms, we meet the cap in

the later part of this Parliament, indeed, on the figures published

today, we still achieve indeed, on the figures published

billion per year of welfare savings we promised. Now, that is because of

the permanent savings we have already made, and the further

long-term reforms we announced today. The rate of housing benefit

in the social sector will be capped at the relevant local housing

allowance, in other words, the same rate paid to those in the private

rented sector who receive the same benefit. That will apply to new

tenants is only. It will also stop paying housing benefit and pension

credit payments for people that have left the country more than a month.

The welfare system should be fair to those that need it, and fair to

those who pay for it as well. Improved public finances our

continued commitment to form mean we continue to be on target for a

surplus. The House will want to know the level of that surplus. Let me

give the OBR forecast for deficit and borrowing. In 2010,

give the OBR forecast for deficit we inherited was estimated to be

11.1% of we inherited was estimated to be

it is set to be almost a third of that, 3.9%. Next year, it falls to

less than a quarter of what we inherited, 2.5%.

less than a quarter of what we down again to

less than a quarter of what we to just 0.2% a year after that,

before moving to just 0.2% a year after that,

of national income in 1919-20, rising to 0.6% the following year.

Let me turn to the cash borrowing figures. With house borrowing

figures included, the OBR predicted at the time of the Budget that

Britain would borrow ?74.1 billion this year. They now forecast we will

borrow less than that, at 73.5 billion. Borrowing them falls to

49.9 billion next year. It continues to fall, and falls to lower than was

forecast in the Budget in every single year after that, to 24.8

billion next year. It continues to fall, and falls to lower than was

forecast in the Budget in every single year after that, to 24

2018-19, in 2019-20, we reach a surplus of ?10.1 billion. That is

higher than was forecast in the Budget. Britain out of the red and

into the black. Surplus rises to 40.7 billion a year after that. So,

Mr Speaker, the deficit falls every year. The debt share is lower in

every year than previously forecast. We are borrowing ?8 billion less

than we expected overall and we reach a bigger surplus. We have

achieved this, well, the same time, helping working families as we move

to a higher wage, lower welfare economy, and we have the security of

knowing our country is paying its way in the world. Mr Speaker, that

brings me to our plans for public expenditure and taxation. I want to

thank my right honourable friend the Chief Secretary, other ministerial

colleagues at the Treasury and the brilliant officials that have

assisted us for the long hours and hard work they have put into

developing these plans. We said ?5 billion would come from the measures

on tax avoidance, evasion and imbalances. Those measures were

announced in the Budget. Together, we go further today with new

penalties for the general anti-abuse rule that the Government

introduced, action on the Government introduced, action undisguised

numeration schemes and Stamp Duty avoidance, and we will stop abuse of

the intangible fixed assets regime and capital allowances. We also

exclude energy generation from the venture capital schemes, to ensure

they remain well targeted at high risk companies. HMRC is making

efficiencies of 18% in its own Budget. In the digital age, we do

not need taxpayers to pay for paper processing or 170 separate tax

offices around the country. Instead, we are reinvesting some of those

savings with an extra ?800 million in the fight against tax evasion,

with a return of almost ten times the additional tax collected. We are

going to build one of the most digitally advanced tax

administrations in the wilderness Parliament so that every individual

and every small business will have their own digital tax account by the

end of the decade to manage their tax online. From 2019, once the

accounts are up and running, we require Apple gains tax to be paid

within 30 days of completion of any disposal of residential property.

Together, these form part of the digital revolution that we're

bringing to Whitehall that the Spending Review. The court Cabinet

Office Budget will be cut by 26%, matching a 24% cut in the Budget of

the Treasury. The cost of all Whitehall administrations will be

cut by ?1.9 billion. These form part of the ?12 billion of savings to

government departments I am announcing today. In 2010,

Government spending took up 45% of national income. This was a figure

we could not sustain because it was neither practical sensible to raise

taxes high enough to pay for that. We ended up with a massive

structural deficit. Today, the state accounts for just under 40% of

national income and it is forecast to reach 36.5% by the end of the

Spending Review. The structural spending this represents is at a

level that a competitive, modern, developed economy can sustain and it

is a level that the British people are prepared to pay their taxes for.

It is precisely because this Government believes in decent public

services and a properly funded welfare state that we are insistent

that they are sustainable and affordable. To simply argue all the

time that public spending must always go up, never be cut, is

irresponsible and lets down the people that rely on public services

most. To fund the things we want the Government to provide in the modern

world, we have to be prepared to provide the resources. Mr Speaker, I

am setting the limits for total managed expenditure as follows. This

year, public spending will be ?756 billion. 773 billion next year, 780

billion a year after, 801 billion, before reaching 821,000,000,020

19-20, the year we are forecast to eliminate the deficit and a surplus.

After this, the focus of public spending rises broadly in line with

the growth of the economy and will be at 857 in 2020-21. The figures

from the OBR show over the next five years, welfare spending falls as a

percentage of national income, while departmental capital income is

maintained and is higher at the end of the period. That is the right

switch for a country that is serious about investing in long-term

economic success. People will want to know what the levels of public

spending mean in practice, and the scale of the cuts we are asking

government departments to undertake. In this Spending Review, the

day-to-day spending of Governor departments is set to fall by an

average of 0.8% per year in real terms. That compares to an average

fall of 2% over the last five years. So, the savings we need are

considerably smaller. This reflects the improvement in the public

finances and the progress we have already made. Indeed, the overall

rate of annual cuts I set out in today's Spending Review are less

than half of those delivered over the last five years. So, Britain is

spending a lower proportion of money on welfare and a higher proportion

on the structure. The Budget balanced, with cuts half what they

were in the last Parliament, making the savings we need, no less and no

more, and providing economic security so the working people of a

country with a surplus lives within its means. This does not mean that

the decisions required to deliver the savings are easy. Nor should we

lose sight of the the Spending Review commits ?4 trillion over the

next five years. It is a huge amendment of the hard earned cash of

British tax payers and all those that dedicate their lives to public

service will want to make sure it is well spent. Our approach is not

simply retrenchment, it is to reform and rebuild. These reforms will

support our objectives for the country. First, to develop a modern,

integrated health and social care system that supports people at every

stage in their lives. Second, to spread economic power and wealth

through a devolution revolution and invest in long-term infrastructure.

Third, to extend opportunity by tackling the big social failures

that for too long have helped people back in our country. Fourth, to

reinforce national security with the resources to protect us at home and

project our values abroad. The resources allocated by this Spending

Review are driven by these four goals. The first priority of this

government is the first priority of the British people, the National

Health Service. The Health Service was cut by the Labour administration

in Wales, but we, the Conservatives, have been increasing health spending

in England. In this Spending Review, we do so again. We will work with

our health professionals to deliver the very best value for that money.

That means ?22 billion of efficiency savings across the service, it means

a 25% cut in the Whitehall Budget for the Department of Health, it

means modernising the way we fund students of health care. Today,

there is a cap on student nurses. Over half of all applicants are

turned away and it leaves hospital is relying on agencies and overseas

staff. We will replace direct funding with loans for new students

so we can abolish this self-defeating cap and creativity

10,000 new training places in this Parliament. Alongside these reforms,

we will give the NHS the money it needs. We made a commitment to a ?10

billion real increase in the health service Budget. We fully deliver

that today with the first ?6 billion delivered up front, next year. It

fully funds the five-year plan that the NHS put forward as its plan for

its future, as the chief executive of NHS England, Simon Stephen, said,

the NHS has been heard and actively supported. Let me explain what that

means in cash. The NHS Budget will rise from ?101 billion today to ?120

billion by 2020-21. This is a half ?1 trillion commitment to the NHS

over this Parliament, the largest investment in the health service

since its creation. So, we have a clear plan for improving the NHS. We

fully funded it and, in return, patients will see more than ?5

billion of health research in everything from genome is to

antimicrobial resistance, to a new dimension Institute and a new

world-class public health facility in Harlow, and more. 800,000 more

elective hospital admissions. 5 million more outpatient

appointments. 2 million more diagnostic tests. New hospitals

funded in Cambridge, Sandwell and Brighton. Cancer testing within four

weeks and a brilliant NHS available seven days a week. Mr Speaker, there

is one part of our NHS that has been neglected too long, and that is

mental health. I want to thank the all-party group, led by my right

honourable friend for Sutton Coldfield, the right honourable

member for North Norfolk and Alistair Campbell, for their work in

this vital area. In the last Parliament we made a start by laying

the foundations for equality of treatment with the first-ever

waiting time standards for mental health. Today we are building on

that with ?600 million of additional funding, meaning that by 2020

significantly more people will have access to talking therapies,

perinatal mental health services and crisis care. It is all possible

because we made a promise to the British people to give our NHS the

funding it needs. In this Spending Review, we have delivered. Mr

Speaker, the Health Service cannot function effectively without good

social care. Many local authorities are not going to be able to meet the

growing social care needs unless they have new sources of funding.

That, in the end, comes from the taxpayer. In future, those local

authorities who are responsible for social care will be able to levy a

new social care precept of up to 2% of council tax. The money raised

will have to be spent exclusively on adult social care and if all

authorities make full use of it it will bring almost ?2 billion more

into the care system. It is part of a major reform we are undertaking to

integrate health and social care by the end of this decade,

integrate health and social care by achieve that I am today

integrate health and social care by the Better Care Fund to support that

integration, with local authorities able to access an extra ?1.5 billion

by 2019-20. The steps taken able to access an extra ?1.5 billion

will have risen in real terms. A civilised and prosperous society

like ours should support its vulnerable citizens and that

includes a decent income in retirement. Many people have already

been auto enrolled into a pension thanks to our reforms in the last

Parliament. A booster will align contributions with the tax years.

The best way to reform pension benefits is to raise the pension age

as we are set to do in the next parliament. That allows us to

maintain a triple lock on the value of the state pension, so never again

do Britain's pensioners received a derisory increase of 75p. As a

result of our commitment to those who have worked hard all their lives

and contributed to our six IT, I can confirm that next year the basic

state pension will rise to ?119 30 a week. That is the biggest increase

to the basic state pension in 15 years. Taking all of our increases

together, over the next five years pensioners will be 1000 ?100 better

off year than when we came to office. We are also undertaking the

biggest change in the state pension for 40 years, to make it simpler and

fairer, to introduce a new pension. It will be higher than the current

meantime -- means tested benefits and an example of a progressive

government in action. Instead of cutting the savings credit, it will

be frozen at its current level where income is unchanged. The first

objective of this Spending Review is to give unprecedented support to

health, social care and to our pensioners. The second is to spread

economic power and wealth across our nation. In recent weeks, great

metropolitan areas such as Sheffield, Liverpool, the Tees

Valley and the North Midlands has joined Greater Manchester in

creating mayors. It's the most determined effort to change the

geographical imbalance which has bedevilled the British economy over

half a century. We are setting aside ?12 billion for the local growth

fund and I am announcing the creation of 26 new or extended

enterprise zones including 15 zones in towns and rural areas from

Carlisle to Dorset and Ipswich. If we really want to shift power in our

country, we have to give all local councils the tools to drive business

growth in their area and the rewards that come when you do so. I can

confirm today, that as we set out last month, we will abolish the

uniform business rate. By the end of the parliament, local government

will keep all of the revenues from business rates, will give councils

the power to cut rates and make their area more attractive to

business and elected mayors will be able to raise rates provided they

are used to fund specific infrastructure projects, supported

by the local business community. Because the amount we raise in

business rates is in total much greater than the rates we give to

councils through the local government grants, we will phase

that grant out entirely over this Parliament. We will also devolve

additional responsibilities. The temporary management fee will no

longer be paid through the benefit system. Instead, councils will

receive ?10 billion a year up front to provide more help for homeless

people, alongside savings in the public health grant, we will consult

on transferring new powers and the responsibility for its funding and

elements of the administration of housing benefit. Local government is

sitting on property worth a quarter of a quarter of ?1 trillion. We will

let councils spend 100% of the receipts of the assets they sell to

improve local services. Councils increase their reserves by nearly

?10 billion over the last Parliament. We will encourage them

to draw on their reserves as they undertake reforms. Mr Speaker, this

amounts to a big package of new powers, but also new

responsibilities for local councils. It is a revolution in the way we

govern this country, and if you take into account both the falling grant

and rising counselling comes, it means by the end of this Parliament,

local government will be spending the same in cash terms as it does

today. Mr Speaker, the devolved administrations of the United

Kingdom will also have available to them unprecedented new powers to

drive their economies. The conclusion last week of the

political talks in Northern Ireland means additional spending power for

the executive to ensure the full implementation of the Stormont House

agreement. But opens the door to the devolution of corporation tax which

the parties confirmed have said they wished to set at 12.5%. That is huge

prize for business in Northern Ireland and the onus is on the

Northern Ireland Executive to play their part and deliver sustainable

budget so we can move forward on that. Northern Ireland's block grant

will be over ?11 billion and funding for new capital in will rise over

five years, ensuring Northern Ireland can invest in its long-term

future. For years, Wales has asked for a slender in -- funding floor to

protect spending. Now this Conservative government is answering

that call and providing that historic funding guarantee for

Wales. I can announce today we will introduce the new funding floor and

set it for this Parliament at the Welsh Secretary and I have also

confirmed that we will legislate so the devolution on income tax can

take place without a referendum. We will also help fund a new Cardiff

City deal. The Welsh block grant will reach ?15 million by 2019-20

while the capital spending will rise over ?900 million over five years.

As Lord Smith confirmed, the Scotland Bill meets the vow made by

the parties... Mr Speaker, it must be underpinned by a fiscal framework

that is fair to all taxpayers and we are ready now to reach an

agreement. The ball is in the Court of the Scottish government. Let's

have a deal that is fair to Scotland, said the UK and is built

to last. We are and entering the city deal for Glasgow and

negotiating deals with Aberdeen and Inverness as well. If Scotland had

voted for independence, they would have had their own Spending Review

this autumn. With world oil prices falling, and revenues from the North

Sea forecast by the OBR today to be down 94%, we would have seen

catastrophic cuts in Scottish public services. Thankfully, Scotland

remains a strong part of a stronger United Kingdom. So the Scottish

block grant will be over ?30 million and 2019-20, while capital spending

available will rise by ?1.9 billion through to 2021. UK government

giving Scotland the resources to invest in its long-term future. For

the UK government, the funding of the Scotland, Wales and Northern

Ireland offices, we'll all be protected in real terms. Mr Speaker,

we are devolving power across our country and will also spending on

economic infrastructure that connects our nation. That is

something Britain has not done enough for a generation. Now by

making the difficult decisions to save on day-to-day costs, we can

invest in new roads, roadways, signs and flood defences that Britain

needs. We made a start in the last and in the last year, Britain topped

a league table of the best places in the world to invest in

infrastructure. The Department for transport's operational budget will

fall by 37%. Transport capital spending will increase by 50% to a

total of ?61 billion, the biggest increase for a generation. That

funds the largest road investment programme since the 1970s, for we

are the builders. It means the construction of High Speed Two, to

link the Northern Powerhouse to the south can begin. The electrification

of lines like the trans-Pennine, the Midland mainline and the great

Western can go ahead. We will fund our new transport for the North to

get it up and running. London will get an ?11 billion investment in its

transport infrastructure, and having met with my honourable member for

Folkestone and other Kent MPs, I will relieve the roads in

Folkestone and other Kent MPs, I operation Stack with the new quarter

of the billion pound investment in new facilities there. We are making

a new ?300 million commitment to cycling that we promised, and we

will be spending over ?5 million on roads maintenance in this

Parliament. Thanks to the incessant lobbying from my Honourable friend

from Northampton North, Britain now has a permanent pothole fund.

Mr Speaker, we are investigating in the transport we need and the flood

defences as well. DEFRA's day-to-day budget. 15% in this Spending Review,

but we are committing ?2 billion to protect 300,000 homes from flooding.

Our commitment to farming and the countryside is reflected in the

protection of funding for our national parks and our forests. We

will not national parks and our forests. We

again! I can tell the House that in recognition of the higher cost they

face, we will continue to provide ?50 of the water bills of Southwest

water customers for the rest of this Parliament, a Conservative promise

made to the south-west and a promise kept. Mr Speaker, investing in the

long-term economic infrastructure of this country is a goal of our

spending reviewed and there is no more important infrastructure than

energy. We are doubling our spending on energy research with a commitment

to Smallman modular nuclear reactors. Also supporting the shale

gas industry to assure that communities benefit from a shell

wealth fund which could be worth up to ?1 billion. Support for low

carbon energy and renewables will more than double. The sale of

ultralow emission vehicles will continue to be supported. In light

of the slower than expected and the introduction of emissions testing,

we will remove the testing of diesel vehicles until 2021. We are

increasing our support for vehicles until 2021. We are

finance. Day-to-day resource urge it will fall I20 2%. We will reform the

renewable heat incentive to will fall I20 2%. We will reform the

our energy industries such as steel to keep them here. We will introduce

a cheaper energy efficiency scheme. This will save ?30 a year from the

energy bills of 24 million households. This government believes

going green should not cost the earth. We are putting other builders

of. We will bring reforms to the compensation culture around minor

motor accident injuries. We expect the industry to pass on the savings

are most see an average saving of 40 to ?50 every year of their insurance

bills. Mr Speaker, this is a government that backs all our

businesses, large and small, and we on this side of

businesses, large and small, and we that there is no growth, no jobs

without a vibrant private sector and successful entrepreneurs. This

Spending Review delivers what business needs. Business needs

competitive taxes. I have already announced a reduction in our

corporation tax rate to 18%. Our overall view of business rates will

report in the Budget but I am helping 600,000 of our smallest is

Mrs by extending our rate relief scheme for another year. Businesses

also need an active and sustained industrial strategy and that

strategy launched in the last Parliament continues in this one. We

commit to the same level of support for our aerospace and automotive

industries, not just for the next five years, but for the next decade.

Spending on our new catapult centres will increase. We will support the

cash support we give through Innovate UK, something we can afford

to do by offering ?165 million of new loans to companies, instead of

grants, as France has successfully done for many years. It is one of

the figures that has helped us reduce the Budget by 17%. In the

modern world, one of the best ways you can back business is by backing

science. That is why in the last Parliament hide protected the

resource Project for science in cash terms. In this Parliament I am

protecting it in real terms, so it rises to ?4.7 billion. That is ?500

billion more by the end of the decade, alongside the capital

Budget. We are funding the new Institute in Manchester and the new