PM warns of difficult path to reshaping economy as union brands speech ‘nothing but hot air’

Boris Johnson said he would unleash the “unique spirit” of the country as he set out on the “difficult” process of reshaping the British economy.

The Prime Minister used his Conservative Party conference speech to say he has the “guts” to reshape society, addressing issues which had been dodged by previous administrations.

With shortages of lorry drivers and other workers hitting supply chains, leading to empty shelves and queues at petrol stations, Mr Johnson defended his strategy of restricting the supply of cheap foreign labour after Brexit.

And despite a looming National Insurance rise for millions of workers in April to fund a £12 billion annual investment in health and social care, Mr Johnson insisted his new approach would ultimately create a “low-tax economy”.

“That’s the direction in which the country is going now – towards a high-wage, high-skilled, high-productivity and, yes, thereby a low-tax economy. That is what the people of this country need and deserve.

“Yes, it will take time, and sometimes it will be difficult, but that is the change that people voted for in 2016.”

Setting out the need for the health tax hike, Mr Johnson said: “We have a huge hole in the public finances, we spent £407 billion on Covid support and our debt now stands at over £2 trillion, and waiting lists will almost certainly go up before they come down.

“Covid pushed out the great bow wave of cases and people did not or could not seek help, and that wave is now coming back – a tide of anxiety washing into every A&E and every GP.

“Your hip replacement, your mother’s surgery … and this is the priority of the British people.”

The rising tax burden has caused concern among the Tories, but Mr Johnson told activists in Manchester: “I can tell you – Margaret Thatcher would not have ignored the meteorite that has just crashed through the public finances.

“She would have wagged her finger and said: ‘More borrowing now is just higher interest rates, and even higher taxes later.’”

The 44-minute keynote address came as the Government implemented its £20-a-week cut in universal credit as the temporary uplift in the benefit over the pandemic ended.

Mr Johnson used his speech, which was largely devoid of major policy announcements, to spell out what his “levelling-up” agenda means.

“The idea in a nutshell is you will find talent, genius, care, imagination and enthusiasm everywhere in this country, all of them evenly distributed – but opportunity is not,” said Mr Johnson.

“Our mission as Conservatives is to promote opportunity with every tool we have.”

He promised a “levelling-up premium” of up to £3,000 to get “the best maths and science teachers to the places that need them most” to boost the life chances of children from poorer areas.

Setting out his brand of “radical and optimistic” conservatism, Mr Johnson also promised action to address long-standing problems in the supply of housing – an issue which has been contentious in his party, with proposed planning reforms blamed for the Chesham and Amersham by-election defeat in June.

Mr Johnson said it had been a “scandal” that the “dream of home ownership” had receded in the past 20 years.

Mr Johnson said the housing needed could be built “not on green fields, not just jammed in the South East” but on brownfield sites “in places where homes make sense”.

Prime Minister Boris Johnson was joined by his wife Carrie on stage following his speech (Peter Byrne/PA)The Prime Minister said Team GB’s second place in the Paralympics medal table demonstrated a country that was “proud to be a trailblazer” and “to judge people not by where they come from but by their spirit, what is inside them”.

“That is the spirit that is the same across this country in every town and village, that can be found in the hearts and minds of kids growing up everywhere, and that is the spirit we are going to unleash,” the Prime Minister said.

Confederation of British Industry director-general Tony Danker said Mr Johnson warned the economy is at a “fragile moment” and called for more detail of the Prime Minister’s approach.

“The Prime Minister has set out a compelling vision for our economy. High wages, high skills, high investment and high growth,” he said.

“But the PM has only stated his ambition on wages. This needs to be backed up by action on skills, on investment and on productivity.

“Ambition on wages without action on investment and productivity is ultimately just a pathway for higher prices.”

Union leader brands Johnson’s speech ‘nothing but hot air’

A union leader branded the Prime Minister’s speech “full of hot air”, although business groups were more supportive.

Manuel Cortes, general secretary of the Transport Salaried Staffs Association, said: “As ever, this political jester came up with nothing but hot air.

“We had slogans over specifics at a time when costs are rising, inflation is a real worry, universal credit is reduced for millions, there are widespread food and fuel shortages and a very real climate crisis.

“As we try to move away from the shadow of Covid, the Prime Minister’s pitch will ring hollow for many. He talks about completing Northern Powerhouse Rail but is set to ditch the Eastern leg of High Speed 2.

“That’s not building back better, but short-sighted folly.

“It looks and feels as though an iceberg is heading towards our economy and Johnson is the captain of a rudderless ship incapable of steering a course to safety.”

Tony Danker, director general of the CBI, said: “The Prime Minister has set out a compelling vision for our economy. High wages, high skills, high investment and high growth.

“But the PM has only stated his ambition on wages. This needs to be backed up by action on skills, on investment and on productivity.

“Ambition on wages without action on investment and productivity is ultimately just a pathway for higher prices.

“It’s a fragile moment for our economy. So, let’s work in partnership to overcome the short-term challenges and fulfil our long-term potential. It’s time to get around the table, roll up our sleeves and get things done. It’s time to be united.”

TUC general secretary Frances O’Grady said: “If Boris Johnson was serious about levelling up Britain, he wouldn’t be slashing universal credit in the middle of a cost-of-living crisis.

“The PM is in no position to lecture people on wages when he is holding down the pay of millions of key workers in the public sector.

“And when he is doing nothing to fix the gaping hole in local authority budgets that has resulted in most social care workers being paid less than the real living wage.

“As the country’s biggest employer, the Government should be setting an example on paying staff properly – not skimping on wages.”

Unite general secretary Sharon Graham said: “Without serious action, this speech is nothing more than headline-chasing by a prime minister desperate to deflect from the serious and growing cost-of-living crisis happening on his watch.

“If the Prime Minister genuinely wants to reverse the years of insecurity and falling wages, then he knows what to do about it: establish sector bargaining to put a solid floor underneath workers’ earnings and stop the never-ending race to the bottom.”

Business Secretary Kwasi Kwarteng described the Prime Minister’s speech as “excellent”, saying it provided “very strong” vision and direction and “reasserted our view of markets, of enterprise, combined with innovation and science, really driving a future for the UK”.

International Trade Secretary Anne-Marie Trevelyan said it showed Mr Johnson would “not shy away from challenges which have to be tackled”.

West Bromwich West MP Shaun Bailey said: “I think (the Prime Minister) absolutely smashed it out of the park today in terms of touching on those really key things, particularly for areas like mine that voted Conservative for the first time in 2019. He had a message there that pitches to everyone in this country.”

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