Andrew Sparrow 

Hunt says tax credit cuts will help to teach British to work as hard as Chinese – Conservative conference live

Rolling coverage of the events at the Conservative party conference in Manchester, including George Osborne’s speech
  
  

Jeremy Hunt arriving at the Conservative conference on Sunday.
Jeremy Hunt arriving at the Conservative conference on Sunday. Photograph: Natasha Quarmby/REX Shutterstock

Summary

  • Jeremy Hunt, the health secretary, has said British people will learn how to work as hard as the Chinese and Americans because the Conservatives have cut the money people can make from tax credits. As Rowena Mason reports, speaking at a fringe meeting at the Conservative party conference, Hunt strayed from his brief to defend the government’s tax credit cuts of up to £1,300 for some of the poorest workers in the UK. Hunt told his audience that reducing tax credits was not just about saving money, and when asked whether the pace of the cuts should be slowed, he said: “No. We have to proceed with these tax-credit changes because they are a very important cultural signal. My wife is Chinese. We want this to be one of the most successful countries in the world in 20, 30, 40 years’ time. There’s a pretty difficult question that we have to answer, which is essentially: are we going to be a country which is prepared to work hard in the way that Asian economies are prepared to work hard, in the way that Americans are prepared to work hard? And that is about creating a culture where work is at the heart of our success.”

That’s all from me for today.

Thanks for the comments.

It’s unfair to pick on a Freudian slip, especially one by a rather promising new MP, so apologies to Lucy Frazer. But when she ended her remarks to a Policy Exchange fringe meeting on low income squeezed middle voters by saying the Tories could win many victories ‘if we see that people are on our side’ (I suspect she meant ‘if people see we are on their side’) she inadvertently put her finger on the problem in Manchester.

The Tories know they have a historic opportunity to reach C2 voters who don’t like what Jeremy Corbyn has to say on defence or immigration but are suspicious of Tory economic policy. What they’ve not quite grasped is that announcing you’re on working people’s side, while staying in your own comfort zone, isn’t enough; you have to visibly move towards them or it looks like you don’t mean it. With tax credit cuts for those people looming, the policy hasn’t yet caught up with the new political positioning.

George Osborne's speech - A reading list

Here are three good articles about George Osborne’s speech.

It would be an error for Labour to merely dismiss this as empty rhetoric. Rather, it must craft a positive and relevant vision that overpowers Osborne’s. And as he woos the 9.3 million who voted Labour, it should ponder what it is doing to appeal to the two million more who voted Conservative. As Osborne showed today, a good start is to stop insulting them.

What Mr Osborne is saying, then, is: allow the failing places to fail, but help people move to the boomtowns. Mothball Wolverhampton, Blackpool and Great Yarmouth and make it easier for Leeds, Milton Keynes and Cambridge (not to mention London and Manchester) to build bypasses, new railway stations, housing estates, tramlinks and cycle lanes. Why? Britain’s strength lies in city-based clusters of service industries, many employing university graduates; such places, in other words, possess the alchemical mix that allows them to capture the advantages of globalisation. Where places are failing it is usually because they are too small, too out of the way or too low-skilled. In government Labour’s answer was to let the boomtowns boom, cream off the benefit in taxes and pass it down to places without an invite to the party. Mr Osborne’s answer is different: work with the grain of economic change, not against it. Pump up the places doing well and help people in the places doing less well to relocate there and throw themselves into the forwards churn of globalisation, rather than merely compensating them for it. This carries the additional benefit of raising the national growth rate (research suggests that the biggest single reason for the gap in GDP per capita between America and Europe is that the former has more big cities); in an interview with Prospect, Jim O’Neill, a former banker now in the chancellor’s ministerial team, estimated that focusing on the big cities would “translate into an additional 0.2 per cent of GDP growth on average per year up to 2030.” Much of the broader thinking behind the move is articulated in this paper from Policy Exchange (Mr Osborne’s favourite think-tank) in 2008.

Ben Chu, the Independent’s deputy business editor, has posted a critique of Jeremy Hunt’s comment about the Chinese on Twitter.

In her speech to the conference this afternoon Amber Rudd, the energy secretary, announced that the government will work with Ofgem and Citizens Advice to strengthen the Energy Ombudsman so that it can address systemic problems in the energy industry, as well as the individual complaints it deals with now.

Here is some more reaction to George Osborne’s business rates decentralisation announcement.

From Gary Porter, chair of the Local Government Association

Today’s announcement by the chancellor is great news for councils and shows that the Government has listened to the arguments set out by local government. The LGA has long-argued that the current system of business rates needed reform so councils could effectively support small businesses and boost high streets.

Councils have been hugely restricted in their ability to introduce local discounts with government setting the charge and keeping half of business rates income. With greater local control, councils will have flexibility to reduce business rates for the types of shops and businesses that residents want in their high streets and neighbourhoods.

From Jonathan Carr-West, chief executive of the Local Government Information Unit thinktank

Today George Osborne has proved his credentials as a devolutionary chancellor. Decentralising business rates could mean greater independence for councils across the country, the opportunity for many of them to unleash their economic potential locally. Until very recently, Treasury officials were briefing that decentralising business rates was out of the question, so this represents a huge step towards a more localised tax system in line with other developed economies.

ICM has released some new polling figures on EU membership. The results are:

Remain: 42%

Leave: 38%

Don’t know: 20%

Apparently this is the lowest figure for remain since December 2013, when the question was phrased differently and the figure was 37%.

Excluding don’t knows, remain are on 52% and leave on 48%.

Liz Truss, the environment secretary, said in her speech to the conference that free markets help to preserve the environment.

It’s free markets that enable people to pursue their dreams and create prosperity.

It’s access to information and free speech that helps us understand the world and make progress.

Where people don’t have these freedoms, we have seen the greatest declines in the natural world.

With species driven to extinction and habitats despoiled.

And as countries become wealthier, they want to invest in the environment, planting trees, cleaning up rivers and tackling air pollution.

I believe that a strong economy and a healthy environment go hand in hand.

Hunt suggests people on tax credits lack dignity and self-respect

Here’s another quote from the Jeremy Hunt fringe meeting. He suggested that those reliant on tax credits and benefits lack dignity and self-respect.

Dignity is not just about how much money you have got ... Officially children are growing up in poverty if there is an income in that family of less than £16,500. What the Conservatives say is how that £16,500 is earned matters. It matters if you are earning that yourself, because if you are earning it yourself you are independent and that is the first step towards self-respect. If that £16,500 is either a high proportion or entirely through the benefit system you are trapped. It is about pathways to work, pathways to independence. It is about creating a pathway to independence, self-respect and dignity.

Here’s some footage of Boris Johnson being pelted with balls by protesters as he arrived at the Conservative conference.

Updated

The Conservative party must not move too far into the centre ground in response to Jeremy Corbyn’s victory in the Labour leadership election, former Tory defence secretary Liam Fox has said.

Speaking at a fringe event at the Conservative party conference in Manchester, focusing on how the Tories should respond to the new Labour leader, Fox said: “Nature abhors a vacuum and it’s always rapidly filled.”

The MP for North Somerset said that, unlike some of his Conservative colleagues, he was not thrilled at the news of Corbyn’s landslide victory in the Labour leadership election. “I think it concentrates the mind of the parliamentary party well if they’re having to fend off an attack from outside,” he said.

One of my worries about Corbyn is that it leads to a complacency in the [Tory] party that begins with them saying ‘we don’t have to reduce the deficit so quickly, we don’t have to do all these things as quickly because they’re a bit unpopular and a bit painful’. The next stage of that is [to say] ‘well, we’ll vote against our own party if it looks like [a policy] might not be popular because there’s no real opposition out there.

TUC says Osborne's business rates decentralisation plan could widen inequalities

The TUC says the government’s tax credit cuts are “an astonishing attack on working people”. Frances O’Grady, the TUC general secretary, made the comment in a statement giving the TUC’s overall reaction to George Osborne’s speech.

The government’s cuts to tax credits are an astonishing attack on working people. They are so severe that, even with a higher minimum wage and higher tax threshold, most low-paid families will be much worse off. But despite people from his own party urging the chancellor to think again, he has refused to listen.

The chancellor has finally recognised infrastructure investment as the priority it should have been five years ago. But if he keeps cutting public investment, then it will all be pie in the sky. We need a properly capitalised National Investment Bank to ensure the infrastructure that Britain needs gets built.

We all want more decisions to be made locally. But by devolving business rates without any national safeguards, regional inequalities will get wider. The communities that most need investment are often those with the weakest business revenue base, so it is vital that the Treasury retains a significant role in regional economic development.”

The Labour MP Graham Allen has tweeted about Jeremy Hunt’s comment about the tax credit cuts.

John McDonnell, the shadow chancellor, has now put out a statement about George Osborne’s plans to decentralise business rates. He is not ruling the idea out, but he has concerns about it.

More needs to be done on business rates and we’ll look at the detail of the reforms set out today. But people will rightly look at the record of George Osborne under whom business rates rose by around £1,500 in the last Parliament. In particular we need to ensure that the right safeguards are in place so that poorer areas of the country do not lose out on vital revenue.

The Spectator’s James Forsyth was also at the Jeremy Hunt fringe meeting. In a blog he says that Hunt also opined on how people are going to have to get used to living with their elderly relatives.

Perhaps, the most striking part of what Hunt said was his futurology. He warned that on current trends, Britain’s aging population would require 100 new care homes a month to open between now and 2020. He argued that this was simply not possible and so it needed to be made easier for elderly relatives to move in with their families. He indicated that making this easier would be a significant part of social care reform.

IFS says families on tax credits will be 'significantly worse off' from government changes

One problem that George Osborne and others have when they try to argue that most people will not lose out from the tax credit cuts is that (when other changes are taken into account too) is that they are up against the Institute for Fiscal Studies. The IFS has repeatedly highlighted how many people will lose out, and Paul Johnson, the IFS director, was at it again on the World at One.

This is what he told the programme.

It’s very clear that the average family currently receiving tax credits will be significantly worse off, even when you take account of the introduction of the higher national minimum wage.

There are different groups of people on tax credits at the moment, quite a lot of them are on the minimum wage but actually quite a lot are earning more than the minimum wage, in particular if they’re working relatively short hours or if they have several children. There’s not actually an enormously close overlap between those on the minimum wage and those on tax credits, so the gainers from the minimum wage are a very different group on average to the people losing from tax credits.

The large majority of people on low incomes on tax credits will be worse off, pretty much everyone of working age who’s out of work will be worse off, if you’re not on tax credits you’re going to gain a bit from the increase in the personal allowance and some other relatively small tax cuts. So, if you’re not on tax credits, a lot of people in that situation will be getting better off, but for those towards the bottom of the distribution, they’re clearly worse off.

I’ve taken the quote from PoliticsHome.

Here’s Larry Elliott’s Reality Check on the tax credit cuts.

Updated

Jeremy Hunt’s comment about tax credits (see 3.11pm) is likely to do down badly with his Tory colleagues because they have been trying hard to stop the tax credit cuts becoming the story of the conference.

This is Dave Prentis, the Unison general secretary, said about the issue earlier.

The government is on the back foot over tax credits and ministers know it. They keep saying that families will be better off, but figures published by the House of Commons Library, and a host of other organisations, tell a very different story.

The reality is that the incomes of almost three million working households will take a huge hit next April as the tax credits they rely on to get through each month are taken away.

Many may get a pay rise from the government’s ‘national living wage’, but will end up losing more than they gain in the tax credits grab. And families on slightly higher, but still very low incomes, will lose out significantly.

Four Comment is Free writers - Matthew d’Ancona, Jonathan Freedland, Anne Perkins and Tom Clark - have delivered their verdict here on the George Osborne speech.

Here’s an extract from Jonathan’s piece.

“Power to the people,” he cried out, daring an echo of Citizen Smith that would have brought derision on Jeremy Corbyn had he tried it. He was proclaiming a “devolution revolution”, invoking the 19th-century era of municipal muscle. He went further, lauding the activism and enterprise, the constant building, of the Victorian age. He had changed, he said. No longer obsessed with restraining government, now he could see its potential to do good. He wants his party to match its 19th-century forebears in engineering, in infrastructure, in building. It seems the ambition of George Osborne is unbounded.

Here is the full quote from Jeremy Hunt about how the tax credit cuts are partly about teaching the British that they need to work as hard as the Chinese.

We have to proceed with these tax credit changes because they are a very important cultural signal. We want this to be one of the most successful countries in the world in 20, 30, 40 years’ time. There’s a pretty difficult question that we have to answer which is essentially: are we going to be a country that is prepared to work hard in the way that Asian economies are prepared to work hard, in the way that Americans are prepared to work hard? And that is about creating culture where work is at the heart of our success.

Hunt says tax credit cuts will help to teach British they need to work as hard as Chinese or Americans

Jeremy Hunt, the health secretary, has been speaking at two fringe events organised by the Times and Reform at which he roamed beyond his health brief to talk about tax credits, public service cuts and the wider political scene. He said:

  • Childhood obesity is a “national disgrace” closely correlated to social class, and there needs to be a stronger nanny state on this issue including interventions in schools and a bigger role for the BBC in educating children. (Former public health minister Anna Soubry has got in trouble for linking weight and class in the past - studies have mixed results about whether there is a correlation.)
  • It is going to be much tougher to make cuts without damaging public services in this parliament and the only way to make it work is fundamental reforms of how they work.
  • The government must press ahead with tax credit cuts because they are an “important cultural signal” to people in the UK that they should be prepared to work as hard as the Chinese and Americans.
  • Jeremy Corbyn is bad news for the right because there is no longer cross-party consensus on big issues and the Tories will have to remake and win basic arguments.
  • He would like to see computers play a bigger role in diagnosis to help free up doctors for cases where their judgement is really needed, citing a US hospital that drew inspiration from Toyota production methods.
Jeremy Hunt arriving at the Conservative conference yesterday
Jeremy Hunt arriving at the Conservative conference yesterday Photograph: Natasha Quarmby/REX Shutterstock

Tony Travers says Osborne reforms will lead to tax competition amongst councils

Tony Travers, the academic and local government expert, is on BBC News now. He says George Osborne’s announcement is quite radical.

It will create an incentive for regions to get an elected mayor, he says.

But Osborne is also encouraging councils to cut tax. That will lead to tax competition between areas, which is something we have not seen in the UK for a long time, he says.

He says the Conservatives have outplayed Labour on this. Labour has not really got a policy on decentralisation, he says. That is why Labour northern council leaders are working with a Conservative chancellor.

And he points out that these changes will only apply to England. Scotland and Wales will have to decide if they want to follow, he says.

Here is Nicholas Watt’s story about the Osborne speech. And here’s how it starts.

George Osborne has announced the biggest transfer of power from central to local government in recent history by allowing councils to retain all the money they raise from business rates – a total of £26bn.

In the most dramatic move in his bid to devolve power from Whitehall as he creates a “northern powerhouse”, the chancellor will allow councils to decide how to spend the revenue and to lower rates to attract new business.

The changes, which undo one of Margaret Thatcher’s last legacies when her government introduced the national business rate in the 1988 Local Government Finance Act, have long been demanded by local authority leaders who say they need greater flexibility over their finances.

My colleague Larry Elliott has been fact-checking George Osborne’s claim that families will be on average £2,000 a year better off under government policies. Larry is not impressed. How did Osborne come to that conclusion, he asks. “By throwing in everything and by blurring the distinction between those gaining and losing from the changes.”

David Gauke, the Treasury minister, is on BBC News now. He points out that city-wide mayors will only be able to use the new power to introduce a new infrastructure tax - an extra 2p on the business rate - if they have the support of a majority of business members on the local enterprise partnership.

That means, in practice, that local business will have a veto over any proposal to levy this new tax.

The Ukip take on George Osborne’s speech is quite similar to the Daily Mail’s. (See 10.52am.) This is from Andrew Charalambous, Ukip’s housing and environment spokesman.

The chancellor has once again failed to announce any kind of meaningful set of policies designed to make brownfield investment more attractive than greenfield. The Tories who once promised to save the British countryside have consistently proved that they have no such intention. Neither do they have the ideas or wisdom to spur the UK towards a much needed brownfield revolution.

Len McCluskey, the Unite general secretary, has criticised George Osborne for not addressing issues like tax credits in his speech.

Chancellor George Osborne’s speech to his party conference failed to tackle the issue of a faltering recovery; the looming swingeing cuts to working tax credits; the ballooning of the national debt; and the fact this government created the longest fall in real living standards since the 1870s.

Osborne continues to peddle his snake oil but the reality is that he has made a clear and heartless choice to make the poor pay through slashing the working tax credits while giving the rich a handout. The combined cost of his cuts in inheritance tax and corporation tax from the this summer was £3.415m, which is enough not to make any cuts to in work support. So he has made a deliberate choice to make millions of working people over £1,000 worse off, while a few thousand millionaires get to hold onto their wealth.

The Institute of Directors has welcomed the business rates decentralisation. But that is partly because it is hoping that this will lead to business rates going down, its statement suggests. This is from Simon Walker, the IoD director general.

We hope this new deal will pave the way for councils to use these new powers to attract businesses and regenerate high-streets. While businesses support devolution, they will not stand for local politicians using it as an excuse to hike taxes. More than half of IoD members were concerned devolution would lead to higher taxes. Councils must avoid the temptation to increase rates to raise revenues, and instead compete to attract businesses to the area, which will bring jobs and wealth.

The full IoD reaction to the speech is here.

Here is Richard Murphy, the tax campaigner who is now offering policy advice to Jeremy Corbyn, has responded to Osborne’s devolution plans on Twitter.

IPPR North, a left-leaning thinktank, has welcomed George Osborne’s decision to decentralise business rates, but warned that steps will need to be taken to protect poorer areas. This is from its director, Ed Cox.

George Osborne should be applauded for taking the devolution agenda into a new bold frontier by giving local areas new powers over business rates.

The real prize of the devolution agenda is for local areas to have powers over how they collect, raise and spend revenues and this is an important first step towards that goal ...

But the chancellor needs to set out what this will mean for the revenue support grant and its overall redistributive impact on local government finance ahead of the spending review.

Unless we retain some redistributive mechanism, there is a significant risk it will starve poorer areas of crucial support and allow wealthier ones to collect all the riches.

McDonnell says Redcar omission shows Osborne 'doesn't live in the real world'

John McDonnell, the shadow chancellor, has issued his response to George Osborne’s speech. Here it is in full. He does not say anything about the business rates reform.

George Osborne spoke for 30 minutes and didn’t mention Redcar once. This is a Tory chancellor who doesn’t live in the real world.

He spoke of slaying dragons more than he spoke of how working people in the north east, who feel abandoned by this Tory government, are seeing their industry and way of life under attack.

He said the Tories are the ‘builders’ but he has sat on the side lines for the last five years and failed to tackle the housing crisis in this country – as a result housebuilding is at its lowest level in peacetime since the 1920s.

It was very disappointing that the chancellor also had nothing to say to those people living in the real world who are seeing their tax credits cut by £1,300 a year, and who are struggling to pay sky high rents or are struggling to find enough work to get to the end of each month.

Instead, he spoke to the few, those millionaires sitting in the hall who will benefit from an inheritance tax cut he is giving them, and to those bankers who were also sat alongside them in the hall who’ll benefit from income and corporation tax cuts.

Angela Eagle and I are in Redcar today meeting people who will be looking at that speech and won’t be fooled by Osborne’s smoke and mirrors. They want substantive answers in the here and now and sadly George Osborne failed to offer them any today.

And here are more details about how the new system will be introduced from a Tory briefing note.

  • The system of transfers, that ensures that councils that raise large sums from business rates help those that raise much less, will remain in place on day one when the new system comes into force. But, after that, councils that increase the amount they raise from business rates will not be expected to hand over any more. Here is the precise quote from the briefing:

The established transfers will be there on day one, but thereafter, the growth in revenue will be kept in that local authority.

  • Since 2013 East Midlands has been the area with the fastest growth in business rates revenue. Yorkshire has been the area with the second largest growth.
  • Since 2013 councils have been allowed to retain 50% of business rates. But in practice some authorities only get 25% of the extra business rate revenue they generate (ie, £25 for extra £100 raised) because of the amount they are expected to hand over.
  • Full devolution of business rates will give councils control of an extra £13bn by 2020.
  • Mayors will need the support of a majority vote of business members of the local enterprise partnership if they want to use the new power to introduce a business rate premium.

Updated

Here is the Treasury news release with more details of George Osborne’s plans to given councils full control of business rates. It says:

  • By 2020 councils will retain 100% of local taxes, including the £26bn from business rates.
  • The uniform business rate will be abolished.
  • The core grant from Westminster will be phased out.
  • Directly-elected mayors will be able to add a premium to business rates for spending on infrastructure - probably set at 2p on the rate.
  • The new powers will involve new responsibilities for councils.
  • The reforms will be fiscally neutral.

Willie Bain, the former Labour MP, says devolving power over business rates represents another Labour idea that George Osborne has lifted.

Here’s an extract from a Labour news release explaining their 2015 policy.

[Ed Balls] will also pledge that a Labour Treasury will allow city and county regions which come together in combined authorities to keep 100 per cent of extra business rates revenue generated by additional growth. They will then be able to invest this to support further business growth in their regions.

The Labour policy was about allowing councils to keep the extra business rates revenue generated by growth. George Osborne was apparently talking about allowing councils to keep all business rates revenues.

But the gap between the two policies may not be as large as those statements suggest, because Tory sources are saying there would still be some mechanism for transfers between poor and rich areas. I will post more details as I get them.

Here is some reaction from journalists to the business rates announcement.

From the Economist’s Jeremy Cliffe

From the FT’s Brian Groom

From the Evening Standard’s Pippa Crerar

The academic Gerry Hassan says there was some Nye Bevan in George Osborne’s speech too.

Updated

The Lib Dems point out that George Osborne’s announcement is the culmination of a review of business rates announced by Danny Alexander, the then chief secretary to the Treasury, shortly before the election.

More from the background briefing.

Tory sources have given more information about the proposal to let cities with mayors levy a new infrastructure charge. (See 12.26am.) They say mayors will be allowed to raise business rates by up to 2p in the pound.

Andy Burnham, the shadow home secretary, says there is a contradiction at the heart of George Osborne’s speech.

George Osborne's speech - Snap verdict

George Osborne’s speech - Snap verdict: In the hall George Osborne’s speech seemed to fall a bit flat, but that is because no one in history has ever given an exciting speech about local government finance, and yet, bravely, Osborne chose to put business rates reform at the heart of his address to the conference. In a speech like this it is common for politicians to over-hype their announcements, to pretend that they are more important than they really are, but this was a genuine biggie. Osborne called it “the biggest transfer of power to local government in living memory”, and that seems fair. The implications are considerable - and potentially worrying for areas with little business revenue - and I will be covering reaction and analysis as it comes in.

Otherwise? It was striking how little there was about the general state of the economy in the speech, and Osborne ignored the tax credits problem entirely, even though it is becoming one of the stories of the conference. Instead we got a thoughtful overview that will do nothing to dispel claims Osborne is building himself up as a future prime minister. As well as a hint of Ronald Reagan (see 11.58am), there was some Thatcher in his home-owning, share-owning democracy rhetoric. But the business rates reforms actually represent a rolling back of a key Thatcherite nationalisation, and it was interesting to note too how much effort he put into appealing to Labour voters. (See 12pm.)

Updated

And here’s Osborne’s peroration.

We live in this great prosperous, peaceful, political democracy.

Precisely because those who came before us did their job.

Because they established factories and built cathedrals and laid railways.

Because they conducted experiments and made scientific breakthroughs and conquered disease.

Because they compiled encyclopaedias, wrote poetry and invented computers.

Because they set sail from these lands, fought tyrants and opened Britain to the world.

Now it is our turn ...

Some people stand on the sidelines.

Some want to knock things down.

We are the builders.

Osborne says city mayors will be able to levy a new infrastructure tax

Osborne says cities with mayors will be able to levy a new infrastructure tax too.

And for those big cities with elected mayors, like London, Manchester and now Sheffield, I will go even further.

Provided they have the support of the local business community, these mayors will be able to add a premium to the rates to pay for new infrastructure and build for their cities’ future.

Yes, further savings to be made in local government, but radical reform too.

So an end to the uniform business rate.

Money raised locally, spent locally.

Osborne says uniform business rate will be abolished

And he adds another important detail - the uniform business rate will be abolished.

And to help local people do that I want to make another announcement today.

We’re going to abolish the uniform business rate entirely.

That’s the single, national tax rate we impose on every council.

Any local area will be able to cut business rates as much as they like…

…to win new jobs and generate wealth.

It’s up to them to judge whether they can afford it.

It’s called having power and taking responsibility.

Osborne explains how this will work.

Right now, we collect much more in business rates than we give back in the main grant.

So we will phase out this local government grant altogether.

But we will also give councils extra power and responsibilities for running their communities.

The established transfers will be there on day one, but thereafter, all the real growth in revenue will be yours to keep.

So this is what our plan means.

Attract a business, and you attract more money.

Regenerate a high street, and you’ll reap the benefits.

Grow your area, and you’ll grow your revenue too.

Osborne says councils to keep all revenue they collect from business rates

Osborne announces he is letting councils keep the revenue from business rates.

But we can go much, much further, here in the north and around the country.

While everyone knows this country has to live within its means - and that means savings in local as well as national government - I want to make sure that as we make these necessary savings we use this moment to undertake far-reaching reform.

Right now we have the merry go-round of clawing back local taxes into the Treasury and handing them out again in the form of a grant.

In my view, proud cities and counties should not be forced to come to national government with a begging bowl.

So I am announcing this:

Today I am embarking on the biggest transfer of power to our local government in living memory.

We’re going to allow local government to keep the rates they collect from business.

That’s right, all £26bn of business rates will be kept by councils instead of being sent up to Whitehall.

Updated

That’s why I am so committed to the Northern Powerhouse.

I’m throwing everything I’ve got at it.

I’ve brought new science here…

… promoted the arts here…

… backed transport links here…

… brought investment from places like China here.

I don’t know if it will work.

But I do know that if you don’t even try you’re bound to fail.

Osborne explains his commitment to the northern powerhouse concept. And he says he has changed in the last five years; he has become more aware of the power of government.

There’s one other problem our country faces that is so deep-seated, and so difficult that no government has really tried to solve it before.

And that’s the gap between north and south, between London and the rest.

I grew up in the middle of London.

And l grew up with the cliché that if it wasn’t happening in London then it wasn’t happening at all.

Becoming an MP in the North of England has changed me - made me realise that great as our capital is - there is so much more to this country.

And I’ve changed in the five years I’ve done this job too.

I’ve always been able to see the problems with government.

Now I understand too the power of government to drive incredible, positive change.

Osborne says the EU must change too.

It’s because we’re not afraid to confront the big issues that we’ve taken on reform in the European Union.

I don’t want the continent that gave us Isaac Newton and Leonardo da Vinci and Marie Curie, to say we’ve given up on the future.

We joined the Common Market because it offered us the promise of jobs and growth.

What it represents to many people across Europe these days is unemployment and stagnation.

That must change.

Osborne says his new national infrastructure commission will start work today.

Some stand on the sidelines.

Some want to knock things down.

We are the builders.

Osborne announces plans for British Wealth Funds.

We are going to find new ways to fund the British infrastructure that drives our productivity.

At the moment, we have 89 different local government pension funds with 89 sets of fees and costs.

It’s expensive and they invest little or nothing in our infrastructure.

So I can tell you today we’re going to work with councils to create instead half a dozen British Wealth Funds spread across the country.

It will save hundreds of millions in costs, and crucially they’ll invest billions in the infrastructure of their regions.

And I’m increasing asset sales to ensure we’re spending a greater proportion of our national income on capital investment than the last Labour government ever did.

Osborne turns to housing.

We’ll give housing association tenants the right to buy.

We’ve had enough of people who own their own home lecturing others why they can’t own one too.

I’m proud that we’re the ones giving more than a million people the chance to have a house of their own.

And if anyone wants to argue with us on that, I say bring it on.

Osborne turns to infrastructure. Elizabeth Gaskell wrote her novel Cranford in his Tatton constituency, and it is about opposition to a railway.

And today, there are some people in my constituency who want to stop our new high-speed railway.

I respect their opposition – but I also respectfully disagree.

Where would Britain be if we had never built railways or runways, power stations or new homes?

Where will be in the future if we stop building them now?

I’m not prepared to turn around to my children or indeed anyone else’s child, and say: I’m sorry, we didn’t build for you.

Osborne says it is disappointing that Labour cannot give the Tories credit for measures that promote social justice.

I’ll always pay tribute to the role the Labour movement played in building the NHS and establishing rights in the workplace.

But that sits alongside the equally proud story of Conservative social justice.

The National Living Wage is the latest page in that story.

For it was Conservatives in previous Governments that ended the slave trade;

That stopped children working in factories and gave them universal education;

That gave equal votes to women…

… and equal rights to disabled people.

Now it’s Conservatives in this government that have banned modern slavery;

Legislated for gay marriage;

Given new shared employment rights to parents and today extend them to grandparents too;

It’s now Conservatives in this Government who are shining a light into the darkest corners of our prisons and bringing the best education to the poorest of our children.

Osborne describes going to a job centre the last time he was in Manchester.

It was exciting hearing people talk about finding work, he says.

He says he has increased the tax allowance to help people like those he met. And the national living wage will give people a pay rise.

Osborne turns to Jeremy Corbyn’s plan to consider the case for quantitative easing.

The British people have heard the argument that the deficit doesn’t matter and they’ve rejected it.

They’ve listened to politicians who forgot to mention the deficit, and they’ve rejected them too.

Now we’re told that instead of earning the money we need to spend, the Bank of England can simply be told to print it.

What could be easier than that?

We hear them say.

What could be easier than that?

They said in Zimbabwe and Weimar Germany too.

It’s not monetarism - it’s magic money-tree-ism.

And let me tell you messing around with the independence of the Bank of England and letting inflation rip destroys savings and is a massive risk to the economic security of every working family.

And he adds a joke.

Mind you, I’d better be careful not to disagree with Jeremy Corbyn about absolutely everything or else he’ll invite me to join his Shadow Cabinet.

That joke probably works better on paper than it did when Osborne delivered it, because it fell a bit flat.

Osborne defends aid spending.

Some people question our commitment to the aid budget but with millions fleeing war zones, and a crisis in Europe, I’m not prepared to cut it.

I want to spend our aid better so it helps the most vulnerable closer to their homes.

And he confirms his commitment to spend 2% of national income on defence.

Osborne turns to today’s announcement about the sale of Lloyds shares.

With Labour the banks went bust - we’re fixing them.

With Labour the debt soared - we’re going to bring it down.

Labour have now turned their back on opportunity and aspiration - we’re going to build the share owning democracy this Party has always believed in.

Osborne says the Tories are the builders.

To borrow from an American President, we choose to take on these things not because they’re easy, but because they’re hard.

And he says there will be a vote in the Commons on his fiscal charter establishing a rule that the government should run a surplus next week.

Osborne says the Tories have shifted the terms of the national debate.

We’ve established the idea that government can’t go on spending money it hasn’t got.

The idea that businesses need to be competitive and make profits to create jobs.

The idea that you don’t show your compassion by the size of the benefit cheque you dole out, rather you get people back to work.

That’s what we built together.

Every argument we won, another business started…

… another person got a job…

… another academy school opened…

… another family felt the security of work.

Every argument we won, we have shifted the terms of the debate in our country and created a new centre ground, around fiscal responsibility and lower welfare, reformed public services and support for business too.

Osborne says the Tories are working for working people, including for people who voted Labour.

He says the party has to win over these people.

They want security and opportunity, but they didn’t quite feel able to put their trust in us.

We’ve got to understand their reservations.

So to these working people who have been completely abandoned by a party heading off to the fringes of the left let us all here today extend our hand.

Do you know what the supporters of the new Labour leadership now call anyone who believes in strong national defence, a market economy, and the country living within its means?

They call them Tories.

Well, it’s our job to make sure they’re absolutely right.

Osborne changes tone.

But, friends, it is precisely in our hour of greatest success that I choose to come here to deliver a warning.

A warning for us all to heed.

It is this:

Don’t let us rest on our laurels.

The British people have not put us here to congratulate ourselves.

They have put us here to do a job.

The lesson of the last five years, and the victory that followed, is that the future favours the bold.

So we’ve got to be the builders, the people with the new ideas.

The people open to the new thinking.

Ready to listen.

Admit where we get it wrong.

Accept when others have got it right.

The people with the plan for the future.

Osborne used the “future favours the bold” line on the BBC this morning. It is reminiscent of Ronald Reagan’s line in his Challenger address about how the future does not belong to the faint-hearted, it belongs to the brave.

Osborne thanks David Cameron for his personal support.

There were moments when lots of people had doubts whether our plans would work moments, as I was well aware, when people had doubts about me.

But one person always backed me in private and in public, and never wavered in their support.

I want to thank him.

That is the person who’s led our country with integrity, intelligence and imagination.

My friend, our Prime Minister: David Cameron

He also says that the election victory “earns him [Cameron] a place in the very highest rank of our party’s leadership”.

Osborne praises the activists for their work in the election.

And he deploys an Edstone joke.

And I’ve been asked to pass on a special thanks.

From the maintenance team at Downing Street.

They want to thank you that they don’t have to put up an eight-foot high tombstone in the back garden.

And what the British people said to us in May couldn’t have been clearer:

We elect you to do a job.

So take decisions, don’t duck them.

And the truth is this:

If you do take those decisions - even if the decisions are unpopular and bitterly opposed at the time -

If you do take the decisions and they are rooted in your values and turn out to be the right ones, then people will go on putting their trust in you.

That’s the lesson of the last Parliament.

That’s the lesson for this one.

Osborne says he was not far from here on the night of the election, when the exit poll was announced. He was waiting to go to his count at the Macclesfield leisure centre.

At these moments politicians are powerless. It is in the hands of the British people, he says.

Politicians take their instructions from the people. We will not let you down, he says.

Osborne says he is proud to be the first Conservative chancellor in a Conservative government addressing a Conservative conference for 18 years.

And if 12 months ago he had said the MP for Morley and Outwood would have been introducing him, someone would have called security.

George Osborne is coming on stage now.

Updated

Jenkyns says, as a northern, she is delighted that Osborne is creating a northern powerhouse.

Osborne has rescued the economy, he says.

Andrea Jenkyns, the Tory MP who beat Ed Balls in Morley and Outwood, is introducing George Osborne.

She says she campaigned for two years to win the seat.

George Osborne's speech

George Osborne, the chancellor, will be giving his speech shortly.

The Mail’s Andrew Pierce says in part it will be a job application.

Whittingdale says BBC should no longer be allowed to regulate itself

In his speech to the Tory conference John Whittingdale said that the BBC should no longer be allowed to regulate itself.

Some I have no doubt are in this hall today. And I know from the many letters and conversations that I have had that you have sometimes felt that the BBC has not always been as fair or as impartial as it should. Although the BBC are right to point out that it is a complaint often voiced by other parties too.

But what is important is that the public should have confidence that complaints are examined independently and carefully. And that it is no longer the case that if you make a complaint against the BBC, the decision on whether it is justified is taken by the BBC.

That is just one of the key issues which we are considering in our review. And if you haven’t yet told us what you think then you still have a few more days in which to do so.

Whittingdale has suggested this before, but his latest comment goes further than what he was saying about this in August.

On a lighter note, Whittingdale also revealed that Margaret Thatcher was an early victim of phone hacking.

The pace of technological change is growing ever faster. In 1983, when I accompanied Margaret Thatcher on her election tour, I was put in charge of the Mobile Phone. There was nothing very mobile about it. It was the size of a brick with a handle. And we soon discovered that journalists in a car behind the battlebus could tune their radio to listen in.

In the Times (paywall) Sam Coates says ministers are considering measures to help those affected by the cuts to tax credits. Here’s an excerpt from his story.

[David Cameron] rejected calls from his MPs for a rethink of the policy in the autumn statement. “No, we think the changes we put forward are right,” he told The Andrew Marr Show on BBC One.

However, two cabinet ministers told The Times that the government was likely to offer more help to the working poor so long as it was not presented as a U-turn or watering down of the plan.

Referring to the autumn statement and the budget, one said: “There are two fiscal events before April. Let’s see where we are, and how tax receipts, particularly corporate tax receipts, are doing ...

A Tory source said that ministers were aware they had a problem, but had not come up with any solutions. They wanted to find an affordable answer that did not make them look weak in next month’s spending review.

Sajid Javid's speech - Summary

Here are the key points from the speech from Sajid Javid, the business secretary.

  • Javid defended the trade union bill.

Now there are those from Labour who describe me as a class traitor.

Len McCluskey says I’m a vampire - sucking the life from worker’s rights.

And he says this because we promised trade union reform in our manifesto, a manifesto that won us a clear majority at the election.

But despite that, the Labour Party and its union paymasters call the bill “undemocratic”.

They wrongly say that it’s an assault on millions of working people.

But they ignore the fact that the action of some unions is an assault on the lives of many millions more!

  • He said business had always been part of his life.

I started my life living above the family shop.

Business has always been part of my life.

I’ve seen how the family mood changes, depending on the day’s takings.

I’ve seen how companies need finance to realise their potential.

I know how hard it can be to set up and to succeed in business.

Every time that someone takes the courageous decision to start their own company, the whole of society benefits. That is why I’m a Conservative.

  • He said being pro-business did not mean turning a blind eye to bad practice.

Being pro-business does not mean that you turn a blind eye to bad practice.

Whether you’re a bank rigging interest rates, a car manufacturer cheating on emissions, or a company not paying your fair share of tax - be warned; we will come after you.

Because free enterprise is not a free-for-all.

My colleague Patrick Wintour has written a good analysis of George Osborne’s coup in hiring Lord Adonis to run the national infrastructure commission. Here’s an excerpt.

[Adonis’s] philosophy is brilliantly summated by himself in the current issue of Prospect, arguing often essential reforms are simple, and too often simple and easy become muddled in public policy. “If simple reforms are controversial and difficult to implement because they radically challenge the status quo then politicians tend to default or waffle, half-measures of complex tweaks of the status quo, achieving little. The inaction or avoiding action, can last decades.”

He is not a half-measures man. Not surprisingly with his record of practical action he has been in high demand – chairing Crossrail 2 and then being appointed to the board of Network Rail.

He may lack his distinguished mane or private wealth, but he is in some respects a younger, more social democratic version of Lord Heseltine, in politics to secure practical change. If that means a bit of state dirigisme, much of it sitting uncomfortably alongside his devolution agenda, so be it.

Here is some Twitter reaction to George Osborne’s announcement about the Lloyds share sale.

From John McDonnell, the shadow chancellor

From Richard Murphy, the tax campaigner whose ideas are being adopted by Jeremy Corbyn

From Giles Wilkes, a former adviser to Vince Cable and now an FT journalist

Updated

The queue jokes keep coming. (See 10.34am.)

The Tory press aren’t being particularly helpful to the Tories at the moment. The Sun is campaigning hard against the tax credit cuts. (See 9.40am.) And here is the first paragraph of the Daily Mail’s story about the national infrastructure commission.

George Osborne will declare war on the Tory shires today as he outlines plans to fast-track infrastructure projects across Britain.

The conference proceedings have started, and Nick Boles, the skills minister, is leading a session on apprenticeships. He started with a joke about yesterday’s protest.

Frank Field says tax credit cuts are 'a dive-bomb attack on Britain's strivers'

Frank Field, the Labour former welfare minister, has responded to George Osborne’s Today interview this morning, and what Osborne said about the tax credit cuts. (See 9.30am.) He says Osborne is launching “a dive-bomb attack on Britain’s strivers from April until 2020.”

The national living wage only reaches its full £9 an hour in 2020 and the free childcare offer won’t be available to those families with eligible children until 2017. The tax credit cuts will be imposed from April. That’s the issue the Chancellor has to face. Even if his calculations are correct he is still launching a dive-bomb attack on Britain’s strivers from April until 2020.

I was in the press centre at the crack of dawn, and managed to get through security without difficulty, but people trying to get into the conference centre now are having to wait ages.

What a shambles. As the old joke goes, it’s a good job this lot aren’t running the country. Hang on, I forgot ....

Updated

In Labour circles there are mixed views on Lord Adonis’s decision to take a post chairing the new national infrastructure commission.

The Labour MP Paul Flynn says Adonis is a “shallow opportunist”.

And this, from the former Labour MP David Clelland, is not intended to be complimentary, I presume.

But the former Labour minister Denis MacShane sympathises with Adonis’s decision.

George Galloway, the Respect politician and former Labour MP, is accusing Adonis of treason.

Some of the reaction may have been fuelled by a Times headline suggesting Adonis is leaving the Labour party. He isn’t. He is resigning the Labour whip in the Lords, but will still be a member of the party. Janet Royall, the former Labour leader in the Lords, says this is not unusual for someone taking this sort of job. She thinks Adonis will do a “great job”.

And Stewart Wood, Ed Miliband’s former policy adviser, agrees.

As does the Labour MP Steve McCabe.

David Davis warns tax credit cuts could turn out to be Cameron's 'poll tax'

David Davis, the Conservative former minister and David Cameron’s rival in the 2005 leadership contest, has warned that the tax credit cuts could be Cameron’s “poll tax”. This is what he told the Sun:

The government has to balance the books but the burden shouldn’t be on the poorest who did nothing to create the problem.

The government needs to look at this again. For three million families losing £1,000 doesn’t mean cancelling your holiday, it means an empty pantry. I hope this doesn’t turn out to be our poll tax.

George Osborne’s most tricky moments during his interviews this morning came when he was asked about asked about the cuts to tax credits. The Sun is campaigning aggressively against the cuts, and today it has published this editorial about the issue.

George Osborne's morning interviews - Summary

George Osborne has given five interviews this morning. Here are the key points he made.

  • Osborne insisted that, overall, most people would be better off as a result of government measures despite the cuts to tax credits. It was important to take into account the impact of increasing the minimum wage, raising the tax allowance and providing free childcare, he said.

The truth is the minimum wage has just gone up this week to £6.70, the national living wage is coming in next April at the same time as the changes to tax credits at £7.20, income taxes have already been cut by me by up to £1,000. We have made a set of changes that, if you take them in the round, mean families are better off and at the same time we have a country that has economic security, where more and more of its budget is not going to welfare.

He also claimed that current welfare spending was unsustainable because Britain had 1% of the world’s population, 4% of its economy, but 7% of its welfare spending.

Unless we take steps to curb the cost of this welfare we are basically confining this country to the second row, to the back row of history. I don’t want that to be the case for Britain.

  • He suggested that building a second runway at Gatwick was still seriously being considered by the government as an option. In a report published before the summer the Davies commission said Britain needed a new runway in the south of England and that it should be built at Heathrow. It accepted that Gatwick was an option, but it said it would not be as good. Osborne suggested the government could ignore Davies and go for Gatwick. He said:

We now have an independent report that has forced the choice on government, made it very clear what the options are, ruled out all sorts of other options that are out there, and said here, if you want to build a runway - and, by the way, you need to - you can either put on at Heathrow or you can put one at Gatwick. And now you decide ... Now, of course, the government has got to make that decision.

He said the decision would be taken by Christmas. It was important for the government to follow proper procedure, he said, otherwise there could be a judicial review, holding the project up for years.

  • He said Britain was “pretty rubbish” at taking infrastructure decisions. That was why he was setting up the national infrastructure commission.

Britain is pretty rubbish at making big decisions on infrastructure. It takes decades to get agreement on things like Crossrail ... I want to change all that.

It was important to press ahead with big infrastructure projects, he said:

But in the end I ask you the question: if we had never built the M25, or the M6 or the Channel Tunnel or the West Coast Mainline, where would we be as a country? All of those projects were bitterly contested at the time. It is a lesson for us as a country that the future favours the bold.

  • He said David Cameron would be meeting Angela Merkel, the German chancellor, later this week to discuss the EU renegotiation.
  • He suggested that the protesters who spat at journalists during the anti-austerity demonstration yesterday were associated with the trade unions. Asked about their conduct, he replied:

Those protesters are, essentially, part of a big trade union march. The trade unions support the Labour party, pay the Labour party. They’ve just bought the leadership of the Labour party. So it’s not really surprising they don’t like the Conservative party.

  • He rejected the suggestion that the creation of the national infrastructure commission meant he was declaring war on the shires.

I don’t want to declare war on people. I want to shake the inertia across this country against building things, against building homes, against building roads, against building railways.

  • He said that the Tories had a particular “responsibility” now to represent working people because Labour under Jeremy Corbyn was heading off “to the fringes”.

He has made a decision - a decision fully supported by a Labour party that voted for him - to head off to the fringes. I think that’s a big responsibility, therefore, for Conservatives to represent working people, some of whom will not have voted for us at the last election, who have been abandoned by the Labour party.

Updated

Here is some Twitter comment on George Osborne’s Today interview from political journalists.

From the BBC’s Norman Smith

From the Spectator’s James Forsyth

From the Times’s Tim Montgomerie

From Huffington Post’s Owen Bennett

From the BBC’s Robert Peston

From Newsnight’s Ed Brown

From the Daily Mirror’s Kevin Maguire

And here is Paul Kenny, the GMB general secretary, on the Osborne plan for a national infrastructure commission.

The Tory Party claim to be the party of workers is nonsense. As well as taking 1,200 per year in tax credits from three million workers, with the appointment of Lord Adonis they plan to demolish the council estates where these workers live, to develop luxury housing for sale.

If you are going to tell a lie tell a big one. The Tories have begun this policy of knocking down council estates in Roehampton, south-west London, where 600 homes face demolition by compulsory purchase orders to make way for housing the 600 families who cannot afford to buy. The property developers fund the Tories and it is their party.

Updated

Here is what Nigel Farage, the Ukip leader, has said about George Osborne’s plan for a new national infrastructure commission.

George Osborne’s plan to ease planning sounds like the death of the green belt.

Updated

Q: Do other EU leaders really have time for British demands, with all the other problems they face?

Osborne says EU leaders are thinking about Britain’s concerns.

The migrant crisis shows how Britain has been able to carve up a tough role for itself.

Q: Could the crisis delay the outcome of this negotiation?

Osborne says he does not accept that. The migrant crisis has shown how Britain can be in Europe but not run by Europe.

And that’s it. Osborne has now given five interviews this morning. I will post a summary soon.

Q: Why are you in charge of the EU renegotation. Shouldn’t that be a job for the foreign secretary?

Osborne says the prime minister is in charge. He, Osborne and Philip Hammond are all working on this.

Q: But you are going around the EU leading the negotiations.

Osborne says it is a team effort. The prime minister is leading from the front. This is going to be a tough negotiation, but we have made a strong start, says Osborne.

Updated

Q: Do you accept your plan carries a political risk? It blows a hole in the claim that you are on the side of working people. Look at what David Willetts said.

Osborne says you cannot look at this in isolation.

Q: Willetts is not looking at this in isolation.

Osborne says this is part of a package. You have to take into account the tax changes, the minimum wage and the free childcare too. The UK has 1% of the world’s population, 4% of its wealth and 7% of its welfare spending, he says.

Q: Yesterday David Cameron said he was certain working families would be better off, despite the tax credit cuts.

Osborne says this is part of a long-term plan. We cannot afford a welfare system that grows and grows and grows.

Q: But the House of Commons library says families will on average lose £1,300 a year, even taking into account the increase in the minimum wage.

Osborne says the typical family, with someone on the minimum wage, will be better off by £2,000 if you include the tax changes and the free childcare being made available.

Q: But do you accept that some families will be worse off?

Osborne says the government has published the figures showing that nine out of 10 families will be better off. [There are more details of those figures here.]

Updated

George Osborne's Today interview

Mishal Husain is interviewing George Osborne.

Osborne says the new infrastructure body is intended to take the politics out of difficult planning decision.

Q: But the government still has not acted on the Davies commission, and decided what to do about a new runway.

Osborne says that is a good model.

Q: So you will accept its recommendation, and build a new runway at Heathrow.

Osborne says the Davies commission has forced the government to take a decision.

A decision will be announced by Christmas.

But the government must take it in the right way. Otherwise there could be a judicial review, and the whole thing will be put back several years, he says.

Chris Cook, Newsnight’s policy editor, wrote a blog during the election explaining why the sale of Lloyds shares to retail investors might not be a good idea. Here’s an extract.

There are dangers worth considering in the Tory plan. There is little clamour for the state to hold on to the banks, but should the sale be targeted at kitchen-table investors? Here are some reasons for caution.

The first is that bank equity is a super-complex financial product. Modern banks trade in things that are impossibly difficult to follow from the outside. They are also accident-prone.

Lloyds Banking Group is not British Telecom. That all makes scrutiny by shareholders both harder and more important. Retail investors, with only small stakes in the company, may not be able to put the time into it. It might not pay for them to bother.

And with a small portion of shares, they would not be able to force the bank to simplify.

So having more small shareholders would probably mean the bank is more easily “captured” by its management. That is to say, it will start serving its employees rather than its owners and customers. That would be extremely bad for everyone.

George Osborne will be on the Today programme in 10 minutes.

Yesterday we learnt that he is not a huge fan. Here’s an extract from Geordie Greig’s interview with him in the Mail on Sunday.

[Osborne] wakes up to the Today show on Radio 4 but doesn’t listen for long.

‘Six out of ten times I go, “I don’t want to hear any more of that,”’ he grunts.

He switches over to Chris Evans on Radio 2. Osborne is a big fan and follows the new Top Gear host’s madcap tweets.

‘There’s a touch of genius about him.’

Sky News’s Faisal Islam says the Lloyds share sale is not as big as the one proposed by the Tories during the general election.

Treasury says proceeds from Lloyds bank share sales will go towards paying down national debt

George Osborne also told Sky News that a website was available where people can register if they want to apply for Lloyds shares. Here it is.

The Treasury says all the proceeds from the sale will go towards paying down the national debt.

Osborne says Lloyds share sale will be 'biggest privatisation in over 20 years'

George Osborne told Sky that the Lloyds share sale would be “the biggest privatisation in over 20 years”. He said he did not want all the shares to go to City institutions.

I want them to go to members of the public, people watching this programme and others. So our offer is this: Buy Lloyds shares. We’ll favour small investors, we’ll favour those who hold the shares for a long time. You’ll get a discount. And we’ll help create that share-owning democracy that we want to see in this country.

George Osborne, the chancellor, is giving his speech to the Conservative conference this morning. Overnight he announced that he has recruited Lord Adonis, the Labour peer and Tony Blair’s former policy chief, to chair a new statutory body that will advise the government on new infrastructure projects.

And this morning he’s got another announcement. He is selling Lloyds bank shares worth £2bn, and they will be available to members of the public at a discount. Here is an extract from the Treasury press notice.

It is the government’s intention to fully exit from its Lloyds shareholding in the coming months, and as part of this at least £2bn of shares will be sold to retail investors. Members of the public will be offered a discount of 5% of the market price, with a bonus share for every 10 shares for those who hold their investment for more than a year. The value of the bonus share incentive will be capped at £200 per investor. People applying for investments of less than £1,000 will be prioritised.

All proceeds from share sales are used to pay down the national debt.

Military personnel and their spouses stationed overseas will be able to participate in the sale, where possible. This is in line with the government’s armed forces covenant, which ensures that members of the armed forces should not face disadvantage in the provision of public services.

Tell Sid, as they used to say.

Osborne is giving interviews this morning. He has already done Good Morning Britain, BBC Breakfast and Sky. He will be on the Today programme at 8.10am, and I will be covering that in detail.

Here is the conference agenda for the day.

10.30am: Economy debate, with speeches from Sajid Javid, the business secretary, John Whittingdale, the culture secretary, and Patrick McLoughlin, the transport secretary.

11.45am: George Osborne speaks.

2.30pm: Speeches from Amber Rudd, the energy secretary, Greg Clark, the communities secretary, and Liz Truss, the environment secretary.

If you want to follow me or get in touch on Twitter, I’m on @AndrewSparrow.

 

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