MANUFACTURING

A resilient economy is a more balanced economy with more exports, more building, more investment – and more manufacturing too.

We’ve got to support our manufacturers if we want to see more growth in our regions.

To those who say manufacturing is finished in the West, I say: look at America, which will see up to five million new manufacturing jobs by the end of this decade.

I’ll tell you why.

US industrial energy prices are half those in Britain.

We need to cut our energy costs.

We’re going to do this by investing in new sources of energy: new nuclear power, renewables, and a shale gas revolution.

We’re going to do this by promoting energy efficiency.

Today, by tilting the playing field – extending the 2% increase in company car tax in 2017-18 and 2018-19 while increasing the discount for ultra low emission vehicles – and reducing the rate of fuel duty on methanol.

But above all we are going to have a £7 billion package to cut energy bills for British manufacturers – with benefits for families and other businesses too.

First, I am capping the Carbon Price Support rate at £18 per ton of CO2 from 2016-17 for the rest of the decade.

This will save a mid-sized manufacturer almost £50,000 on their annual energy bill.

And it will save families £15 a year on their bills too – over and above the £50 we’ve already taken off.

Second, I’m extending the existing compensation scheme for energy intensive industries for a further four years to 2019-20.

Our steel makers, chemical plants, paper mills and other heavy energy users make up 35% of our manufacturing exports and employ half a million people. This scheme helps the companies most at risk of leaving to remain in the UK.

Third, I’m introducing new compensation worth almost a billion pounds to protect these energy intensive manufacturers from the rising costs of the Renewable Obligation and the Feed-In Tariffs.

Otherwise green levies and taxes will make up over a third of their energy bills by the end of the decade.

Fourth, I am exempting from the carbon price floor the electricity from Combined Heat and Power plants which hundreds of manufacturers use.

And this entire package delivered without any reduction in the investment in renewable energy.

Today I have cut the cost of manufacturing in Britain.

Half of the firms that will benefit most are in the north of England. A third are in Scotland and Wales.

Thousands of good jobs protected.

A more resilient economy.

A government on the side of manufacturers.

A Britain that makes things again.

DUTIES

So we’re backing exports, backing manufacturing, backing a Britain that builds.

And Mr Deputy Speaker, we also want to help hardworking people keep more of what they earn and of what they save.

That’s what we’ve done by freezing council tax, freezing fuel duty and raising the personal allowance to £10,000.

And from next year tax free childcare – 20% off, for up to £10,000 of childcare costs for parents.

And an early years pupil premium to help the most disadvantaged.

Today we can do more to help.

Let me start with duties

I can confirm that the fuel duty rise planned for September will not take place.

Petrol will be 20 pence lower per litre than it would have been.

Turning to gambling duties.

Fixed odds betting terminals have proliferated since gambling laws were liberalised almost a decade ago.

These machines are highly lucrative, and therefore it’s right we now raise the duty on them to 25%.

We will also extend the horserace betting levy to bookmakers who are based offshore.

And we’ll look at wider levy reform and at introducing a ‘racing right’ to support the sport.

While betting machines have grown, the number of bingo halls has plummetted by three quarters over the last thirty years.

Yet bingo duty has been set at the high rate of 20%.

Now fuel duty is frozen, my HF for Harlow has turned his energy and talent into a vigorous campaign to cut bingo duty – ably assisted by my HF for Waveney.

They want the rate cut to 15%.

I can go further.

Bingo duty will be halved to 10% to protect jobs and protect communities.

Let me turn now to tobacco and alcohol duties.

Tobacco duty has been rising by 2% above inflation and will do so again today.

This escalator was due to end next year – but there are no sound health reasons to end it, so it will be extended for the rest of the next Parliament.

We’ve introduced new laws to prevent alcohol being sold below minimum tax rates, and this helps prevent supermarkets undercutting pubs, and helps stop problem drinking.

It’s a far more targeted approach than the alcohol duty escalator hated by many responsible drinkers.

Today, I am scrapping that escalator for all alcohol duties.

They will rise with inflation, with these exceptions:

Scottish Whisky is a huge British success story.

To support that industry, instead of raising duties on whisky and other spirits, I am today going to freeze them.

And with some cider makers in the West Country hit hard by the recent weather, I am going to help them by freezing the duty on ordinary cider too.

And then there’s beer. I know the industry, led so ably by my HF for Burton, have been campaigning for a freeze.

But beer duty next week will not be frozen.

It will be cut again by 1 pence.

Pubs saved. Jobs created. A penny off a pint for the second year running.