Yesterday, the Chancellor of the Exchequer, the Rt Hon Rishi Sunak MP spoke at the Annual Onward Chairman’s Dinner. He paid tribute to Onward’s work and influence in areas like the Community Ownership and Levelling Up Funds, and outlined the three key future priority areas for Government to improve productivity: greater capital investment by businesses, improving technical skills for those already in work, and driving up business investment in R&D.
His speech has received widespread media coverage. It was mentioned in Politico’s London Playbook, The Independent, The Times, inews, Bloomberg, GB News, The Evening Standard, The Sun, The Daily Express, and other outlets.
Please click the link below to watch his speech or read the transcript:
Read a full transcript of the Chancellor’s speech below:
(Check against delivery)
Good evening, everybody.
And Danny, thank you for those incredibly kind and warm words. You are also a very dear friend to me as well.
Thank you for your support over the past couple of years, as ever, it’s always best to begin with a few facts. So thank you to everyone for being here tonight to support the work of Onward. Thank you especially to my parliamentary colleagues in the audience tonight for your engagement with ideas and helping to keep debate strong in our party. And thanks to Will and the team at Onward.
Now I remember when you guys were setting up, and there was a space on the centre right that we all knew existed, but we couldn’t quite articulate. And then you came along and spoke to us about a change in politics that had been happening right under our noses. Some truths hidden in plain sight. Now Onward has always let the quality of its work sound the loudest. And, Will, we have all heard it.
You can find the impact of Onward’s ideas across a slew of our Government’s policies, such as the community ownership and levelling up funds. But perhaps their greatest contribution to the Government so far is Neil O’Brien.
He provided such a boost at the start of Onward’s journey, and is now fortuitously placed in the Department for Levelling Up. Ladies and gentlemen this evening is rightly a tribute to the fantastic work of Onward. And I’d like you to join me in congratulating Will and the whole team for everything that they have achieved.
Now Onward exists to help provide the big ideas to the biggest challenges. And there is no greater challenge in our country right now than the task of rebuilding our economy after the pandemic.
In the here and now, we’re tackling the cost of living challenge head on. And we’re focused on making sure that those most in need get the support they deserve. Now, this isn’t just economically rational. It’s morally right. And my view of a stronger economy has always been one that rewards hard work, but constantly gives people another opportunity to get it right.
This isn’t just a short term imperative, but an active part of our long term strategy, a long term strategy that will build a stronger economy by fixing our productivity problem and driving up growth. A few months ago, I delivered the Mais Lecture and set out a plan to do exactly that. This plan has three priorities. Priorities that I believe will foster a new culture of enterprise and deliver a higher growth rate.
The first is to encourage greater levels of capital investment by our businesses. Second, we need to improve the technical skills of tens of millions of people already in work. And third, we want to make this the most innovative economy in the world by driving up business investment in R&D.
Capital, people, ideas. Businesses, investing more, training more and innovating: Three priorities to deliver higher productivity tied with one golden thread. But what the Government does, is far less important than creating the conditions for private businesses and individuals to thrive. Now over the longer term, we all know, higher productivity is the only way to achieve a sustainably higher growth, higher wage economy.
But we must be honest about the long standing weaknesses hampering our ability to achieve that, specifically in investment in skills, and innovation. I firmly believe that the Government is now doing its part. Public sector net investment is at its highest sustained level for half a century. Yet capital investment by UK businesses is significantly lower than the OECD average, and accounts for approximately half of our productivity gaps with France and Germany.
Next, Government funding for post-16 education is increasing considerably, alongside a range of initiatives for T-levels for the Prime Minister’s lifetime skills guarantee. And yet, UK employers spend just half the European average training their employees, leading to just 18% of adults holding vocational qualifications, a third lower than the OECD average.
And lastly, Government is delivering our pledge to increase public investment in R&D to £22 billion a year. And yet, business investment in R&D as a percentage of GDP is less than half the OECD average. And our lower rate of innovation explains almost all of our productivity gap with the United States.
Now, this is not to criticise business, or beatify Government. These are simply the facts. The growth and productivity challenge is a shared problem. Government and the market need to crack it together. That’s why I’ve set out a plan for economic growth that prioritises these three things: Capital, people, and ideas. Because without investment, we cannot increase the quantity and the quality of what we do people because our workforce is our greatest asset and ideas.
Because anything truly transformative begins in the same place, the imagination, we must put all our energy into these three priorities. And so in the autumn, we will be setting out a range of tax cuts and reforms, to incentivise businesses to invest more, train more and innovate more. And getting this right won’t just mean that the economy improves, but real places do. Now I talk about it often because it’s my political backyard. But if you want to know what I mean, then go to Teesside.
Strong local political leadership from a great mayor Ben Houchen, an active and excited business community, a new freeport, the Government’s new economic campus, investment in town centres like Stockton, Redcar and Middlesbrough, a revitalised train station at Darlington, and so on, you get the picture.
But only a few years ago, the SSI Steel Park closed and thousands of jobs were lost. People were asking if Teesside even had a future. But as the shadow has receded, new industries have sprung to life: Vaccine manufacturing, offshore wind, hydrogen, carbon capture and storage. The author William Gibson once remarked ‘the future is already here. It’s just poorly distributed’. I can say with confidence that is less known in the North East today than at any point in recent history.
And my ambition is to bring that sort of transformative change and optimism to every part of the United Kingdom. That is our plan for a stronger economy, inspired by and shaped by many sources, but with an undeniable Onward imprint.
Now in conclusion, it would obviously be odd for me not to acknowledge the political events of this week. And honestly, I genuinely can for the first time I have had this job not to try to offer broader political views on the country or the party. Largely because up until recently, anything I did or said was framed by others as some tilt to the leadership, but that’s not as much of a problem for me anymore.
So given that, my view is that our strategic political challenge is to reconnect the coalition between what some will call the Red and Blue Walls. Now in truth, I don’t like those terms. Because in my experience, conservative voters largely share the same values no matter where they live. In fact, most people in this country share those values. They believe in hard work. They believe in justice, and opportunity. They believe that change is positive and we must embrace it. And they believe that our country, the United Kingdom, and its story is something they could be proud of.
Our challenge with the voters and the country more likely is the same as it was on the morning of Friday, December 13th, 2019. To prove that we are worthy of the great trust placed in us to deliver on the priorities of the British people. It is no more or less complicated than that. The Conservative Party will win if we have proven ourselves capable of leading the country through the toughest of times and offer a compelling vision for the future built on hope and aspiration.
Now in their 2019 report, The Politics of Belonging Onward talked about the tension in the public’s mind, between freedom and belonging. But such attention is not unresolvable; our politics at its best is a unifying enterprise.
We can disagree, we can vehemently disagree on many things. But if we stay true to our bond with the people, based on those shared values, we can not only unite our party, but the whole country. I believe we can.
We can inspire, we can deliver. And I know that Onward will help us to do that. Thank you very much.