Public service reform is pro-business, pensions minister argues
Reforming Britain’s public services is a pro-growth and pro-business policy, the pensions minister has argued.
Torsten Bell, who was appointed in the mini-reshuffle following City minister Tulip Siddiq’s departure from government, has said it’s not possible to have a “failing state and a growing economy”, in an interview with the Guardian.
The former Resolution Foundation thinktank director said: “The reason why the budget is pro-growth is because you cannot have a failing state and a growing economy.
“I’ll give you a concrete example: I walk into a Sainsbury’s in Uplands, in Swansea, and there are security guards on the door. Why are there security guards on the door?
“Because there isn’t a functioning response to shoplifting, right? That is a retail tax. We are taxing retail to pay for the failing state – and that is what we are turning around.”
And the MP for Swansea West added, in reference to the NHS: “It is like a sickness tax on every business in the country if their workers are off because they are not being treated.”
He added: “One thing I’ve definitely learned from six months as an MP – every Saturday I meet people… who say, ‘my health is affecting everything else in my life’.”
It comes as Chancellor Rachel Reeves has faced anger from businesses and lobby groups for raising taxes in her October Budget, including a £25bn hike to employer national insurance contributions (NICs), with Labour promising to spend an extra £25bn on the NHS.
Bell also stressed that a lack of economic dynamism was contributing to wage stagnation, with an average man in 2024 earning seven per cent less in real terms than 20 years earlier, as he wrote in his recent book, ‘Great Britain? How We Get Our Future Back’.
He added: “That brings to life how large the economic failure is and why people might be really pissed off.”
On financial services, Bell added: “Our pension system is the financial plumbing for our capitalism.
“The way I think about it as part of this wider growth story is, the objective is higher investment levels, right? That is one thing that we are doing across the board.”
And he praised pensions auto-enrolment, but said ministers needed to ensure the whole system worked well for savers.
He said: “That’s what I’m doing. OK, we’ve got people saving. Have we got the best pensions landscape that they’re saving into, how do we do better for savers, and how do we do better for driving up growing investment?”