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Middle East: Economic Update
24 March 2026
Lead MP
Rachel Reeves
Debate Type
Ministerial Statement
Tags
DefenceEconomyTaxationClimateEnergyBusiness & TradeBenefits & Welfare
Other Contributors: 31
At a Glance
Rachel Reeves raised concerns about middle east: economic update in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Government Statement
DefenceEconomyTaxationClimateEnergyBusiness & TradeBenefits & Welfare
Government Statement
Thank you, Mr Speaker. I paid tribute to our armed forces and noted the ongoing economic impact of the war, including high oil and gas prices and an inflation forecast of 3% to 3.5%. The Government’s response includes global collaboration through US military bases use and new defence financing with EU and NATO partners; energy security measures such as investment in renewables, lifting onshore wind ban, bringing forward renewable auctions, and encouraging domestic oil and gas investments; nuclear advancements like Sizewell C and small modular reactors; and easing regulatory barriers for critical infrastructure. The Chancellor also highlighted support for households through the removal of two-child limit, day one sick pay introduction, wage rises, prescription charge freezes, etc., and business rates reduction measures. Trade negotiations with EU on sanitary and phytosanitary agreements are ongoing to control food prices, alongside targeted agrifood tariff reductions, meetings with supermarkets and banks for customer support, enhanced competition monitoring by the CMA, and new anti-profiteering frameworks. The Government will be responsive to rising prices through extending fuel duty cuts, emergency support funds, and price caps on energy bills. Responsibility is emphasised in fiscal planning, avoiding past mistakes of high borrowing under Liz Truss's government, ensuring stability within iron-clad fiscal rules.
Mel Stride
Con
Central Devon
Question
How many fuel retailers have yet to engage with the new fuel finder service, and can she comment on technical glitches and out-of-date price information reports?
Minister reply
The Minister did not provide specific figures but acknowledged issues reported by MPs about technical glitches and out-of-date price information in the fuel finder service.
Mel Stride
Con
Central Devon
Question
Given the need, can she explain why a large-scale nuclear site was not chosen instead of the small modular reactor planned for Wylfa?
Minister reply
The Minister did not provide an explicit response but emphasised commitment to advancing both Sizewell C and small modular reactors as part of their nuclear energy strategy.
Mel Stride
Con
Central Devon
Question
What fiscal capacity does she believe the Government has to support those in need, and what plan is there to ensure targeted approaches reach all those who need them?
Minister reply
The Minister highlighted contingency planning for every eventuality while adhering to iron-clad fiscal rules to keep inflation and interest rates low.
Mel Stride
Con
Central Devon
Question
The MP expressed concerns about technical glitches with the fuel finder service, questioned the choice not to proceed with large-scale nuclear sites, and inquired about fiscal capacity for energy cost support. He also criticised the inconsistency of government policies on universal versus targeted support.
Minister reply
Reeves responded that over 90% of retailers have signed up to the cheaper fuel finder service, with regular price updates. She defended the decision not to proceed with large-scale nuclear sites by pointing out that no funds were allocated for these projects during the previous government’s tenure. Reeves also stated that fiscal capacity has more than doubled compared to what was inherited from the Conservatives.
Meg Hillier
Lab
Hackney South and Shoreditch
Question
The MP asked about data availability for targeting support at those who need it most, both across Whitehall departments and local government.
Minister reply
Reeves acknowledged the importance of having accurate data and highlighted that her administration is working with the Department for Work and Pensions, local Government, and energy companies to ensure targeted support can be provided effectively. She also noted that £150 will be taken off everyone’s energy bills already.
Daisy Cooper
LD
Weston-super-Mare
Question
The hon. Lady criticised the previous government's failure to invest in renewable energy, arguing for a three-pronged approach including incentives for demand reduction and targeted support for vulnerable households.
Minister reply
The Chancellor thanked the MP for her questions but defended the current government’s stance on renewables and nuclear power, stating that investments were being made through the National Wealth Fund. She also mentioned plans to offer improvement relief on business rates for energy efficiency projects.
Jon Trickett
Lab
Hemsworth
Question
Will the Chancellor ensure that the Government intervenes directly in the market to prevent profiteering, similar to introducing the energy profits levy and electricity generator levy?
Minister reply
The Chancellor confirmed that measures such as the energy profits levy and empowerment of regulators like the Competition and Markets Authority are in place to prevent price gouging.
Edward Leigh
Con
Gainsborough
Question
Is there a sensible middle-ground approach regarding green energy and new extraction from the North Sea, with an open mind about both?
Minister reply
The Chancellor agreed that the oil and gas industry is crucial for energy security and resilience. She confirmed that the Energy Secretary will take a quasi-judicial decision on Rosebank and Jackdaw licences with an open mind.
Question
Does my right hon. Friend agree that the Government's measures make poorer families better off, while the Conservatives' record is shameful?
Minister reply
The Chancellor agreed and noted that in Scotland, the legacy of two poor governments (Conservatives and SNP) means people are worse off, especially due to lack of support for the nuclear sector.
Jeremy Hunt
Con
South West Surrey
Question
Will the Chancellor confirm that targeted support measures will be fully funded in her Budget without increasing national debt?
Minister reply
The Chancellor confirmed that a targeted approach, rather than universal support, would be more appropriate and sustainable. She noted that energy bills are now falling due to measures taken last year.
Question
Can the Chancellor confirm that decisions on encouraging regulators and contingency planning will prioritise protecting constituents’ living standards while ensuring economic stability?
Minister reply
The Chancellor confirmed that measures from her Budget last year are crucial for stabilising energy bills, noting that inflation and interest rates would be higher without them.
Alistair Carmichael
Lib Dem
Orkney and Shetland
Question
Shetland is home to one of the largest onshore wind farms in the country, the operators of which are paid millions not to generate electricity because of grid constraints. When will we hear the details of how the trial of discounted energy rates for communities such as ours will work and what it will mean in terms of reductions to the bills of my constituents?
Minister reply
On the point about national grid infrastructure and why we end up paying for energy that cannot be used, we have to speed up those connections. We must act in the national interest and get this infrastructure built. The Secretary of State for Energy Security and Net Zero will set out in more detail the specific ways in which we can bring down prices for communities.
Question
My constituents are appalled by supermarkets and other petrol retailers that are price gouging and profiteering from global instability. Will the Chancellor set out the action that she is taking to clamp down on price gouging?
Minister reply
We have introduced the cheaper fuel finder to ensure greater transparency on prices offered by different fuel retailers, which provides a system similar to France’s app for travelling.
Harriett Baldwin
Con
West Worcestershire
Question
Given the current crisis, does the Chancellor regret in her first Budget increasing unfunded borrowing by £150 billion over this Parliament?
Minister reply
The fiscal rules introduced have allowed us to invest in Sizewell C and small modular reactors. Borrowing fell in the last year under our fiscal rules compared to the previous Government.
Rachael Maskell
Lab
York Central
Question
Will she consider a warm homes prescription to protect people’s health by keeping their homes warm, and will she ensure sufficiency in the crisis and resilience fund so that local authorities can invest in those in the greatest need?
Minister reply
From next month, families with children will benefit from the abolition of the two-child cap in the universal credit system. We have also doubled the number of recipients of the warm home discount and put £14 billion into upgrading people’s homes through the warm homes plan.
Question
The Chancellor has mentioned several times that households will benefit from £150 off their energy bills, but a constituent has been told that his energy bills are still rising. What conversations is she having with energy companies to make sure people do actually benefit?
Minister reply
Energy companies—through both fixed and variable tariffs—are passing on the £150 reduction by getting rid of the energy company obligation levy entirely and moving other levies from bills onto general taxation. People should be seeing an average cut of £117 in their energy bills from 1 April.
Question
As a result of the previous Government failing to invest in sustainable energy and nuclear, we are much more exposed to price shocks. Does she agree that it is vital that we do all we can to protect the most vulnerable from energy price hikes?
Minister reply
There have been six interest rate cuts since the general election, and gas prices are now a third less than four years ago due to our Government’s investment in renewables.
John Glen
Con
Salisbury
Question
Given that we are spending over £100 billion a year on debt interest, what assessment has the Chancellor made of the implications for public finances of higher inflation and borrowing costs?
Minister reply
We have looked at targeted support to avoid putting upward pressure on borrowing costs or inflation. The Bank of England’s assessment was considered, but their Governor also noted that action taken in last year's Budget reduces inflation by between 0.4 and 0.5 percentage points.
Dan Carden
Lab
Liverpool, Walton
Question
Constituents who have to rent their home in the private rented market will see their energy bills go up but their biggest outgoing each month is often exploitative rent. What can she do to tackle this issue?
Minister reply
The Renters Rights Act 2025, which was opposed by the Conservative party, gives people greater certainty and rights over eviction.
Question
Just three weeks ago at the spring statement, I cautioned that significant fiscal intervention would be required to protect businesses and households. Now she prevaricates in order to protect those self-same public finances. Some 13% of my constituents are reliant on oil; what can she do?
Minister reply
We have put £53 million towards supporting heating oil users, allocated based on usage in different parts of the country.
Question
It is expected that food inflation will hit 4%, increasing a typical family’s annual grocery bill by approximately £240. What will the asks and demands be so that people can access nutritious and affordable food?
Minister reply
The two-child limit for universal credit will be lifted from next week, reducing reliance on food banks. We are also committed to getting a sanitary and phytosanitary deal with the EU to bring down prices in shops.
Esther McVey
Con
Tatton
Question
The sad truth is that the Chancellor weakened the UK economy with her tax-busting Budgets and jobs tax, and that has been exposed by this middle east crisis. The Energy Secretary’s actions are making things worse: he has just refused to maximise drilling in the North sea and issue new licences, which would provide much-needed energy security and affordability. Will she now see sense and overrule the Energy Secretary’s decisions?
Minister reply
Since I became Chancellor, we have had six cuts in interest rates, and for every month that I have been Chancellor, wages have risen faster than prices. Compare that with the previous Parliament, where people were worse off at the end than they were at the beginning. If the right hon. Lady believed in energy security so much, why was she part of the Government who refused to fund small modular reactors or Sizewell C and opposed onshore wind, which is the cheapest form of energy? If she believes in energy security, she should back it.
Question
My constituents are being exploited by unscrupulous petrol retailers who are not letting a crisis go to waste. At BP in Winsford unleaded is 10p more per litre than the cheapest price in the area, and at Shell in Middlewich it is 15p more per litre. Does the Competition and Markets Authority have the powers that it needs to clamp down on this unscrupulous behaviour?
Minister reply
We have introduced the cheaper fuel finder to ensure that my hon. Friend and, most crucially, his constituents have that information. People in France can already see the different prices of petrol at different filling stations on a map via an app or their sat-nav. That is where we will be in just a few weeks’ time once we have the technology working with those companies. The previous Government had 14 years to introduce something like that, and other countries have already done so while we went without. Having the fuel finder tool means that all our constituents can fill up at the cheapest cost.
Gavin Robinson
DUP
Belfast East
Question
I thank the Chancellor for recognising the disproportionate reliance on home heating oil in Northern Ireland, but the £17 million made available for half a million homes reliant on oil equates to £34 per household, and there is no data to target that support. There is £81 million available from the renewables obligation for electricity. We were told by the Prime Minister and the Northern Ireland Secretary that that could be targeted, yet Treasury officials are blocking that, so I ask her to look at that again.
The Chancellor has made a commitment not to restore the 5p duty on fuel, but could she also look at the rebate for red diesel to help support construction, transport, haulage and energy regeneration in our country to stimulate the parts of our economy that have a disproportionate reliance on it and have lost the support that they gravely need?
Minister reply
I thank the right hon. Gentleman for what he said about heating oil. Obviously, a disproportionate amount of support has gone to Northern Ireland, given its greater reliance on heating oil, and we encourage local authorities to target the money at those who need it most. At the same time, to ensure that everybody is supported, the Competition and Markets Authority is doing an urgent review to make sure that price gouging is not going on. We acted in a matter of days on heating oil, because that was the right thing to do.
When we froze fuel duty, we also took action on red diesel, but I am happy to ensure that the relevant Minister meets with the right hon. Gentleman to talk further about what needs to be done.
Question
The Chancellor will be aware that we have a strong manufacturing sector in Huddersfield and in Yorkshire, including the defence businesses and small and medium-sized enterprises that are feeling the pressure of rising costs. The middle east war has seen import prices go up and disrupted supply chains, so how is she supporting manufacturers in particular?
Minister reply
My hon. Friend is right about the importance of manufacturing in Huddersfield and more widely across Yorkshire. We are introducing the supercharger from the beginning of April, which will take £420 million off the energy bills of the most energy-intensive industries. The British industrial competitiveness scheme will also help over 5,000 businesses when it comes in next year.
Question
The fuel price shock caused by Trump’s reckless war highlights just how risky it is for the UK to be locked into the global fossil fuel markets. The Climate Change Committee recently pointed out that the cost of achieving net zero by 2050 is less than the cost of a single fossil fuel price spike, reinforcing the point that we need to invest in clean, green technologies and get ourselves off being hooked on fossil fuels.
The key problem in the UK is that gas is coupled to electricity prices, so decoupling is crucial. Will the Chancellor look at the report last week from Common Wealth, which points out that decoupling could be achieved right now and would save households at least £200 each year?
Minister reply
I agree that de-escalation is the best way to reduce bills for families and businesses. I gently say to the hon. Lady that we want investment in renewables, and we introduced the Planning and Infrastructure Act 2025 to make it easier to build them, but her party voted against that—a vote which would have kept people’s bills higher than they need to be. We have had a one-third reduction in gas imports, and gas is setting the price of our energy at something like a third less than it was just four years ago. The electricity generator levy and the energy profits levy are ensuring that excess profits are taxed, and we can use that money to support the public finances and public services.
Justin Madders
Lab
Ellesmere Port and Neston
Question
The consumer-focused, pragmatic approach being taken by this Government is in such contrast with the rhetoric of some on the Opposition Benches, who would only see military action escalate—and be in no doubt that our constituents would be paying the price for that.
I welcome the CMA’s report this morning about action to tackle rip-off vet fees, but that report took several years. The Chancellor spoke of new powers for the CMA to tackle price gouging, but can she confirm that it will be able to act swiftly, nimbly and in real time to tackle companies seeking to exploit this particular crisis?
Minister reply
My hon. Friend is absolutely right: the Conservative party’s gung-ho approach would have made the crisis worse, not better. Our approach diplomatically has been to de-escalate the crisis at every stage, in part because we do not want that cost of living impact on families. As he knows, we met the Competition and Markets Authority a couple of weeks ago to talk through what more can be done, including on rolling out fuel finder for cheaper fuel and investigating the impact on heating oil. The CMA will be coming back to us in the next few weeks following that investigation, and looking more widely at how to keep prices down for all our constituents.
Simon Hoare
Con
North Dorset
Question
The £474,000 awarded to Dorset council last week as part of the Chancellor’s announcement is welcome, but I must tell her that it really will not touch the sides; more will need to be done to support rural communities. Unwillingly and unwittingly, the Government will be profiteering through a massive hike in VAT and duty take. May I urge the Chancellor to ringfence, either in whole or in great part, the excess receipts that she will be receiving—this would not add to Government borrowing—to support rural communities across the country as they face this cost of living crisis?
Minister reply
I thank the hon. Gentleman for what he said about heating oil. As well as the direct support for his local authority and many others, the CMA’s work is crucial to stop businesses exploiting the crisis to increase their profits. As I said in response to my hon. Friend the Member for Ellesmere Port and Bromborough (Justin Madders), the CMA will report on that shortly. On ringfencing certain tax revenues, it is clear that a prolonged conflict will reduce other tax revenues and push up borrowing costs, so it is not possible to ringfence a particular tax for a particular use, because other tax revenues will be coming down. But the whole reason for the energy profits levy and the electricity generator levy is to have some stabilisation in the system to bring in money to support the Government and our constituents when that is most needed. Of course, we will be using it to do that.
Question
I thank my right hon. Friend for the serious approach she has taken to the conflict, unlike the hokey-cokey approach we have seen from the Conservative party. Peterborough is willing to play its part in developing our energy infrastructure, and we have already had £1 billion-worth of private investment to upgrade the gas networks based out of Peterborough, but my constituents know that the price hike is not just about what is happening now in the middle east; it is about that decade when we did not build the energy infrastructure the country needs. Will she reassure me that her plan will speed up new nuclear, speed up investment in renewables and get the country building the energy infrastructure we need if we are to tackle this challenge for the long term?
Minister reply
I thank my hon. Friend for that question. It is great to see that investment in the gas networks coming into Peterborough, supported by him. That is in stark contrast to the Conservatives, who got rid of our gas storage facilities, stalled on nuclear and stalled on renewables. As a result, they left us more vulnerable to an energy price shock.
Ben Lake
PC
Ceredigion
Question
What contingency planning is taking place to support non-domestic energy bills, especially in rural areas such as mine where a great number of small businesses and community organisations rely on heating oil and LPG?
Minister reply
I am sure that the hon. Member will agree that the best thing we can do to support households and businesses is to de-escalate the crisis and bring it to an end as quickly as possible. But, as I set out in my statement, I will not tolerate businesses price gouging and earning excessive profits because of the conflict in the middle east. The CMA therefore has new powers to ensure that does not happen, and we are targeting support at those who most need it.
Shadow Comment
Mel Stride
Shadow Comment
The shadow Chancellor criticised the current Government for mismanaging the economy with high inflation, borrowing costs, and interest rates. He highlighted issues like reduced oil and gas extraction due to net zero policies despite fields ready for development, leading to energy insecurity. Stride questioned the minister on fuel finder service engagement, small modular reactor preference over large-scale nuclear sites, fiscal capacity for targeted support, heating oil needs, and consistency in public spending control. The shadow criticised Labour's lack of resolve in welfare reform, arguing it is weakening the economy.
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