00:00What our economic policy will do is kickstart growth again in this country.
00:05We need UK GDP and more importantly, UK GDP per capita to be growing up at 3 to 4 percent again.
00:12If we cannot do that, then frankly, for our children and their children, there's simply no way to pay the bills, given the size of things like the pensioner population, etc.
00:25How are we going to do that? We need to lean into Britain's strengths.
00:28We have a formidable financial services sector on a relative basis, not as strong as it once was, and frankly, has been smothered and clobbered by EU regulation.
00:38This country has failed as a result of Tory mismanagement to make the most of the Brexit freedoms that we've been granted.
00:44Our crypto and digital assets bill starts to do just that.
00:48Similarly, we need to lean into AI. This country still has a significant percentage of the world's finest AI talent.
00:55We do very little with that commercially in terms of generating value for the British economy and helping British people get richer.
01:02Obviously, we've had mass immigration in this country, which people are very, very angry about.
01:08And that is one reason why we're polling not just ahead of the prime minister's party now, but in the gold standard YouGov poll last week,
01:14we were full eight points clear, which is pretty astonishing for a party that won such a walloping majority just under a year ago.
01:21So we're going to lean into AI. We're going to retool the economy. We need to talk about energy.
01:25That's probably the single biggest thing we have to do.
01:27Hang on a sec. Before we get to energy, I like your opening statement. Thank you.
01:32In terms of the party, though, the main and the biggest promise, and I think the most eye-catching surely will be for voters,
01:38the idea of increasing the tax threshold from £12,500 to £20,000, i.e. no tax for people under £20,000 a year.
01:45I mean, the issue remains that that doesn't seem to have really been costed, the estimate that it would cost upwards of £50 billion per year.
01:53And still this major question about how you would really pay for such a huge tax.
01:58Yeah, well, look, we've got a very simple answer to that. It is cost.
02:00So let me give some context on this.
02:02So, yes, according to the IFS, to raise the threshold to £20,000, meaning that those earning below that amount,
02:08which benefits the youngest in society and the eldest in society, would cost, let's call it £60 billion, a lot of money.
02:15If you look at this Labour government, who are talking about fantasy economics and money trees, magic money trees,
02:20it was only last summer in June, in their manifesto, they pledged, as you know, to increase spending by £10 billion.
02:27In Rachel Reeve's first budget, a mere three months later, she increased spending by how much? £60 billion.
02:33And since then, they found on that same magic money tree a further £30 billion for Chagos, and I'm sure we're going to see much more.
02:40And by the way, a lot of that spending, things like Chagos, as far as we're concerned, is for projects that add no value,
02:46in fact, detract value from the lives of British citizens.
02:49One of the things we're going to cut is we're going to completely reverse all of the net zero religiosity that has now plagued Westminster now for decades.
02:57That will not only save somewhere between £35 and £45 billion a year in terms of public spending,
03:04it will also materially reduce energy costs.
03:06You know, this is the big elephant in the room that nobody in politics really talks about,
03:10but people listening to your show will understand.
03:12What is GDP? Ultimately, it is output. Output is energy.
03:15We have currently got the most expensive energy prices in the world, consumers and manufacturers and industrial companies.
03:23We need to collapse that energy price.
03:25We need to proliferate nuclear, particularly small modular reactors.
03:29We need to start drilling again in the North Sea.
03:31And if we don't reduce our energy prices dramatically, we're going to get left behind.
03:36I mean, look at China, which is producing somewhere between 4.6...
03:39But all of that means massive investment, and drilling in the North Sea doesn't mean that you lower oil prices.
03:43It means that you produce oil for private companies that goes on to public international markets.
03:49Sure, but the reality is that will reduce energy prices in the medium term, right?
03:53Absolutely. If you increase the supply, the energy price will come down.
03:56And in terms of investment...
03:57But it's a global market for oil.
03:59Well, absolutely. But the North Sea is a meaningful input into that and has been heavily curtailed.
04:07And the evidence of that is the tens of thousands of jobs that have already been lost in that regard.
04:11In terms of SMRs, look, we already have a national champion in the UK in the form of Rolls-Royce,
04:16who are pretty good at building high cost of failure, highly sophisticated manufactured parts.
04:22SMRs can also, because 80% to 90% of the components are built in a factory,
04:26you can proliferate those much more quickly than you can the large reactors.
04:29OK. In terms of you've been credited with professionalising the party,
04:33and you've done well in polling recently, and you've done well in local elections,
04:36and you're... This is the credit that has been given.
04:40But does this economic plan... Will it actually stand up to bond investors,
04:44who are basically our audience listening?
04:46Do you think that this policy is really going to be able to do that in terms of the economic policies?
04:51And on the crypto bill that you've written and published today,
04:56the Crypto Assets and Digital Finance Bill,
04:58why you want to make Britain a crypto and blockchain powerhouse?
05:02Again, what are the benefits to the UK from that?
05:05So, in terms of whether markets will like our economic policies,
05:08I think they will, because we'll be very transparent,
05:10not just about areas where we will cut taxes.
05:13And we do need to cut taxes, otherwise this economy is going to continue to basically not grow.
05:17We're going to be very clear where we're going to cut spending.
05:19Nigel, in his speech this week, actually talked about somewhere between £350 billion and £400 billion of spending cuts
05:26that he wants to make in his first term.
05:27How do you deliver that?
05:28I mean, Elon Musk made the exact same promise a few months ago for the US,
05:31and Doge promised trillions of dollars in cuts.
05:34It sounds like a very similar script, and Elon Musk has left Washington, D.C. basically intact,
05:40effectively the same as when he started.
05:42Yeah, so it's a very different political system in the US in the sense that the founding fathers
05:46were very particular, actually, about largely putting the purse strings
05:49and control of the purse strings in the hands of Congress, which is why Elon...
05:53But Elon Musk went directly into government departments to cut funds.
05:57But ultimately, the bill, this big, beautiful bill that Trump is passing, ultimately increases spending in a way that more than offsets all of that.
06:06The Prime Minister of the United Kingdom, assuming that he has the support of a significant majority of his or her MPs,
06:13is much more actually constitutionally empowered to make the sort of cuts that we're talking about.
06:16You can actually do it in the budget.
06:18And Nigel's being very clear.
06:19Look, some people won't like the fact.
06:20Some people love net zero.
06:22We're being very clear that a lot of people don't, and that's why we have so much support already.
06:26We need to scrap the net zero subsidies.
06:28We need to stop the net zero investments that are being made.
06:31We have to cut energy prices.
06:33We have to cut foreign aid.
06:34We have to deport people here illegally, so we no longer have to spend £5 billion a year of British taxpayers' money on asylum hotels.
06:43If you made a 5% cut...
06:45So just the last point I'd make.
06:46If you just look at these quangos, if you made a 5% cut to their budgets, which we think is more than achievable, that's a further £13 billion.
06:53The cuts I've just given you there are between £75 and £85 billion per year.
06:58Even if you managed to get through an awful lot of that, that would more than fund the programmes that Nigel's talking about in terms of tax cuts.
07:05Would some of this be done with Bitcoin, perhaps?
07:08Would some of the investment you want to make be done through Bitcoin?
07:11It's something that you're talking about.
07:14The bill, you've talked about perhaps accepting donations in Bitcoin, that you want this Bitcoin to be a central part of the financial offering of the UK.
07:24Well, we think the financial services industry in the UK, the City of London, is at a significant disadvantage at the moment.
07:30A, because of a lack of clarity around regulation, but also, look, a lot of people listening to this programme will have had the experience.
07:38They open a Coinbase account or they connect their account with a crypto, perfectly legal, legitimate crypto provider,
07:44transacting crypto legally, and their account suddenly gets locked or they start getting asked a thousand questions by their bank.
07:50So one of the things the bill does is make it illegal for any financial services provider or bank to discriminate against you for lawfully using crypto.
07:58But the FCA is deeply worried about cryptocurrencies.
08:01There's now a health warning telling you that you can lose all of your investments in cryptocurrency because the regulator is so worried.
08:08The City of London police that leads on investment fraud talks about cryptocurrency continues to be the most common asset.
08:14Fraudsters claim to be investing in 66% of all fraud reports, 650 million quid a year.
08:21It's a deeply still problematic investment, isn't it?
08:24No, the reality is that what we so we need to do a few things.
08:29Number one, we need to actually improve the regulatory regime.
08:31So a lot of the crypto activity comes, A, onshore and is fully transparent.
08:38That's why, despite the fact that we're saying we're going to cut the capital gains tax on crypto assets to 10%,
08:43we think over the course of Nigel's first time we'll meaningfully increase tax receipts as a result of crypto transactions.
08:50Secondly, we're going to introduce a two-year regulatory sandbox.
08:52Precisely so major financial institutions, including the ones not far from this office, have some time to actually build innovative products.
09:02And look, we're getting overtaken.
09:03We can live, you know, the FCA can choose to live in the 1970s if it wants.
09:07One in four 18 to 34-year-olds in this country already transact in crypto.
09:12And if we don't bring them into the system, if we don't make it fair and listen to them,
09:16which is why reform has a lot of young people's support, we're going to get left behind in this competitive world.
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