Chancellor Jeremy Hunt speaks to GLEN OWEN in an exclusive interview on the eve of his Budget

Before sitting down in his Downing Street office to preview his first Budget, Jeremy Hunt has somehow managed to squeeze in a 19-mile morning run. 

The symbolism of a healthy-looking, 56-year-old workaholic galloping through the park with his labrador, Poppy, is unlikely to be accidental, as next week the Chancellor will confront the ‘economic inactivity’ of the middle-aged.

Pension reforms will reduce incentives for people to take early retirement, as part of a ‘back-to-work’ package which will also include a crackdown on benefit claimants and greater childcare support for the low paid – an attempt to tackle the dead weight of more than five million working-age adults who are not in employment.

‘We need to say that when you turn 50, this shouldn’t be a time when you are looking ahead and thinking, ‘Sooner or later I am going to face the cliff edge of retirement,’ ‘ he says. 

‘This should be a time when you are thinking, ‘I’ve got another 20 years of working life ahead of me.’ ‘

Jeremy Hunt: ‘We need to say that when you turn 50, this shouldn’t be a time when you are looking ahead and thinking, ‘Sooner or later I am going to face the cliff edge of retirement”

The Chancellor is hoping that the labour-force reforms will deflect attention from the ongoing row over his decision to hike corporation tax from 19 to 25 per cent

The Chancellor is hoping that the labour-force reforms will deflect attention from the ongoing row over his decision to hike corporation tax from 19 to 25 per cent next month, which has united business leaders, backbench MPs and Tory donors in their opposition.

He is expected to try to take some of the sting out of the criticism by dipping into a £100 billion tax-revenue windfall to introduce investment- tax breaks for businesses, which he says will cut the ‘effective’ – rather than headline – rate of corporation tax.

Citing the example of the tax breaks applied by other countries, he says: ‘You can lower the amount of corporation tax you pay as a company because of the incentives that they’re given to invest in capital – you get your money back the following year off your tax bill.’

The symbolism of a healthy-looking, 56-year-old workaholic galloping through the park with his labrador, Poppy, is unlikely to be accidental, as next week the Chancellor will confront the ‘economic inactivity’ of the middle-aged

The move is likely to be one of the few talking points in a Budget which even its architects admit is ‘a bit boring’, a tinkering exercise also involving extensions to the energy price scheme, a freeze in fuel duty and a modest £5 billion increase in the defence budget. Money is clearly being saved up for Election year.

Mr Hunt, whose cumulative Cabinet experience as Culture Secretary, Health Secretary, Foreign Secretary and now Chancellor runs to nearly a decade, urges his critics to be patient over the Government’s tax plans.

‘We need to go on a journey to bring down business taxation but it’s not something we can do overnight,’ he says. 

‘Even after the corporation tax rise, we will still have a lower headline rate of corporation tax than any G7 country.

‘If I think about the tax cut of which I am most proud as a Conservative, it is the fact that for the past year for the first time in our history you have been able to earn £1,000 a month without paying a penny of tax or National Insurance.’

Last year’s Government turmoil means that Mr Hunt is the fourth Chancellor since July. 

His predecessor, Kwasi Kwarteng, delivered a tax-cutting ‘growth’ Budget in September which instead crashed the markets and helped to bring down Liz Truss’s Government.

Mr Hunt, whose cumulative Cabinet experience as Culture Secretary, Health Secretary, Foreign Secretary and now Chancellor runs to nearly a decade, urges his critics to be patient over the Government’s tax plans

Mr Hunt’s critics argue that he has ‘over-corrected’ by prioritising stability over growth; however, he insists he is working to a plan that will release the benefits of an economic resurgence in time for polling day.

Part of that, says the Remain-supporting Hunt, involves finally harnessing the benefits of Brexit. 

‘That was a decision by the country to adopt a new social contract where we grow an economy not dependent on unlimited high-skill migration, which is what you had with the single market,’ he says. 

‘That means we have to remove the barriers that prevent those five million people engaging in work and that is a fundamental Conservative value.’

His plan involves the greater use of post-Covid flexible working, a crackdown on benefits claimants who turn down job offers, and help for the 700,000 parents with children under the age of 12 ‘by being more generous about when childcare is paid. At the moment it’s paid in arrears and that puts people off’.

Mr Hunt says he now thinks that ‘Brexit is starting to be a success… in the end, Brexit is about freedom, autonomy that we didn’t have before and it’s about us using that autonomy to make the British economy more competitive’.

He adds: ‘You’ll hear more in the Budget, but I think we’ve got a big moment where we can forge our own path and make a tremendous success of Brexit.’

The Chancellor, whose wife Lucia is Chinese, defends Rishi Sunak’s decision to try to ‘disapply’ human rights laws which allow small-boat migrants to claim asylum.

‘We believe that what we want to do is consistent with being in the ECHR. We’re fully expecting that to be challenged in the courts. The PM has said we’re up for the fight. I think one of the things that makes me most proud, I’m married to an immigrant.

‘We’re one of the most tolerant countries in the world when it comes to migration and we have a very strong track record, second to none, in the welcome we give to people from countries in difficulty.’

The Chancellor, whose wife Lucia is Chinese, defends Rishi Sunak’s decision to try to ‘disapply’ human rights laws which allow small-boat migrants to claim asylum

He is trenchant on Gary Lineker’s inflammatory comparison of the Government’s asylum policy with ‘1930s Germany’, saying: ‘I don’t think he should have said that. They were very offensive comments and I think it’s deeply regrettable that he has yet to apologise for them.’ 

With immaculate comedy timing, a disembodied voice coming from his Apple watch says: ‘I’m not sure I understand.’

Before the interview concludes, I want to clear up a ‘fact’ which appears in most profiles of the father-of-three: that he is such a fan of the lambada that he has a ‘sprung’ dancefloor in his home to practise. He says the story arose from an embellishment by Michael Gove.

‘When the BBC were doing a profile of me, [Gove] gave an interview in which he informed them that I’d put a sprung dancefloor in my house,’ he says. 

‘As it happened, I used to be a very keen Latin dancer and I’d bought a house which happened to have a very good wooden floor. But I didn’t put it in.’

He and Mr Sunak will have to be nimble-footed to turn around the economy in time to stop Sir Keir Starmer getting his hands on the levers of power in 2024.

Chancellor Jeremy Hunt signals new tax breaks for firms in bid to see off Tory rebellion over corporation tax in Wednesday’s Budget

Amid mounting anger over the rise in the levy from 19 per cent to 25 per cent next month – which has angered Tory MPs and led party donors to warn privately that they will cut their funding – Mr Hunt used an interview with The Mail on Sunday to signal new tax breaks for business.

He said: ‘The most important measure we should be looking at is not the headline rate of corporation tax but the effective rate of corporation tax.’

Mr Hunt added that he was examining the way that in other countries, ‘you can lower the amount of corporation tax you pay as a company because of the incentives they’re given to invest in capital – you get your money back the following year off your tax bill’.

The Budget is expected to include a ‘back to work’ package to tackle the fact there are five million adults of working age who are not in employment

Mr Hunt’s Cabinet colleague Kemi Badenoch has highlighted criticisms of the measure, telling today’s Mail on Sunday that companies were calling for the planned rise to be axed

Even Mr Hunt’s Cabinet colleague Kemi Badenoch has highlighted criticisms of the measure, telling today’s Mail on Sunday that companies were calling for the planned rise to be axed.

The Business Secretary said: ‘I would be lying if I said they weren’t telling me that they wanted lower corporation tax.’

Ms Badenoch – one of the unsuccessful Tory leadership candidates who lost out to Liz Truss and is the third person to take on the business brief since September – caveated her remarks by adding: ‘We also saw what happened when we tried to lower taxes in a way that the markets didn’t find acceptable last September.

‘What this Government is about is sound money and we need to make sure that we are balancing the books.’

The Budget is expected to include a ‘back to work’ package to tackle the fact there are five million adults of working age who are not in employment.

This is likely to centre on pension reforms to reduce the incentives for people to take early retirement, raising the retirement age earlier, a crackdown on benefit claimants and greater childcare support for the low paid.

Changes to Universal Credit will include paying childcare support upfront, rather than in arrears – and increasing the maximum amount people can receive in childcare support from £646 to £950 for one child, and from £1,108 to £1,629 for two or more children.

More than 700,000 parents and guardians on Universal Credit who currently have no, or limited, requirements to find a job will be asked to look for work or increase their hours. 

The over-50s will be offered ‘returnerships’ which offer skills training that takes previous experience into account, as well as an expansion of skills bootcamps and an enlargement of the ‘Midlife MOT’ initiative aimed at helping people ‘make informed decisions about their finances and retirement’.

Mr Hunt said: ‘We have a historic problem in this country of being under-capitalised. We have less machinery per hour worked, less capital per hour worked and that has meant our productivity is not as good as countries like Germany or Singapore. And so, yes, we do need to look at the effective corporation tax level.’

He added: ‘Even after the corporation tax rise, we will still have a lower headline rate of corporation tax than any G7 country. We need to go on a journey to bring down business taxation but it’s not something we can do overnight.’

Other measures are expected to include a freeze in fuel duty and a modest £5 billion increase in the defence budget.

Jeremy Hunt says the government should have an ‘open mind’ about Covid-19 Wuhan lab leak theory 

Jeremy Hunt has said that the Government should have a ‘completely open mind’ about whether the Covid-19 pandemic started as a result of a leak from a Chinese laboratory.

The Chancellor’s comments, in his interview with The Mail on Sunday, add to growing pressure on the Cabinet Office to review its assertion that it was ‘entirely coincidental’ that Covid was discovered close to a Chinese government laboratory.

It was revealed last week that former Health Secretary Matt Hancock was censored by the department over his concern that the virus was the result of a lab leak in Wuhan.

Mr Hancock was asked to remove passages from his book, Pandemic Diaries, in which he questioned China’s version of events because of concerns they would ’cause problems’ and could ‘damage national security’ – Civil Service code for not wanting to upset Beijing.

Mr Hancock was asked to remove passages from his book where he questioned China’s version of events because of concerns they would ’cause problems’

Cabinet Secretary Simon Case oversaw the process by which Mr Hancock (pictured at his book launch) was told to delete references to a lab leak

Former Tory leader Sir Iain Duncan Smith urged Ministers to release MI6 briefings about Covid’s origins to justify its initial dismissal of the lab theory.

His intervention came after the US House of Representatives unanimously voted to declassify intelligence about China’s Wuhan Institute of Virology. This newspaper has led the way globally in revealing a growing body of scientific evidence pointing to an accidental leak of the virus from the institute.

In the lab, scientists were carrying out experiments on coronaviruses sampled from bats more than 1,000 miles away.

Christopher Wray, director of the FBI, announced earlier this month that the origin of coronavirus was ‘most likely a potential lab incident’.

In his comments to the MoS, Mr Hunt said: ‘I think we should have a completely open mind about how it started and be very rigorous in following the evidence where it leads. And I don’t think we should discount the possibility of it happening in China because of a lab leak.’

Cabinet Secretary Simon Case oversaw the process by which Mr Hancock was told to delete references to a lab leak, with officials informing him that the Government believed the location of the first outbreak was ‘entirely coincidental’.

Last week, a spokesman for Prime Minister Rishi Sunak said there are ‘still questions that need to be answered about the origin and spread of Covid-19’. He added: ‘The UK wants to see a transparent, science-led review and believes all possibilities remain on the table until that is concluded.’