17:26 - The House divided: - Ayes: 108 / Noes: 313 - Question accordingly negatived.
The Exchequer Secretary to the Treasury (James Murray)
I thank the shadow Chancellor for opening the debate.
In their motion, the Opposition have set out a list of objections to the decisions that the Government have taken—or, in the case of the measurements around pints, decisions that shadow Ministers seem to have entirely imagined. They may be able to list their objections, but they are unable to accept responsibility for the damage that they did to our economy. Crucially, they are unable to offer any credible alternative. The motion makes it clearer than ever that the Conservatives have no vision, no ideas and no plan to deliver the change that our country needs.
In contrast, Labour is the party with a plan for change—a plan to restore economic stability, boost investment and drive growth across the UK to put more money in people’s pockets. We know that it is up to the Government to provide stability, security, fiscal responsibility, and to remove unnecessary regulation when it stands in the way of growth. It is businesses large and small—including family businesses and their workforces—that will create jobs and wealth and be the engines of growth in the economy. We know that pubs, shops, traders and services across the country not only play an important role in all our lives, but drive economic growth. Those businesses and their workforces are the backbone of our economy, and they need a Government who will take the right decisions in the national interest, even when they are difficult, to support our security and prosperity.
I briefly remind Conservative Members of the context in which the decisions have been made. That context is, of course, the inheritance that this country faced after 14 years of the Conservative party being in power.
Dr Evans
The context is that back in 2010 the then Government had to borrow £158 billion. Fast forward another decade, and we had something called the pandemic, when we had to borrow £400 billion on top of that. Collectively, that is a great big difficulty. Five years ago, when the pandemic happened, I sat in this Chamber listening to all the interventions asking for more spending. Does the Minister not agree that that is the problem the Conservative Government dealt with?
James Murray
The hon. Gentleman said that we had something called the pandemic; we also had a Prime Minister called Liz Truss and that had a pretty big impact on our economy. I know the shadow Chancellor is distancing himself from it. If his colleagues would like to leap to Liz Truss’s defence, I would welcome an intervention. No, they are not seeking to intervene. Funny that, Madam Deputy Speaker. Perhaps, in closing, one of the other shadow Ministers can defend Liz Truss’s record.
Dr Evans
The way I see it, the problem that Liz Truss had with her Budget was that she did not set out her workings. The problem with Rachel Reeves’s Budget is that she did, and the country and the world does not believe it. That is far more detrimental to the situation we find ourselves in because she cannot get out of that problem. That is the difference between Liz Truss and Rachel Reeves.
James Murray
Wow. I should let the hon. Gentleman intervene more often if he is going to say that the only problem with Liz Truss is that she did not set out her workings. I think the problem was rather more fundamental than that, as people across this country will attest.
Frankly, it is no wonder that Conservative Members want to bury their heads in the sand and try and pretend the last 14 years did not happen. It was 14 years of mismanagement and decline, along with jolts of disaster, digging ever deeper holes in our public services and our economic resilience. It was their decisions that led to their resounding electoral loss last year and it was their record in office that made necessary the difficult decisions that we had to face on entering government.
Paul Holmes (Hamble Valley) (Con)
I thank the Minister for handling this debate in his usual courteous way. May I take him back to something that he said in his remarks about hospitality businesses and pubs delivering economic growth? There is a small pub chain in my constituency that must find a third of its total turnover because of the actions of this Government, with the result that it may have to close a venue that supports a small village in my constituency. Is that the economic growth that he thinks he is delivering?
James Murray
I assume the hon. Gentleman refers to the changes around employer national insurance, to which I will come in my remarks.
Let me be absolutely clear about the context: no responsible Government could have let things carry on the way they were. That was simply not a tenable situation and I think Conservative Members know that. That is why at the autumn Budget, we took the difficult but necessary decisions on welfare, spending and tax, and those decisions were vital steps towards restoring economic stability and fixing and supporting the public finances. As I said earlier, while Conservative Members have taken every opportunity to say they oppose those choices, they have yet to offer any solutions of their own. Difficult decisions were necessary, so let me set out why we made some of the choices that we did.
Nick Timothy (West Suffolk) (Con)
The Labour party manifesto said that by the year 2028-29, it would increase spending by £9.5 billion a year. Why, then, did the Budget increase it by £76 billion—eight times more than the Labour manifesto said?
James Murray
As I am sure the hon. Member will know, upon entering Government and speaking to Treasury officials about the state of the public finances, we uncovered a £22 billion black hole, which was known to then Ministers but which the OBR was not informed about.
Nick Timothy
The Minister might have noticed that there is a bigger gap between £9.5 billion and £76 billion than £22 billion. His answer is clearly ridiculous. We are talking about such tax rises not because of the £22 billion fictional black hole, but because of the decision to increase spending by eight times more than the Labour party promised at the election. Will he accept that or not?
James Murray
The hon. Member’s comments are clearly ridiculous if he thinks the £22 billion black hole was fictional. It has real-terms consequences in terms of the pressure—
James Murray
I will make some progress as I have been very generous in giving way to the hon. Gentleman. He will know that his colleagues who were in government were aware of the in-year spending pressures and they chose not to share that with the Office for Budget Responsibility and thereby not to share it with the British people. That is the truth of what we inherited, and that is why we had to take difficult decisions.
I turn to some of the difficult decisions that we had to take in the Budget last year, because the Opposition motion refers to our decisions on business property relief. I assure hon. Members that the decisions we took on that and on agricultural property relief were not taken lightly. The Government recognise the role that those reliefs play, particularly in supporting small farms and family businesses, and that is why we chose to maintain rather than abolish them, which has meant maintaining significant levels of relief from inheritance tax beyond what is available to others. Indeed, the reliefs will remain more generous than the last time they were changed. The changes we are making mean that agricultural and business property reliefs will be better targeted and fairer.
According to the most recent data from His Majesty’s Revenue and Customs, 40% of agricultural property relief benefits the top 7% of estates making claims. It is a similar picture for business property relief, with more than 50% of business property relief claimed by just 4% of estates making claims. Those data bear out the fact that the benefit of the existing 100% relief on business and agricultural assets has become heavily skewed towards the wealthiest estates.
It is neither fair nor sustainable to maintain such a large tax break for such a small number of the wealthiest claimants, particularly in the light of the wider pressures on the public finances. That is why we are changing how we target agricultural property relief and business property relief from April next year. Individuals will still benefit from the 100% relief for the first £1 million of combined business and agricultural assets. On top of that amount, there will be 50% relief, which means that inheritance tax will be paid at a reduced effective rate of up to 20%, rather than the standard 40%. That sits on top of the other spousal exemption and nil rate bands, which apply more widely within the inheritance tax system.
Gregory Stafford (Farnham and Bordon) (Con)
Kilnside farm in my constituency, run by Bob Milton, is only 36 acres in total. It is a tiny farm, yet it will be subject to the new taxes. How can the Minister say that only 4% will be affected? Even the smallest farmers in my constituency will be hit.
James Murray
To correct the hon. Gentleman, I did not say that only 4% will be affected. We have set out that up to 520 estates claiming agricultural property relief, including those that also claim business property relief, are expected to be affected in 2026-27. That means that about three quarters of estates will be unaffected and will not pay any more inheritance tax. All the data on that has been set out in a letter from the Chancellor to the Treasury Committee, and if the hon. Gentleman looks at that document, he will see some of the stats that I refer to.
Rebecca Smith (South West Devon) (Con)
Of the 500 or so that the Minister has just explained will have to pay inheritance tax, does he have any idea what number are small businesses, compared with the large estates that he seeks to challenge in the legislation?
James Murray
The data that I refer to is based on claims data. This is an important point that comes up frequently when we have debates on agricultural property relief and business property relief. If one were to consider assets owned by farmers or other business owners, the actual value of the asset does not give a guide to what claim might be made against inheritance tax because that will depend on the ownership structure, on debt that might be owned or on what inheritances have happened earlier in people’s lives and so on. The only data that can give an indication of what impact the changes will have from April 2026 is the claims data.
The data that I referred to earlier and which I referred to in response to the hon. Member for West Suffolk (Nick Timothy) is the real claims data that HMRC has. That is the data on which we made decisions around this policy and which informs some of the Chancellor’s statistics in her response to the Treasury Committee, which the hon. Lady may like to consult.
Carla Lockhart (Upper Bann) (DUP)
In Northern Ireland, the Agriculture Department has indicated that almost half of all farms, and 75% of all dairy farms, will be impacted by the inheritance tax. When will the Minister start to speak with, and listen to, industry leaders? Quite frankly, the meeting last week was an outrage. He needs to sit and listen to industry leaders, who know the industry and are speaking on behalf of real farmers on the ground who will be impacted by this inheritance tax.
James Murray
The hon. Lady referred to meetings that I held last week, both with representatives of UK-wide organisations and those that represent other nations within the UK. There is a difference between listening to people and having to agree, because sometimes we listen and we disagree. That is the situation we found ourselves in after that meeting—we listened to concerns but we have a different approach. I have been setting out in this debate exactly why we have taken this decision.
Caroline Voaden (South Devon) (LD)
I recently surveyed all the farms in my constituency, and 85% of the people who responded said that they would be affected by this inheritance tax, mainly because of the cost of land in South Devon—practically all farms will be subject to it. When will the Government listen to the evidence that we are collecting from our farmers, which shows that their assessment that only 25% of farms will be affected is not correct?
James Murray
It is important to emphasise that the correct data to work out the impact of these changes is the claims data. That is what is available to HMRC, and it is the basis on which we have established how many farm estates are likely to be affected by the changes.
Wendy Morton
The point that we are trying to make is that the Minister is looking only at one dataset, not the big picture. We have spoken a lot about farmers, but the business property relief is about the whole of the business community. Will he not go away and have another look at this, taking account of all the evidence that, hopefully, he has been listening to since the announcement of this reckless policy?
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. Before the Minister continues, let me remind Members who have not understood the etiquette that they cannot just wander into a debate when someone is on their feet and try to intervene. They need to take part in the whole debate.
James Murray
I return to the point that I have made several times today: the way to understand how the policy on agricultural property relief and business property relief will work is to look at actual claims data—the claims as they relate to individual estates. The overall value of farms or businesses does not tell us exactly what the estate value will be through an individual claim. That is the correct way to approach it.
Several hon. Members rose—
James Murray
I will make some progress, because I have given way many times on this particular point. I have plenty more to get through and I am sure that other Members would like to contribute.
Depending on people’s individual circumstances, a couple will be able to pass on up to £3 million to their children or grandchildren free of any inheritance tax at all. If owners pass on their assets more than seven years before death, no inheritance tax will be due either. Where any payment is due, it can be paid over 10 years interest-free in most circumstances. That benefit is not seen anywhere else in the inheritance tax system.
I recognise, as evidenced today, that the inheritance tax reforms generate strong views, but reform is necessary given the fiscal challenge that confronts us. This is a fair approach that helps put the public finances back on a sustainable footing.
Several hon. Members rose—
James Murray
I am going to make some progress.
Let me move on to the changes to employer national insurance contributions, which is another of the difficult decisions that we had to take at the Budget. I recognise that the changes will have impacts, but asking employers to contribute more is the fairest way to restore fiscal stability and to provide essential services, such as our NHS, with the resources they desperately need. The rate of employer national insurance will increase from 13.8% to 15%, while the per-employee threshold at which employers start to pay national insurance, known as the secondary threshold, will be reduced to £5,000.
At the same time, we firmly recognise the importance of small businesses, and we will protect the smallest businesses and charities by more than doubling the employment allowance to £10,500. That means that next year, 865,000 employers will pay no national insurance contributions at all. More than half of employers will see no change or will gain overall from this package, and employers will be able to employ up to four full-time workers on the national living wage and pay no employer national insurance contributions.
Employers will also be able to benefit from other employer national insurance contributions reliefs, including hiring under 21s and under-25 apprentices, where eligible. These changes broadly return national insurance contribution revenues as a proportion of GDP to the level that they were before the previous Government’s cuts to employee and self-employed national insurance, but in a way that does not result in higher taxes in people’s payslips.
The Opposition’s motion also refers to business rates. We want local shops and high streets to thrive again, which means we must act to support the businesses behind them, which have had to contend with changing consumer habits and significant economic headwinds in recent years. While online shopping is convenient and offers great variety, the high street brings people together. Hospitality businesses have played a key role in bringing people into town centres.
However, at present the business rates burden falls more heavily on property-intensive sectors, which is why business rates need rebalancing. From 2026-27, we therefore intend to introduce permanently lower tax rates for high street retail, hospitality and leisure properties with rateable values below £500,000. This will benefit more than 280,000 properties. At the same time, to make this tax cut sustainable, we will apply a higher rate to properties with a rateable value of £500,000 and above. That group represents less than 1% of all properties, but covers the majority of large distribution warehouses, including those used by online giants, helping to level the playing field for high street businesses.
Damian Hinds (East Hampshire) (Con)
The hon. Gentleman and other Ministers have constantly come back to the point about the higher rateable value commercial premises, saying that they include distribution centres for online giants. What proportion are they of the total?
James Murray
Data is being set out by the Valuation Office Agency, which should give the right hon. Gentleman the details that he requests, but I am happy to write to him with the details that are available. In order to sustainably fund a permanent cut for retail, hospitality and leisure properties below £500,000, we have to ensure that it is paid for. We are seeking to increase the rate on properties with a rateable value of £500,000 or more to ensure that it is sustainably funded. That will come in from April 2026.
Andrew Lewin
My hon. Friend is talking about the importance of sustainable funding, and I completely agree. It is fascinating that the last Government had a business rate relief system, which was a good one, but had nothing in the Budget for it at all, so they planned to cancel it entirely. That is why we are now in this situation.
James Murray
My hon. Friend is absolutely right to point out that, under the previous Government, there was a series of cliff edges and one-year extensions that provided no stability whatsoever to businesses trying to plan investment, hiring or expansion decisions. That is why we have decided to extend the relief that the previous Government were due to end in April 2025 for one further year, before introducing permanently lower rates from April 2026.
Dr Johnson
The Minister is talking about planning—I should declare an interest as a farmer’s wife—and says that 500 farmers will be affected. Of course, none of us can know who is going to die next year. While 500 farmers will be affected, there may be many, many more who might die and might be affected. There is a discrepancy between how many he thinks will definitely be affected—how many he predicts will die—and the actual number of people who may be affected and cannot plan their businesses accordingly, because they simply do not know. He argues that they can put their assets down a generation, but no one knows if there will be a car accident and the younger generation will be killed. He is simply taxing tragedy.
James Murray
I think I was following the hon. Lady point that in many cases no one knows when inheritance tax will be due, because people cannot predict the sad events that may happen in their lives. But it is clear that, in trying to work out the impact of changes to tax policy, the best source of data is the actual claims data for those reliefs in the past. That is exactly what we have used. We have looked at the HMRC data on actual claims under agriculture property and business property relief. That is what determines the data that I mentioned of up to 520 estates being affected in 2026-27.
Dr Johnson
My point was that the Minister may be correct that 520 estates will be affected, but others who may be affected will need to plan their businesses and lives accordingly. That is why so many more people are affected by his announcement than simply those who will die next year or the year after.
James Murray
I return to my point that three quarters of estates claiming agricultural property relief, or agricultural property relief and business property relief, will not pay any more inheritance tax in 2026-27 as a result of these changes. In terms of the extra inheritance tax liability, which is what the data about claims points towards, the data is clear that the majority of estates will not be affected. As I mentioned to several of the hon. Member’s colleagues on Conservative Benches, the data is set out in quite some detail in the letter that the Chancellor wrote to the Treasury Committee. If she has a look at the data in that letter, that might answer some of her questions.
I will briefly finish my comments in relation to business rates. I was thanking my hon. Friend the Member for Welwyn Hatfield (Andrew Lewin) for intervening to point out what we inherited from the previous Government: a situation where relief for retail, hospitality and leisure was chopping and changing year to year. Indeed, from April this year there was to be a cliff edge, so it would have gone away entirely—according to the plans we inherited from the previous Government, there was to be no relief at all after April. We therefore decided to extend the relief at a fiscally responsible level for a further year, ahead of our permanent reforms coming in.
While we are on the subject of hospitality, let me address the absurd notion in the Opposition’s motion—I do not believe the shadow Chancellor mentioned this in his comments—that the pint is under threat. The pint is part of our nation, and we do not need a new law to protect the pint any more than we need a new law to say that the sun must rise in the morning—I wonder whether the Opposition Members who drafted that part of the motion may have been close to a number of points when they did so. In any case, I am proud to reject the insinuation in their motion and to put on record—if it needs to be said—that pints are at the heart of our nation and, under Labour, they will stay that way.
Bradley Thomas (Bromsgrove) (Con)
The Government continually talk about how the Chancellor has shaved one penny off a pint, but many publicans in my constituency tell me that they are having to find an extra £2,000 a month for additional costs as a result of the Government’s Budget. Does the Minister accept that a penny off a pint is futile if there are no pubs left to drink in?
James Murray
What I accept, as I said earlier, is that our difficult decision on employer national insurance contributions will have impacts on different businesses across the country. But the hon. Member should welcome—businesses across the country will welcome this—the extra support that we have provided through draught relief to support those pubs to succeed. That is an essential part not just of our economic activity across the country, but of our social lives and enjoying pints. I know that enjoying pints matters very much to Opposition Front Benchers.
I will try to make some progress, because there is quite a lot to cover in the Opposition’s motion. On employment, the motion seeks to undermine the Employment Rights Bill, so let me directly address those points. The Bill is the first phase in delivering our plan to make work pay, supporting employers, workers and unions to get Britain moving forward to bring greater predictability to the lives of working people. While I recognise that the flexibility offered by zero-hours contracts, zero-hours arrangements and low-hours contracts can benefit both workers and employers, without proper safeguards that flexibility can be one-sided, and it is far too often the workers who end up bearing all the financial risk.
That is why we have committed to ending this one-sided flexibility, to ensure that all jobs provide a baseline of security so that workers can better plan their lives and their finances. That includes ending exploitative zero-hours contracts. We will deliver the commitment through two measures: first, a right to guaranteed hours where the number of hours offered reflects the hours worked by the worker during a reference period; and secondly, new rights to offer reasonable notice of shifts, with proportionate payment for shifts that are cancelled, moved or curtailed at short notice.
I will try to draw this to a close. [Interruption.] Opposition Members might not want to hear it but, out of respect to you, Madam Deputy Speaker, I will bring my remarks to a close. The motion exposes a Conservative party that is happy to object to the difficult decisions that we have taken but totally unable to offer an alternative plan of its own. The debate has also allowed me to set out, on behalf of the Government, how we are moving fast to take the sometimes difficult but necessary decisions to deliver our plan for change.
We are taking the right decisions to fix our public finances, to restore stability and fiscal responsibility, and to ensure that both businesses and their employees can work productively and securely to drive economic growth. The changes that we have begun making are essential for economic growth, so we reject the Opposition’s motion. We are determined to move further and faster to make people across the UK more secure and better off.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson.
The Parliamentary Under-Secretary of State for Business and Trade (Gareth Thomas)
I thank Members on both sides of the House for their contributions to what has been an interesting debate. We heard, in particular, excellent speeches from my hon. Friends the Members for Vale of Glamorgan (Kanishka Narayan), for Gateshead Central and Whickham (Mark Ferguson), for Birmingham Northfield (Laurence Turner), for Ealing Southall (Deirdre Costigan), for Hexham (Joe Morris) and for Clwyd East (Becky Gittins). We also heard interesting speeches from the Liberal Democrat hon. Member for St Albans (Daisy Cooper) and her colleague the hon. Member for Tunbridge Wells (Mike Martin), and from the hon. Members for Beaconsfield (Joy Morrissey) and for Bromsgrove (Bradley Thomas), the right hon. Member for Tatton (Esther McVey), the hon. Members for Dumfries and Galloway (John Cooper), for Bridgwater (Sir Ashley Fox), for Meriden and Solihull East (Saqib Bhatti), for South Northamptonshire (Sarah Bool), for Farnham and Bordon (Gregory Stafford), for Keighley and Ilkley (Robbie Moore), for West Suffolk (Nick Timothy), for Bromley and Biggin Hill (Peter Fortune), for Broxbourne (Lewis Cocking) and for Kingswinford and South Staffordshire (Mike Wood), as well as Scottish National party and Plaid Cymru speeches from, respectively, the hon. Members for Moray West, Nairn and Strathspey (Graham Leadbitter) and for Ynys Môn (Llinos Medi).
As my hon. Friend the Exchequer Secretary to the Treasury emphasised in his opening remarks, we are taking the tough decisions now to support family businesses. We recognise that they are the backbone of our economy, our communities and, indeed, our society. Unlike the Conservative party, who crashed the economy, we are determined to champion those family businesses. While the shadow Chancellor, the right hon. Member for Central Devon (Mel Stride), was sitting at the Cabinet table, the cost of loans to family businesses were going through the roof. He was part of a Cabinet that left this Government with a huge £22 billion black hole in the public finances. It is always interesting to listen to the shadow Secretary of State for Business and Trade, the hon. Member for Arundel and South Downs (Andrew Griffith), who never seems to mention any more that he was once in the Treasury helping to write the Liz Truss Budget. Any time he wants to intervene and apologise for that, he will find me willing to let him do so. He finished his time in Government as a business Minister, when a record number of family businesses went bust. [Interruption.]
Madam Deputy Speaker (Judith Cummins)
Order. I am interested, and my constituents will be very interested, to hear what the Minister is saying.
Gareth Thomas
We know that there are just over 5 million family businesses in the UK, the vast majority of them small businesses. We are determined that, for the first time for a decade and more, those small businesses will be placed at the front and centre of the Government’s plan to kick-start the economy. In our first almost eight months, we have already taken significant steps to begin to reverse the decline of the last 14 years, all of which will help to create a stronger business environment for family businesses to grow and develop—for instance, an investment summit that raised £63 billion and created 38,000 jobs; starting our programme to build 1.5 million new homes; kick-starting Great British Energy to bring fuel prices down; major reforms to the planning system; record research and development spending; and significant investment in new infrastructure. In the Budget, more than £1 billion was announced for the British Business Bank over the next two years, with more funding for start-up loans and the growth guarantee scheme—precious capital to help entrepreneurs to take ideas from design to development, and to build the next generation of family businesses.
Robbie Moore
I am not entirely sure whether the Minister himself believes what he is reading. Has any economic impact assessment been made of the collective impact that all the Budget changes will have on many of our family businesses, including the reduction in the agricultural property and business property reliefs?
Gareth Thomas
I am grateful to the hon. Gentleman for mentioning those reliefs, and I will come to them in due course.
The Budget also set out practical support for small businesses, especially those on the high street. Many family businesses are affected by shoplifting, and no one should underestimate the scale of the problems that we inherited in that regard. Out-of-control shoplifting has plagued family businesses, and businesses generally, for years, with both staff and store owners feeling powerless and police forces, cut to the bone under the last Government, inadequately resourced to respond properly. Just yesterday, the Home Secretary confirmed that in the Crime and Policing Bill we are tackling this issue head-on by scrapping the effective immunity for low-value shoplifting, thus helping all family businesses. At the Budget, my right hon. Friend the Chancellor also announced additional funding to crack down on the organised gangs who target retailers.
Gurinder Singh Josan
For my entire working life I have been self-employed in the family business which was established by my dad and my uncle in 1975. Does the Minister agree with my experience that family businesses do not operate in isolation? Lots of things matter to family businesses. If someone is ill in the morning, they cannot join the 8 am merry-go-round for a GP appointment—the state that the Tories left this country in—because they have to get to work, open up and get people through the door. If the buses do not work, staff cannot get in. If potholes are not fixed—
Gareth Thomas
I do agree with my hon. Friend. As he rightly alludes to, in the Budget we had to take tough decisions to fix the foundations of our economy, to restore stability and to begin to rebuild the crumbling infrastructure and address the terrible state of our public services. While we have raised employer’s national insurance contributions, we have mitigated the impacts by increasing the employment allowance to £10,500—a record amount—which means that 1 million small businesses will be paying either the same or less in national insurance contributions than they do now.
Several hon. Members rightly pointed out during this debate that a lot of family businesses are high street businesses. Many of them have been run for successive generations, and they are part and parcel of our communities. The Conservative party did next to nothing to help family businesses on Britain’s high streets. It allowed thousands of bank branches to close and thousands of pubs and other high street family businesses to go, too. That is why this Government are focused on our five-point plan to breathe life back into Britain’s high streets.
Laurence Turner
As the Minister knows, the Nationwide Caterers Association, which represents small independents and family-run street food businesses, is based in Kings Norton in my constituency. I thank him for the recent positive meeting we held. Does he not agree that one of the previous problems it faced was that, under the previous Government, it struggled to get a seat at the table?
Gareth Thomas
I was pleased to see my hon. Friend and those from the business organisation he brought in to see us, and I hope to have the opportunity to come to his constituency to see very directly the action we discussed at that meeting.
Our five-point plan to breathe life back into Britain’s high streets, as well as to address antisocial behaviour and retail crime, means reforming the business rates system, working with the banking industry to roll out banking hubs, stamping out late payments and empowering communities to make the most of vacant properties. We are already delivering in all those areas.
To support high street family businesses and other SMEs further, we have frozen the small business multiplier and extended business rates relief for the retail, hospitality and leisure sectors. We are permanently reducing tax on properties for those businesses, too. One of the many reasons why the Conservative party lost the confidence of British business is that, despite promising many times to reform business rates, it never did. We are determined to do so. Even at this late stage—and I hope the House will join me on this—I hope the Scottish Government will agree to cut business rates for the retail, hospitality and leisure sectors in in Scotland, echoing what we are doing here.
Hon. Members will know that, since Christmas, high street rental auctions have allowed councils to tackle persistently vacant properties by putting leases up for auction. This right to rent for businesses is paving the way for further regeneration and growth, for new family businesses to emerge and for current family businesses on the high street to benefit from the extra footfall.
We are also determined to tackle the scourge of late payments. Over 50% of small businesses have reported problems with late payments. After years of tough talk and little action from the Conservative party, we have already taken decisive steps to protect family businesses in this regard. We have already announced measures to tackle late payments in contracts with long payment terms, so that small firms are not waiting months on end for big firms to pay up. We will bring forward secondary legislation in this parliamentary Session to make further changes, and will shortly launch a public consultation on potential primary legislation measures that go further still to tackle this problem.
To further help family businesses, we are creating a new business growth service, which over time will bring together under one national banner a whole array of business support services throughout the UK. However, we are not stopping there. Later this year, we will be launching our small business strategy. From boosting scale-ups to regenerating the high street, supporting the adoption of new digital technologies and further addressing the access to finance challenges that businesses face, this paper will set out the Government’s vision for all small businesses. We have set out a whole series of measures to tackle the situation facing family businesses in this country.
In his opening remarks, the shadow Chancellor failed—remarkably, perhaps—to acknowledge that according to the latest PwC chief executive survey, the UK is the second best place in the world to invest, behind only the US. He also failed to mention that the International Monetary Fund and the OECD both predict that Britain will be Europe’s fastest-growing G7 economy in the coming years, and omitted the fact that the UK was the only G7 economy, other than the US, to have our growth forecast upgraded last month by the IMF, which credited the decisions we made in our Budget.
That is the kind of change the British people voted for at the last general election. There is still a lot more to do, and we on the Government Benches are determined to get on with the task.
Question put.