Oral Answers to Questions

Alan Mak Excerpts

Tuesday 20th December 2022 Commons Chamber

[Victoria Atkins]

I do hope that the hon. Gentleman noted the announcements by my right hon. Friend the Chancellor in the autumn statement in relation to dividends and corporation tax allowances. We want to ensure, where we can, that unearned income is roughly comparable to earned income. That is precisely why the principle running through the autumn statement was that those with the broadest shoulders should bear the greatest burden.

[Alan Mak (Havant) (Con)]

I welcome the Edinburgh reforms, which help to make our financial services sector more competitive. I urge my hon. Friend to adopt the same approach to R&D tax reliefs and capital allowances, so that our world-class entrepreneurs, start-ups and small and medium-sized enterprises can benefit from the same advantages.

Independent Brewers: Small Brewers Relief

Alan Mak Excerpts

Tuesday 6th September 2022 Commons Chamber

[The Exchequer Secretary to the Treasury (Alan Mak)]

I begin by congratulating the hon. Member for Midlothian (Owen Thompson) on securing the debate and commending him for his ongoing advocacy on behalf of the brewers and distillers from his constituency. I join him in congratulating the organisers of the 20th anniversary celebration he mentioned. As he said, he has some notable examples of beer and gin producers in Midlothian. I understand that brewing in Scotland dates back to the neolithic period—truly some very small brewers indeed.

As the Member for Havant, I too am proud of the brewing heritage in my constituency. In fact, the combination of a thriving local malt trade and fine spring water meant that beer was a mainstay of Havant’s local economy for centuries. Although it is many years since the final kegs rolled out of our last active brewery, that legacy is still visible in some of our town’s buildings.

Let me also thank the other hon. Members who have taken the time to contribute to this debate, and who represent all four nations of the United Kingdom, which reflects the appeal and significance of our first-rate alcohol industry. I particularly recognise the contribution of my predecessor, my hon. Friend the Member for Harrogate and Knaresborough (Andrew Jones), who played a key role in initiating the review.

Before I address the various points raised today, I will briefly explain the wider reforms, the rationale for them and why they are important. The key point is that the Government are making changes to outdated alcohol tax laws—laws that are arbitrary and inconsistent. Crucially, the result of these reforms will be a system that is much fairer, simpler and more aligned with public health goals than the system we inherited from our membership of the European Union. EU law contains many inconsistencies and barriers to simplification, including, for instance, preventing member states from taxing all types of drink in proportion to their alcohol content.

In contrast, the Government’s proposed reforms, as set out in last year’s autumn Budget, radically simplify the system and tax all products in proportion to their alcohol content, which ensures that higher-strength products pay proportionately more duty. We are also introducing new reliefs to support pubs and help small producers to expand and thrive. The Government remain committed to delivering alcohol duty reform. We are considering the feedback that we have received and we will respond in the coming months.

Put simply, the reform of alcohol tax laws is long overdue. These laws have barely changed since the 1990s, partly because the incoherent and prohibitive EU rules that we experienced in the past have hindered that much-needed change. In the current system, for instance, a high-strength white cider pays less duty per unit than a low-strength beer. Sparkling wine—a sector in which the UK is starting to lead the world—pays much more duty per unit than still wine, even when it contains substantially less alcohol. Fortified wines, which are made with the addition of spirits, pay less duty than a liqueur made with spirits, even if they are the same strength.

The plain fact is that we inherited 15 rates from the EU across five different products with three different methods of taxation. As such, the current system is complex and archaic. In fact, the Institute of Economic Affairs think-tank has said that it “defies common sense”. For their part, producers, importers and exporters in this country have called the system “distorted” and

“perversely incentivised to produce stronger drinks”.

They have welcomed the opportunity for reform.

Now that we have left the EU, we have an opportunity to create alcohol laws that are more rational, and that support the many and varied producers and traders in this country. At the autumn Budget last year, the then Chancellor laid out the significant benefits we planned to introduce with our reforms, which include a radically simplified system that slashes the number of bands from 15 to six and taxes all products in proportion to their alcohol content; taxing all products in the same way, which is a rational policy that was banned by EU law; ending the premium rates on sparkling wine and equalising them with still wine, and substantially reducing duty on rosé; introducing new rates for low-strength drinks below 3.5%, which will encourage innovation and reflect consumer preferences for low or no alcohol drink alternatives; and cutting duty on a 3.4% beer by 25p a pint.

We are also modernising the taxation of cider, targeting unhealthy and problematic white ciders while cutting the duty for lower ABV, craft and sparkling ciders; freezing duty rates for the third Budget running, saving consumers £3 billion over the coming years; and, of particular interest to Members tonight, we have introduced small producer relief, supporting the many small artisan alcohol producers who continue to create world-beating products in this country.

The hon. Member for Midlothian asked about the possible behaviour and role of global producers and the cost of reducing the rate for beer below 3.5% ABV. The Government’s intention is to encourage reformulation and innovation in lower-strength products, including by larger brewers, and this proposal received broad support from the sector during the call for evidence. The costs of these alcohol duty reforms were published at autumn Budget 2021, and they took account of the impacts of reformulation between bands. A tax information and impact note will be published alongside the draft legislation in the usual way.

The hon. Gentleman mentioned that, since 2002, small brewers relief has provided reduced rates of beer duty for small producers. The rapid and successful growth in the sector since that relief was introduced has undoubtedly contributed to the diversity and quality of beers on the market. This is good for producers and good for consumers. However, we must also recognise that responses to the technical consultation the Government ran on SBR pointed to flaws in the system. Some called it “too generous”, going beyond the relative cost disadvantage experienced by small producers. Others called it “distortive” and “flawed”. Alongside our other generational reforms, we have the opportunity to improve on the positives of SBR and extend those benefits to other industries.

While no final decisions have been taken, the new relief we announced at the Budget includes expanding the relief across all categories, allowing small producers to diversify their product range to other products below 8.5% ABV, while still benefiting from reduced rates; introducing a more progressive taper, removing the cliff edges from the previous scheme, which the hon. Gentleman mentioned; expanding the scheme to products below 2.9%, encouraging innovation in the growing low or no alcohol market and in turn helping consumers make healthier choices while still supporting our outstanding alcohol industry; and, let us not forget, introducing draught relief, a move that directly supports the great British pub with reduced duty rates on draught beer and cider so that consumers can enjoy the fantastic products made by our small producers in their favourite local.

The hon. Gentleman mentioned, and the point was reinforced by my hon. Friend the Member for Aberconwy (Robin Millar), the issue of container size, and the fact that small independent brewers and community pubs often use 20 and 30-litre containers for their beer. I want to assure them both and the wider alcohol community that, while I cannot make any announcements tonight, we have listened and we understand their point.

The hon. Member for Midlothian also raised the issue of help for the sector as it recovers from covid-19. While the final design of the alcohol duty reforms will be confirmed shortly, I want to reassure him that the Government recognise the pressures facing the sector. I remind him that the Government have already introduced a range of measures that continue to provide significant support for businesses, including cutting business rates by 50% for eligible retail, hospitality and leisure businesses in this financial year. He asked about support for energy costs, and as he will have heard from the Prime Minister this afternoon, announcements will be made this week and in the coming weeks, so I reassure him that he can look out for those.

The hon. Gentleman also asked whether the full SBR rate will be maintained at the new lower rate, whether total production across all alcoholic products will be used to calculate the SPR and whether the SPR will be launched at the same time as the other alcohol duty changes. I reassure him that the Government recognise the success that SBR has brought to the industry, and we look forward to seeing the benefits shared with other sectors. While I cannot make any announcements tonight, I hope he understands that the Government are carefully considering the feedback stakeholders shared with us through the consultation and we will publish our response shortly.

The benefits I outlined earlier would not have been available to this country before we left the EU. The reality is that we have a once-in-a-generation opportunity to improve an outdated system, providing new incentives for producers to grow and innovate and a major boost for pubs. Our reforms are more rational, fairer, better aligned to public health goals and more in tune with consumer preferences, and they support the Great British pub and the small producers delivering fantastic world-class products.

Let me again thank the hon. Member for Midlothian and all hon. Members across the House who have contributed to this evening’s debate. I also wish to assure them that we will soon confirm the details of these wider reforms and publish the draft legislation, alongside the Government’s response to the consultation.

If, indeed, we have been brewing alcohol on these islands for thousands of years I see no reason why we should not continue, with even greater success, for thousands more. Given a chance, I am sure those neolithic producers of beer would have enjoyed the benefits afforded by small brewers relief, and they would almost certainly have welcomed the opportunity to expand their operation with the reformed small producer relief.

Question put and agreed to.

Approved Mileage Allowance Payments

Alan Mak Excerpts

Monday 5th September 2022 Written Statements

[The Exchequer Secretary to the Treasury (Alan Mak)]

The Government have become aware of a technical inaccuracy in its responses to a number of parliamentary questions, correspondence and a parliamentary e-petition response on the subject of approved mileage allowance payments (AMAP) from March to August 2022.

The response stated that actual expenditure in relation to business mileage could be reimbursed free of income tax and national insurance contributions. This is in fact only possible for volunteer drivers. Where an employer reimburses more than the AMAP rate, income tax and national insurance are due on the difference. The AMAP rate exists to reduce the administrative burden on employers.

The guidance available on gov.uk has been correct throughout and the Government believe that the number of taxpayers who could be affected is very small.

HMRC is also taking steps to bring this inaccuracy to the attention of employers and employees where necessary. Should any cases arise HMRC will work on an individual basis aiming to ensure that any taxpayers who relied on incorrect information are not disadvantaged.

[HCWS280]

Simon Hinchley-Robson: Discharge from the RAF

Alan Mak Excerpts

Monday 10th January 2022 Commons Chamber

[The Lord Commissioner of Her Majesty's Treasury (Alan Mak)]

Let me begin by associating myself with the tributes from Mr Speaker and many others to Jack Dromey. He will be missed across the House, and I send my condolences to the right hon. and learned Member for Camberwell and Peckham (Ms Harman) and the rest of Jack’s family.

I congratulate the hon. Member for Eltham (Clive Efford) on securing an important debate on an important issue. I know that he is a long-standing and formidable advocate for the LGBT+ community in his constituency, and the issue that we are discussing tonight clearly has broader implications for the way in which Defence treats its people. That, however, should in no way diminish the harrowing experiences of Mr Hinchley-Robson in the 1980s. I have no wish to defend that behaviour. It was plainly appalling. It was inexcusable, it was wrong, and it unfairly tainted a promising career. It is certainly to Mr Hinchley-Robson’s great credit that despite receiving that treatment, he has been able to go on and serve his community with distinction, as he once served his country.

I want to address the issue of compensation from the outset. As the hon. Gentleman noted, at the time of Mr Hinchley-Robson’s service in the RAF, section 10 of the Crown Proceedings Act 1947, which barred members in Her Majesty’s forces from pursuing common law claims for compensation against the Ministry of Defence, was in force. As the hon. Gentleman also noted, section 10 was subsequently repealed by the Crown Proceedings (Armed Forces) Act 1987, but that was not made retrospective.

However, in 1999 the European Court of Human Rights concluded that the MOD had discriminated against service personnel in relation to sexuality as a protected characteristic. That led to the Court directing the MOD to provide a remedy for those who were affected, with most pay and pensions claims being settled by 2008. As regards new claims for compensation, the MOD would always advise that independent legal advice be sought. When common law claims are received, they are considered on the basis of whether or not the MOD has a legal liability to pay compensation. When there is a proven legal liability, compensation is paid.

We should not forget that, shocking though Mr Hinchley- Robson’s case is, it is historical. The MOD of 2022 is a very different entity from its 1980s incarnation. Mr Hinchley-Robson was discharged from service in line with the policy in place at the time. That unjust and retrograde policy was rightfully changed on 12 January 2000, and the RAF, in line with the other services, now has a range of policies and processes to ensure that such unlawful discrimination is eliminated.

[Clive Efford]

I did point out in my speech that those regulations were in place at the time, and they have been quoted to me in previous correspondence with Ministers. What I am also highlighting, however, is the physical abuse that Mr Robson suffered at the hands of the Special Investigation Branch, which went way beyond just applying the rules and regulations that existed at that time. Surely the Government have some responsibility to him as a consequence of that behaviour.

[Alan Mak]

I have seen the correspondence to which the hon. Gentleman has referred, and I am aware of the allegations that have been made. They are very serious, and, as I said earlier, my advice is for Mr Hinchley-Robson to make a formal claim to which the MOD will respond.



In 2012, power was conferred on the Home Secretary to formally disregard certain convictions for specified repealed homosexual offences and, in 2017, automatic pardons were introduced for individuals who had had their convictions disregarded, as well as posthumous pardons for those who had died before the provisions came into force. I am proud to say that, at the start of this year, the Government unveiled plans to expand those powers so that more veterans could benefit. Amendments to the Police, Crime, Sentencing and Courts Bill will enable individuals who have been convicted of same-sex activity under any offences that have now been repealed or abolished to apply to the Home Secretary to have those convictions disregarded. The scheme is also being extended to all general disciplinary offences that were used to prosecute men and women for same-sex activity.

At the turn of this decade, 20 years after military personnel were allowed to serve as openly lesbian, gay or bisexual, the MOD main building was lit with rainbow colours and both the RAF and the Army were listed among Stonewall’s top 100 employers. In February last year, we began returning medals to veterans who had been forced to forfeit them for reasons connected to their sexuality. And, last November, I was proud to see our LGBT+ military and civilian personnel marching with pride in the Remembrance parade. Today we have a thriving LGBT+ network in the MOD, and all serving personnel and veterans can access a range of support mechanisms, from the 24/7 anti-bullying and harassment helpline to the Veterans’ Gateway.

The fact that things have changed out of all recognition does not mean we are complacent. On the contrary, reports such as those released by Air Chief Marshal Wigston in 2019 and by the House of Commons Defence Committee last year act as constant reminders to keep doing more to ensure that all armed forces personnel can thrive. That is why the MOD’s leadership, from the Secretary of State for Defence down, has been crystal clear in stressing that there is a zero-tolerance policy on unacceptable behaviour or discrimination of any kind within the organisation. Today, all personnel are encouraged to call out such bad behaviour, whether they are a victim or a witness. They will never be penalised for doing so. I also want to reassure the hon. Member that our upcoming veterans’ strategy action plan will include further steps designed to address past wrongs.

Today we are looking to build a force fit for the future, but we will not succeed if we exclude parts of our community. Nor can we claim the moral high ground as a proud defender of global freedom, tolerance and justice if we fail to show the same regard for our own people. Yet our desire to make the MOD a more diverse, more inclusive and more welcoming place has less to do with operational imperatives and much more to do with a fundamental respect for human dignity. Every individual, no matter their sexuality, their gender, their colour, their race or their religion, deserves to be treated with consideration. This commitment to diversity and inclusion is one that I take personally and seriously, as the first ever Member of Parliament of British Chinese heritage and the first ever Government Minister of British Chinese heritage to speak at the Dispatch Box.

We should be especially proud of those courageous individuals who are prepared to stand up and, if necessary, lay their lives on the line for their country. Individuals such as these are the best of us—individuals such as Mr Hinchley-Robson. The fact he and others within the LGBT+ community faced discrimination in the not-too-distant past remains a cause of shame and huge regret, but it is now incumbent on us to use this case as a powerful reminder that such shocking incidents must never happen again.

Question put and agreed to.

Finance (No. 2) Bill (Third sitting)

Alan Mak Excerpts

Committee stage
Wednesday 5th January 2022 Public Bill Committees

[The Chair]

I am waiting for the Whip. If the Whip wishes to move the adjournment, I will call Richard Holden first when we come back after the break.

[The Lord Commissioner of Her Majesty's Treasury (Alan Mak)]

What would you prefer, Chair?

[Mr Holden]

I will be really quick.

Oral Answers to Questions

Alan Mak Excerpts

Tuesday 11th February 2020 Commons Chamber

[Jesse Norman]

The hon. Lady is quite wrong. We accepted all but one of Sir Amyas’s recommendations, and we did not accept that one because the issue he raised was already being handled very well within the system. If the hon. Lady has a specific concern, she is very welcome to raise it with tax commissioners or, indeed, with me, although on an anonymised basis because obviously I cannot deal with specifics.

[Alan Mak (Havant) (Con)]

16. What steps he is taking to improve UK productivity.

[The Chancellor of the Exchequer (Sajid Javid)]

You ain’t no Deputy, Mr Speaker!

Increasing productivity is the best way to boost wages and improve living standards. We have worked hard to build a stronger, fairer economy, dealing with the deficit, helping people into work, and cutting taxes for families and businesses.

[Alan Mak]

The link between investment in research and development and increased productivity is well recognised. What steps is my right hon. Friend taking to encourage more private sector investment in R&D to help Britain become a leader in the fourth industrial revolution?

[Sajid Javid]

I thank my hon. Friend for all the work that he has done to put the UK at the forefront of the fourth industrial revolution. He is right to raise the importance of research and development. We are committed to investing an additional £7 billion in R&D by 2021-22 —the largest increase in 40 years—and, as my hon. Friend will know, in our manifesto we committed ourselves to going even further.