(1 year, 6 months ago)
Lords ChamberMy Lords, I thank my noble friend the Minister for all the engagement and patience he has shown over the last few weeks and months, not just with me but with a wide congregation. We now have something that is much better than when it began its journey through the House, so I thank the Minister for that.
I am very pleased with two particular changes in this batch of amendments from the Government. First, that key, vital objective has been added for the registrar, so that it is absolutely crystal clear culturally for the organisation Companies House to know what it has to do. Added to that, giving her more discretion on how she delivers on that is very sound because, of course, it will be a mobile battlefield and she will have to be more fleet of foot.
Lastly—and I have said this before, but I think it is important that it goes on the record—we should not underestimate the extent of the cultural change needed in Companies House to move from being, as my noble friend said, a passive recipient of data to something far more dynamic and intelligent. That is why this reporting to Parliament—albeit with a sunset clause up to 2030—is really important to keep driving the momentum of that change. Every single employee of Companies House will need to be thoroughly retrained in this new mission.
My Lords, I apologise for my croakiness; the hay fever is definitely winning. I join others in welcoming, in these government amendments, that we have seen significant change since Committee. It is worth highlighting a couple of comments from the Minister’s introduction. He said that the aim of the Bill to drive dirty money out of the UK; I hope we can all agree that that is essential. He also said that we had seen so many people abusing our open system; I think we have to acknowledge that we invited those people in, and that that is the situation we created. We are now trying to fix it.
In that light, I very much welcome the fact that the Minister said that we need to see how these changes bed in before going significantly further. I want to make sure that we acknowledge, and see on the record, the fact that the Government have acknowledged that this is not enough, and that a lot more will need to be done, in what is, after all, as described by UK Finance,
“the fraud capital of the world”.
(1 year, 7 months ago)
Grand CommitteeMy Lords, I apologise to the noble Baroness, Lady Kramer, because I would certainly have attached my name to these two amendments had I been able to get my head sufficiently above the parapet in the face of the barrage of legislation that your Lordships’ House currently faces. They are terribly important amendments, as was highlighted yesterday in the other place in Prime Minister’s Questions, when the Prime Minister in response to a question about what is happening on Teesside said:
“Contracts at the site will be a commercial matter for the companies involved”.—[Official Report, Commons, 10/5/23; col. 334.]
There is great public concern about what is happening on Teesside, and it is at the moment extremely opaque.
I shall concentrate mostly on freeports, because, as the noble Baroness said, investment zones are such a “fluffy” area that is very hard to grasp on to it. As to what we know about freeports and what is happening, a lot of the questions are being asked by the independent media and the civil society organisations referred to by the noble Baroness. I would point anyone who is interested to an excellent, 44-page report from the Byelines Network that was put out by local journalists from around the country in areas directly affected. It does a great job of examining some of the issues, but butting up again and again against commercial confidentiality and lack of recording. One of those reports notes that in 2020, the Royal United Services Institute Centre for Financial Crime and Security Studies submitted evidence to the International Trade Committee saying that
“there is evidence of criminal activity taking place in multiple freeports around the world. It often involves trade in counterfeit goods, drug trafficking, smuggling of untaxed goods or trade-based money laundering”.
If we were to think of something that is essential to the purposes of the economic crime Bill now before us, shining the light, opening the doors and being able to see what is happening would clearly be it. What we are talking about with freeports are huge concessions from the Government. As the noble Baroness, Lady Kramer, said, they include freedom from all kinds of usual customs controls, but also stamp duty land tax relief, enhanced structures and building allowance, enhanced capital allowances, employer national insurance contributions relief, and business rates relief and retention. Those are huge concessions. Surely it would only be absolutely fair and reasonable to demand full transparency about who is responsible and who is making those decisions.
It is very evident that there is great public concern. This is one way that the Bill or some other mechanism—I directly put the question, “If not this Bill, where else?”, to the Minister—will make sure of what will happen if we create these structures. The reason why people are so suspicious about this seems to go back to an uncredited blog from 2010 on the website of a right-wing lobbying group, the TaxPayers’ Alliance, which raised the idea of charter cities. People are very suspicious. Surely the Government would want to dispel some of those suspicions by ensuring that there is absolute transparency and openness.
My Lords, I rise because I hope that I might be able to provide some help to my noble friend the Minister, as this is obviously not his area of expertise; this is at the Companies House end.
Right at the beginning of Committee, I tabled Amendment 44. Its explanatory statement says:
“This amendment mandates companies to disclose whether their shareholders are acting as nominees. Nominee shareholders protect the identity of the beneficiary of the shareholding. This measure will help mitigate the risk of abuse through nominee shareholders. Failure to comply would incur a penalty”.
Last night, I met the Minister, my noble friend Lord Johnson, who indicated to me that the Government were sympathetic to this approach. I do not want to put words into his mouth, as he is not here now, but I suggest to the Minister, my noble friend Lord Sharpe, that he talks to my noble friend Lord Johnson to see whether there is any way that we could look at this; that would deal with the specific concern raised by the noble Baroness, Lady Kramer, in relation to freeports.
(2 years, 9 months ago)
Lords ChamberMy Lords, I rise very briefly to make my first contribution in Committee on these two very important amendments. Both were very comprehensively introduced by the noble Baroness, Lady Kramer.
As a former journalist, I reflect on how protecting your sources is something that is drummed into you from a very early stage in your career. However, one thing I have observed over 20-plus years as a journalist is how much more complex this has become. Having been an editor at the Guardian Media Group, I know what difficulties there are in trying to protect sources these days. That is on the technical side of things. But, as the noble Baroness, Lady Kramer, said, there is also the issue of how torrid a time some people have had even when whistleblowing about what you might describe as ordinary and mainstream companies. We have seen that with people who have exposed safety and financial issues. With some of the people we are looking to target here, it is crucial that there is the security of knowing that, if information comes out and others seek to prosecute, uncover and expose them, there will be a group looking after the whistleblower. The noble Baroness has made a very important point.
I support the amendment of the noble Baroness, Lady Kramer. I accept that it is unlikely to go into this Bill, but I very much hope that it will go into mark 2.
I do not share the somewhat Panglossian view of my noble friend the Minister that this whole crime issue is a tiny issue. There is a wall of bad money out there trying to get in, and we have been far too complacent. The Transparency International report of 2018 looked at the BVI and found over 1,100 companies involved in 200 major frauds to the value of tens of billions of pounds. This was just one territory.
Whistleblowers are a vital source of information and intelligence. The noble Baroness, Lady Kramer, is right in saying that we do not recognise them nearly enough in this country. I will not go on further, save to ask the Minister replying that she will take back this issue and ensure that it is plumbed into the next Bill.
(3 years, 2 months ago)
Lords ChamberMy Lords, I respectfully disagree with the noble Lord’s view of the Treasury’s position. I mentioned the emissions trading scheme that was announced earlier this year. We have published the Industrial Decarbonisation Strategy, which sets out the vision for a low-carbon industrial sector by 2050. In March this year we were the first G7 country to agree a landmark North Sea transition to support the oil and gas industry’s transition to clean energy. Through this deal, the sector has committed to cut emissions by 50% by 2030. The Treasury is closely involved in all these initiatives.
My Lords, I follow on from the question put by the noble Lord, Lord Eatwell, about the polluter pays principle. I am sure the Minister is aware of the International Monetary Fund’s report earlier this month recommending that polluters—fossil fuel companies—should pay for deaths and poor health from air pollution and heatwaves, and for the impact of global heating. This is the International Monetary Fund. Will the Government be following this advice and publishing a road map for when they will get to the point of really making polluters pay?
My Lords, I repeat that we are moving very fast to decarbonising; we are one of the fastest in the G20, and indeed in the G7. If we push the envelope too hard, we will just see a boomerang of costs going back to consumers. We very much support the aspiration for polluters to pay but it must be done on a sustainable basis.
(3 years, 7 months ago)
Lords ChamberMy Lords, the Government recognise the importance of fintech in our economy. Indeed, that needs to flow through to the curriculum; we have extended the number of pupils studying computer science at A-level, for example. In the Cabinet Office, in my role overseeing the Government Digital Service I pushed that out to Bristol and Manchester to engage much more closely with FE and HE in those cities. My noble friend is absolutely right; continual focus on this is needed.
My Lords, the Chancellor of the Exchequer said at the UK FinTech Week conference that the Government would
“push the boundaries of digital finance”.
Does the Minister acknowledge the risk that, in cheerleading the latest technology, the Government will fail to count the costs of runaway financial innovation: both the obvious environmental costs—Bitcoin climate emissions are equivalent to those of the whole nation of Norway—and the dangers to the security of our real economy and lives? This was the world experience of 2007 and 2008, which they risk forgetting.
The Government absolutely recognise the risk of a financially weak system. We learned important lessons 12 years ago and they are very much part of our institutional memory.
(3 years, 8 months ago)
Lords ChamberMy Lords, the UK has an established record of being at the forefront of initiating global action on international tax. It is no different here: during our G7 presidency, we are leading the way to ensure the delivery of G20 commitments that we secured in January 2019 for a comprehensive global solution based on two pillars. Pillar 1 would deliver on ensuring that businesses are taxed where they make their profits, and pillar 2 would deliver a global minimum tax.
I expect that the Minister will acknowledge that, with their plan to raise the UK corporate tax rate, the Government have, at least implicitly, acknowledged that the 30-year-long global race to the bottom on corporate tax rates has led to major multinational companies not paying their way, while reeling in profits, building inequality and starving public services of essential funds. I also expect that the Minister will know that the recommended and UK-planned 25% minimum rate, as recommended by the Independent Commission for the Reform of International Corporate Taxation, would raise more than £22 billion for the UK Exchequer. Given that, and given that Germany, France and the Netherlands rapidly supported the US intervention, why is the UK not at the forefront, as the Minister said, but trailing well behind? Why have we not stepped in and backed this plan?
My Lords, we have always been a Government who want to reduce taxation wherever possible. However, the Government have been very active in dealing with the abuse of corporate taxation over the last few years—for example, with the corporate interest restriction rules, which prevent multinationals from avoiding tax using financing arrangements, raising £1 billion a year since 2017. Other examples are the diverted profits tax, which has led to an additional £5 billion by countering aggressive tax planning, and the tax charge on offshore receipts in respect of intangible property, which is forecast to raise £1 billion a year.
(4 years ago)
Lords ChamberMy Lords, the CDS is the system that is being rolled out specifically for Northern Ireland from 1 January, because that is the one that enables a dual-tariff mechanism. The development is well under way. We have one or two more upgrades to make to it, with the last one on 21 December. I am not going to pretend that that is not tight, but the development is moving at pace, and the most recent upgrade enabled the dual-tariff operating model to work. The CSPs—the community service providers that provide the link into the CDS for traders and hauliers—are working at pace. The main one, the Trader Support Service, is working at particular pace, and I am confident that the system will be connected by the due date.
My Lords, further to the questions from the noble Lord, Lord Wigley, and the noble Earl, Lord Clancarty, the head of Stena Line’s head of UK Port Authorities told the BBC yesterday that it was preparing for no deal and was confident that it was in the right place for that. As far as I am aware, the Government are still looking for a deal. That means that big companies such as Stena, and also small companies, will have to deal with the uncertainty, with 36 days to go. What help is being provided to enable small independent businesses, in particular, to interact with that extremely late-arriving IT system?
My Lords, the difference for the vast majority of traders between a deal and no deal is simply the level of tariffs that will have to be put into the HMRC and DIT systems. So their readiness needs to be at the same level, whether it is a deal or no deal.
(4 years, 1 month ago)
Lords ChamberI thank the noble Lord for his supportive comments. I completely agree with him that intergenerational solidarity is vital as we come through this crisis. I worry about the cliff edge of debt that we are generating, but I accept his point that we need to be here today for all those very vulnerable people who we have tried to help over the past six months. I hear what the noble Lord says about the complexity of eligibility. I am pleased to confirm to him that we are working to make clearer eligibility criteria. They have been introduced for the third SEISS grant, and we have committed to there being a fourth grant early next year.
My Lords, I join the noble Baroness, Lady Kramer, and the noble Lord, Lord Bird, in focusing on the self-employed, particularly those who are missing out on help altogether. In figures out this morning, the LSE Centre for Economic Performance found that one-fifth of self-employed people anticipate quitting altogether, rising to 58% of those under the age of 25. The right reverend Prelate the Bishop of Portsmouth referred to the conditions of uncertainty that we are going to see in the new year. What will the Government do to enable the self-employed to rebuild their careers and their lives and to give them security as a foundation to do that? An unconditional payment, such as universal basic income, could be such a foundation. Will the Government consider it?
The noble Baroness knows that this Government certainly do not support a universal basic income, but we are very aware of the vulnerability of many self-employed people. We have tried to close as many of the gaps as we can. As I mentioned in my answer to the noble Lord, Lord Bird, we have clarified the criteria in the latest round. The noble Baroness will know that we have made the entitlement more generous and extended it not just to November through until January.
(4 years, 7 months ago)
Lords ChamberI thank the noble Earl for his point; we discussed this in a Question last week. I know that in the Chancellor’s response yesterday, he said that he had been in touch with some of the groups that the noble Earl mentioned—I think he mentioned the Musicians’ Union, and so on. I am not saying that to take income by dividend is wrong; as I said last week, a dividend is defined as a surplus of profit of a business after all its operating costs have been paid, and the tax is paid and retained profits kept for reinvestment. That is my point. But what has happened in the week between our conversation and today is that bounce-back loans are now available, and that is probably the route for those people whom the noble Earl is particularly worried about.
My Lords, the noble Baroness, Lady McIntosh, referred to the difficulties of the hospitality sector. UKHospitality reports that 71% of its members have had claims for business interruption insurance refused, and that of course is another potential source of income. In answer to my question on small business insurance and coronavirus last week, the noble Lord, Lord Callanan, referred to issues around infectious diseases clauses. I want to ask the Minister today about general business interruption insurance. The New Jersey and Ohio legislatures are bringing through Bills which will basically say that insurance companies have to pay out on business interruption insurance for small companies. Will the Government consider doing likewise?
The noble Baroness, Lady McIntosh, also asked about those businesses paying council tax rather than business rates. Will the Government consider doing something to help them?
I thank the noble Baroness. On insurance, I did not hear my noble friend Lord Callanan’s response, so I do not want to conflict with what he may have said, but the key thing here is that when one takes out a general business policy, one has the option of an extension for pandemic cover. The problem is that I think most businesses did not elect to do that, so it would not be right then to impose that cover on insurers retrospectively through the route suggested by the noble Baroness.
On paying council tax rather than business rates, as I have mentioned before, we have put together a package of some 11 types of support for businesses, ranging from the very smallest to the largest, including such things as the deferral of tax liabilities. I believe that there are 1.3 million self-employed people on self-assessment. Deferring will provide that whole cohort with some £13 billion in cash flow. So a range of measures is there. It is important for noble Lords to look in the round at the support that we are offering.
(4 years, 9 months ago)
Lords ChamberI do not fully agree with the noble Lord. Most people who have a mortgage do not increase the amount of the mortgage every year when they get a pay rise. A country needs to be mindful of that and not do the same.
A number of noble Lords, including the right reverend Prelate the Bishop of Rochester, the noble Lord, Lord Razzall, and the noble Baroness, Lady Lister, are worrying about social care. It is perhaps worth just summarising some of the things we have done over the last year or so. Over the last three years, between 2017-18 and 2019-20, we have cumulatively given councils access to up to £10 billion of dedicated additional funding for adult social care; we are increasing the funding of that next year.
The noble Baroness, Lady Bennett, talked about the bailout of the banks in 2008 and 2010 as though we should not have done it. It is worth just putting it back on the record that if we had not done it, the whole system would have ground to a halt. We would have been plunged back into the dark ages, which would have been great for our carbon but not for the millions of people who rely on a functioning economy.
For clarification—perhaps I was not clear—I said that we should not have made the people, particularly the disabled, poor and young, pay for the bailout of the banks.
To reassure the noble Baroness, most of that burden will have fallen on the higher-income taxpayers, as I alluded to earlier. Something like the bottom 60% of taxpayers receive more in services from the state than they pay in tax, so I do not feel that they took an unfair level of the cost of that bailout. Of course, the banks continue to pay an additional levy over and above corporation tax to try to bring about the fairness she alludes to.
The noble Baroness, Lady Finn, is keen—I was not aware of this—on a tidal power solution. We live at opposite ends of the country; I am on the east and she is on the west. If the numbers work, I—wearing my Treasury hat—would be very interested. I have a farm that runs down to the sea; I would love to create a tidal power system there, but I do not think the numbers work. To reassure our Green Members, what is happening in offshore wind is, frankly, extraordinary. There was a contract for difference auction about a month ago—they do them every two years—and the bidding price for the offshore-generated electricity was 32% lower than two years ago. It is the most incredible development. That is why I do not accept the gloom that says that we are not embracing the green economy and decarbonising. We are now creating offshore wind at a price virtually without the need for subsidy. If the noble Baroness can do that with her tidal—