Hospitality Industry

Baroness Wheatcroft Excerpts

Tuesday 24th January 2023 Lords Chamber

[Lord Callanan (Con)]

As I said in reply to an earlier question, the Home Office keeps visa policies under constant review. Where there are demonstrable shortages of labour in certain sectors, I am sure that the Home Secretary and other Ministers will want to look closely at them.

[Baroness Wheatcroft (CB)]

My Lords, one of the problems affecting the tourism industry is the lack of tax-free shopping. We are sending people to France and Italy when they should be coming here, at a time when our hotels and hospitality industry need that business. Will the Minister commit to reconsidering that policy and looking at the effects of it?

[Lord Callanan (Con)]

Again, noble Lords are tempting me to go down the path of Treasury policy. I know that the Chancellor has heard many of the representations that were made to him about tax-free shopping. If he has anything to announce, I am sure we will hear about it in the Budget.

REUL Bill: Trade Unions and Workers’ Rights

Baroness Wheatcroft Excerpts

Monday 23rd January 2023 Lords Chamber

[Baroness Wheatcroft (CB)]

My Lords, has the Minister recently read or listened to the speeches of Tony Danker, the director-general of the CBI? He is very clear that his members do not want this legislation; that they find it, even as potential legislation, damaging to their markets; and that, should it go ahead, it will undoubtedly shrink the market further for British exports, which have suffered enough already.

[Lord Callanan (Con)]

I have not seen the comments which the noble Baroness attributes to the director-general of the CBI, but I will certainly look at them. However, I am not sure how our repealing redundant pieces of legislation in this House affects overseas markets.

Economy: The Growth Plan 2022

Baroness Wheatcroft Excerpts

Monday 10th October 2022 Lords Chamber

[Baroness Wheatcroft (CB)]

My Lords, first I welcome my friend, the noble Baroness, Lady Neville-Rolfe, back to the Front Bench.

The Chancellor was absolutely right when he said that the only way to sustainably raise the living standards of our nation is to confront the challenge of our lifetime: to raise productivity. He was right when he talked of the need to lift skills, improve infrastructure and speed up the planning process. However, that was Chancellor George Osborne in 2015. The Prime Minister and her Chancellor talk about their decision to go for growth as if they have had a unique revelation. On the contrary, successive Governments have talked this talk. The problem has been delivery.

There have been numerous initiatives. George Osborne cut corporation tax and raised the investment allowance, just as Kwasi Kwarteng has done. It did not increase investment levels. He announced the creation of 26 new or extended enterprise zones. The productivity gap remained. Nevertheless, we are now promised dozens of investment areas. Business was not crying out for tax cuts or gimmicky zones. Even the president of the CBI has said that cancelling the planned increase in corporation tax was not a particular demand of his members—albeit that the noble Viscount, Lord Trenchard, was keen on it.

Business needs a skilled workforce and efficient infrastructure; that is the key to bridging the UK’s productivity gap and growing the pie. But our education system ranks only 15th in the OECD’s league table, behind countries such as China and Japan, but also behind Estonia and the Netherlands. Our best schools are brilliant but, through the Peers in Schools initiative, I have been into secondary schools which in the staff room the staff refer to as “secondary moderns”. I have been into a secondary school where the headmaster told me that his first task was not so much educating his pupils as providing them with some stability in their lives. The skilled workforce, on which bridging the productivity gap depends, needs a better education system than the one that we have.

The need for serious infrastructure investment remains. This country has a national productivity investment fund. Its contributions to improving infrastructure include extending passenger waiting areas within Derby bus station and a new pedestrian cycle crossing in Middlesbrough. Competing with modern China or Korea will need a little more than that. Perhaps the Minister could tell me what the national productivity investment fund is doing now.

Business also craves stability. That has certainly not been enhanced in recent weeks. Incentives for long-term investment might help. Some countries enable companies to reward long-term investors with enhanced voting rights. The UK will not countenance that. Business also needs a stable community if it is to flourish. The inequity now evident in our society is threatening that stability.

The mini-Budget fiscal event was crazy. The withdrawal of the 45% tax rate was simply crass, from every point of view. The noble Lord, Lord Frost, in welcoming the growth strategy, invoked the name of the late Lady Thatcher, but that devotee of good housekeeping would never have countenanced the idea of borrowing to fund tax cuts. It took her nine years to reduce the top rate to 40%. Even if this Government have the right recipe to grow the pie, it will take years to bake it.

In the meantime, to get anywhere near that promised plan to bring down debt in the medium term, there will have to be vicious cuts to public spending; or does everything depend on what is written on page 17 of the growth plan:

“The financial services sector will be at the heart of the government’s programme for driving growth across the whole economy”?


A “deregulatory package” will

“unleash the potential of the UK financial services sector.”

Can they have forgotten 2008?

Four-Day Working Week

Baroness Wheatcroft Excerpts

Monday 5th September 2022 Lords Chamber

[Lord Callanan (Con)]

Again, my noble friend makes an interesting point. Of course, there are many different ways of defining it. He is right to point out that productivity is the key to this. If there is evidence that people will work smarter and harder during the time they are at work, of course that would be a good thing and it would help to bring it about.

[Baroness Wheatcroft (CB)]

My Lords, the Minister has quite rightly stressed the importance of businesses being able to decide this sort of thing for themselves—what is right for them. So can he give the House an assurance that, under this Government, there will be no return to a three-day week, whatever happens in the energy crisis?

[Lord Callanan (Con)]

Well, we have no plans for a four-day week; we certainly do not have any plans for a three-day week.

Energy Storage Capacity

Baroness Wheatcroft Excerpts

Tuesday 5th April 2022 Lords Chamber

[Lord Callanan (Con)]

My noble friend’s question deserves a long answer because it is a complicated subject. We need to differentiate between short-term storage, particularly from batteries and elsewhere, which is currently expensive—although prices are coming down—and longer-term storage provided by the likes of pump storage stations such as Dinorwig. That has been around for decades, and there are similar schemes in Scotland too. We need to do all these things. We need to get more offshore wind because it is a very cheap form of power, but it is intermittent, so we also need storage capacity to balance out that intermittency. As the noble Lord, Lord Fox, said, we also need more nuclear for baseload power.

[Baroness Wheatcroft (CB)]

My Lords, storage is a long-term solution, so can the Minister tell me whether Dungeness B, which was finally decommissioned only last year, might be brought back into service? Has the department examined the possibility of doing that as a short-term solution?

[Lord Callanan (Con)]

Of course we will want to ensure that the existing nuclear stations, of which Dungeness B is an excellent example, will continue into their lifespan as long as possible, but we will need to replace many of these ageing nuclear stations, which is why we recently passed the nuclear financing Act.

North Sea Oil and Gas

Baroness Wheatcroft Excerpts

Thursday 10th February 2022 Lords Chamber

[Lord Callanan (Con)]

The noble Baroness makes some good points. As I said in response to my noble friend earlier, we keep these matters under review. If it can be demonstrated that fracking can be carried out in a safe and reliable manner, then of course we need to consider it. But we have to be realistic about this: it is not going to be the answer to our short-term difficulties. In preparation for this, I was chatting to some specialist officials and they said it could easily be 10 years—even if we got rid of the moratorium tomorrow and overcame all the environmental problems that were caused—before any fracked gas came on stream.

[Baroness Wheatcroft (CB)]

My Lords, the oil companies, including BP and Shell, have been making record profits. Yet for their North Sea operations they have had a negative tax rate for several years. Given the current circumstances, might the Government re-examine the fiscal regime in the North Sea? Can the Minister tell the House?

[Lord Callanan (Con)]

Of course, I leave all tax decisions to the Chancellor. But, again, I think that the noble Baroness is wrong and looking at this too simplistically. First, most of the profits announced by the companies in recent days were made in worldwide operations; a very small percentage came from British domestic production. Secondly, it was only last year or the year before that they were making net losses; I do not remember the noble Baroness or others saying that we should give them taxpayer support. Thirdly, where do these profits go? First, they pay more corporation tax and, secondly, they go to UK pension funds, shareholders and people who need that income to help them though the crisis. There are no easy answers; the idea that there is some magical, mythical pot of money that we can just extract from to solve all of our problems is not true, I am afraid.

EU: Imports

Baroness Wheatcroft Excerpts

Tuesday 1st February 2022 Lords Chamber

[Lord Grimstone of Boscobel (Con)]

My Lords, making sure that the Northern Ireland protocol operates as smoothly as we intended will continue to be a priority for our relationship with the EU. While we have tried to operate this agreement in good faith, I frankly admit that the problems are significant and are growing. This must be resolved through a real negotiation between us and the European Union, which is why the Foreign Secretary is paying so much attention to this matter.

[Baroness Wheatcroft (CB)]

My Lords, on Monday morning operations were under way to restore Operation Stack, apparently on a permanent footing, as soon as possible. Can the Minister tell us how long he expects the ship refitting to take?

[Lord Grimstone of Boscobel (Con)]

My Lords, I am very confident that as traders, hauliers, importers and, indeed, exporters become increasingly familiar with the new procedures, things will operate smoothly. We have prepared freely available tools to assist traders with these new processes, introduced on 1 January. Of course, we want things to move smoothly, and we will continue to emphasise this.

Private Equity Takeovers

Baroness Wheatcroft Excerpts

Thursday 21st October 2021 Lords Chamber

[Lord Callanan (Con)]

My Lords, we benefit in global terms from being an open and accessible economy. That brings in billions of pounds-worth of inward investment. My noble friend Lord Grimstone, who is in charge of the Office for Investment, works extremely hard to attract overseas investment. We must be very careful not to send out the message that we do not welcome inward investment into this country. That was something recognised by the previous Labour Government and certainly something recognised by this Government. Of course we keep these matters under review. We have introduced the National Security and Investment Act, which gives us additional powers to intervene on national security grounds, and we extended the grounds on which the Secretary of State can intervene under the Enterprise Act.

[Baroness Wheatcroft (CB)]

My Lords, some private equity companies are good managers of businesses, others rather less so. Does the Minister agree that, given the need of the Treasury to bring in extra cash, the treatment of carried interest—the favourable tax treatment of private equity operators—is no longer sustainable?

[Lord Callanan (Con)]

My Lords, I have never noticed any lack of interest from the Treasury in extending the tax base whenever it possibly can, but the current tax rules reflect the hybrid nature of this reward. If investment managers realise their carried interest gain within three years, that gain is treated as income and taxed accordingly. This approach is also followed by other comparable jurisdictions.

Sovereign Defence Capability: Meggitt Takeover

Baroness Wheatcroft Excerpts

Wednesday 15th September 2021 Lords Chamber

[Lord Callanan (Con)]

I can indeed reassure my noble friend that the UK’s replacement warhead will be designed and manufactured in the United Kingdom. While work continues with US counterparts to ensure that the UK replacement warhead remains compatible with the Trident missile system, the requirements, design and manufacture of the warheads are sovereign to each nation.

[Baroness Wheatcroft (CB)]

My Lords, the undertakings given by Parker-Hannifin last for only one year. Does the Minister believe that they should be extended if jobs in this country, and other things, are to be safeguarded by those undertakings? Could he update the House on how the investigation into the Chinese takeover of Britain’s largest computer chip manufacturer is progressing?

[Lord Callanan (Con)]

Those are competition concerns. I am in a difficult position, as noble Lords will understand. It is a quasi-judicial process, and it would not be appropriate for me to comment on the details of the specific commercial transactions of any security or competition assessments that are currently taking place.

Status of Workers Bill [HL]

Baroness Wheatcroft Excerpts

2nd reading
Friday 10th September 2021 Lords Chamber

[Baroness Wheatcroft (CB)]

My Lords, I welcome the Bill and thank the noble Lord, Lord Hendy, for presenting it in such an effective way. The law can sometimes be an ass and, looking at the distinctions which currently exist in employment law, you can hear it braying. It is time for change. That in 2021 our law still preserves the right of businesses to treat those who labour for them in the way that 19th-century mill owners did is something of which we should all be ashamed. It was in 1819 when the cotton factories Act was passed, and among its provisions was that workers had to be nine years old. We have moved on from there, but nowhere near far enough. At that stage, mill owners argued that any changes to the labour laws would hit productivity and increase prices. What they meant was that they would lower profits. We need businesses to make profits, but not through unfair exploitation of labour. We should have moved on to something much better than that.

In fact, though, the problems are still huge. The Joseph Rowntree Foundation found in 2017-18 that 4 million workers lived in poverty, and half of the workers living in poverty were in full-time employment. Nobody can sit in this Chamber and feel comfortable with that statistic. The way things still work in far too many businesses is that companies pay their chief executives and other top staff huge salaries, and pay generous dividends to their shareholders, yet many of their workers are having to claim universal credit. How can that make sense? The taxpayer is subsidising the chief executive’s salary and the dividends. I find that very hard to justify.

We need businesses to compete fairly, and some of them are cheating—there is no other word for it—by taking on people on terms that they will not even understand. How many people really know the difference between being an employee and being a worker? It is a totally bogus distinction. Those companies are out to defraud the country and to defraud their competition, and we must stop them being able to do that. This Bill is a wonderful way to do it.

The Bill also plays absolutely into the levelling-up agenda. It must be fair to make sure that workers who provide their labour do so on equal terms unless they choose to be fully self-employed. I absolutely respect and applaud the right of some people to be self-employed. If you work from home and are self-employed, why not live somewhere in the sun, as many youngsters are now deciding to do, and be in charge of your life, with the work/life balance that you want? But not many people can afford that sort of luxury. They want the security of full-time employment, albeit with flexible hours. If we believe in compassionate capitalism, that is what we should guarantee. I have heard many speeches this morning that I am sure will have swayed the Minister, but I look forward to hearing how, if he does not support the Bill, he can justify that.