Finance Bill

Lord Mackinlay of Richborough Excerpts

Monday 26th October 2015 Commons Chamber

[Stella Creasy]

And people say that progress cannot be made in this Chamber or that there cannot be cross-party agreement! The hon. Gentleman is absolutely right. In fact, 10% of girls in Africa do not go to school when they have their periods because they do not have appropriate sanitary protection, so he is right to be concerned about this. What I am saying—let us see whether we can tempt him to make further progress—is that feminism should be without borders; in which case we should be concerned about inequality in the tax rates and VAT that our sisters pay in a range of countries, including those in the European Union.

Tonight we have an opportunity, here in the British Parliament, to show solidarity across the continent and make sure that this issue is part of the negotiating process. Because let us be honest, it was never part of the negotiating process in this House prior to joining the European Community. It was only part of the negotiating process because of Dame Dawn Primarolo. It is a red herring to think that this is about the European Union; rather, it is a recognition that the time has come to end these inequalities. Our sisters in France tried to bring forward legislation just this summer and were defeated. What a strong message of social progress we could send from the British Parliament today by passing this proposal and sending our Prime Minister to have that difficult conversation and to say, “How do we clarify the way in which essential items are categorised across the European Union? How do we make this work for 51% of our population?”

I am sensing from the hon. Member for Stone that he does care about these issues deeply and does recognise the inequality. If he has frustration tonight, it is simply that he is not seeing progress happening quickly enough. Let me reassure him that, whether it takes 20 years or two hours of debate, it is possible to make progress. I urge him to support our new clause, so that we can send our Prime Minister to the European Union with something worth fighting for. We can all hear back from him in February whether he has made progress and been able to say to our French, German and Italians counterparts that tampons and sanitary towels should be treated as necessities in 2015. I am sure that when we hear that message from the Minister tonight, he will give us great succour—that he will use the appropriate terms and bring us all into the 21st century by supporting the new clause as well.

[Craig Mackinlay (South Thanet) (Con)]

May I give my respects to the hon. Member for Dewsbury (Paula Sherriff) for bringing this debate to the House? I have heard some very interesting figures this evening—in particular, that 250,000 people have signed previous amendments and discussion points about this issue over the years, and I know that there have been all sorts of discussions about this very issue for as long as I have been in Parliament.

I am not surprised that new clause 7 has attracted cross-party support, with many Members, both female and male, from the Government, SNP and, obviously, Labour Benches supporting it, and so they absolutely should, because this has always been, and will always be, a wholly illogical tax. We heard some interesting detail from my hon. Friend the Member for St Albans (Mrs Main). I would not know the difference between various products if they were laid out, yet some would be zero-rated and some would be taxed at the lower rate, although this is not just a female issue. I think she described some of these items as “Oops-a-daisy” products, and if there is a male “Oops-a-daisy” product, it would be zero-rated, so we can immediately see these anomalies in the tax system. Nappies have always been zero-rated because they relate to children. Indeed, one of the anomalies that we have enjoyed compared with much of the European Union—how long that will last, who knows—is that children’s products and food continue to be zero-rated, no matter how luxurious the food might appear to some.

--- Later in debate ---

[Madam Deputy Speaker (Natascha Engel)]

Order. The hon. Gentleman must remember that he is speaking through the Chair. I have made no proposals today.

[Craig Mackinlay]

My sincere apologies, Madam Deputy. [Interruption.] You have taken me way off track now.

In conclusion, the hon. Member for Glasgow Central made an appeal earlier for a message or plea to come from this place to the European Union. I think we have heard that from many Labour Members, too. I am afraid this goes back to the very old times of taxation without representation. Messages are all very well, but surely this sovereign place should be able to choose to set the rate of sales tax or VAT on products such as tampons and sanitary towels. I am afraid that it rather reduces the status of this House to one of being a colony of old, pleading with an empire power.

[Alison Thewliss]

The Prime Minister has been traipsing around Europe of late begging and pleading with European leaders all around the place. Would it not perhaps have been useful for him to have raised this issue then and saved himself another visit?

[Craig Mackinlay]

I certainly hope his visits around various European capitals have an awful lot on their agenda. Following today’s debate, I hope this issue will be one such item. The issue is one of exclusivity in setting VAT rates on products important to us in this place, not elsewhere.

[Mr Jenkin]

In response to the hon. Lady’s intervention, is not the point that there are so many issues we want our Prime Minister to raise in the European Union? There is an increasing number of myriad issues, such as how much contribution we make, the free movement of people and how we control our borders. It is these little things—I say “little” mistakenly, because of course it looms large as an equality item in our minds—that get set aside in favour of other things. This is a rotten way of running a continent.

[Craig Mackinlay]

I agree with my hon. Friend. I hope progress can be made on very many areas, not least on this one.

We should not be like a colony pleading with an empire power. This is clearly a rate that should be set here. I thank again the hon. Member for Dewsbury for raising this issue, which, important in itself, has opened a Pandora’s box on who governs this country.

[Roger Mullin]

I rise to speak to new clause 1, which also relates to VAT. I pay tribute to everyone who participated in the previous debate, particularly my hon. Friend the Member for Glasgow Central (Alison Thewliss) who, in Committee, was the first to raise this issue and moved new clause 2. At that time, we were favoured with support from the Labour Benches. They can look forward to us reciprocating that support this evening.

On Second Reading, I focused on the fire and rescue service and its punishment by the UK Government in relation to VAT. I should now like to focus in some detail on Police Scotland, which came into being in 2013. I should say that I have a prejudice in supporting the police, as I am a former academic adviser to the Scottish Police College, and have contributed in the past to training programmes for chief officers, police super- intendents and, most recently, crime analysts.

A key reason for the creation of Police Scotland was, according to the Scottish Government:

“Establishing a single service aims to ensure more equal access to national and specialist services and expertise such as major investigation teams whenever and wherever they are needed.”

Allow me to give a few examples of the effect of creating a single force. Assistant Chief Constable Malcolm Graham, speaking as recently as 29 September 2015, stated:

“Since the advent of Police Scotland, every murder committed has been detected.”

He is overly modest. Such has been the improvement in homicide detection that they have opened old, unsolved cases from when there were eight smaller forces and have already solved five of them. Police Scotland has improved the investigation of rape and sexual crimes across the entire country and is now able to treat rape as seriously as murder. The National Child Abuse Investigation Unit has been established as a specialist unit to support the investigation of complex child abuse and neglect across Scotland. Police Scotland has also been able to tackle intellectual property crime much more effectively, recovering about £20 million in criminal assets and making about 70 arrests. The result has been improvements on areas such as cross border co-operation and terrorism, as I discussed in Committee.

The Government, however, say we must abandon the improvements resulting from Police Scotland to satisfy some old rules established in the Value Added Tax Act 1994. Reflecting on the debate we have just had, this is one area on which the UK Government have it entirely within their power to act reasonably on a matter related to VAT. They have chosen to provide VAT exemptions to other public bodies elsewhere in the United Kingdom, while at the same time completely denying the right of the Scottish police and fire and rescue service to achieve an exemption.

Speaking to the Justice Committee of the Scottish Parliament last November, Chief Constable Sir Stephen House said:

“I do find it bewildering that we seem to be the only police service in the United Kingdom that is charged VAT. None of the 43 forces in England and Wales pay it. And the answer seems to come back from the Treasury, ‘oh, that’s because you’re a central government organisation’. Well, you’ve got the Police Service of Northern Ireland, they don’t pay VAT. And you’ve got the National Crime Agency and they don’t pay VAT—but we pay VAT. I just don’t understand the logic of it and I frankly don’t think the Scottish public would understand it either.”

Consider what the Government have been willing to do on VAT. At the stroke of a pen, the Government made central Government-funded academy schools in England exempt from VAT. For goodness sake, even the BBC does not have to pay VAT. When it suits the Government, and previous British Governments, they have little difficulty in allowing exemptions.

In Committee, the Minister said:

“If the Scottish Government are now reconsidering their position and wish to discuss how the service can be eligible once again for VAT refunds, the Treasury will happily engage with them to advise.”––[Official Report, Finance Public Bill Committee, 17 September 2015; c. 24.]

It is not the Scottish Government who need to reconsider their position, but the UK Government. Although we are talking significant sums for Police Scotland and the Scottish fire and rescue service—in total, in excess of £30 million per annum—it is a mere pittance compared with the overall UK budget. There is no economic rationale for continuing to deny VAT exemption. The Government seem simply to lack the decency to care about policing and fire and rescue services in Scotland. So much for the party of law and order. So much for the respect agenda. Its attitude has about it the stench of duplicity and blind prejudice.

Euro Area

Lord Mackinlay of Richborough Excerpts

Tuesday 21st July 2015 Westminster Hall

[Craig Mackinlay (South Thanet) (Con)]

I pay particular tribute to my right hon. Friend the Member for Wokingham (John Redwood) for bringing this issue into the public arena. The words of the five presidents need to get out there.

The euro needs to work. It exists much as I foresaw, many years ago. In ’99, when the first 11 got together to have it as their currency—the number has expanded to 18—I foresaw the problems that would arise. On the Floor of the House this morning we heard that we have an adverse balance of payments situation, not least because sterling is strengthening thanks to difficulties in the eurozone. The situation may provide the impetus we now need even more to look rather further afield to our friends and the growing markets outside the EU, which are untainted by the euroland crisis and are more linked to the dollar world.

Some years ago, an insurance company had the strapline, “We never make a drama out of a crisis.” It seems to me that whenever there is a crisis, in the EU generally and in euroland in particular, there is an attempt to make an opportunity out of it. However, it is not used as an opportunity to argue for what we would say is sensible—that perhaps the EU ought to do less; the argument is always that the EU wants more. I suppose that is the new logic. If there is a single currency, then given the pressures and strains of such divergent economies, the logic will be what the five presidents have come up with: there has to be more of the same, and words like “divergence”, “difference”, “independence” and “democracy” have no place in that.

My right hon. Friend mentioned that there are five presidents across the EU. Dombrovskis is the Vice-President for the Euro and Social Dialogue—I must say I had not heard of him before—and his words encapsulate what the situation is moving towards:

“The Economic and Monetary Union has been strengthened in recent years, not least in the light of the financial and economic crisis. Yet it remains incomplete.”

These people want more. They want a competitiveness authority so that there are common wage agreements across borders and a European deposit insurance scheme. Then they claim that Europe needs strengthened democratic accountability. I truly wonder how the people of Greece can reconcile the idea of strengthened democratic accountability with what they have just gone through.

[Richard Drax]

My right hon. Friend the Member for Wokingham made the point that we should not get in the way, because things are going down a path that he rightly identified as the correct one under the circumstances. Perhaps I am being naive, but should we not be screaming from the rooftops, “Stop,” for all the reasons my hon. Friend the Member for South Thanet (Craig Mackinlay) has just mentioned—should we not tell them to get out of this experiment before millions more suffer?

[Craig Mackinlay]

My hon. Friend makes a good point. Unemployment in many parts of euroland is now beyond any measure we have seen in respectable parts of the western world since the crises of the 1930s. For Greece, sadly, that unemployment is perhaps here to stay for a generation, if not more.

I mention Greece, but the people who need to ask themselves where they are going—perhaps they have not yet read the five presidents’ document—are of course the people of Germany. The recipe that the presidents propose is one of massive fiscal transfers guaranteed by the German taxpayer. Such transfers may work in the United States, and the people of Texas may be happy to support their colleagues, friends and family in Dakota, but I wonder whether that really holds true between Germany and Greece, which describes its supposed friends and colleagues in Germany in terms that I have not heard for a very long time.

I again pay tribute to my right hon. Friend the Member for Wokingham, but we need to recognise that what the presidents propose beyond 2017 requires a grand treaty change for the eurozone. If that is for them, fine, but it is certainly not for Britain. We have an opportunity to wrap together what we require, which is a proper treaty change to get a relationship that is in tune with the British people—a return to the free trade and friendship that we thought the EU was all about. Perhaps 2017 can be an excellent year for those who feel as many of my Conservative colleagues do, and they are in tune with many people outside this place and across the country.

I ask the Minister to consider that in the round. A crunch time has come, and it is obvious what our European colleagues want. They have not asked their people, and they dare not ask their people, but it is clear that this is becoming a Euro-state that is not right for Britain. I am in favour of a new relationship that I hope can be found for the good of Europe and for the good of Britain.

Greece

Lord Mackinlay of Richborough Excerpts

Monday 6th July 2015 Commons Chamber

[Mr Osborne]

We agree that a key issue is Greece’s ability to make its debt repayments. That is self-evidently the case because it failed to make a debt repayment to the IMF last week, and it also has to make a big debt repayment to the European Central Bank. I do not think it is right simply to pick out one piece of the IMF’s advice. It has also stated strongly that the Greek economy needs major structural reform, for example. We have to look at the IMF’s advice in the round, which is why it is such a valuable institution.

[Craig Mackinlay (South Thanet) (Con)]

I cannot help wondering whether the resignation of the Greek Finance Minister, Mr Varoufakis, might result in an opening for the former Chief Secretary to the Treasury, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne). Does my right hon. Friend acknowledge the importance of a strong economy and a plan to eliminate the deficit? Put in simple terms, does he agree that we need to live within our means?

[Mr Osborne]

My hon. Friend is right to say that countries need to live within their means. As a Government, we have addressed that matter over the past five years, and I shall address it again in a couple of days’ time in the Budget. Mr Varoufakis has now resigned, and I shall be moving on to yet another Greek Finance Minister, but I doubt that the next one will have quite the dress style of the one we have just lost.

Greece

Lord Mackinlay of Richborough Excerpts

Monday 29th June 2015 Commons Chamber

[Mr Osborne]

I am not very impressed with anti-austerity crusaders who promise the earth and cannot deliver.

[Craig Mackinlay (South Thanet) (Con)]

The slide of the Greek economy has been long, slow and increasingly painful as it has lurched from one bail-out crisis to the next. The fundamental failure is, of course, the euro at its heart and I do not feel that a new deal now will do anything to solve that. Might a no vote next week be the best outcome, and will my right hon. Friend offer practical support to Greece when it inevitably and sensibly reinstates its own currency?

[Mr Osborne]

I completely respect my hon. Friend’s opinion, but it is better from my position to say that it is for the Greek people to decide in that referendum. Of course, whatever the outcome, my hon. Friend is absolutely right to say that we are there as a friend of Greece to help it at this troubled time whatever course it chooses to take.

Oral Answers to Questions

Lord Mackinlay of Richborough Excerpts

Tuesday 16th June 2015 Commons Chamber

[Mr Osborne]

I welcome the hon. Lady to her new position on the shadow Treasury team. Of course we have to make difficult decisions to balance our budget. If we do not get our public finances in order there will not be any powerhouse in any part of the country, and that is what we are doing. It is disappointing that the Labour party, having worked out that it did not have any economic credibility, has started the new Parliament by opposing all the savings we make. As it happens, in the in-year savings I announced we have protected the local government settlement.

[Craig Mackinlay (South Thanet) (Con)]

5. What recent progress he has made in reducing the deficit.

[Mr Ranil Jayawardena (North East Hampshire) (Con)]

10. What recent progress he has made in reducing the deficit.

[The Chief Secretary to the Treasury (Greg Hands)]

Thanks to our long-term economic plan, the deficit has more than halved as a share of GDP from its post-war peak of 10.2% in 2009-10 to 4.8% by the end of last year, but the job of fixing the public finances is not yet complete.

[Craig Mackinlay]

Will my right hon. Friend confirm that competitive procurement continues across all Government Departments to ensure value for money for taxpayers in all that we do?

[Greg Hands]

I congratulate my hon. Friend on his stellar victory in demolishing both the UK Independence party and Labour. I made a number of visits to his constituency, and I can say that he is truly one of the party’s finest campaigners. The Government remain committed to improving value for money in public procurement, building on the significant progress made in the previous Parliament. The Minister for the Cabinet Office and Paymaster General and I meet regularly to discuss this, continuing the excellent work of Francis Maude.