Beer Duty

Graham Stringer Excerpts

Tuesday 7th March 2017 Westminster Hall

[Steve Double]

I now understand the point the right hon. Gentleman is making. I would never drink and drive at all. That attitude has become much more the norm in today’s society, where most people consider that drinking anything and driving should be avoided. I am not entirely sure that I agree with his point.

The brewing and pub industry not only employs 900,000 people but attracts many younger people to its workforce—in fact, 46% of those employed in the sector are under 25 years old. That level of employment among the young is a critical factor, especially in rural constituencies such as the one I represent in Cornwall. While many start out in basic roles, they go on to become professionals in the trade or elsewhere—for example, working as chefs, licensees or successful businesspeople in their own right, and employing others.

That said, the news has not always been good in recent times. Some 17,000 pubs have closed in the past three decades, and while the closure trend has slowed markedly of late, many communities will grieve the loss of their local, which all too often is the only pub in the area.

[Graham Stringer (Blackley and Broughton) (Lab)]

Although it is not the only factor, does the hon. Gentleman agree that cuts in beer duty increase investment and employment opportunities, particularly for the young, while increases do the opposite?

[Steve Double]

I wholeheartedly agree. Lower taxes generally encourage investment and growth in a sector, and I will press for that as the debate goes on.

Multiannual Financial Framework

Graham Stringer Excerpts

Wednesday 7th December 2016 General Committees

[Mr Gauke]

First, on why we abstained on the annual budget, it is fair to say that the budget deal has a healthy payments margin of €9.8 billion—over €7 billion more than last year—and we welcomed that. We still believe that the EU could go further to cut lower priority spending from the budget. However, progress has been made, and the UK recognises that by not voting against the budget. We very often voted against the budget in the past because we felt that not enough had been done to deal with wasteful spending and that better value for money could be obtained for the European taxpayer. However, given that the payment margins were healthy this year, we decided not to vote against. More could have been done, but, in the circumstances, we decided to abstain.

On the reallocation of immigration expenditure, I can reassure the hon. Gentleman that the spending on aid was not impacted by increases in internal security. In fact, both have been enhanced.

Pensions remuneration is not a matter for budget discussions; it is a matter for the rules that the Commission applies to itself, so there were no particular discussions on that point. The UK and other member states have pointed out that the European Commission’s administration costs are higher than we would like. Indeed, there has been an increase in recent years, particularly in administration costs, although that has largely been put down to increased security costs, given recent events. The specific point that the hon. Gentleman raised was not part of our discussions.

[Graham Stringer (Blackley and Broughton) (Lab)]

The EU vanity project, Galileo, has massively overspent, not because of need but because of technical and budgeting incompetence. Will the Minister tell us how much extra that has cost the British Exchequer and what that extra expenditure has done to the original cost-benefit analysis of Galileo? Will he also tell us what action the Government took to try to keep that project within budget? If he is unable to answer now—I would not be totally surprised—will he write to Committee members with his response?

[Mr Gauke]

I thank the hon. Gentleman for his question. He has anticipated what I will say, which is that I will write to him with details. I will check, but as far as I understand it, the delays on Galileo have led to fewer commitments in this multiannual financial framework, rather than an increase. Of course, what has happened to the overall project costs is another matter, but my understanding is that it has led to fewer commitments over this period—I caveat that by saying that I will confirm it.

[Graham Stringer]

Finally, it is all very well looking at these budgets with under-expenditures, over-expenditures and changes in the budget, but will the Minister tell us what action the Government are taking, while we are still a member of the EU, to ensure that the EU has signed, audited accounts for all this money?

[Mr Gauke]

The hon. Gentleman takes me into the territory of another of the regular annual debates that we have in this room, or sometimes in the Chamber, on signing off EU accounts. Fraud and error levels fell again this year but are still too high and the issue that he raises continues to apply. We take the financial management of the EU budget very seriously. Taxpayers need to have confidence that their funds are being effectively managed and implemented at EU level. The Government have been robust in holding the Commission to account, including by regularly taking a strong public stand in voting against signing off the accounts. We continue to place pressure on the Commission to improve. We debate the issue regularly, and I look forward to the next time we do—I cannot remember exactly when that will be, but I am sure the hon. Gentleman will be there and will be able to make his points again on that.

Air Passenger Duty: Regional Airports

Graham Stringer Excerpts

Tuesday 20th October 2015 Westminster Hall

[Mark Menzies (Fylde) (Con)]

It is a privilege to serve under your chairmanship, Sir David. I will keep my remarks short because I know that many right hon. and hon. Members wish to contribute. Blackpool airport is in my constituency. Sadly, it is one of the airports, along with Plymouth and Manston, that has closed in recent years.

At its peak several years ago, Blackpool enjoyed more than 600,000 passengers per annum. It had Ryanair and Jet2 flights to Northern Ireland, the Republic of Ireland and the Isle of Man. The decision to close the airport last year was a devastating blow to the local economy. Not only was there an impact on people’s ability to fly out of Blackpool to holiday resorts; it also sent out a message that the wider tourist economy was not fully open for business. With Blackpool and the Fylde coast, we, too, have world-class golf courses such as Royal Lytham and St Annes, so the facility of an airport is important. When the Open was on, for example, a large number of private and corporate jets used that facility, which brought in high spenders to access our golf courses.

We have talked about many things that could be done to help the small, regional airports. One that seems glaringly obvious is some flexibility on air passenger duty. I am aware that the Government have looked at that in relation to Northern Ireland, to introduce some fairness on long-haul flights, and that powers are to be devolved to the Scottish Parliament. That is quite right, because it is an important economic tool—[Interruption.] I could not hear what my friends from the Scottish National party were saying, but it is important that that power is used to try to generate and stimulate flights.

[Graham Stringer (Blackley and Broughton) (Lab)]

The hon. Gentleman is making a good case for Blackpool airport, which I have flown out of. We have heard cases for Birmingham, Prestwick and Belfast, and I could make a very similar one for Manchester; a case could be made for Bristol and Newcastle and for the large London airports. Is this not simply a bad tax? Every regional economy, along with the Exchequer, would benefit if it was abolished.

[Mark Menzies]

It is certainly a very unpopular tax, as we would discover if we asked any of our constituents when they booked flights and saw what they were paying in air passenger transport duty or if we spoke to any business person who had to take regular long-haul flights; the tax would be a huge cost to their business.

When we move to a situation where Scotland has power over its air passenger transport duty and may decide to abolish it altogether, there will be a market distortion, particularly in the north of England. Although that is welcome for Scotland, those of us with regional airports in our constituencies are deeply concerned that it could see the migration of the few flights left from some small airports, with the necessary knock-on loss of those regional airports to our economies. I urge the Treasury to put a plan in place so that airports—those in the north of England in particular—are not disadvantaged when Scotland is able to exercise those tax-varying powers.

It also seems odd, when we are trying to shift traffic away from the over-congested runways of the south-east, that we are not using every tool in our box to try to get some of those flights into the midlands, the south-west, Scotland and the north of England. There are so many people whose journeys do not originate in the south-east but who migrate their journeys because that is where the flight connectivity is. Again, I ask the Treasury to work with the Department for Transport to see whether we could implement some mechanisms to vary air passenger transport duty to try to stimulate alternatives outside the over-congested runways of the south-east.

I conclude with a plea for Blackpool and the small regional airports that are hanging by a thread. Blackpool reopened several months ago, but there are flights only to Northern Ireland and the Isle of Man. Small regional airports such as Blackpool need all the help they can get. At a time when aviation is booming, it would be a real travesty if they were to lose their place as part of our national transport infrastructure.

Greece

Graham Stringer Excerpts

Monday 6th July 2015 Commons Chamber

[Mr Speaker]

That has very little to do with Greece. The hon. Gentleman has put his point on the record, but it is nothing to do with the statement today, to the details of which we ought to attend.

[Graham Stringer (Blackley and Broughton) (Lab)]

The Chancellor, in a moderate and balanced statement, said that he respects the Greek decision. That is in sharp contrast to some of the eurocrats and Ministers from other eurozone countries, who have made bullying and intemperate statements to the Greek Government. Will the Chancellor tell the House what steps he and the Prime Minister have taken to stop the same people trying to interfere in our referendum about our future in the European Union?

[Mr Osborne]

As I think we saw in the past week, some of those intemperate statements might have had the exact opposite effect to the one that they were intended to have, which reminds us not to interfere in other people’s democracies.

Scotland Bill

Graham Stringer Excerpts

Monday 29th June 2015 Commons Chamber

[Graham Stringer (Blackley and Broughton) (Lab)]

Amendment 36 would, in essence, have opposed clause 16 standing part of the Bill, because I want the Committee to explore the specific issues related to air passenger duty and the more general principles about tax competition between Scotland and the rest of the United Kingdom that may well evolve from a discussion on air passenger duty.

Some of us who voted to set up the Scottish Parliament in the first place now think that, although it seemed a very bold decision at the time, it was less bold than it might have been and that if we had the benefit of being able to go back in time—we do have the benefit of hindsight—the proposals that the Government are making might well have been those that should have been put before the House after the 1997 general election, with us now moving towards full fiscal autonomy for the Scottish Parliament. It was a fundamental mistake to set up a Scottish Parliament with mainly spending powers and no tax-raising powers, apart from the plus or minus 3p on income tax.

[Mr MacNeil]

The hon. Gentleman is absolutely right. One of the mistakes is that there is no incentive for the Scottish Government to grow the economy. A great example that we have in the Hebrides is that the Scottish Government have put a road-equivalent tariff on to the ferries. This has grown the economy in the west of Scotland, but the increase in tax revenue is not going to the Government that funds it but to Westminster, which gives no extra cash and further incentives to roll it out further across the west coast. It is similar with childcare and a number of other issues.

[Graham Stringer]

The hon. Gentleman makes a pretty fundamental point about devolution. When the House was making a decision to devolve powers, it would have been sensible to settle on a grant basis that was fair between Scotland, England and Wales, which the Barnett formula was not, and then allow the Scottish Parliament to raise taxes on that basis, so that if it wanted better-quality services, it could have had higher taxes and, if it was more efficient, it could have had better services or lower taxes, and so on. That is a very clear principle.

[Mr MacNeil]

The important point I am driving at is that, if the Scottish Government had proper control of their taxes, they could have grown the economy more and that growth would have delivered far more than the zero-sum game of who has got and has not got what in the UK. It is the ability to grow the economy that tax powers would give that is really fundamental.

[Graham Stringer]

If the hon. Gentleman is saying that Scotland, or any other devolved authority, should benefit from the initiatives it takes and from its own efficiencies, I agree completely. We are moving that way, but the Bill does not move far enough. No Minister or shadow Minister has been able to explain to me, in any of our debates, why we should have the unfair funding in the Barnett formula.

Those are the basic principles. I now want to explore how, if taxation is devolved to the Scottish Parliament, the United Kingdom Government will respond to competition. Air passenger duty is a very good example. As I understand it, the SNP intend to reduce air passenger duty by 50% and then reduce it to zero. That is quite a sensible policy for the SNP to follow. For that matter, it is a sensible policy for the United Kingdom Government to follow, because a number of consultants’ reports have shown that there is almost certainly likely to be a benefit for the whole United Kingdom if air passenger duty is taken away.

Every other country in the European Union has moved either to very low rates of APD or, as in the Netherlands, to zero. It is therefore a sensible policy, but the Government do not seem to have a clear position on what they will do about the very unfair competition between regional airports.

[Mr MacNeil]

Air passenger duty is a perfect illustration of what I said earlier. If the Scottish Government decided to lower APD and that upped the rate of economic activity in Scotland, they should benefit from the fruits of that activity. The benefits should not go to Westminster, because it would not compensate the Scottish Government for that initiative.

[Graham Stringer]

On 20 January, the Chancellor of the Exchequer told the Treasury Committee, in response to a question asked by my hon. Friend the Member for Wythenshawe and Sale East (Mike Kane) about that very point:

“I think the best approach to dealing with this concern, which I think is perfectly legitimate, is to cross the political boundaries of our two parties to try to find a solution that helps these regional airports that can be affected by an air passenger duty decision north of the border.

HMRC has done some work on this and I think it anticipated that Manchester airport would lose around 3% of its traffic and Newcastle could lose around 10% of its traffic. That was work carried out a couple of years ago… I think you and I—I made the same offer to Ed Balls—could work to help regional airports in the north of England if the Scottish Government were to go down the road of dramatically cutting its air passenger duty.”

Further to that, the Chancellor told the House of Commons on 27 January:

“We have a couple of years to work this out—it does not have be done tonight or tomorrow—and we can work out a plan that protects the brilliant Newcastle, Manchester and other regional airports.”—[Official Report, 27 January 2015; Vol. 591, c. 726.]

What progress has been made on that? This is about a loss of 3% and 10% of business, which are not trivial amounts.

This will result in not only an economic benefit for Scotland, but in real competition, which will come in two forms: there will be competition for passengers on short-haul flights, for which APD is £13 per passenger, and for those on longer-haul flights, for which it is £71 per passenger. Obviously, the same amount is paid for the return flight. A passenger from Newcastle therefore has an incentive—this applies to large families in particular—to travel to Edinburgh or Glasgow in order to save some money. Someone travelling long distance from north America or China has the same incentive.

[Mr Kevan Jones (North Durham) (Lab)]

Does my hon. Friend agree that there is a knock-on effect on cargo? If the successful flight from Newcastle to Dubai were to be jeopardised in any way, the revenue earned from the airport through the transfer of cargo in that passenger aircraft would also be at risk.

--- Later in debate ---

[Graham Stringer]

I agree with my hon. Friend. There is competition not only for passengers, but to get airlines and aircraft to land. Given that a lot of cargo is carried in an aeroplane’s belly, if Newcastle, Manchester or Leeds Bradford loses a flight to Scotland, it will lose not only the passengers and the benefit they bring but the cargo carried by the plane. The United Kingdom already has experience of that with Belfast airport. The Northern Ireland Assembly managed to get the power to vary APD because it was in competition with Dublin airport, which was taking passengers and aircraft to travel from south of the border. That is well known to people who are interested in transport, but it is less well known that the impact was not only on Belfast, but on English and Welsh airports, as people decided to fly across the Atlantic from Dublin to save the £71.

--- Later in debate ---

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

The hon. Gentleman is making a point about cross-border competition. Does he agree that there is another point about the longer-term sustainability of airports outwith that area, such as Inverness and Dundee? They need additional support and would benefit from the reinvestment in Scotland of the revenue generated by additional passenger traffic.

[Graham Stringer]

I agree with that perfectly sensible point.

The Government may have a number of possible solutions, and I hope that the Financial Secretary will be able to respond in some way. Manchester airport has made the case strongly to the Government that there should be an air passenger duty holiday on new long-haul routes, and that would be helpful. The Government could devolve decision making to other parts of the United Kingdom as well as to Scotland, although it would be difficult to find a mechanism for doing so. The Government could also agree to compete with Scotland, because if there is no competition, there will be an unfair loss of jobs through lowering the rate of air passenger duty.

Such solutions seem sensible to me, given the experience in the rest of Europe and, indeed, in the rest of the world. The tax was brought in not for environmental reasons, as is sometimes said, but entirely to deal with the hole in the budget after the 1992 general election. It is an inefficient tax: consultants have estimated that it costs the economy more than it brings into the Treasury in cash. Even if the Financial Secretary cannot give an absolutely definitive answer today, I hope he will assure us that he is willing to look at some of the sensible responses to this new competition in tax regimes.

[Mr MacNeil]

The hon. Gentleman has been very kind in giving way. The tax is about more than just a hole in the budget; it is actually a demand-management tool for Heathrow and perhaps for Gatwick as well. If airports are full, APD is a demand-management tool that might work. It is certainly not helping in Edinburgh, Glasgow or Manchester. The solution is not to worry about each other, but for us to be rid of it, and for the Government to keep the demand-management tool in airports that are already saturated.

[Graham Stringer]

I do not agree with the point the hon. Gentleman makes in his fourth intervention. Demand management is not the solution for our regional airports, which have huge extra capacity, but if I went down that line, I expect you would rule me out of order, Mr Crausby. I look forward to the Financial Secretary’s response.

[Stewart Hosie]

I will come on to the comments made by the hon. Member for Blackley and Broughton (Graham Stringer) in a moment.

The provisions relating to the devolution of air passenger duty—I will concentrate on the duty, rather than the aggregates levy or the further provisions in clause 18—were set out clearly in the Smith agreement:

“86. The power to charge tax on air passengers leaving Scottish airports will be devolved…The Scottish Government will be free to make its own arrangements with regard to the design and collection of any replacement tax, including consideration of the environmental impact.

“87. In line with the approach taken in relation to the Scotland Act 2012, if such a tax is introduced by the Scottish Parliament to replace Air Passenger Duty (APD), the Scottish Government will reimburse the UK Government for any costs incurred in ‘switching off’ APD in Scotland.”

Given that they simply would not collect it, I do not imagine those costs would be very high. The provisions also require:

“88. A fair and equitable share of associated administrative costs will be transferred to the Scottish Government. The…block grant will be adjusted”.

A wide range of organisations that gave evidence to the Scottish Parliament Devolution (Further Powers) Committee backed the devolution of APD, including the Institute of Directors Scotland, Glasgow chamber of commerce, the Scottish Chambers of Commerce and the Scottish Council for Development and Industry. As the report says:

“This was coupled with support for either a reduction or scrapping of this duty after devolution had taken place.”

The Scottish Parliament Information Centre analysis for the Committee, referred to in the report, found that:

“Draft clause 14”—

now clause 16—

“would make this a devolved tax, as recommended by the Smith Commission. It would give HMRC the ability to ‘switch off’ these UK taxes in Scotland from a date to be set by secondary legislation.”

As with many of the clauses we have discussed, there is no recommendation as to how the transfer would work or how the block grant would be adjusted, but, as I understand from other clauses, there is no requirement for legislation to achieve that. Essentially, the legislation delivers on the Smith agreement in the way anticipated. We have no concerns with the drafting of the clause, which did not change between the Command Paper version and the Bill.

In terms of the policy approach on air passenger duty, on which much of this clause stand part debate is centred, the Scottish National party supports the devolution of air passenger duty to the Scottish Parliament. We are pleased that the Scotland Bill will deliver this recommendation. We have previously set out our proposals to halve APD when control over the tax is devolved, and we fully intend to abolish it when public finances allow. We believe that taking that action will encourage greater tourism and investment in Scotland, boosting our economy and creating new jobs.

There are a substantial number of benefits for consumers from the reduction of air passenger duty, not least because the UK levies are some of the highest aviation taxes in the world—indeed, APD is relatively rare in other countries. APD is currently £71 for an economy class long-haul flight, which is extraordinary—that is over 2,000 miles. Abolishing APD would mean that a family of four, with children over 12-years-old, would save something under £300 per long-haul flight—a substantial saving by any measure. Reducing APD would therefore save consumers money, and, in certain circumstances, significantly reduce the cost of family holidays.

There are broader economic benefits from a reduction in air passenger duty. A report commissioned by Edinburgh airport in March 2015 found that a reduction in APD would bring considerable economic benefits to Scotland. The report argued that the Scottish Government’s policy of halving APD in the first instance would create new jobs, and that a failure to take action would cost Scotland tourists and tourism revenue. Its key findings included the fact that a 50% reduction would provide benefits to Scotland worth £200 million a year, meaning a £1 billion economic boost over the lifetime of a Parliament; and that a 50% reduction would bring considerable benefits to local communities, creating something in the order of 3,800 new jobs by 2020. On the other hand, it was estimated that we could lose out on about 1 million passenger journeys a year if APD was not reduced. Again, by 2020, that would cost the Scottish economy up to £68 million in lost tourism expenditure every year. It is clear, therefore, that devolving and reducing APD would have a considerable economic impact on Scotland and that failure to act would mean Scotland missing out on significant tourism and hospitality revenues.

We have heard what happened in the Republic of Ireland and Northern Ireland. Although the 2014 study by Ulster University was a little more ambivalent and suggested only a limited number of scenarios in which Northern Ireland might benefit, supporters of a reduction pointed to the success of this approach in the Republic of Ireland. As the BBC reported:

“Tourism NI chairman Howard Hastings said: ‘If you compare with our nearest neighbour in the Republic of Ireland, in the two years since they abolished air passenger duty, they've seen arrivals grow by 1.1 million passengers.’”

It is self-evidently a success, and if we can replicate that, we can deliver the benefits I have described. If we do not, we will face the cost of failure.

The hon. Member for Blackley and Broughton and others tabled amendments that are not being debated—although the debate has been very similar to the one I would have heard had we been debating them—and expressed concern that the devolution of APD to Scotland would disadvantage airports in the north of England, as travellers journey across the border to Scottish airports in order to travel to holiday destinations abroad. The SNP makes no apologies for championing Scotland, and we believe that the reduction and eventual abolition of APD would benefit Scotland’s economy and tourism sector in particular. Its devolution is also a cross-party commitment agreed through the Smith commission.

Attracting more tourists to Scottish airports by reducing APD could also benefit the north of England by rebalancing the economy away from London’s pull and bringing more visitors to the northern parts of these islands as a whole. If one considers Edinburgh to be a hub airport, I am sure that businesses in the north of England would rather spend an hour on the train from Newcastle to Edinburgh than four, five or six hours on the cross-London journey to Heathrow, let alone travelling to a hub airport such as Schiphol or Charles de Gaulle. Edinburgh is the ideal solution for people from Durham, for example.

A stronger Scottish economy will also bring significant economic benefits to the north of England, as new trade and investment opportunities arise. However, we are concerned about some of the UK Government’s threats in relation to APD—this relates to what the hon. Member for Blackley and Broughton said about competition. During the election, the Prime Minister astonishingly expressed concerns that a reduction in APD would “distort competition”. He said:

“The SNP government in Scotland is committed to using its new powers to cut and eventually abolish air passenger duty for flights from Scottish airports. That could distort competition and see business drawn north of the border with a huge impact on airports in the rest of our country so we’re reviewing the way air passenger duty works to make sure other cities don’t lose out”.

Devolving and amending APD is not a distortion of competition; it is competition.

The Prime Minister’s comments chimed with his so-called Carlisle principle. It was reported that the Prime Minister had

“outlined plans for an annual review of the impact of Scottish Devolution on the rest of the UK. He announced what he’s calling the ‘Carlisle principle’”.

He did that during a speech in Crewe—one would think he would go to Carlisle to do it, but Crewe it was. He said that the aim was to make sure that policies devolving more power to Scotland did not have a negative impact on other parts of the UK—in areas such as air passenger duty, tax rates, university tuition fees or energy policy. If only we had thought of that, we would not have abolished the subsidies for onshore wind.

The Prime Minister said:

“I want to set out a new principle—you could call it the Carlisle Principle—that we will make sure that there are no unforeseen detrimental consequences to the rest of the country from Scottish devolution, for either England, Wales or Northern Ireland.”

Will the Minister explain what the Carlisle principle—whatever it actually is—will mean in practice for the devolution of APD? I hope that when he gets up, he will say precisely nothing.

--- Later in debate ---

[Alex Salmond]

I agree with the hon. Gentleman’s first point only to the extent that there are people who argue that nuclear power does not require the investment of public money. I think he will find that, as the implementation of these proposals proceeds, substantial amounts of public money will be invested in the infrastructure to make it viable and credible. According to a recent study of transport infrastructure spending per head in various parts of England, the figure for the south-east of England was over £2,000 per head, the figure for the north-east was £26 per head, and the figure for the north-west was £200 per head. I do not have the exact figures, but I think that I have the relative parameters just about right—

[Graham Stringer]

rose—

[Alex Salmond]

The hon. Gentleman can please inform me otherwise.

--- Later in debate ---

[Graham Stringer]

The figures that the right hon. Gentleman has given are moving in the right direction, but the distortion is actually even greater. The capital expenditure figure is over 90% in London and the south-east, compared with single-figure percentages in Yorkshire and Humberside and the north-east.

[Alex Salmond]

I am never knowingly undersold. I accept what the hon. Gentleman has said. I was trying to moderate the figures slightly, in case the Committee found them incredible. However, they do tell us where we should be turning in the context of “distortion of competition”.

I am delighted that Members from the north of England have accepted that this tax should be devolved, and I am delighted that they have accepted the economic argument behind the direction in which the Scottish Government are moving. I think that the tax should be reduced at airports in the north of England as well, because they have substantial capacity that would increase revenue for us all. I am glad that their amendment did not become the basis of this conversation, because if the Scottish Government had opposed the devolution of part of APD to Northern Ireland, no progress would have been made. We are now on the verge of having APD devolved to Scotland, and I say to Members representing north of England constituencies that they should take the attitude that this should be the example for further devolution of a sensible policy which not only benefits one part of the country but looks at the economic opportunities in all parts of the country.

Unfortunately, I arrived for this debate at the end of the VAT fiddle discussion. I hope when the Minister replies on APD that, instead of his wholly disappointing and negative attitude to the embezzlement of VAT from the Scottish police service, he will return to the style of grace and imagination with which he usually so adorns the Dispatch Box, and this time recognise the opportunity for Scotland, and indeed the north of England, of making sure that this disgraceful tax is reduced and economic activity is increased.

--- Later in debate ---

[Mr Gauke]

We have had a reasonably lengthy debate in which Members have not, for the most part, tended to differ on the substance of the clause on air passenger duty, although the hon. Member for Wolverhampton South West (Rob Marris) is never afraid of setting out a contrary opinion. In fact, some Opposition Back Benchers argued for the abolition of APD, which would cost about £3.2 billion, while others argued for increasing it. If there is a need for fresh thinking among Labour Members, we are hearing plenty of it this evening, even if there has not been much in the way of coherence.

[Graham Stringer]

The Minister is right to mention the revenue from air passenger duty, but is he aware that a number of studies—the most significant being the PwC study—suggest that the economic benefit to the country of the abolition of APD would be greater than £3.2 billion?

[Mr Gauke]

I am aware of those studies. I will not detain the Committee for long on this subject, but we do not agree with the conclusions of the PwC study. We do not believe that the benefits of abolition would be as significant as the study suggests.

The hon. Members for Blackley and Broughton (Graham Stringer) and for North Durham (Mr Jones) talked about the impact on regional airports of the devolution of APD to Scotland. We recognise the potential impacts and the Government are reviewing options for supporting regional airports to deal with the effects of devolution. We will be publishing a discussion paper on this later in the summer and our document will address many of the concerns raised during today’s debate by the hon. Gentleman. I will ensure that it is available to Members of this House.

European Union Referendum Bill

Graham Stringer Excerpts

Tuesday 16th June 2015 Commons Chamber

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

I shall speak to amendments 4, 5 and 6 on the publication of information, and amendment 54, in my name and those of my right hon. Friends, on the application of purdah.

I congratulate the hon. Member for Morley and Outwood (Andrea Jenkyns) on her maiden speech. She enjoyed a famous victory at the election and she is entitled to enjoy it. She spoke very movingly about her father and I wish her well for her time in the House.

I also congratulate my hon. Friend the Member for Hampstead and Kilburn (Tulip Siddiq) on her excellent maiden speech. She reminded us—it was a good reminder —of the reasons why people come to these shores, and of the wonderful chances and opportunities that this great country can bring to people who do come to these shores. I know she brought with her some very distinguished and very welcome guests to watch our proceedings.

Another week has brought more European troubles for the Conservative party. Last week, we had the debacle over collective ministerial responsibility. The Prime Minister was first reported as saying that it would apply, then that he had been misinterpreted, and then that no decision had been taken on the issue. This week, we have had the tabling overnight of an amendment saying that in response to pressure, from the Opposition and from elsewhere in the House, the referendum will not take place in May next year in combination with other important elections that will be taking place throughout the country. We welcome that change of heart from the Government, but I must point out to the Minister that his amendment deals only with the issue of May next year and not May 2017. That is an issue to which we will want to return. There have also been reports overnight that the Government may have something to say about purdah. I will question the Minister more on that as we go.

Amendments 4, 5 and 6 concern the provision of information for the public on the implications of Britain leaving the EU. I say at the outset that this is not the same as a discussion about purdah, which is dealt with by amendment 54 and others. Amendments 4, 5 and 6 deal with information that we feel should be provided at least 10 weeks before the referendum takes place, not in the final four weeks of the campaign.

The UK has been a member of the EU for more than 40 years, so we know what membership means in terms of trade, legal obligations, costs and so on. Of course, the Prime Minister has set out on a renegotiation process that may change to some degree the terms of that membership, but all of that will be made public well before the referendum takes place and people will be able to make a judgment on whatever he achieves in the negotiations. What is less clear, as was pointed out by the right hon. and learned Member for Rushcliffe (Mr Clarke) on Second Reading, is what being out of the EU would mean. The amendments are intended to inform the public debate on this issue.

[Graham Stringer (Blackley and Broughton) (Lab)]

I have some sympathy for providing as much information as possible during the referendum campaign, but is my right hon. Friend aware that probably the most definitive assessment of the costs and benefits of leaving the European Union has been provided by Open Europe? It says that on the one hand there may be benefits and on the other hand there may be disbenefits, depending on what assumptions are put into the calculation. How does he expect the Government to come down on one side or the other, and which assumptions would go into that assessment?

[Mr McFadden]

I have read the work by Open Europe. My hon. Friend is right to say it has made an assessment, but it is one assessment among many—there have been many others. As I go, I will explain why I think there is merit in Government Departments taking a proper look at this.

There has been much talk of whether the UK would adopt the Norwegian model, the Swiss model or some other model of being outside the EU. The Committee will be glad to know that I am not going to go through all the costs and benefits of those models today, but they all raise questions about being outside the EU that have not yet been answered.

Amendment 4 calls for a report from the Office for Budget Responsibility on the implications for the public finances of a British exit. Few would dispute that since the OBR was established it has gained a reputation for both independence and quality. The reports it produces on the Budget and the autumn statement are valued across the House and have helped to inform the debate about fiscal policy in the past five years. In the run-up to the recent election, my party called for the OBR to assess the tax and spending promises of each of the main parties, a demand supported by the Treasury Committee in the previous Parliament, although there was some debate about whether the request had come too late in the Parliament to be brought into being in time for the election.