Tax Avoidance and Evasion

Debate between James Cartlidge and Kevin Foster

Wednesday 13th April 2016 Commons Chamber

[James Cartlidge]

I simply do not agree with that. I want to start by focusing on the action that has been taken, because I do not think that the anger out there is caused by a lack of action.

[Kevin Foster]

Will my hon. Friend give way?

[James Cartlidge]

May I just make one point first, although it is lovely to have so popular a speech and so many interventions? On the action we have taken, as my hon. Friends the Members for Torbay (Kevin Foster) and for Newark (Robert Jenrick) have said, there has been a 50% fall in the corporation tax gap. I am sure that that is the sort of point on which my hon. Friend the Member for Torbay wants to support me.

[Kevin Foster]

I thank my hon. Friend for giving way. He has already been very generous with interventions. Does he agree that one of the things that really used to anger people was that an office cleaner could be paying a higher rate of tax than a hedge fund manager who worked in the same office? That was happening not in a tax haven, but here in the UK, and it is right that it was tackled.

[James Cartlidge]

That is an excellent point. It was a fundamental injustice, and we dealt with it. In the latest Budget, we announced a series of measures to tackle tax avoidance on matters such as hybrid mismatch, VAT evasion through online sales and the general anti-abuse rule. We will introduce a new penalty of 60% of tax due in all GAAR cases that are successfully tackled. We have brought in a long list of measures on matters such as serial tax avoidance and offshore avoidance.

On the broader point about the wider economics, I founded a small business in 2004—a mortgage broker specialising in the shared ownership sector—and it was obvious to me in the build-up to 2008 what was coming down the track. I believe that the then Government were trying to tackle inequality through debt. In those days, two potential homebuyers, one of whom was relatively wealthy and well educated, and the other who had less good skills and was less able to command such a salary, could both obtain similar levels of mortgage through the extraordinary measures that existed at the time, such as self-certified and sub-prime mortgages. We all know where that led.

In terms of public debt, the then Government’s main measure to deal with inequality was tax credits, which led to a £30 billion increase in in-work benefits. We paid for that increase in benefit spending on the national overdraft at a time when the country was doing pretty well and the world economy was relatively strong.

Flexible Ticketing: Rail Transport

Debate between James Cartlidge and Kevin Foster

Thursday 10th March 2016 Commons Chamber

[James Cartlidge]

I am more than happy to do that. The franchise in our area is Abellio Greater Anglia. My region is fortunate in at least one sense—I am not sure what the score is in my hon. Friend’s region—because the franchise is up. There are three bids going in for it.

Let me take a few of the key points from my constituents about why we should have part-time tickets and more flexible ticketing. Deborah from Sudbury said:

“It is very old-fashioned to think that workers go to their office every day and we should not be penalised for flexible working”—

I totally agree.

Some years ago, I went to a presentation about voting patterns by a leading American psephologist. He said there are three groups of voters in the country. I cannot remember two of them, but the other was symbolised by a grey cloud. That was not a political point; it was about character and how we appeal to different types of voter. The voters symbolised by the grey cloud had certain features, one of which was that they were moved by newspaper headlines about bad weather, which is quite interesting. However, the most common feature was that they ate their dinner at the same time every day—quite frankly, that describes my late grandad. However, the era of predictability, of nine to five and of everyone doing the same thing all the time is gone; it has been shattered and blown apart by liberalisation and globalisation. That might be a good thing or a bad thing, but it is a fact of life that we and our constituents all face, and our rail ticketing system should reflect that.

[Kevin Foster (Torbay) (Con)]

I congratulate my hon. Friend on securing the debate. Would he say that this is also about reflecting families’ changing lifestyles, in that the 1960s model—the father commuting to work five days a week while the wife was at home with the children—is now gone? With men and women rightly sharing parental responsibilities, they may wish to divide up the days of the week that they work, and season tickets need to reflect that.

[James Cartlidge]

That is an excellent point. Recent Office for National Statistics data show that between April and June 2015, just over 7.3 million people had a flexible working pattern. By the way, that is people who are employed; it does not include the army of people such as self-employed contractors who go into London a few days a week. We have a flexible labour market and flexible working, but our rail ticketing system is, in effect, stuck in the same Julian calendar that we have had since 46 BC. If that sounds like a long time, hon. Members should wait until they get stuck on a delayed service out of Liverpool Street.

Russell from Nayland made an important point about bad value for money:

“On the basis of me paying £5520 a year…this means I am really overpaying for 173 days a year”

of travel, which is an extraordinary statistic. That means that he is, in reality, paying £2,615.76 or, depending on his tax bracket—if he is a solicitor, I suspect it is 40%—£4,000 or more for those 173 days. That is a big deal, particularly in our region, because an extensive survey recently undertaken by Transport Focus found that just 21% of the commuters on Abellio Greater Anglia were satisfied that their ticket was value for money, compared with 34% on other lines. I realise that I may end up in a competition with hon. Members in the Chamber about whose line has fewer happy customers, but there is no doubt that value for money is a big concern.

It is fair to say that if there was more satisfaction with value for money in general, the issue of part-time tickets would not actually feature. I get these emails because people feel frustrated that they look hard at what they are getting and think, “Hold on a minute. I’m paying for Saturday, Sunday and Friday.”

School Funding

Debate between James Cartlidge and Kevin Foster

Thursday 5th November 2015 Westminster Hall

[Kevin Foster]

Yes indeed, and let us be clear that the council that would benefit the most from the F40 proposals is Barnsley. If one was looking for an example of an area that one would have thought the Opposition would be committed to wanting to do something for, it would be that one.

For me, this is not about wealthy parts of the country versus deprived parts of the country. There are parts of my constituency that are quite wealthy, but they are the older parts—the places that are less likely to have young families with children going through school. The areas in my constituency that are the most deprived and that have the most challenges are the ones that have the most young families with children going through school. I was delighted to hear my hon. Friend the Member for South Suffolk (James Cartlidge) make the point that education is the ladder out of deprivation.

[James Cartlidge]

It is very kind of my hon. Friend to refer to my comments. He is making a very interesting point about overall prosperity. Is it not the case that the levels of deprivation in places such as Tower Hamlets and Hackney were once much higher than they are now, and actually what is happening is that inner London has become relatively far more prosperous, partly because of the housing market and partly because of the City and so on, whereas parts of our constituencies have not caught up at the same pace? That is the underlying change that justifies the demand for fairness.

[Kevin Foster]

I totally agree with my hon. Friend. We need up-to-date information and an up-to-date funding formula. Let us be candid: a hundred years ago, Liverpool was a booming port that was producing a tax surplus. Now, the situation there is the other way round, because of changes in industry. It would be strange to hear arguments that we should base funding today on what the economy was like a hundred years ago. Equally, if we do not change the formula and do not move on, people can find themselves living in areas that were once deprived that still receive extra support even though they are no longer deprived.

This is about making sure that pupils are fairly funded, because even in the most prosperous parts of this country there will be families who are struggling and who need the ladder of opportunity that good, solid education provides, so that they can get the jobs and the skills, and share in the aspiration that many of us have.