Finance (No. 3) Bill

Debate between Lindsay Hoyle and Lord Hanson of Flint

Monday 4th July 2011 Commons Chamber

[Mr Hanson]

I beg to move amendment 10, page 1, line 9, at end insert—

‘(3) By 31 March 2012 the Office of Budget Responsibility, in consultation with HMRC, will report to Parliament on the revenue of the 50 per cent. rate of income tax and its impact on the UK economy.’.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With this it will be convenient to discuss the following:

Amendment 14, page 1, line 9, at end insert—

‘(3) A report on the impact of the current rates of income tax on inequality in the United Kingdom, also taking into consideration all other direct and indirect taxes including duties and excises, council taxes and mandatory charges for the use of cars and televisions and making specific reference to the overall tax rate of taxpayers grouped by decile in the United Kingdom and by each individual constituent country shall be prepared by HM Treasury and laid before the House of Commons not later than 1 December 2011.’.

Amendment 30, page 1, line 9, at end insert—

‘(3) All public sector employees whose earned income does not exceed £21,000 shall be entitled to a £250 reduction in tax liability for the tax year 2011-12.’.

[Mr Hanson]

I do not intend to detain the House for long on these amendments, although they are important. I particularly welcome amendment 30, which stands in the name of my hon. Friend the Member for Hayes and Harlington (John McDonnell) and my right hon. Friend the Member for Birkenhead (Mr Field), and which I will touch on briefly. Clause 1 deals with rates of taxation and, if approved, will set the rates for the next financial year at 20%, 40% and a special rate of 50%. Amendment 10, which is simple and straightforward, has been tabled by the shadow Treasury team because we want to shed a little light on how the Government will report on their future plans for the 50% rate of tax.

We already know certain key facts. We know that the Chancellor has asked HMRC to collect tax receipts for this financial year and that he has assessed the revenue levels of the 50% rate for this year. In Committee, the Exchequer Secretary said:

“The Chancellor’s Budget statement to the House on 23 March simply highlighted the fact that he has asked Her Majesty’s Revenue and Customs, as part of that ongoing work, to see how much the additional rate actually raises. HMRC will look at all the available evidence about the impact of the 50% rate, including data from the 2010-11 self-assessment returns, which will become available next year.”––[Official Report, Finance (No. 3) Public Bill Committee, 10 May 2011; c. 22.]

My concern, which I will put directly on the table, is that the Government have already prejudiced any decision on the 50p rate of tax by stating clearly that they believe it will do lasting damage to the economy. We want further explanation of the methodology that they will use to consider the 50p tax rate for future Budgets, and I think that the best organisation to do that is the Office for Budget Responsibility. The Government set up the OBR and gave it a number of key roles, one of which I have helpfully drawn from its own website. Under the heading “What we do”, it states:

“We scrutinise the Treasury’s costing of Budget measures: During the run-up to Budgets and other policy statements, we subject the Government’s draft costings of tax and spending measures to detailed challenge and scrutiny.”

All the amendment would do is formally recognise that role in relation to the Government’s forthcoming review of the 50p additional rate.

The Chancellor has said to the House of Commons, the public and anyone who will listen that he sees this as a “temporary measure” and that it will do “lasting damage” to the economy. He has signalled that he will abolish the 50p rate as soon as he can, in line with Conservative thinking before the election. However, the timing remains uncertain. I believe that the Chancellor has pre-empted the review. When HMRC undertakes the review, it will do so on the assumption that at some time around 2013 the Chancellor of the Exchequer will abolish the rate on incomes above £150,000.

Finance Bill

Debate between Lindsay Hoyle and Lord Hanson of Flint

Tuesday 28th June 2011 Commons Chamber

[Mr David Hanson (Delyn) (Lab)]

I shall speak to new clause 10, but before I do so, may I remind the hon. Member for Redcar (Ian Swales) that he fought an election on the Tory tax bombshell? I remember pictures of the Deputy Prime Minister, the right hon. Member for Sheffield, Hallam (Mr Clegg), standing in front of a poster that referred to a Tory tax bombshell—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I am sure the right hon. Gentleman would want to speak through the Chair.

[Mr Hanson]

I remember the hon. Member for Redcar standing with the Deputy Prime Minister in front of a poster that said “Tory tax bombshell”. I find it amazing to hear the hon. Gentleman speak this evening as an apologist for the Conservative Government’s imposition of VAT on people in Britain.

New clause 10 calls for a review of the assessment of the impact of VAT on UK economic growth over the next three months. As Members know, last Tuesday we voted on a Labour motion, which was opposed by the Liberal Democrats, to cut VAT on a temporary basis to 17.5% while economic growth is restored. The Conservative party voted against that motion, which would have ensured that we had the VAT cut proposed today.

--- Later in debate ---

[Mr Hanson]

Wait. When the Conservative party—[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Mr Hemming, you have had one intervention. If the shadow Minister is not giving way, you should respect that.

[Mr Hanson]

When the Conservative party, supported by Liberals who at the general election opposed VAT increases, imposes VAT increases, it does so on businesses and on jobs and hardest on the poorest people in our society. I will now give way to the Minister so that he can explain that.

--- Later in debate ---

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We are not going to get bogged down in the VAT figures. We need to talk about the new clauses in the group. We are drifting into parts where we should not be.

[Mr Hanson]

I remind the hon. Member for Birmingham, Yardley (John Hemming) that new clause 10 calls for a review of the impact of value added tax on businesses and families over the next three months. Labour Members voted last week for a temporary reduction in VAT. Labour policy is to have a temporary reduction to tackle the real issues that we all face in our constituencies in relation to jobs, living standards and the future of our businesses.

Finance (No. 3) Bill

Debate between Lindsay Hoyle and Lord Hanson of Flint

Wednesday 4th May 2011 Commons Chamber

[Mr Hanson]

I beg to move amendment 6, page 6, line 22, at end add—

‘(14) The Chancellor shall publish, by 31 October 2012, an assessment of the impact of the changes to capital allowances on the UK economy.’.

[The Chairman of Ways and Means (Mr Lindsay Hoyle)]

With this it will be convenient to discuss clause stand part.

[Mr Hanson]

You have caught me slightly off guard, Mr Hoyle. I was expecting my hon. Friend the Member for Hayes and Harlington (John McDonnell) to participate in the previous debate, but I shall plough on as ever. It is good to see you back in the Chair. I hope that you had a refreshing evening’s sleep after we had considered earlier matters.

National Insurance Contributions Bill

Debate between Lindsay Hoyle and Lord Hanson of Flint

Thursday 13th January 2011 Commons Chamber

[Mr Hanson]

I beg to move amendment 1, page 2, line 9, leave out paragraph (b).

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With this we will discuss the following:

Amendment 2, page 2, line 21, leave out subsection (5).

Amendment 3, in clause 11, page 6, leave out lines 24 to 29.

Amendment 4, page 6, leave out lines 35 to 41.

Savings Accounts and Health in Pregnancy Grant Bill

Debate between Lindsay Hoyle and Lord Hanson of Flint

Monday 22nd November 2010 Commons Chamber

[Mr David Hanson (Delyn) (Lab)]

I beg to move amendment 1, page 1, line 1, leave out Clause 1.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With this it will be convenient to discuss the following:

Amendment 17, page 1, line 6 , leave out ‘3rd January 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 4, page 1, line 6, leave out ‘2011’ and insert ‘2016’.

Amendment 18, page 1, line 8, leave out ‘3rd January 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 5, page 1, line 8, leave out ‘2011’ and insert ‘2016’.

Amendment 19, page 1, line 14, leave out ‘3rd January 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 6, page 1, line 15, leave out ‘2011’ and insert ‘2016’.

Amendment 20, page 1, line 17, leave out ‘3rd January 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 7, page 1, line 17, leave out ‘2011’ and insert ‘2016’.

Amendment 21, page 1, line 18, leave out ‘3rd April 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 8, page 1, line 18, leave out ‘2011’ and insert ‘2016’.

Amendment 22, page 1, line 21, leave out ‘3rd January 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 9, page 1, line 22, leave out ‘2011’ and insert ‘2016’.

Amendment 23, page 2, line 2, leave out ‘3rd April 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 10, page 2, line 2, leave out ‘2011’ and insert ‘2016’.

Amendment 24, page 2, line 4, leave out ‘3rd January 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 11, page 2, line 4, leave out ‘2011’ and insert ‘2016’.

Amendment 25, page 2, line 5, leave out ‘3rd April 2011’ and insert

‘a date to be set by regulations made by the Secretary of State by statutory instrument’.

Amendment 12, page 2, line 5, leave out ‘2011’ and insert ‘2016’.

Amendment 26, page 2, line 8, at end insert—

‘(5) Regulations made under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.’.

Amendment 51, page 2, line 8, at end insert—

‘( ) The Chancellor of the Exchequer must lay a report before Parliament no later than 31 December 2011 on the impact of section 1 on looked-after children in England, Wales, Scotland and Northern Ireland.’.

Amendment 52, page 2, line 8, at end insert—

‘( ) The Chancellor of the Exchequer must lay a report before Parliament no later than 31 December 2011 on the uptake of tax free savings accounts by looked-after children in England, Wales, Scotland and Northern Ireland following the implementation of section 1.’.

Amendment 36, in title,  line 1, leave out

‘To make provision about eligibility for a child trust fund;’.

[Mr Hanson]

The Bill was considered in Committee but it was not amended, despite the fact that we had some 19 Divisions, which showed the strength of feeling among Labour Members. I am pleased to see so many of my hon. Friends who served in Committee in their places today.

The Labour Opposition’s objection to clause 1 was well rehearsed on Second Reading and in Committee, but I regret to tell the House that it will be rehearsed again as we continue to explain our objection to the clause. As ever, I wish to help the Minister and be pragmatic by giving him the opportunity to reflect on the mistake he is making in proposing clause 1 and on the issues we raised in Committee, which my right hon. and hon. Friends want to debate again.

My main concern is to delete clause 1, which amendment 1 is designed to achieve, unless we can get the Minister to reconsider some of the amendments we tabled in Committee, which are before us today. I refer particularly to amendment 17, which would delay the abolition of the child trust fund until such time as the proposed child ISA—individual savings account—came into play. We had that debate in Committee and I will refer to it again later.

Amendment 4 would allow the abolition of the child trust fund to be delayed until 2016. Again, I want to help the Minister and give him an opportunity to fulfil his manifesto commitment to help the poorest third of children in society. At the general election in May, he said that he would not wish to see them disadvantaged by the abolition of the child trust fund.

I also support amendments 51 and 52, tabled by my right hon. Friend the Member for Wythenshawe and Sale East (Paul Goggins), which raise issues that my hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson) aired in Westminster Hall relating to looked-after children. It is important to return to those issues again today.

Amendment 1 would delete clause 1. I want the Minister and the House to know that, however pragmatic our approach to the abolition of the child trust fund, our fundamental objective is to ensure that the fund remains for all children, as proposed by the previous Labour Government.

I say that for three reasons. First, we believe that the child trust fund promotes saving, encourages financial education and ensures that all young people have a financial asset at the age of 18, which is particularly important for those who come from poorer families. The child trust fund scheme, introduced by the Labour Government, was having a positive effect between April 2008 and April 2009: a massive 823,504 vouchers were issued—about 70,000 a month; more than 74% of the accounts were opened by parents; and about £2 billion is held in funds. By the end of this year, it is likely that more than 6 million child trust funds would have been opened. That is a success by any stretch of the imagination—a success now being torn up by the coalition Government. Those child trust funds would have helped to support our children when they reached the age of 18. That would have been a progressive measure, which is why Labour Members oppose clause 1.