Oral Answers to Questions

Debate between Lord Jackson of Peterborough and David Gauke

Tuesday 17th January 2017 Commons Chamber

[Mr Stewart Jackson (Peterborough) (Con)]

11. What fiscal steps he is taking to increase housing supply in (a) Peterborough and (b) England.

[The Chief Secretary to the Treasury (Mr David Gauke)]

Progress has been made since 2010, with housing starts now at an eight-year high. However, the scale of the challenge requires us to go further. That was why my right hon. Friend the Chancellor announced in the autumn statement that the Government will invest £5.3 billion in housing. This includes investing £2.3 billion in the new housing infrastructure fund, which will deliver up to 100,000 homes in high-demand areas, an additional £1.4 billion to deliver 40,000 new affordable homes, and £1.7 billion to deliver a programme of accelerated construction on public land.

[Mr Jackson]

Does my right hon. Friend agree that supporting the off-site construction of new homes, as we have been doing in Peterborough, is one important way to get more good-quality homes built quickly?

Oral Answers to Questions

Debate between Lord Jackson of Peterborough and David Gauke

Tuesday 19th April 2016 Commons Chamber

[Mr Gauke]

It is the case that the Crown dependencies and overseas territories are, at our prompting, ensuring that they have got registers of beneficial interests. It is also the case that the UK is co-operating, as my right hon. Friend the Chancellor has made clear, with other jurisdictions. I hope we move to a position whereby public registers are the norm, but even before we get to that point, clearly we will look at the opportunities for the information on the central registers to be shared among co-operative economies and jurisdictions.

[Mr Stewart Jackson (Peterborough) (Con)]

I remember the good old days when the Chancellor regarded Treasury predictions as so discredited that he established the Office for Budget Responsibility instead. I cannot think what could have changed. The GDP projections in his dodgy dossier are predicated on breaking our manifesto commitment on immigration, while the cost implications of his new policy of mass migration for school places, housing, health and transport are not made explicit in the document. Why is that?

Future Government Spending

Debate between Lord Jackson of Peterborough and David Gauke

Wednesday 4th March 2015 Commons Chamber

[Mr Gauke]

My hon. Friend is absolutely right. Indeed, as a distinguished Chair of the Public Accounts Committee, he was heavily involved in identifying that wasteful spending. One of this Government’s achievements is the measures we have introduced to reduce such wasteful spending. In particular, the efforts of the Minister for the Cabinet Office in pushing forward reform and identifying efficiency savings have reduced the cost of Whitehall strikingly.

[Mr Stewart Jackson (Peterborough) (Con)]

Is not it disingenuous—some might even say slightly dishonest—to pray in aid references to 35.2% of public expenditure, as opposed to GDP, as ideological extremism when we need look back only 12 years to the Blair-Brown Government to find a time when the percentage was 35.9%, which is almost indistinguishable? Is not that trying to hoodwink and fool the voters, and is not that pretty dishonest?

[Mr Gauke]

My hon. Friend makes an important point. The statistics he uses are absolutely right. With regard to public spending on services—I will turn to the detail in a moment—we are talking about returning to the levels of 2002-03, before the previous Government lost control of public spending.

--- Later in debate ---

[Mr Gauke]

It was an attempt to show how ridiculous the Labour party’s economic policy is when the only example it puts forward, apart from the 50p rate, which is likely to cost money, is increasing the cost of gun licences. I did not really expect the shadow Chief Secretary to take it seriously that that was the big policy. Does he disagree that the shadow Home Secretary has already claimed that that money will be spent on policing? It is going to be spent on policing, is it not? There was a time in debating these matters when the big argument from Labour Members, their big macro-economic analysis, was that we were going too far, too fast. Now it has come down to this. What have they got a few days away from a general election? They have a policy on gun licences—that is it. What has the great Labour party come to? Gun licences!

[Mr Stewart Jackson]

Perhaps the Minister can help me out. The Labour party had a top tax rate of 40% for 155 of its 156 weeks in office, which apparently was the epitome of social justice. Why does he think Labour is attacking us for having a 45% rate, which brings in more money but is suddenly seen as feathering the nest for the rich?

[Mr Gauke]

My hon. Friend is absolutely right. The problem with the 50p policy is that it is not an effective way to raise revenue. Our record is very clear: we have been very effective at getting more money out of the wealthy. As we see from the IFS analysis today, the wealthiest have made the biggest contribution. What we are left with is a symbolic gesture, not a tax policy.

Finance Bill

Debate between Lord Jackson of Peterborough and David Gauke

Tuesday 2nd July 2013 Commons Chamber

[Mr Gauke]

It was not that long ago that we were told that the reductions in public sector employment would not be met by new jobs in the private sector, but they have been met many times over. The reality is that we have an astoundingly good record on job creation over the past three years, despite the fact that the economy has faced significant challenges.

This Government have established a corporate tax system that attracts international investment to the country and that encourages UK businesses to grow. Corporation tax will be eight percentage points lower in 2015 than the levels we inherited in 2010. This Bill cuts the main rate to 21% next year and 20% the year after, which will give us the joint lowest rate in the G20, the lowest of any major economy in the world and the lowest rate this country has ever known.

The Bill does that alongside separate action to incentivise activity across the economy. It introduces a new above-the-line credit for large company research and development investment, provides reliefs that are among the most generous in the world for the animation and high-end television industries, and gives long-term fiscal certainty to the oil and gas industry on decommissioning tax relief.

[Mr Stewart Jackson]

There was no time to debate new clause 3 on air passenger duty so I will not speak to it, but will the Treasury continue to review the effects of APD on the travel industry and the wider economy?

Transferable Tax Allowances

Debate between Lord Jackson of Peterborough and David Gauke

Wednesday 28th November 2012 Westminster Hall

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

It is a pleasure to serve under your chairmanship, Mr Turner.

I congratulate my hon. Friend the Member for Peterborough (Mr Jackson) on securing the debate, on making such a forceful, passionate and well-informed speech and on ensuring that there would be significant participation—at least among my hon. Friends. I congratulate all those who made speeches: the hon. Member for Strangford (Jim Shannon), and my hon. Friends the Members for Congleton (Fiona Bruce), for South West Bedfordshire (Andrew Selous), for Aberconwy (Guto Bebb) and for Enfield, Southgate (Mr Burrowes).

The debate has demonstrated the degree to which members of my party value commitment and how important we believe the institution of marriage to be to society. That point came across clearly, and, as has been pointed out on several occasions, the Conservative party said, in our 2010 manifesto, that we would recognise marriage and civil partnerships through the tax system. We want to send a clear message that marriage is important and commitment is valued, and that we want to encourage and support hard-working families.

In the past two and a half years, the Government have taken a lot of action to help hard-pressed families in difficult economic times, and I want to say a word or two about some of the steps we have taken before returning to the specific issue of marriage. The Chancellor has said, in his principles for good taxation, that our tax system should be fair, rewarding work and supporting aspiration, and that it should ask most from those who can most afford it. In the context that the Government inherited a difficult financial position in 2010, we have taken steps to bring Britain’s tax system into line with those principles. First and foremost, we chose to focus on tackling the deficit and promoting growth. Among other things, we have focused our efforts on reforms that are intended to ensure that work pays—that point was raised by several hon. Members—including through the introduction of universal credit and our successive increases in the personal allowance.

Given the current economic climate, it is more important than ever that we recognise the wide variety of pressures faced by working families, and we have taken action to help them. For a start, our policy on the personal allowance has helped low and middle earners by improving rewards for work and putting money in their pockets. We have said that raising the personal allowance to £10,000 is our priority for the income tax system, and we stand by that. In the June 2010 Budget, we announced a £1,000 increase in the personal allowance for those aged under 65. We talked about making real-terms steps through the rest of the Parliament to achieve our goal, and those were not idle words, because a further increase of £630 followed at the 2011 Budget. This time, the benefits were passed on to higher rate taxpayers, which meant that there was a real-terms increase of £42 for every taxpayer earning up to £115,970. We promised that we would raise the personal allowance by at least the equivalent of the retail prices index until our objective of £10,000 was reached, but both those increases were significantly above inflation, thus making a real-terms difference to hard-working people.

Those two announcements have taken the personal tax allowance from £6,475 in 2010-11 to £8,105 in 2012-13, and basic rate taxpayers have gained £210 a year in real terms. In the 2012 Budget, we went further and announced an increase of £1,100 from April 2013. That is both the largest real-terms increase in the past 30 years and the largest ever cash increase in the personal allowance. The increase will take the allowance to £9,205 from April 2013, which will provide a real-terms gain of £170 for most basic rate taxpayers in 2013-14. The £10,000 goal is now within touching distance.

Other policies, such as on cutting fuel duty, on council tax, and on keeping interest rates low, have of course helped hard-pressed families. We have provided extra funding to support family support services. The Department for Education set up a relationship support division worth £30 million over four years, which will encourage stability—the very thing that several hon. Members have raised in the debate—and provide support for couples who are experiencing difficulty in their relationship. We hope that that will help some couples to stay together, and that when that is not possible, for whatever reason, it will lessen the impact that the breakdown of parents’ relationships can have on children.

We have touched during the debate on child care. The Government have taken steps to help families with three and four-year-olds by increasing the child care support that they get in a week, as well as to extend support to 260,000 disadvantaged two-year-olds. Indeed, we are looking at what we can do to improve the affordability and accessibility of quality child care.

Universal credit has been touched on in the debate. We are reforming the benefit system to ensure that work pays. Entitlement to universal credit will be based on household income and a single payment will be made to the whole household. That will support family budgeting and ensure that there is no penalty for families, whether one parent chooses to stay at home or both choose to work. Families will be able to keep their benefits for longer before withdrawal at a single rate, which is a much needed improvement on the current system of multiple earnings disregards, as multiple withdrawal rates can leave families confused and trapped out of work.

[Mr Stewart Jackson]

Will the Minister disabuse the Opposition of the notion that the policy is about giving married couples an unfair tax break? It is about nudge behaviour, so that they can make a proper choice between cohabitation and marriage, which is a different thing.

[Mr Gauke]

My hon. Friend was right to point out that the previous Government recognised marriage in the context of inheritance tax, which is generally applicable to wealthier households, yet seemed resistant to any recognition of marriage in the tax and benefits system that would help poorer households.

Marriage and civil partnerships are about commitment and stability. They represent a firm promise to stick to something and keep working at it. We want to rectify the way our tax and benefits system relates to that. Studies have shown that married couples are less likely to split up than cohabiting couples, and stability is vital to children. An unstable home life can have a detrimental effect on their happiness and development, and that has been shown by numerous studies, some of which have been quoted today. A recent example is the “Understanding Society” survey by the Institute for Social and Economic Research, which found that parents’ happiness in their relationships had a quantifiable effect on the happiness and well-being of their children. Family is one of the most important influences on a child’s development. The family is where one learns a sense of responsibility. It is where people learn how to behave and how to treat others, and about the things that are important in life.

We are committed to finding ways to support marriage in the tax and benefits system. My hon. Friends will be aware that at the general election we set out a policy of allowing married couples and civil partners to transfer up to £750 of unused tax-free personal allowance when the recipient is a basic rate taxpayer. There is, as we have heard, a reference to that in the coalition agreement, with a statement that the Liberal Democrats can abstain on transferable allowances. None the less, the Government—from the Prime Minister downwards—have made it clear that we remain committed to recognising marriage in the tax and benefits system. I reassure hon. Members that considerable work has been done to examine ways of doing that, and we have heard various ideas about where we should focus our attention during the debate.

During difficult economic times, we want to provide real, tangible support to families. We remain committed to recognising marriage in the tax and benefits system, the case for which was powerfully made by several of my hon. Friends. Our policies have helped hard-working families. It is true that we are prioritising increasing the personal allowance, which increases the rewards for work for those on low and middle incomes, but we remain committed in the way that I have set out.

Finance Bill

Debate between Lord Jackson of Peterborough and David Gauke

Monday 2nd July 2012 Commons Chamber

[Mr Gauke]

Speaking as a Conservative, I consider that all the British people are our people.

By raising £1.8 billion by 2014-15, we will ensure that those with the broadest shoulders bear the greatest burden. That was why my right hon. Friend the Chancellor announced that we would seek to withdraw child benefit from higher rate taxpayers. We always said that we would consider ways to implement the measure, but we have been clear that a complicated new means-testing system, which is what would happen if we extended the tax credits system in the way that some have proposed, would not be a sensible way forward. Instead, we should look to existing systems and processes to ensure that we can achieve our goal.

Clause 8 withdraws financial gain from child benefit from families in which one partner has an income of more than £60,000, and reduces the gain if one partner has an income of more than £50,000. It does so in the most efficient and pragmatic way possible, applying a tax charge on those high earners using existing processes. That charge will apply to an individual in receipt of child benefit, or to their partner if they are married or in a civil partnership or living as if they were married or in a civil partnership—a point that the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) made. That is an existing definition of partners within social security legislation and means that other adults living in the household will not affect the liability.

The changes will not affect those receiving child benefit who have income under £50,000, or whose partner does. Some 85% of families receiving child benefit, or 7 million families, need not be troubled by the changes. If an individual or their partner has income of more than £50,000, the charge will be tapered depending on their income. The equivalent of 1% of the child benefit award will be charged for every £100 increase over £50,000 in adjusted net income. Child benefit will be withdrawn in full only at an income of £60,000. Furthermore, the thresholds between which the taper will operate will not depend on the number of children.

The changes will take effect from 7 January 2013, and the individuals affected will include information relating to the charge on their self-assessment returns for the first time for the tax year 2012-13. The first payments of the charge will be due by 31 January 2014 if a taxpayer chooses to pay in a lump sum. Those affected will be able to opt out of child benefit payments—that answers a question that my hon. Friend the Member for Mid Bedfordshire (Nadine Dorries) asked. Some may wish to do so, although Her Majesty’s Revenue and Customs will set out clearly the options and implications. For example, if an individual’s income were to fall below £60,000, they may revoke their election not to receive child benefit, and payments would be resumed.

[Mr Stewart Jackson]

If my hon. Friend is going to consider the efficacy of different policies, will the Treasury undertake to consider alternative sources of funding as a corollary to this change, such as a cap on the number of eligible children?

[Mr Gauke]

My hon. Friend and other hon. Members have made the case for a cap on the number of children receiving child benefit. I hear his point about an alternative policy, but we must ensure that the child benefit regime provides support for those who need it most. The policy for which we are legislating maintains that principle—those on the lowest income will retain support.

The Government strongly discourage anyone from not registering for child benefit on the birth of their child, even if they decide to opt out of receiving payments. The child benefit system does not process only child benefit, and failing to register can affect state pension entitlement and make it less straightforward for the child to receive a national insurance number when they turn 16. It is therefore important that children remain registered.

Amendments 21 and 22 would allow those on the taper who have opted out of child benefit retrospectively to receive the payment. I am pleased to confirm that HMRC will apply the legislation as it is to enable such a claim to be made. I can therefore reassure the hon. Member for Kilmarnock and Loudoun that the amendments are not necessary. As I have said, the legislation provides a claimant whose income, or whose partner’s income, is more than £50,000 with the opportunity to elect not to be paid child benefit, so they are not liable for the high income child benefit tax charge. A claimant who has elected not to be paid child benefit can subsequently revoke that election and ask HMRC to reinstate payment of child benefit.

The payment of child benefit would then normally be made from the first pay day after the revocation has been received by HMRC, and not from the date when child benefit was first stopped. That is because it would make no sense to pay arrears of child benefit to those whose income, or whose partner’s income, is more than £60,000. However, the legislation provides for retrospective revocation when a claimant discovers that, contrary to their original expectations, they do not have an income of £50,000 or above. That retrospection will be limited to two years after the end of the tax year to which the original election applies. That means that child benefit can be paid for up to that two-year period.

When a child benefit claimant or their partner has income of between £50,000 and £60,000, the decision whether to elect to receive child benefit is not so clear cut, because the amount of the tax charge is dependent on their income. HMRC recognises that a couple might be nervous about making an election if a later decision to revoke the election would apply only to future payments, leaving them worse off. The legislation provides HMRC with the power to issue directions as to how the election process will be administered. I hope I have cleared up that point.

Let me try to deal with the few remaining points. Draft guidance is being prepared over the summer, during which time HMRC will consult external representatives, including the Social Security Advisory Committee and the HMRC benefits and credits consultation group. The directions will confirm that an election that has been made by a claimant whose income or whose partner’s income is between £50,000 and £60,000 can be revoked retrospectively, to the point at which the child benefit ceased.

I have dealt with this point on the state pension, but it is possible to be registered even if people are not receiving cash. I have also dealt with the point on the definition of partners used in the Bill. As for the argument that the measure is complicated, we have looked at alternatives, but we think the measure is the best available to us. On the principle of individual taxation, HMRC is committed to protecting confidentiality. For taxpayers who are unable to discuss their incomes with each other, HMRC will develop a process with appropriate security checks so that they can answer yes or no to simple questions about the income of their partner.

As I have said, the Government have had to make difficult decisions. The measure means we can continue to provide child benefit, and so, in a sustainable manner, protect those who need it the most. We accept that this is not an ideal situation, but the budget deficit left by the previous Administration is the challenge we must overcome if we are to avoid a far worse predicament. I urge the Opposition to withdraw their amendment.