Tax Increases

Debate between Lord Watts and Lord Livermore

Thursday 10th July 2025 Lords Chamber

[Lord Livermore (Lab)]

The noble Baroness knows that I will not comment on specific financial market movements, but I will write to her on stablecoin if that is okay with her.

[Lord Watts (Lab)]

My Lords, we have just heard that the benefits system is broken. Can the Minister remind us who broke it? Is this not a case of having to clear up the mess that they left?

[Lord Livermore (Lab)]

My noble friend is absolutely right to point out the mess that we inherited and why so many difficult decisions had to be taken. He is right to point to the mess they left us in the welfare system; I think we had the highest proportion of people not working and were the only country in the G7 where worklessness had not returned to where it was pre pandemic. We also had to clear up a mess in the public finances, which is why, as he rightly says, we have had to take so many difficult decisions.

Government Performance against Fiscal Rules

Debate between Lord Watts and Lord Livermore

Tuesday 8th July 2025 Lords Chamber

[Lord Livermore (Lab)]

There are two things here: the fiscal framework and the fiscal rules. On the fiscal framework, we have moved to one fiscal event a year, which is the November Budget. There are two fiscal forecasts, in the spring and in the autumn. The noble Lord is absolutely right: we should not give a running commentary on the fiscal forecast. That is, quite properly, for the Office for Budget Responsibility to do. It will do that in the usual way ahead of the annual Budget, and then the Chancellor will make decisions based on that forecast.

The noble Lord talks about the fiscal rules. The one thing I will say is that the changes to the fiscal rules that we made when we came into office were to enable us to invest sustainably in infrastructure and in public services, to stop the cannibalisation of investment to patch up day-to-day spending which we saw under the previous Government. It is interesting that the party opposite has opposed that change to the fiscal rules yet still supports the additional investment that that changed fiscal rule brings. Again, I am not sure that that is entirely consistent.

[Lord Watts (Lab)]

My Lords, will the Minister rule out following the example of the Truss Government, who crashed the economy? Has he received an apology for being left such a sad state of affairs in the economy that we have inherited?

[Lord Livermore (Lab)]

My noble friend is absolutely right. It is exactly because of the experience of the previous Government—that disastrous Liz Truss mini-Budget, which saw mortgage rates spiral and from which working people are still suffering higher mortgage payments—that it is so important that we maintain fiscal responsibility and why we absolutely continue to adhere to our fiscal rules.

Unpaid Tax

Debate between Lord Watts and Lord Livermore

Monday 7th July 2025 Lords Chamber

[Lord Livermore (Lab)]

After the measures we took in the Budget and the Spring Statement, no one could possibly say that we are not sufficiently resourcing the fight against the tax gap. As I said in my original Answer to my noble friend, the National Audit Office recognises in its report that this Government are scaling up compliance activity to tackle serious offshore non-compliance and have committed further funding to do so. It also recognises many of the measures we are taking, including, as I said earlier, significant additional investment in compliance officers by the end of the Parliament. The noble Lord will recognise that this is the most ambitious package to close the tax gap ever; we have committed an additional £660 million each year for measures to do so and by the end of the Parliament we will raise an additional £7.5 billion a year.

[Lord Watts (Lab)]

My Lords, is it not disgraceful that some of the richest people in Britain get honours despite registering for tax purposes in places such as Monaco? As well as that, they are usually first in the queue for tax payouts if they want a subsidy for their business. Is it not time that we took a tougher line on these freeloaders?

[Lord Livermore (Lab)]

I do not think the honours system is for me to comment on. The noble Lord will be pleased to know that we are taking the action I have already described, and we also intend to take further action to close the tax gap. At the Spring Statement, we published consultations on a wide range of issues, including widening the use of third-party data to help HMRC reduce error; strengthening HMRC’s ability to act against those tax advisors who facilitate non-compliance; and closing in on promoters of marketed tax avoidance.

Business Rates Reform

Debate between Lord Watts and Lord Livermore

Monday 23rd June 2025 Lords Chamber

[Lord Livermore (Lab)]

I am grateful to my friend for his question. I will say honestly that I had not thought of it in that way before, but I can absolutely see the point that he is making. My noble friend started his question by talking about the important role that BIDs play. There are, as he knows, more than 340 BIDs now operating in the UK, which are cumulatively investing more than £154 million each year in their local areas. I think the type of initiative that he described is exactly the type of work that they, in some areas, do, and I am sure could do more widely. So I very much agree with the point that my friend makes.

[Lord Watts (Lab)]

My Lords, are the Government considering using business rates to encourage live music in pubs and clubs? That could have a massive effect on making, certainly pubs, more interested in providing music on weekends.

[Lord Livermore (Lab)]

That is a very interesting proposal from my noble friend. As I say, we will set out an interim report later this summer, setting out a clear direction of travel, and let us see whether those ideas are included.

Economic Growth

Debate between Lord Watts and Lord Livermore

Wednesday 11th June 2025 Lords Chamber

[Lord Livermore (Lab)]

I agree with the noble Lord’s point, which is exactly why we have embarked on the EU reset and negotiated a new strategic partnership with the EU that is in the national interest. I completely agree that the EU is our closest partner and biggest market. In 2024, almost half the UK’s total trade was with the EU and around 94,500 UK businesses exported goods to the EU, which is why the EU reset is so important. We negotiated a defence pact with the European Union, and we negotiated an SPS agreement with it to make exports easier. We have moved closer to agreeing closer co-operation with the EU on energy and the ETS, and we have agreed that we will work towards establishing a balanced youth experience scheme with the EU. All these things will move us closer to our biggest and most important market.

[Lord Watts (Lab)]

My Lords, is it not the case that we inherited a bankrupt economy and low growth, and that we had no prospects in the UK until we had a Labour Government? Is it not going to take more than a couple of months to turn around the mess that the last Government left?

[Lord Livermore (Lab)]

I completely agree with my noble friend.

Winter Fuel Payment

Debate between Lord Watts and Lord Livermore

Tuesday 10th June 2025 Lords Chamber

[Lord Livermore (Lab)]

I am happy to give the noble Baroness those commitments.

[Lord Watts (Lab)]

My Lords, the Opposition suggested that the Government have put pensioners behind the NHS and teachers. Does the Minister agree that the Tories do not seem to want to tell teachers or NHS staff that they want them to be poorer?

[Lord Watts (Lab)]

That is what they are doing.

[Lord Livermore (Lab)]

My noble friend is obviously right to point out that the party opposite has consistently criticised the public sector pay rises that we have given.

Denial of Banking Services: UK Defence Sector

Debate between Lord Watts and Lord Livermore

Wednesday 4th June 2025 Lords Chamber

[Lord Livermore (Lab)]

I do not think any specific guidance has been given in the way that the noble Lord asks, but the most important thing to say here is that the banking sector should never take a blanket approach to any one sector. Of course, the decision as to what banking services to offer is ultimately a commercial decision but, as I said, banks should not take a blanket approach and they should make sure that decisions are taken on a case-by-case basis. The Government are actively engaging with banks to ensure that they understand the importance of the defence sector. The FCA has worked to understand why banks might close or reject accounts, and where it has found areas where firms need to improve customer outcomes, the Government expect them to consider the FCA’s findings and take them very seriously.

[Lord Watts (Lab)]

My Lords, is this another case of a regulator letting the British public down? Should we not press the regulators to do the job that they are supposed to do, and if they do not do it, remove them?

Strategic Priorities Statement: Defence

Debate between Lord Watts and Lord Livermore

Tuesday 25th March 2025 Lords Chamber

[Lord Livermore (Lab)]

I am grateful to the noble Baroness for her question. I do not agree with her criticism of the Treasury, but I agree with what she said about risk appetite. That is exactly why, when the Chancellor wrote to the National Wealth Fund, she specifically said that the

“economic capital limit will … be increased from £4.5 billion to £7 billion, allowing”

the National Wealth Fund to “take on greater risk”, and giving greater “flexibility over its investments” to

“support more projects that struggle to access private finance”.

[Lord Watts (Lab)]

My Lords, does the Minister welcome this Question from the Opposition? Does it not once again demonstrate the problems of Brexit? We hear every week about differences, and today they are complaining about access to aviation and defence. Is it not time that they changed their position and stopped asking questions that give us an advantage?

[Lord Livermore (Lab)]

I am very happy to agree with my noble friend’s assessment of the damage that Brexit has done to our economy.

Closed-Ended Investment Companies: Cost Disclosure

Debate between Lord Watts and Lord Livermore

Monday 24th March 2025 Lords Chamber

[Lord Livermore (Lab)]

I do not think I can agree with the second part of the noble Lord’s question, but I absolutely agree that these vehicles do not exist in Europe and do exist in this country, which is exactly why the Government legislated to reform retail disclosure in the way that they did so that it is fairer, more proportionate and more suited for UK markets.

[Lord Watts (Lab)]

My Lords, does the Minister agree that the system needs to be transparent and, quite frankly, there need to be effective rules? If we have effective legislation or rules, and we have transparency, is that not what we are seeking?

[Lord Livermore (Lab)]

Yes, I agree with my noble friend. The Government have provided the Financial Conduct Authority with tailored powers to deliver a new disclosure regime that is fairer and more proportionate and, as I said in the previous answer, tailored specifically to UK markets. I know that the FCA is engaging extensively with the industry and other interested parties as it looks to finalise its rules.

Carbon Border Taxes

Debate between Lord Watts and Lord Livermore

Wednesday 12th March 2025 Lords Chamber

[Lord Livermore (Lab)]

I do not think that that is relevant to this policy. Most of our trade in food is with the EU, and the EU has a similar scheme to ours.

[Lord Watts (Lab)]

My Lords, is not this another example of the mess that has been left by the previous Government? Does my noble friend agree that they did nothing to negotiate this, which is now causing problems to our industry?

[Lord Livermore (Lab)]

I am very tempted to agree with my noble friend. I think that what he says is absolutely the case.

UK Border Strategy: Single Trade Window

Debate between Lord Watts and Lord Livermore

Tuesday 25th February 2025 Lords Chamber

[Lord Livermore (Lab)]

I agree, I think, with the underlying point that the noble Lord is making. Clearly, trade with the European Union is incredibly important. The European Union is our largest single trading partner. Four of our top five export markets are in the EU, and eight out of the top 10 in the EU account for nearly 50% of our trade. This is exactly why we must reset our relationship with the EU, our single biggest trading partner. We recognise that delivering new agreements will take time, but we are ambitious, we have clear priorities, and we want to move forward at pace.

[Lord Watts (Lab)]

My Lords, is the Minister as bored as I am by the Opposition’s attacks on the Labour Government for trying to resolve the problems that were created by the last Government? When will he remind them what Boris said about the benefits of the leaving the European Union? We have seen all the problems with it, but we have not seen many of the benefits.

[Lord Livermore (Lab)]

My noble friend is obviously absolutely right on that point. We are being attacked here for not implementing the solution to the problems that they created. Importers now face up 40 pages of forms that they must fill in: customs declarations, goods movement records and agricultural declarations. Exporters face up to 100 questions every time they wish to move goods to the European Union. We were told that, as a result of Brexit, we would continue to enjoy the exact same benefits. I think nothing could be further from the truth.

National Insurance Contributions: Hospitality Sector

Debate between Lord Watts and Lord Livermore

Thursday 13th February 2025 Lords Chamber

[Lord Livermore (Lab)]

I completely agree with the noble Lord that small businesses are the backbone of the economy. Many of the regulations he speaks about were introduced by his Government over the past 14 years. We have committed not to raise corporation tax for the lifetime of this Parliament, giving certainty to business and keeping the rate at the lowest in the G7. We will introduce legislation to tackle late payments, which is a key issue that disproportionately affects small businesses. The upcoming small business strategy will set out a comprehensive plan to ensure that small businesses have access to the right skills, finance and markets to reach their full potential.

[Lord Watts (Lab)]

My Lords, is it not the case that the Opposition are trying to suggest that the national insurance increases are the result of the Labour Government? Is it not a fact that, if they had not left that deficit, we would not have had to introduce the measures that we have had to introduce recently?

[Lord Livermore (Lab)]

My noble friend is absolutely right. As I have said all along, there are consequences to responsibility, and we have always acknowledged that. But the consequences of irresponsibility—for the economy and working people—would have been far, far greater. We saw exactly that with the Liz Truss mini-Budget, which crashed the economy and saw typical mortgage payments increased by £300 a month.

Economic Growth: Public Spending

Debate between Lord Watts and Lord Livermore

Wednesday 12th February 2025 Lords Chamber

[Lord Livermore (Lab)]

I am grateful to the noble Lord for his question, but his contention seems to be that we were wrong to be honest about the challenges in the public finances, and should instead have maintained the previous Government’s cover-up. He seems to be saying that we were wrong to deal with those challenges, and should instead have maintained the £22 billion black hole in the public finances. Let me be clear: those are exactly the two ingredients—hiding from scrutiny and hiding from reality—at the heart of the Liz Truss mini-Budget, and we saw how that ended. If that is the noble Lord’s recommendation, I fundamentally disagree with him. We were right to restore honesty and transparency to the public finances, and we were right to repair them, which is why we took the difficult decisions that we did.

[Lord Watts (Lab)]

My Lords, does the Minister agree that the last Tory Government left £22 billion to be paid by somebody? We heard no suggestion just now of how you bridge the gap between what the country can afford and that £22 billion.

[Lord Livermore (Lab)]

I completely agree with my noble friend. He is absolutely right that the previous Government left a £22 billion black hole; they had no idea how to fund that. We have still heard absolutely no alternative put forward by the Conservative Party: no alternative for dealing with the challenges that we face, no alternative for restoring economic stability and therefore no plan for driving economic growth.

Covid Counter-Fraud Commissioner

Debate between Lord Watts and Lord Livermore

Wednesday 5th February 2025 Lords Chamber

[Lord Livermore (Lab)]

The commissioner has clearly set out his programme of work. He will work in three phases: first, an assessment of the recovery efforts to date; secondly, a plan for further activity to drive additional recoveries; and thirdly, a consideration of lessons learned and recommendations for future government schemes. The noble Baroness says that we should wait for the outcome of his report; that is perfectly fair, but what I do not understand is why we inherited a recommendation from the previous Government that any attempt to reclaim money should be abandoned. That is surely unacceptable.

[Lord Watts (Lab)]

My Lords, has not a smokescreen been created here? Can my noble friend guarantee that the commissioner will carry out his full investigations and that, once he has done so, any criminal activity will be referred to the police to take the appropriate action?

[Lord Livermore (Lab)]

I am grateful to my noble friend for his question, but obviously, I cannot say what criminal activity may be uncovered. Certain proceedings and investigations are already ongoing. We would not want to prejudice those proceedings, and nor would the commissioner, but my noble friend is right to say that the commissioner should be allowed to do his work.

Non-domicile Status

Debate between Lord Watts and Lord Livermore

Tuesday 28th January 2025 Lords Chamber

[Lord Livermore (Lab)]

I am slightly confused about what underlies the noble Lord’s question, given that, as I say, the previous Government introduced this party’s policy on this issue. The OBR had migration assumptions associated with that policy, as it does with this one. The OBR has factored in the potential behavioural response of affected non-domiciled individuals into its costings. It accounts for an assumed level of migration from this group, just as it did for the previous Government’s groups. So, as I understand it, the migration assumptions for the previous Government’s reforms were 10% and, for this Government’s reforms, they are 12%.

[Lord Watts (Lab)]

Does the Minister find it strange—

--- Later in debate ---

[Lord Watts (Lab)]

Yes, noble Lords are going to get it. Does the Minister find it strange that members of the party opposite seem to be very worried about non-doms, when the last Government introduced taxes that hit ordinary working families and they did not utter a word of criticism about that?

[Lord Livermore (Lab)]

I am grateful to my noble friend for his question. I find quite a lot strange about the attitude of the party opposite, not least what he says—the fact that it introduced £30 billion-worth of taxes on working people in the last Parliament, and yet it does not seem to think there is anything wrong with that and still has not apologised.

Exports to the European Union

Debate between Lord Watts and Lord Livermore

Wednesday 20th November 2024 Lords Chamber

[Lord Livermore (Lab)]

As the noble Lord knows, we have acceded to that partnership already. At the G20 this week, the Prime Minister spoke about reopening negotiations with India. In the spring, the Government will publish a trade strategy, in part to reset our relationship with the EU, but also to support more small businesses to export and remove barriers to trade right around the world.

[Lord Watts (Lab)]

My Lords, the last Government wrecked the economy and our relationship with our biggest trading partner, all on the back of the idea that there were loads of trade deals out there to be done. They failed to do them, and those that they did damaged the farming industry in the UK.

[Lord Livermore (Lab)]

I agree with some of my noble friend’s sentiment; I am not entirely sure what the question is. However, it is important to recognise the significance of the EU to our trade. Four of our top five export markets are in the EU, and eight out of the top 10. The EU accounts for nearly 50% of our trade; total trade with EU is worth over £800 billion and 41% of total exports go to the EU.

United Kingdom Declining Birth Rate

Debate between Lord Watts and Lord Livermore

Wednesday 6th November 2024 Lords Chamber

[Lord Livermore (Lab)]

We have to ensure that changing technology works to the benefit of all in society and contributes to our key objective of economic growth.

[Lord Watts (Lab)]

My Lords, it appears that the major problem is the number of older people now living longer. It is not a problem for them or for us but it has economic implications. Is it not the case that it takes two working people in each household to pay tax to keep one pensioner at home? What are we going to do to bridge the gap between the number of people working and the number who are not?

[Lord Livermore (Lab)]

Clearly, we have an ageing society and there are associated costs with that. That is why increasing the levels of economic growth in our country is so important, so that we have the resources to fund the priorities that matter to us.

European Investment Bank

Debate between Lord Watts and Lord Livermore

Wednesday 24th July 2024 Lords Chamber

[Lord Livermore (Lab)]

The noble Baroness is correct that there are continuing projects in the UK that were financed by the EIB prior to leaving the EU and which it continues to support. I agree with her that there is merit in improving our relationship with the European Union. We have not yet set any plans on working with the European Investment Bank, but I will absolutely consider the point she makes.

[Lord Watts (Lab)]

When we left the European Union we were told that there were loads of trade deals to be done around the world. The previous Government sent people to every quarter of the world to try to do trade deals and failed. Will the Minister redirect his staff into doing something positive rather than waste our time?

[Lord Livermore (Lab)]

I do not think it is a question of either/or. Clearly we need to do more to reset our trade relationships right around the world. We want strong multilateral partnerships with new countries and to reset our relationship with the strongest and closest partners that we have in the European Union. We should work hard to develop stronger trade relationships right across the board.