Economic Outlook and Furlough Scheme Changes
Debate between Lord Wood of Anfield and Baroness Penn
Baroness Penn
My noble friend will be aware that the PM has commissioned a comprehensive review of the two-metre guidance. It will take advice from a range of experts, including the CMO, the CSA, behavioural scientists and economists. That work will be completed in the coming weeks.
Lord Wood of Anfield (Lab) [V]
My Lords, a YouGov survey this week showed that more than half of UK businesses will lay off more than a quarter of their staff within three months of the end of the furlough scheme. That scheme was bold and necessary, and I applaud the Chancellor for it, but it is vital that it is an employment subsidy scheme and not an unemployment benefit scheme. Can the Minister commit to making further wage support for employers, especially large firms, conditional on their providing commitments to retain their workers and/or to invest in their retraining in the months ahead?
Baroness Penn
The noble Lord is right that the design of the scheme is about keeping a connection between an employee and an employer during lockdown so that they can return to that job afterwards. That is why we have set out a careful process for unwinding the scheme so that, from August, employers will need to begin to contribute costs, scaling up from national insurance and pension contributions to 10% and then 20% of the wages covered.
Inheritance Tax
Debate between Lord Wood of Anfield and Baroness Penn
Baroness Penn
My Lords, the Government thank the Office of Tax Simplification for the work it has done; they are looking at the results of its two reports very carefully. I reassure the noble Lord that since 2011, inheritance tax and trusts have been brought into the disclosure of tax avoidance schemes—DOTAS—regime, which means that any new and innovative inheritance tax avoidance scheme involving transfers into trust must be disclosed to HMRC, and gives the Government powers to take any enforcement actions necessary.
Lord Wood of Anfield (Lab)
My Lords, as the noble Lord, Lord Palmer, said, the very wealthiest are just not paying their share of inheritance tax. In 2016, estates worth £2 million to £3 million paid only 20% rather than the 40% required. Estates worth over £10 million paid on average just 10%. With Exchequer revenue to be at a premium in the years ahead, will the Government urgently examine the closure of the myriad loopholes available to the very wealthiest; for example, through the extensive use of transfers to trust?
Baroness Penn
My Lords, I point out that in 2018-19, inheritance tax receipts were at a record high, and 70% of inheritance tax comes from estates valued at £1 million or more. I believe that the noble Lord is referring to certain exemptions that come under agricultural and business property. While we recognise that there are some concerns, the policy intention behind those exemptions is to allow family farms and businesses to be passed on without having to be broken up to pay inheritance tax. We think that that is an important aim.
Economy: Bank of England Forecasts
Debate between Lord Wood of Anfield and Baroness Penn
Baroness Penn
We are very keen to have a green recovery which uses the Government’s policies in working towards economic growth but which also supports our commitment to net zero by 2050.
Lord Wood of Anfield (Lab)
My Lords, pursuing the Question put by the noble Lord, Lord Lamont, one of the—[Inaudible]—about the scale and speed of recovery. It said that growth could hit 15% for 2021 as a whole. Does the Minister not agree that inducing excessive optimism about the speed of the recovery has its own risks, and does she agree with the former Chancellor, Sajid Javid, who said today that a— [Inaudible]—unlikely?