Hospitality Sector: Fiscal Support

Rachael Maskell Excerpts

Wednesday 31st January 2024 Westminster Hall

[Rachael Maskell (York Central) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Ms Bardell. The hospitality sector is at the sharp end of all market sensitivities and feels every economic challenge acutely. Although it is used to seasonal highs and lows, when covid hit, the sector’s resilience became dependent on intervention. Whether businesses were supplying food, drink or accommodation or operating as a wider part of the tourism sector, the covid and post-covid shocks served their blows on hospitality. There are also the issues of the cost of living—whether that is seen through reduced customer disposable income or increased energy costs—and diversion of shipping in the middle east; each part has a story to tell about the sector.

Indeed, Brexit produced serious challenges in labour supply, and the new visa rules are also creating pressure. Last year, 8,500 visas were provided for the sector, and that is not to mention the dependants who come with health workers and so on, and the students; that also takes its toll. I ask the Government to think again. Although I welcome higher income and a rise in the minimum wage to address the wage disparity in this sector, we must recognise that it needs cushioning and that the sector needs support.

In York, we face the additional challenge of flooding. The floods have an impact. There is usually poor reporting describing York as being like Venice, but I can assure everyone that York is open and functioning. Today, because of the resilience measures that have been put in place, only a small cluster of hospitality outlets are impacted by flooding. However, they have received no business rate suspension—they must receive that, and I ask the Minister to look at that issue—and the Bellwin scheme cannot be triggered for a small area. Those businesses have costs associated with flooding, so that needs to be addressed.

Turning to other fiscal challenges and solutions, we would welcome a reform of business rates. I have long debated in this place how disadvantage and disincentives impact on the sector. Frankly, the Government have demonstrated a sticking-plaster approach during my time here. I am glad that Labour is listening and that it will bring in reform of business rates, but I plead that it puts those reforms in its manifesto so that everyone can be clear about that.

The hospitality sector and other businesses in York have talked about a profit-related tax to make it a fairer system in the long term; I urge the Minister to look at that.

The sector’s turnover in York is worth £1.16 billion annually and is ranked 16th highest in the country. For a relatively small, concentrated area it employs 16,500 people across 1,283 venues to date. However, there is a 5.4% vacancy rate—484 jobs—so we need to consider the impact that is having on the sector’s ability to stay open full time and welcome people into their establishments. I recognise how York has weathered this stormy time and I recognise its resilience. People enjoy coming to the incredible city of York and taking advantage of the offer that we have, but that should not be taken for granted. Ensuring that resilience measures and fiscal reforms are put in place is important for the long term for the hospitality sector in York.

I note that the overseas sponsorship programme has offset some of the vacancy issues, not least for chefs, and we need to ensure that the labour shortages are tackled. I ask the Government to look again at the impact that withdrawing from such schemes will have.

A focus of my work looks at how we can increase the family offer in York. We really need to broaden the base of people wanting to come and use our city for a broader interest. I certainly welcome those interested in talking about the family coming to York because that will also build greater resilience for the longer term.

I know that the Minister understands the sector well, given his previous roles. Indeed, he could come on a whistlestop tour round the city with me. I urge him, as we come up to the next fiscal event, to allow an extension, a quick win, on the covid loans. Businesses could make further investment to grow their businesses if they could pay their loans back over a longer period. That would be a quick and easy win for the Government.

On VAT, I concur with the remarks made earlier. Hospitality Association York has also made the case to me that a drop in VAT would very much assist the sector and provide an economic stimulus. We all want to see that benefit passed on to consumers and customers who use the sector. I want the work that Hospitality Association York is doing in growing the skills and talents in the sector and building for the long term to be recognised and supported.

Finally, as York becomes a world heritage site and York Central is developed for the future, we have great opportunities for investment beyond the walls as well. Up in Acomb we see many independent businesses now providing great opportunities. Right now we are in the heart of the most challenging season for our sector. Despite the ice trail coming up this weekend, the Viking festival over the half-term period and the residents’ festival that we have just had, we need action from the Treasury to ensure that the hospitality sector is sustainable now and in future.

[Hannah Bardell (in the Chair)]

Before I call the next speaker, I ask Members to stick to five-minute speeches because I want to try to call everybody and give equality to all.

--- Later in debate ---

[Nigel Huddleston]

All I can say to the hon. Gentleman is that we are listening. Some measures are being put in place that local authorities will have powers to implement, but I understand that a lot of people are not happy with the situation. I completely understand the challenges at a local level, particularly when it comes to employment and the unaffordable cost of housing in many parts of the country, as many Members have mentioned.

[Rachael Maskell]

In my speech I mentioned the extension of covid loans for businesses that have those loans. What is the Treasury’s view on extending them so that investment can be made in those businesses elsewhere?

[Nigel Huddleston]

I cannot comment on any further changes, but there has been some flexibility with covid loans, as we have announced. This is important. Of course, we want those covid loans to be paid back, but that needs to be done over a period of time that is sustainable for businesses. This is in the context of the overall support, including the comments that I made about business rates relief and other things for the retail, hospitality and leisure sector. We are aware that the sector was hit so hard by the pandemic and is still in the process of recovering—it is recovering remarkably strongly, but it is not out of the danger zone yet.

Oral Answers to Questions

Rachael Maskell Excerpts

Tuesday 19th December 2023 Commons Chamber

[Jeremy Hunt]

As I go to carol services over the festive period, I will make sure that I am suitably inspired by what the three wise men brought to the crib. I can tell my hon. Friend that I am actually visiting our gold reserves this week, so I will see at first hand just how important they are.

[Rachael Maskell (York Central) (Lab/Co-op)]

Right now, council leaders up and down the country are having to make very difficult decisions on cutting vital services—not because of profligacy, but because of Government cuts to their funding. What steps is the Chancellor taking to ensure that local authorities—such as that in York, which is the lowest-funded area—are adequately funded?

[Laura Trott]

The hon. Lady will have heard my answer to a previous question where I stated that we have put billions of pounds of extra money into local government this year to cover pressures. We recognise that those pressures are real, which is why the provisional settlement proposes an above-inflation rise for next year.

Autumn Statement Resolutions

Rachael Maskell Excerpts

Wednesday 22nd November 2023 Commons Chamber

[Rachael Maskell (York Central) (Lab/Co-op)]

I concur with the commitment of the hon. Member for Erewash (Maggie Throup) to public health measures in today’s statement. It is fascinating, however, that when given a rare chance to make life better for millions of people—people just about managing, or people not managing but really struggling—the Conservatives turn on them, as we heard today, making their lives even harder.

The economic success we heard about is glossy, but we are coming down from last year’s disastrous Budget. Inflation has halved this year because it went so high last year, causing our constituents to have exceptionally high mortgage rates, which they are paying for day by day. Borrowing is at an all-time high, just shy of 100% of GDP, and the economy will be £40 billion smaller in 2027 than was predicted in March this year. That shows that the economy is still fragile and volatile, and even after 13 and a half years of this Tory Government all we have seen today is money being moved from welfare to the wealthy. Do we wonder why people are worse off when we see such decisions being made?

I believe economic policy—how we tax and spend—must focus on creating a fairer society, alleviating poverty, tackling injustice and inequality and helping people to be independent yet collectively contribute to the vital services we depend on across our society. Public sector services hardly got a mention today, yet they are on their knees. Council, health and public service leaders across the country will therefore be baffled by the decisions the Chancellor made.

We have seen 13 and a half years squandered, with poor economic productivity, poor investment in our people and planet, and increasingly poor social outcomes. We have more people sick—7.8 million on waiting lists—more needing a home and more in need, and we have 14.5 million people on the edge, in poverty, in debt, struggling with heating, rent and food. And of course there was no promise of additional help today. We must remember that 4.3 million children in York and across the country now live in poverty; 18% of pensioners are counting the pennies to get by and we have a harsh winter ahead of us, with the energy price cap due to go up tomorrow and a tough year beyond that. Food prices are up about 25% on April 2022 figures, while gas prices are 60% and electricity prices 40% higher, yet wages have not matched that growth. In York, residents face the fourth-highest rents in the country.

While the fall in inflation is an important factor, because it will have an impact in the long term, none of us will ever forget how we got to where we are today. The economy needed the Chancellor to do more than just talk about cutting the revenue into the Treasury; the autumn statement should have been more about redistribution and, sadly, it was lacking in that—not least when the national insurance measures that he introduced will bring the greatest benefit to the richest people, who pay more national insurance, meaning that working people continue to pay more.

Turning to those working people, we know that working hard really matters, and I want everyone to have the opportunity to use their skills and talents to the full and contribute to society, and in return receive just reward for their labours. However, our public services are on their knees. York Council has seen £11 million in cuts this year and £40 million in the last four years. York’s schools are underfunded—the 17th worst in the country—and vital services are absolutely desperate.

We must understand the consequences of the cuts that the Chancellor talks about, not least those to national insurance. We are working hard in York to create opportunities, with exceptional schools, colleges and universities, a Labour council, businesses, charities and public services. Despite our calling out for two and a half years for funding for BioYorkshire, which will create 4,000 good-quality green-collar jobs, the Government have not brought forward the investment long promised, alongside UK Research and Innovation. Likewise, the creative sector, particularly the visual effects sector, has a real impact on my constituency, and I welcome a deeper dive into that area, but why have we not seen that money bought forward until now?

All we see are services cut back, underfunded, understaffed and just not working. People are paralysed by the pressures of life, suffering with mental, economic and physical stress. They are simply not coping. Rents are too high and wages too low; there are bills to pay, but no money left and no hope.

I want to make three points. First, we have no spare social housing, as I said to the Chancellor. York is one of the worst places in the country to access housing, with rents in the private rented sector the fourth highest in the country. The broad market area is too broad. As a result, people in my constituency, even after receiving £650 a month in local housing allowance, still have to pay an additional £983 on private rent. They cannot afford to live in my city but, if they move away, it will skew the economy even more. We need the broad rental market area to be reviewed. I urge the Minister to take that away and ensure that it happens, because it really matters for my constituents.

Secondly, I am sickened by paragraph 3.25 of the autumn statement. People at their most vulnerable do not engage with the DWP because they cannot, because life is too hard for them. To introduce such punitive measures as those we have heard about from the Chancellor is a complete disgrace. It is ill-conceived, immoral and economically illiterate, because those people will end up elsewhere in our public services, creating even greater demand. They will end up in our NHS in desperate need, not least if the Government take away their prescriptions. What an utter disgrace to do that to people who are already sick and struggling. I will fight the Government every step of the way on that measure, and I trust that my party will, too. That is not how we should treat human beings who are struggling and suffering. The Government should be ashamed of themselves, not least because the Chancellor then tried to pitch those individuals against other people who are struggling—people who come to our country for sanctuary. I could not believe that I was hearing that in this House—shame. We have to change that. I trust that the Labour party will be at the forefront of that charge.

On the DWP, the bedroom tax is still hurting people, sanctions are still hurting people, and the two-child limit is still hurting families in my constituency, as is the benefit cap. If we reversed those measures, we would see a big number of people move from poverty into being able to have dignity in their lives. Surely, this place is meant to achieve that.

Thirdly, the Joseph Rowntree Foundation’s work on the basket of essentials guarantee—providing every person enough money to survive on, with £120 a week for a single person and £200 for a couple—would really make a difference for people who are dependent on social security. I often hear Members on the Treasury Bench ask, “How would you afford it?” Well, according to the University of Greenwich, a wealth tax on people with an accumulated wealth of over £3.4 billion, for example, would bring in £70 billion. We must remember that the 50 richest families in our country own 50% of the wealth.

Change is so achievable. We must think about priorities. Politics is about morals, justice and fairness, but we have not seen that today. I know that it will not be long until we have a Labour Government, who will be here to serve, give hope, and do everything humanly and economically possible to turn things around. We believe in fairness, honesty, justice and equality, and we will deliver them.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I am afraid that I will have to take the limit down to nine minutes.

Autumn Statement

Rachael Maskell Excerpts

Wednesday 22nd November 2023 Commons Chamber

[Jeremy Hunt]

The shadow Chancellor cannot hear these things too many times. She loves copying and pasting our policies, and there is another that she could merrily get copying and pasting. Here is the reason why my hon. Friend is absolutely right—[Interruption.] Let me tell the shadow Chancellor the reason—it is very straightforward. We had an economic crisis thanks to the energy shock and the pandemic; Labour had an economic crisis because of what happened in the financial markets. The difference is that we took tough decisions to bring back fiscal responsibility and they ducked every single one.

[Rachael Maskell (York Central) (Lab/Co-op)]

The biggest disparity in local housing allowance comes from the geography of broad rental market areas. In York, given the way these things are calculated, LHA is £650 but there is a £983 cost on top of that for a property. It is not working, so will the Chancellor review the BRMA?

[Jeremy Hunt]

I am happy to discuss that matter with the Secretary of State for Work and Pensions. I recognise that the hon. Lady has campaigned on the issue sincerely for some time. I will say, though, that the decision to increase local housing allowance to the 30th percentile will help 1.6 million families with an extra £800. I hope she recognises that that will make a difference.

Oral Answers to Questions

Rachael Maskell Excerpts

Tuesday 14th November 2023 Commons Chamber

[Gareth Davies]

We have ambitious plans for energy generation and our energy security. We want to bring communities with us, and we look at all options as we do so.

[Rachael Maskell (York Central) (Lab/Co-op)]

6. What recent assessment he has made of the potential merits of introducing a wealth tax.

[The Financial Secretary to the Treasury (Nigel Huddleston)]

Of course, the UK does not have a single wealth tax, but it does have several taxes on wealth and assets, and those generate substantial revenues. The Government are committed to keeping taxes low so that working people keep more of what they earn. The Government’s approach to delivering fiscal sustainability is underpinned by fairness, with those on the highest incomes paying a larger share.

[Rachael Maskell]

But the burden of tax is increasingly falling on working people’s incomes, while the richest 50 families in the UK have alone accumulated a combined wealth equivalent to that of half the population. Research from the University of Greenwich shows that a wealth tax could generate £70 billion for much-needed public services, so will the Government at least put forward a commission to investigate the matter and introduce a fair taxation policy?

[Nigel Huddleston]

I am not sure whether the hon. Lady is lobbying me or Opposition Front Benchers with her comments, but she will be well aware that we do have a progressive tax system in the UK. It is important to remember that the top 5% of taxpayers are projected to pay nearly half of all income tax in 2023-24; and the top 1% as much as 28%. Compared with what we inherited from Labour in 2010, when the top 1% of income tax payers paid 25% and the top 5% paid 43%, the tax system is fairer and more progressive under the Conservatives.

--- Later in debate ---

[Jeremy Hunt]

I thank my hon. Friend for drawing attention to the apprenticeship levy, which has been a tremendous success in bringing a rigour to technical qualifications that was not there before. We are very open to reforms to the apprenticeship levy, providing they stick to the fundamental principle that any investment is not in in-house training that would otherwise have happened, but in transferrable, passport-able training that someone can take with them if they move to another business.

[Rachael Maskell (York Central) (Lab/Co-op)]

T10. The NHS dental plan has been stuck in the Treasury for months, while my constituents are waiting years to see an NHS dentist. When the Chancellor makes his autumn statement, will he also release the dental plan with the funding that is required so that we can get dental treatment back on track for our constituents?

[Jeremy Hunt]

I will not pre-empt what I am going to say next week, but I will say to the hon. Lady that, as a former Health Secretary, I am well aware of the pressures on NHS dentistry and its importance to all our constituents.

Mortgage Charter

Rachael Maskell Excerpts

Monday 26th June 2023 Commons Chamber

[Jeremy Hunt]

The hon. Lady raises a very fair point. I will write to her with some details of what we are thinking in that area.

[Rachael Maskell (York Central) (Lab/Co-op)]

Private rents go up when mortgages go up, yet local housing allowance disparity is growing faster in places like York than anywhere else in the country. What process has the Chancellor set in train to review local housing allowance and the broader rental market, which is out of kilter in places like York compared with surrounding areas?

[Jeremy Hunt]

The hon. Lady is absolutely right to talk about the impact on renters because of the high prevalence of buy-to-let landlords and the pass-through effect. That is an area we are looking at in great detail, and I will write to her with some of the things we are looking at and planning to do.

Mortgage Market

Rachael Maskell Excerpts

Tuesday 13th June 2023 Commons Chamber

[Andrew Griffith]

My Treasury colleagues and I liaise closely with the Bank of England and the Prudential Regulation Authority, whose job it is to assure us of the soundness and resilience of banks. The Governor has talked about how the UK financial system is safe, secure and soundly capitalised, and that remains my belief.

[Rachael Maskell (York Central) (Lab/Co-op)]

York is a low-wage economy, yet we have extortionate house prices. Last year, housing costs went up by 23.1% in York—the highest rise in the country. My constituents are already mortgaged to the hilt and cannot afford more. What protections will the Minister put in place if mortgage rates rise further, as they are predicted to do? My constituents simply cannot afford their mortgages and they cannot afford this Government.

[Andrew Griffith]

If York is a low-wage economy, the hon. Lady’s constituents will be benefiting enormously from the unprecedented 9.7% increase in the national living wage. The measures we are putting—[Interruption.] Perhaps she does not like the 9.7% increase in the national living wage that this Government came forward with. We are putting measures in place with lenders, including forbearance, and working with the Department for Work and Pensions on mortgage interest support and to ensure that families have access to the support they need.

Oral Answers to Questions

Rachael Maskell Excerpts

Tuesday 21st March 2023 Commons Chamber

[Victoria Atkins]

I am very grateful to the hon. Lady for her question and I urge her to get behind our trade and co-operation agreement. As I say, it is the world’s largest zero-tariff, zero-quota deal. I am delighted to say that the Chief Secretary has just confirmed that we have signed the memorandum.

[Rachael Maskell (York Central) (Lab/Co-op)]

14. If he will take fiscal steps to increase funding for social and affordable housing.

[The Chief Secretary to the Treasury (John Glen)]

The Government are committed to delivering social and affordable housing and are investing £115 billion in the affordable homes programme from 2021 to 2026. That is the largest investment in affordable housing in a decade and includes investment in supported housing, social and affordable rent and shared ownership.

[Rachael Maskell]

The affordable homes programme will deliver just 32,000 homes over five years while 1.2 million households are waiting for social houses, yet there was no mention of new money in the Budget last week, which was a massive disappointment in the light of the scale of the housing crisis. In York, we are seeing a net loss of social housing. Will the Chief Secretary ensure that social housing is prioritised, that money comes forward and that we see a real boost to the affordable homes programme so that York, and places like it, can have the housing they need?

Oral Answers to Questions

Rachael Maskell Excerpts

Tuesday 20th December 2022 Commons Chamber

[John Glen]

My hon. Friend is an expert in this area. He is absolutely right to point to that concern. We must ensure joined-up regulatory innovation to make sure there are no unforeseen circumstances. He puts his finger on a very important point.

[Rachael Maskell (York Central) (Lab/Co-op)]

I refer to my entry in the Register of Members’ Financial Interests. The Chancellor knows that a workforce plan cannot work if the Government cannot retain staff in the NHS. We cannot retain staff in the NHS if we do not pay them—that is why they are out on strike today. Will the Chancellor, instead of hiding behind the pay review body, admit that the Government set the remit for the pay review body? The only way to end this dispute is for Government to sit down with the trade unions and negotiate.

Autumn Statement

Rachael Maskell Excerpts

Thursday 17th November 2022 Commons Chamber

[Jeremy Hunt]

What represents the strength of the Union is £4 billion being spent to build the new frigates in Scotland and £4 billion being spent to support Scottish families with the cost of energy bills.

[Rachael Maskell (York Central) (Lab/Co-op)]

The scale of wage restraint resulting from today’s autumn statement will accelerate York’s housing crisis. What measures in the statement will secure a greater supply of affordable housing for local people, not investors, in my constituency?

[Jeremy Hunt]

The hon. Lady makes an important point. I am in constant discussion with the Secretary of State for Levelling Up, Housing and Communities about the importance of housing policy creating new houses for people on low incomes. However, on wages overall, the £4.7 billion for the social care sector, for which she advocates, will make a significant difference in that area.