Finance (No. 2) Bill

Stella Creasy Excerpts

Report stage
Wednesday 11th March 2026 Commons Chamber

[James Wild]

My hon. Friend is absolutely right, despite the chuntering that we hear from the Minister. The welfare bill is predicted to rise to £406 billion over the forecast period. The Chancellor keeps saying that she is fixing welfare. Where? What is she doing? She had to back away from very modest savings. We have identified £23 billion-worth of welfare savings, and the Minister could make those if he wished, but he does not, and that is why growth has once again been downgraded. The Chancellor boasts about beating the forecast last year. Well, the forecast at the beginning of the year was 2%, and the Government failed to get anywhere near 2%. They beat the downgraded forecast, so let us not hear any more about that. We want to hear what the Government will do to drive growth, and taxing the people generating it is precisely the wrong thing to do.

New clause 10 requires the Chancellor to review the UK carbon border adjustment mechanism. We debated CBAM extensively in Committee, and it is dealt with in a great swathe of the Bill—in the schedules—but there is plenty more to come. Given the complexity of the policy, many industries believe that the absence from the Bill of a formal oversight and review process is a serious mis-step that needs to be addressed.

There are many potential pitfalls in this new mechanism. First, the measure fails to consider several sectors that are at significant risk of carbon leakage, such as chemicals and refining. Secondly, the Government have decided to link the UK and EU emissions trading schemes. Following the announcement of that alignment, the price of carbon in the UK more than doubled, which cost our economy about £5 billion. We should be reducing the burden of carbon taxes on business, not increasing them. The EU has yet to publish its benchmark beyond 2030, which means that the UK would be signing up to a system that would effectively give Brussels a blank cheque. Moreover, CBAM does not address issues with carbon leakage in export markets. There are proposals to exempt our manufacturing exports from UK ETS costs and CBAM to make the industry more competitive, putting it on a level playing field internationally. Has the Minister considered maintaining long-term free allowances for products destined for the export markets? Given those complexities—I could go on about them more, but the Minister gets the gist—[Hon. Members: “More!”] It seems that other Members may want to come in on this issue.

I think that the Minister should recognise the value of regular reviews. I know he will say that the Government keep all taxes under review, but let us have an actual review that is published, so that we can see what is happening. I encourage Members to support new clause 10.

This is a Finance Bill full of tax increases that break trust with the British people. The Labour Government have introduced the family farm and business tax, frozen personal thresholds, hiked taxes on savers and investors, cut relief on employee ownership trusts, taxed inheritance pensions, taxed taxis—we discussed that in Committee—and increased gambling, alcohol and other duties and environmental levies. The list goes on and on. There is 534 pages-worth, which I could read out if there were any appetite for it. Our amendments and new clause would back the taxpayers, and the investors and businesses trying to drive growth in our economy, and I urge Members to support them.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

I rise to support the legislation. In particular, I want to talk about new clause 4.

I have to admit that I am a terrible person to go shopping with. [Laughter.] Wait for it. I grew up in a household where my dad used to stockpile copies of “Which?”. In the family, it was drilled into me that you had to seek advice; you could never just buy things. Pity my poor partner on the occasion when we went to try and buy a sofa; it was a very long, drawn-out day. I was taught the value of information and advice in making good choices in life—although I do not claim always to have followed that teaching—because it is easy to rip people off and mislead them, and there are people who will exploit misinformation to cause harm to others for their own financial gain. It is difficult for individual consumers to fight that, but collectively, with good regulation, we can make an economy work well.

New clause 4 is about good advice empowering consumers to make good choices. I welcome clauses 156 and 157, and the work that the Government are doing to crack down on organisations that promote harmful tax avoidance schemes. We have all seen the companies that promote schemes to avoid paying tax, often to the elites—one can only think of Jimmy Carr, and what he must be thinking at this point in time.

Banning the promotion of tax avoidance schemes that have no realistic prospect of working is the right thing to do because it is causing harm, but I am not here to play a violin for the elites; I am here to bang the drum for the millions of people who are being harmed, but who have not yet had the same level of attention. Elite companies might be promoting tax avoidance schemes for an elite group of people, but online there are hundreds, if not thousands, that are now doing it for the masses, causing financial detriment and harm to our constituents as a result. I would argue that this is a much greater harm, because these are people with too much month at the end of their money. When they realise the mistake that they have made and how much money they have lost, they do not have the savings to be able to pay the bill.

--- Later in debate ---

[Kirsty Blackman]

You would not believe, Madam Deputy Speaker, how far beyond delighted I was when I discovered that I would be stepping in for a colleague on the Finance Bill. I am sure that the House is similarly ecstatic to hear me speak on the Bill. I did a significant number of Finance Bills in my first few years in this place, and I have missed it. I have also missed the former Member for Amber Valley, Nigel Mills, who used to make a speech from the Government Back Benches about something that nobody else had even considered or knew existed. The hon. Member for Stoke-on-Trent Central (Gareth Snell) is very kindly stepping into his shoes and raising issues relating to gambling tax, which, to be fair, are important. He is asking very important questions, as Nigel Mills used to, about a fairly niche subject. In the light of the hon. Member’s comments about gambling taxation and the black market, it would be great if the Treasury provided updates on how the tax has worked.

In fact, I think the Treasury should generally provide more updates on every tax measure that it implements. If the Treasury says that a tax measure will raise £30 million, it would be helpful for the MPs who sat on the Finance Bill to know whether it did in fact raise £30 million, or if it raised £50 million or £10 million. Then, we could make better decisions about future tax changes, because we would have a better idea of whether they would achieve the Government’s aims. Successive Governments have been particularly bad at undertaking post-implementation reviews, particularly of tax measures. It would be really handy to see that information more regularly, so that we can make better-informed decisions.

Let me touch on the transparency issues that have been mentioned. Earlier, I raised my concerns about the fact that additional Ways and Means motions were added at this point. I also raised the fact that we do not have oral evidence sessions during the passage of the Finance Bill. I continue to make the case that that could be done after Committee of the whole House. Usually the more technical aspects of Finance Bills are considered in a Public Bill Committee in a Committee Room, rather than in a Committee of the whole House in the Chamber.

The Minister said that some Government amendments had been tabled following stakeholder feedback—particularly through written evidence—to clarify the intention of the legislation. The Government had intended to do something, and stakeholders said, “We don’t really understand this; it’s not clear enough. Could you clarify it?”. If the Government had held oral evidence sessions, they may have been able to make those changes in Committee, rather than on Report. I urge them, and any future Government, to consider holding oral evidence sessions. Anyone who has been on a Bill Committee in which there are oral evidence sessions will understand their great value, and we refer back to them so many times throughout the course of a Committee. There is nothing quite like being able to ask an expert questions, rather than just looking at the written evidence, which is helpful, but it is not the same. We do not remember written evidence in the same way, and we do not have the same ability to probe it.

I want to touch on the four amendments that may be put to a vote. The SNP and I are happy to support new clause 4, tabled by the hon. Member for Walthamstow (Ms Creasy). I was thinking about the history of some “get rich quick” schemes. We had Ponzi schemes and pyramid schemes. The new thing—the Ponzi scheme of the day—is the scheme that says, “This is foolproof. This is failsafe. You are going to make loads of money doing this,” but it is actually unregulated. The new clause would be incredibly helpful. I would have preferred the new clause to say “user-to-user services” instead of “social media”, so that it would cover all the stuff in the Online Safety Act 2023. That covers things that we may not classically define as social media. For example, if somebody gave really terrible tax advice on a money-saving expert forum, would that be included in the definition of social media? Social media is not 100% defined, which is why I would have preferred a different term. However, the new clause is sufficient to cover the majority of people.

[Ms Creasy]

I feel the need to stand up for Martin Lewis, because he is one of the good guys when it comes to advice, and those forums are policed very well. The problem is people exploiting the fact that social media companies also have a vested interest in generating content that goes viral. They are the sole publishers of these videos—they make money from them—that tell people outlandish things that they can do with their taxes. I think we all agree that it is worth looking at the Money Saving Expert forum. I peruse it at length myself, much to the detriment of being able to make decisions.

[Kirsty Blackman]

It is absolutely worth looking at that forum, but as the hon. Member said in relation to the new clause, people who are promoting schemes with no expectation that they will actually work should not be doing it on money-saving expert forums, or anywhere else. I agree that Martin Lewis has been very clear that he does not give advice online, and that people who, for example, say, “This is a Martin Lewis tip” are lying. It is worth highlighting that the way in which he has chosen to put forward tax advice or information is totally different to the way chosen by the financial influencers referred to in new clause 4. As I said, I am more than happy to support it; I would have just liked it to be wider.

We are happy to support new clause 11 on the uprating of agricultural relief, tabled by the Liberal Democrats. If the new clause and the uprating is not to be implemented, it would be incredibly useful to see the Government’s rationale for why they have chosen not to do annual uprating in a way that would be standard for the majority of other reliefs. What is the logic for that? As I was not on the Bill Committee, I am not as across this part of the Bill as I perhaps should be, so I am not clear what mechanism is in place to uprate the relief. Is it done under the negative or affirmative statutory instrument procedure? Will the House actually see a statutory instrument, or is a delegated authority given to the Minister? It would be helpful to have an idea of what the mechanism is, and whether, if inflation continues at the current rate or goes up again, the Government are likely to put in place an increase to ensure that agricultural relief continues to wash its face—to provide the relief it is supposed to.

--- Later in debate ---

[Dan Tomlinson]

I will not get into specific worked examples. The general point is that the Government have made changes both to business property relief and to agricultural property relief, in order to raise additional revenue from the very wealthiest estates. We have sought to do that because we want to put fairness into our tax system.

The CBAM was mentioned by the Opposition, and by my hon. Friend the Member for Mid and South Pembrokeshire (Henry Tufnell). I thank him for his strong advocacy for his constituency, and the thousand people who work in the refinery there. The Government said at the Budget that we recognise the important role that refineries play in our energy security, and we are now considering the feasibility and impact of including refined products in the CBAM in future. It is very complicated, and there would be knock-on impacts on other sectors if the Government were to proceed with that. I have met representatives from the sector recently, and I will continue to engage with them.

Finally, I turn to new clause 4, which requires the Chancellor to report on how the regulations in the prohibition address the harm to individuals and businesses from online tax avoidance promotion, and the steps that His Majesty’s Revenue and Customs should take to inform the public of the risk posed by online tax avoidance. I thank my hon. Friend the Member for Walthamstow (Ms Creasy) for raising the important issue of avoidance promotion. I agree with her that it is appalling that these individuals promote tax avoidance schemes and get away with it. It causes misery to those caught up in the schemes, and deprives our public services of vital revenue. The Government are taking action via this Finance Bill to crack down on them.

I confirm to the House that the measures introduced in clauses 156 to 162 apply equally to those promoting avoidance schemes online, including on social media, and to those promoting them through more traditional routes. I can also confirm that the promoter action notice in clauses 163 to 173 will also apply.

I would also like to reassure my hon. Friend that we are publishing guidance on these matters, and I will ensure that it is clear throughout that the Government’s intention is to capture anyone who is promoting tax avoidance. This includes social media influencers who are making a monetary gain through clicks, as highlighted by my hon. Friend, and I would welcome her engagement in developing the guidance.

[Ms Creasy]

I thank all the MPs across the House—except those in the obvious party—who understand the risks to our constituents from this advice. It is very welcome to see a Government respond so quickly to social media problems, unlike the last one; we remember payday lending and the “buy now, pay later” lenders. The Minister talks about issuing guidance. Does he have a rough timeline for when that guidance will be available? I guess what I am really asking, on behalf of the millions of people who have been ripped off, is when Samuel Leeds will get a knock on the door from the taxman.

[Dan Tomlinson]

I look forward to working with my hon. Friend, and other Members who are interested in this topic, to make sure that we move as quickly as we possibly can. Let me thank all Members for their contributions during this this debate.

Question put and agreed to.

New clause 5 accordingly read a Second time, and added to the Bill.

New Clause 6

Offshore income gains: savings

“(1) This section applies in relation to an offshore income gain arising to the trustees of a settlement in a case where Chapter 2 of Part 13 of ITA 2007 (transfer of assets abroad) applies in relation to that gain for the tax year 2025-26 or any subsequent tax year because of the amendments made by section (Offshore income gains).

(2) If the offshore income gain arose in a tax year before the tax year 2025-26 and, by reason of that offshore income gain or a part of it, an offshore income gain was treated as arising in a tax year before the tax year 2025-26 to an individual under paragraphs (2) to (5) of regulation 20 of the Offshore Funds (Tax) Regulations 2009 (S.I. 2009/3001)—

(a) Chapter 2 of Part 13 of ITA 2007 is to be treated as not applying in relation to the offshore income gain arising to the trustees or that part of that gain, and

(b) references in section 734 of ITA 2007 to chargeable gains treated as accruing to an individual are to be treated as including the offshore income gain treated as arising to the individual.

(3) An individual is not chargeable to income tax under Chapter 2 of Part 13 of ITA 2007 on income treated as arising to the individual under section 732 of ITA 2007 by reason of the offshore income gain to the extent that the income, without the amendments made by section (Offshore income gains)(1) and (2)(b)—

(a) would have been treated as arising to that individual under paragraphs (2) to (5) of regulation 20 of the Offshore Funds (Tax) Regulations 2009 (S.I. 2009/3001), and

(b) would have been non-chargeable income (see subsections (4), (5) and (6)).

(4) The income would have been non-chargeable income if, without the amendments made by section (Offshore income gains)(1) and (2)(b)—

(a) the income would have been treated as arising by reason of—

(i) the matching of a capital payment received (or treated as received) by the individual before 6 April 2008 with an offshore income gain arising on or after 6 April 2025, or

(ii) the matching of a capital payment received (or treated as received) by the individual on or after 6 April 2025 with an offshore income gain arising before 6 April 2008, and

(b) paragraph 100 of Schedule 7 to FA 2008 would have applied to the income.

(5) The income would have been non-chargeable income to the extent that, without the amendments made by section (Offshore income gains)(1) and (2)(b), it would have exceeded the relevant proportion of income—

(a) which would have been treated as arising to the individual by reason of—

(i) the matching of a capital payment received (or treated as received) by the individual on or after 6 April 2008 with an offshore income gain arising on or after 6 April 2025, or

(ii) the matching of a capital payment received (or treated as received) by the individual on or after 6 April 2025 with an offshore income gain arising on or after 6 April 2008, and

(b) to which paragraph 101 of Schedule 7 to FA 2008 would have applied,

and, for that purpose, “relevant proportion” has the meaning given by sub-paragraphs (9) to (18) of paragraph 126 of that Schedule as they would have been modified by sub-paragraph (3) of paragraph 101 of that Schedule.

(6) The income would have been non-chargeable income to the extent that, without the amendments made by section (Offshore income gains)(1) and (2)(b), it would have exceeded the relevant proportion of income—

(a) which would have been treated as arising to the individual by reason of—

(i) the matching of a capital payment received (or treated as received) by the individual on or after 6 April 2008 with an offshore income gain arising on or after 6 April 2025, or

(ii) the matching of a capital payment received (or treated as received) by the individual on or after 6 April 2025 with an offshore income gain arising on or after 6 April 2008,

(b) to which paragraph 102 of Schedule 7 to FA 2008 would have applied, and

(c) to which paragraph 101 of that Schedule would not have applied,

and, for that purpose, “relevant proportion” has the meaning given by sub-paragraphs (4) to (7) of paragraph 127 of that Schedule as they would have been modified by sub-paragraph (4) of paragraph 102 of that Schedule.

(7) Subsection (3) does not prevent Chapter 2 of Part 13 of ITA 2007 from having effect as though the income not chargeable to tax under that subsection had been charged to tax under section 731 of that Act.

(8) Accordingly—

(a) in the application of section 733(1) of ITA 2007 to the individual for subsequent tax years, the amount of that income will be deducted at Step 2 and at paragraph (a) of Step 5, and

(b) in the application of section 733(1) of ITA 2007 to any other individual for subsequent tax years, the amount of that income will be deducted at paragraph (b) of Step 5.

(9) In section 733 of ITA 2007, after subsection (2D) insert—

“(2E) See subsections (7) and (8) of section (Offshore income gains: savings) of FA 2026 (offshore income gains: savings relating to amendments made by section (Offshore income gains) of that Act) for special provision about income that is treated as arising under section 732 but that is not chargeable to income tax under subsection (3) of that section.”

(10) This section—

(a) is to be treated as having come into force on 6 April 2025;

(b) has effect for the tax year 2025-26 and subsequent tax years.” —(Dan Tomlinson.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 7

Pensions: abolition of the lifetime allowance charge

“(1) Paragraph 134 of Schedule 9 to FA 2024 (power to make further provision in connection with the abolition of the lifetime allowance charge) is amended as follows.

(2) In sub-paragraph (2)—

(a) for paragraph (b) substitute—

“(b) have effect for the tax years 2024-25 and 2025-26 (as well as subsequent tax years);”;

(b) in paragraph (d), at the end insert“(including any provision that could be made under paragraph 133)”.

(3) In sub-paragraph (3) omit “that increase any person’s liability to tax”.

(4) In sub-paragraph (4), for “5 April” substitute “30 June”.” —(Dan Tomlinson.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 11

Uprating of allowance amounts for agricultural property

“The Chancellor of the Exchequer must, within six months of the passing of this Act, undertake and publish an assessment of the potential merits of uprating annually the relief allowance amount for agricultural property by the change in the value of agricultural land.”—(Charles Maynard.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

Business Rates

Stella Creasy Excerpts

Tuesday 27th January 2026 Commons Chamber

[Dan Tomlinson]

The hon. Member may not wish to watch the football, and that is fine—that is her decision—but she will be interested to know that we are consulting on whether we can extend the power over longer licensing hours to other events. She will have to let me know if there are other events that she would like to go and watch in a pub, and that can be part of the consultation.

I have already answered the specific question that the hon. Member raises in a way, but I am happy to repeat myself. It is the case that pubs are valued differently than other sectors on the high street. It is also the case that they have suffered in the past 14 years, with 7,000 pubs closing and significant pressures. More broadly, we have put in a package of support, as I have outlined already.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

I know that many of the businesses in the Walthamstow beer mile that are also music venues, as well as our brilliant Rose and Crown pub and the Wood Street Bear, will welcome what the Minister has said today, and rightly so, because pubs are important. I must take issue, however, with his metric that pubs are somehow the only cornerstone of community life in this country. I join colleagues in asking for further support for the hospitality industry, in particular those small independent venues, such as cafés, community centres and soft play centres. I am sure he does not want to be the Minister responsible for sending toddlers into pubs because the other places that their parents might take them to during the day have closed down. That would not be in anybody’s interest. May I make a plea for him to revisit his exclusion of these smaller, independent chains from the hospitality relief that he is talking about?

[Dan Tomlinson]

I would not want to be the Minister who caused that to happen. My hon. Friend has made a very good point, and, as the parent of a young child, I can say how much I value soft play, even though it is rather exhausting at times.

I have set out the specific reasons why we have taken this approach to pubs and live music venues, and I am glad that my hon. Friend welcomes that for the businesses in her constituency. More broadly, the Government did come forward with £4.3 billion of support, most of which is coming this year, and we will of course continue to engage with businesses and with parliamentarians on this important issue in the run-up to future Budgets.

Oral Answers to Questions

Stella Creasy Excerpts

Tuesday 4th November 2025 Commons Chamber

[Dan Tomlinson]

In the end, when it comes to property taxation, we have to make sure that we have a fair and sustainable system that brings in revenues from a range of sources. Scrapping individual taxes without any realistic and plausible plan to fund them is the road to economic ruin in this country. We have seen what happened in the past when Conservative Governments came forward with plans to cut taxes without the means to afford it. We on this side of the House will not be making that mistake.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

T10. British businesses face a toxic storm of crushing tariffs from America and mountains of paperwork from Europe. I welcome the Prime Minister’s recognition that we need to do something about the latter because in my constituency, because of Brexit, businesses now have to deal with 27 different VAT regimes rather than one. Can the Chancellor update us on what she is doing to be a red against the red tape and solve that problem?

Government Performance against Fiscal Rules

Stella Creasy Excerpts

Monday 7th July 2025 Commons Chamber

[Darren Jones]

I will not give a running commentary on my conversations with businesses or constituents in my constituency, but what I have heard from businesses in the defence and infrastructure sectors is welcome news regarding our long-term spending commitments, our reform of the planning system and our commitment to spending more on capital across our country, which will generate good jobs and good skills in every part of the country.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

There has been talk about the previous Prime Minister. As the MP for the constituency where the lettuce that lasted longer than the previous Prime Minister was located, I can confirm that we all know from our constituents that she did more damage. It is good to hear Conservative Members finally talking about the small businesses that are the backbone of the British economy, rather than worrying about the millionaires. Does my right hon. Friend agree that we need to give those businesses even more certainty and confidence about the road ahead? The EU trade deal that we have done is a brilliant start, but does he agree that there is now a case for also looking at things like alignment by default, so that they can confidently know what kind of future they have under this Government?

[Darren Jones]

I thank my hon. Friend for welcoming the trade deals that this Government have entered into with the United States, India and the European Union, with whom we got a great deal, especially on food and drink imports and exports, which will result in lower prices on the shelves of our supermarkets across the country. As my hon. Friend knows, we have committed to an annual summit with our counterparts in the European Union, and I am sure that my ministerial colleagues will set out further detail on those negotiations in due course.

Oral Answers to Questions

Stella Creasy Excerpts

Tuesday 1st July 2025 Commons Chamber

[Darren Jones]

On behalf of the House, may I thank social care workers for the service they provide in all our constituencies? As a result of this Labour Government commitment’s to social workers and the social care system, we will have increased funding for social care by £4 billion by 2028-29 through the local government settlements, and we will bring forward a fair pay agreement to make sure that there is a fair deal for those people serving our constituents on the frontline.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

The main beneficiaries of Brexit have been printers, because of all the extra paperwork that the previous Government created. The National Audit Office has estimated that their border arrangements have cost us £4.7 billion and rising, and the single trade window will add to the red tape. Does the Chancellor agree that the best way to reduce the paperwork requirements in the first place is to do a good deal with Europe, and will she update us on her progress on that?

[James Murray]

My hon. Friend will have seen the Prime Minister’s work to reset relations with the EU. She mentions the single trade window, and it is the Government’s intention to deliver that. More widely, the Government are committed to minimising the administrative burdens and frictions experienced by businesses trading internationally.

UK Infrastructure: 10-year Strategy

Stella Creasy Excerpts

Thursday 19th June 2025 Commons Chamber

[Darren Jones]

The difference from the last Government is that they promised things with no money, and we are promising things with actual money. The hon. Member points to the midlands hub in the spending review document. That is about development funding. One of our different approaches under this infrastructure strategy is that, instead of just allocating the total estimated spend at the start of the project and letting the project get on without proper oversight, we are issuing development funding earlier and more often, so that we can have properly costed business cases with proper assurance. That means we can guarantee members of the public that we will deliver on our promises, unlike his party.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

I welcome this investment strategy. Many of us have seen at first hand the broken infrastructure we are dealing with. The Chief Secretary will know my concern that many of the organisations we will be asking to tackle these problems are also dealing with the legacy of the private finance initiative, which saw buildings and projects cost three times more than the actual assets themselves. The pleas that many of us made to the previous Government to tackle these legal loan sharks of the public sector fell on deaf ears, and I know that this Chief Secretary will not make the same mistake. Would he be open to meeting those of us who are keen to learn the lessons of the private finance initiative? In particular, can we cap what private companies can make on military contracts, children’s care homes and other social infrastructure projects, so that we do not see our public sector savaged by these companies in future?

[Darren Jones]

I am always happy to meet my hon. Friend. I can confirm that in the design and funding of NISTA, I have funded a particular team to work on the management of disputes under the old PFI contract schemes to make sure that we are getting the best outcomes and best deal for the public sector.

Debt Advice Services

Stella Creasy Excerpts

Thursday 9th January 2025 Commons Chamber

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

“Follow that!” is the first thing to say. Let me try.

I will start by saying that often the British public would rather talk about sex than debt. Both can equally cause a lot of trouble, though. A 2019 study showed that the majority of people in this country believed it was easier to talk about miscarriages than about money. How that has changed in recent years, when the cost of living has become the top topic of conversation for millions of people because they are drowning in debt. Indeed, they are now the majority.

In my constituency of Walthamstow, nearly 55,000 people are in financially vulnerable circumstances. That is 58% of my local population and way above the national average of 38%. Yet the truth is that debt is suffocating millions of people in this country; it is not just a north-east London phenomenon. The Joseph Rowntree Foundation recognised in October that there were 7 million low-income families in this country going without the essentials in the previous six months, including 5.4 million who had experienced food insecurity in the previous month. That is a fancy term for starving themselves because they could not afford to put food on the table. Furthermore, 4.3 million low-income households are in arrears on at least one household bill or credit commitment, and 14 million people in this country have less than 100 quid in their savings. One piece of Lego stuck in the washing machine and they are done.

Some would say that taking on debt in response to that is manageable—and it is for some people. That is how they have got through the crisis. However, that is not the one person every four minutes who is declared bankrupt or insolvent in this country. The Registry Trust estimates that 4.6 million people have one or more county court judgment. They are issued at a rate of 2.5 times more in lower-income communities such as mine than in higher ones. At the end of last year, lenders wrote off £576 million of debt, of which £291 million was credit card debt. That is £3 million a day being written off because people will just never pay it back.

Four million households hold a loan they originally took out to pay for food or housing—that is worth around £9.6 billion. Some £2.3 billion of that is owed on bills that have a massive consequence if people do not pay them or fall behind, such as council tax, rent or mortgages and energy bills—the kind where people end up losing their home or with the bailiffs at the door. It is not hard to see why. This is not profligacy; there is just too much month at the end of many people’s money.

High inflation since the end of 2021 has baked in higher prices in areas such as food, and energy costs are rising again. Private rents have continued to increase ahead of inflation, up 8.7% last year and higher in places such as Walthamstow. Interest rates might have seen two cuts, but the full impact of elevated interest rates is still feeding through into mortgages. Yes, the legacy of Liz Truss will be felt for decades to come, in the empty pockets and multiple evictions. So sue me for saying so.

The Government set up a financial inclusion committee with consumer groups and financial institutions to look at how to provide individuals who have poor credit histories with access to safe and affordable credit. In this target-rich environment, there is much for the legal loan sharks in this country to feast on—and feast they do. Low-income households in this country owe £23 billion in unsecured loans and credit cards. That is up from £19 billion just in May last year. A total of 2.2 million low-income families have high-cost credit loans such as payday loans or pawn shop arrangements. Three million people told Ipsos last year that somebody in their family had gone to an illegal lender in the last three years.

Banks do not want to lend to these people because they are seen as a bad bet. That is because of the cost of living crisis: they just cannot get hold of the money to keep things moving. Our credit union movement, which has been promised so much by so many different Governments, just cannot grow to keep up with the need. Governments have promised to invest in it but failed to do so. It has been as ripped off as those who ended up at Wonga or Klarna to make ends meet.

I pay tribute to groups such as Fair4All Finance, which provides funding for credit unions such as the London Capital credit union that works in Walthamstow, but no credit union can compete with the online lenders who are pummelling our constituents on their phones and on their websites, offering them unprotected credit to get through to the end of the month so that they can buy a pizza. Then they stick them with late repayment fees and charges before lending to them again, even though they cannot repay it, because they are stuck in a spiral of unaffordable debt. In all of this debt, the most important thing that a person can do is talk about it. That means that they need somebody to talk to, because it could be the critical difference between getting out of the hole that they are in and burying themselves even further.

The Financial Conduct Authority imposes a levy on all regulated financial services companies to pay for such support, and that includes funding the Money and Pensions Service. Others such as the citizens advice bureaux, which many of us will pay tribute to in our constituencies, and StepChange have to fundraise for themselves. Ultimately, in this environment we cannot afford to keep funding failure. We need to prevent people getting into debt in the first place and move them off the high-cost credit that causes so much of it.

However, so few people in the current environment get the help that they desperately need to get out of this nightmare. The 2018 independent Wyman review found that just 1.1 million people got debt advice, with just 13% of those considered indebted. By 2020, it was estimated that 1.7 million were getting help. The Government set a strategy of 3.7 million by 2030, but, just last year, the Money and Pensions Service only saw 2 million people. That is not through a lack of trying. Some 82% of debt advisers told MAPS that there had been a large increase in demand, while just over half of them reported a decrease in the resources to cope with it. That is the nub of the debate today.

The total funding available for debt advice in this country in 2018 was £196 million, with about a third of that coming from the levy on financial services and the rest coming either from local government or fair share creditors—the payments that people can get in a debt repayment plan to pay for services. We now know that the financial services levy is raising about £78 million, but we have no idea what is happening to the rest of the money needed, not least because local government is on its knees after 14 years of Conservative cuts. My own local authority is cutting the support that it offers to people struggling with council tax payments, let alone providing any debt advice. It is not alone. Exeter CAB has seen a £125,000 cut to its services, Woking CAB a £189,000 cut and Coventry Independent Advice Service a cancelled grant for £325,000. The numbers go on across the country.

Funding will get harder too because of the cost of living crisis, as more and more people cannot afford to make a debt repayment plan in the first place. The CAB says that half of the people it works with have a negative budget, and 66% of Money Advice Service users were also in that position. Therefore, there is a risk that we will not get the funding to get people out of this hole. The Money Advice Service needs to get involved in cases earlier, but a consultation by the previous Government last year on the future of the service said that, looking at what the overall level of debt advice should be, the funding required was out of scope.

Above all, it is scandalous, given how implicated the “buy now, pay later” companies—the Klarnas, Clearpays and Laybuys of this world—are in the debt problems in this country and the length of time it has taken to get even close to some kind of regulation of them, that they do not even contribute to this pot, because they are not a form of regulated credit. Not only are our constituents going without protection from the ombudsman when they are mis-sold products; these companies are not even paying for the damage that they do. Yet around one third of people who need debt advice have “buy now, pay later” debt.That is why I am urging the Government—especially in the light of delays in regulating companies, which had a windfall this Christmas and will have another one next Christmas—to consider a windfall tax on the BNPL companies to help pay for the debt advice that is so desperately needed.

The companies have written to me claiming that they are not against being regulated, which is odd because I was at the Labour party conference where they stood on a platform and claimed to be so. They have also said that they are happy to contribute to making donations towards debt advice, so let us take them at their word, and squeeze them as much as they have squeezed our constituents.

We also have to stop commercial companies that make millions of pounds from pretending to offer debt solutions and claiming that they are helping consumers rather than pushing them further into debt. At the very least, the Insolvency Service should regulate such companies. Frankly, I would prefer a law that ensured that excessive profits cannot be made from somebody else’s personal debts by capping the charges. Sickeningly, many “buy now, pay later” companies present themselves as a money management service. That is why I am asking the Government to develop measures on what lenders are doing not only to reduce financial exclusion but to ensure that they are not the cause of debt themselves through bad lending practices. Even America, that great bastion of communist thinking, does more. The Community Reinvestment Act gives lenders an explicit obligation to meet the needs of all borrowers in their localities, including those on low incomes, to help stop them being the main meals of the legal loan sharks in the first place.

That is why we need to ensure that the Money and Pensions Service does not become primarily a website and helpline. Tackling debt in communities means helping people in communities, especially given the variation in debt between areas. If the service is just online, that does not uphold the principle of helping those most in need, and especially the most vulnerable. That matters because of the number of people who would benefit. In 2021, the service defined those in need as people who were behind on one priority bill or facing bailiffs. It separated out those people that it thought just needed money guidance—tips on how to budget—but those people were building up arrears, and were recognised to be at a tipping point. Some 8 million people are listed as needing debt advice, but a further 13 million are at that tipping point. Any of us who have had someone come to our constituency surgery in financial difficulty know that the sooner we intervene, the more chance we have of success. With 21 million people at a tipping point, let us not let them tip; let us help them now.

Research by the Centre for Responsible Credit shows that such people are already under extreme financial pressure. They frequently borrow to make ends meet. They use “buy now, pay later”, have unauthorised overdrafts, and are already behind on their consumer payments. If we underestimate the number of people in debt because the bigger group are better at juggling, can we really say that it is not a problem to be constantly borrowing from Peter to pay Paul, Paul to pay Penelope, and Penelope to pay both of them? Millions of people in this country are one bad argument with their partner, one new school uniform item needed or one parking fine away from being unable to manage, and they have just been through a month when everyone spends, on average, an extra £700 because it is Christmas.

These people do not need us to judge them; they need us to help them. If we do not massively increase the funding for money advice services and ensure that their focus is on preventing debt in local communities, it will not just be personally devastating for millions of people but hamper our chances of getting economic growth. Ultimately, I am asking Ministers to introduce a cost-cutting measure. The National Audit Office reported in 2018 that debt problems are so detrimental to the wellbeing of the British public that they lead to higher public spending on both welfare services, such as mental health services, and state-subsidised housing to the tune of £900 million a year. That is why we ultimately need a financial inclusion committee to look at not just the costs of credit but how we stop people getting ripped off in the first place, and to be a consumer champion across the piece, whether on energy deals, finance or even local public service debt advice provision. In the end, if we join up the dots we really will save everyone money—the one thing that right now nobody has.

--- Later in debate ---

[Ms Creasy]

We all value the debt advisers. As my hon. Friend has just said, “buy now, pay later” companies do not yet contribute to the levy that pays for those people, but the companies themselves have said that they would make voluntary contributions. Would the Treasury consider approaching them to get that money ahead of their being part of the regulatory landscape, so that we can have more of these brilliant debt advisers?

[James Murray]

I am sure that Treasury officials and the Economic Secretary to the Treasury, my hon. Friend the Member for Hampstead and Highgate (Tulip Siddiq), will be in close contact with the sector about any proposals they have. It is important to emphasise that because of the regulations we are consulting on for the new regime, that will mean that “buy now, pay later” firms will be required to pay those specific fees and levies, which will help fund free debt advice services. We know that funding those services is important because intervention through debt advice services not only prevents financial difficulties from escalating, but protects people’s overall mental health and wellbeing. More widely, there are positive effects for families, communities and the economy at large.

As a new Government, we are committed to supporting national and community-based services through the Money and Pensions Service, or MAPS as it is commonly known. Those services provide advice to hundreds of thousands of individuals and families in need in England. In December, MAPS published its first debt advice impacts report, which showed that across 2023-24 people accessing debt advice through MAPS-funded services gained an estimated £48 million of extra income. That underlines the fact that for many people, advice not only allows them to deal with their debt problems, but helps them to find a way forward with more money in their pockets. Eighty-seven per cent of people who received MAPS-funded debt advice said they would recommend the service to someone in a similar situation.

Outside of England, the UK Government provide funding through the financial services levy to the devolved Governments in Scotland, Wales and Northern Ireland. As debt advice is a devolved matter, the devolved Governments have responsibility for delivering those services within their nations and for tailoring provision to the needs of their local communities.

My hon. Friends spoke about the gap between those who need debt advice and those who are currently accessing it. The Government recognise that gap and the need to tackle it. Funding levels, which my hon. Friends mentioned, are regularly reviewed to reflect demand, inflation and evolving needs. The MAPS debt advice budget for the upcoming financial year will be communicated in the usual way in the spring, and I will ensure that my hon. Friends are informed.

My hon. Friend the Member for Walthamstow mentioned the MAPS consultation last year on the future of its debt advice commissioning strategy. MAPS published its response to that consultation in October, setting out its commitment to increasing debt adviser wellbeing, further building advisers’ skills and delivering digital transformation across the debt advice sector. As part of its efforts to address unmet demand for debt advice, MAPS has also launched its debt advice modernisation fund, a grant initiative designed to support projects aimed at enhancing and modernising debt advice services in the not-for-profit sector. Projects are currently under way and will be completed by the end of March.

My hon. Friends touched on the wider issue of financial inclusion. I assure them that the Government are taking further steps to ensure that individuals can access the financial services they need.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Stella Creasy Excerpts

Committee of the whole House
Tuesday 17th December 2024 Commons Chamber

Our constituents are not fools, so I sincerely ask Labour Members to consider whether they came into Parliament to increase taxes on their GPs, on their care workers, on their charities and on their nurseries, or to add to the burden on hospices, like Keech hospice in Mid Bedfordshire, on local air ambulances and on charities such as the Greensand Trust, which does amazing work on environmental conservation in my constituency. They did not, so Labour Members should stand up to their leadership today, for the sake of hard-working people throughout our country, and stop this jobs tax.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

It is extraordinary to follow Opposition Members, with their short-sightedness and, frankly, short memory of the damage they have done to this country. Indeed, it is the very definition of chutzpah. I have been in this place for 14 years, and I watched what happened unfold in my constituency and across the country. That is how we got to this Bill today. New MPs may wish to rewrite history, but many of us can give testimony to the damage the Conservatives did.

This country should be grateful that we now have a Chancellor who is facing up to the fantasy public finances that we inherited from the previous Government, and who is trying to rebuild this nation. We finally have a framework for improving our rail services. Anybody thinking about getting on a train this Christmas knows how far we have to go. The damage lies at the door of the previous Conservative Government.

This Government are devolving meaningful powers to local government and generating clean electricity, which are just two things that the previous Government could not even understand, let alone get a grip of. We are certainly developing a better approach to our infrastructure.

In their final years in office, the Conservatives passed tax cuts that the country could not afford. There may have been genuine shocks around the world, but we can see the damage the Conservatives did, and we can see that they chose to compound it with bad choices. They did not just break Britain; they slashed it and burned it to the ground. That means this Government’s first year in office is a salvage operation. The previous Government’s decision to prioritise fake tax cuts over sustained investment in our public infrastructure has cost us all dearly.

Those who are sceptical of what I am saying should stand in an A&E and see the trolleys in the corridors, as 7.9 million people still wait for operations. They should talk to the schools with reinforced autoclaved aerated concrete, to the councils barely clinging on to provide social care, and to the police who just do not exist on our streets.

[Graham Stuart]

Will the hon. Lady give way?

[Ms Creasy]

For donkey’s years, I listened to the right hon. Gentleman try to claim that this country was on the up. I have seen the alternative. Please let him justify that.

[Graham Stuart]

As the hon. Lady knows, 4 million jobs were created under the last Conservative Government. She has just talked movingly about patients stuck on trolleys in corridors. Could she explain to the Committee how the Labour Government’s policies in England will differ from the policies of the Labour Government in Wales, which has far worse outcomes and worse waiting lists than anywhere in England.

--- Later in debate ---

[Ms Creasy]

I will tell the right hon. Gentleman what this Government are going to do differently: they will make a difference to all our constituents by getting waiting lists down with the money provided to invest in our NHS. The previous Government were all vandals, and we have seen the damage they have done.

The challenge before us in the Bill is to ensure this Government do not make the same mistakes, but instead address head-on the need to build the necessary foundations. To deal with the expectations of the public—our constituents—we need to talk more openly about the fact that having better services requires better funding through taxation. The broken Britain we now see will not fix itself with a bit of time. Worse, the public cannot be distracted from the problems they see by being given someone else to blame—trans people, refugees, immigrants, women or foreigners generally. That is a fantasy the British public did not buy at the last election, and they should not be promised it again. They know we have a difficult road ahead and difficult choices to make, but they will back those choices if they can see there is a reason to do so.

Above all, the British public understand that this country needs investment and growth. I am chair of the Labour Movement for Europe and I think there needs to be discussion about our future relationship with Europe, but that is for another time. We also need infrastructure, which is why I have proposed new clause 4. Infrastructure is not just about roads and rail, but about the services people need every day to be able to get to work and to manage their commitments, including childcare.

As somebody who spent 14 years urging the previous Government to invest in childcare, I will brook no lectures from the Opposition now they have had a damascene conversion to the idea that it matters. Childcare is economic infrastructure. [Interruption.] The right hon. Member for Beverley and Holderness (Graham Stuart) is chuntering from a sedentary position, but time and again he voted against proposals to make childcare a matter of economic infrastructure.

New clause 4 is about how best we invest in our people to be able to grow our economy. As we make tough choices, it is important we do so in a way that means our productivity improves, which means looking out for parents as well as potholes. We are in the middle of the biggest expansion of childcare this country has ever seen, to try to get to a point where every parent can access 30 hours of free childcare for all under-fives. Under the last Government, some parents were paying more for childcare than for their rent or their mortgage. The previous Government repeatedly failed to invest, and then they made promises that they knew they could never keep, pushing up demand without increasing supply. We must not make the same mistakes.

It is vital for our economy to make childcare more accessible and affordable, and we know we have a way to go. In rural areas, there are 31% fewer childcare places compared with inner cities and town centres. The most deprived communities have 32% fewer places per child, compared with affluent areas. Of the poorest fifth of parents with young children, only a third use formal childcare, compared with 73% of the highest earning households. The previous Government reinforced that inequality, rather than addressing it in their childcare policies. That is why in my constituency there are still three children chasing every single childcare place.

[Dr Luke Evans]

The hon. Lady has always been an advocate for childcare. One way the previous Government tried to address the issue was to try to stop the cliff edge for childcare by looking at households rather than individual parents. In the last Budget, the Government were looking at the proposal to consider households as one unit. Does that mean the hon. Lady has changed her mind and would support that mechanism being looked at again? It would solve a lot of the problems caused by, for example, a single parent having to pay for childcare because they are exempt, whereas a household containing a couple who earn under £45,000 are not eligible.

[Ms Creasy]

Let me reach the hand of co-operation across the House to the hon. Gentleman, if he wants to finally work on what would be a genuinely affordable and accessible childcare system in this country. However, I will temper his enthusiasm, because his party made things worse. Under the previous Government, there was a 50% reduction in childcare place. We saw nurseries closing time and again because of the changes his Government made. We are starting from a foundation where the places simply do not exist. For the places that are there, too often it is those who can well afford childcare who are taking them.

If we are to get to a position where we have the childcare places we need, so that every child can get the best start in life in this country, we need to invest. We need to ensure that we save what is there and encourage those nurseries that can expand to do so. If we do that, we will reap the rewards, both in the Exchequer and in society. That is why early years provision matters to the future of this country.

Research by the Education Policy Institute shows that 40% of the disadvantage gap at the age of 16 has already emerged by the age of five. Equally, investment in early years means we could save £16 billion a year later, according to the London School of Economics. It also means we will get more money, because more people—mothers, fathers and carers—can make the choice to work and pay tax.

[Daisy Cooper]

The hon. Lady is making a compelling case about the need to invest to save. When we invest upstream in our public services, that often saves money for the taxpayer further down the line. Does she agree with the Liberal Democrats that that could be equally applied to investing in GPs, dentists and pharmacists to relieve pressure on the NHS?

[Ms Creasy]

I have worked with the hon. Lady on various issues, and I hope she will give me the latitude to expand my argument and set out my proposals, which we could move forward on together as a House. I do not doubt her sincerity, but I also recognise the fiscal destruction of the previous Government that we need to deal with, which means we need to tell the British public the truth about what needs to happen. Making unfunded promises is as bad as not promising to act.

Parent surveys show that a real difference is made when 30 hours of childcare is offered. That amount of childcare enables families to make choices about getting back into work. If we want to get to 30 hours by September next year, we need 60,000 additional childcare places and 29,000 extra members of staff. If we do not have fundamental root and branch reform of how we fund the provision of childcare, that will cost about £72 million extra a year on hiring staff alone. That is the challenge we face if we want to get this right.

I know how hard the Minister is working to get the economy growing again. I know he is going to hear pleas from every single sector about the impact of the national insurance changes; nobody should be under any illusion that they are not difficult changes. I make a plea for the childcare sector because I believe that in the end, it will pay for itself. If we are able to get more people back to work, especially mums, who all too often end up bearing the burden of childcare, we will be able to raise more taxes and there will be more investment as a result.

That is particularly true of the childcare sector because it is a people-intensive industry. Staffing costs make up 75% of a nursery’s running costs, compared with 30% for the average restaurant. Because the previous Government systemically failed to invest in childcare, the majority of childcare has been provided by the private sector. Some 85% of places are delivered outside the state sector. There is little flexibility on numbers in the sector, because ratios—the number of people looking after little people—matter. These are not businesses with small numbers of staff; an average nursery has 14 members of staff, which means the additional costs will be about £36,000 to £39,000 a year. Around £14,000 of that will be national insurance.

Many Members agree that we need to invest in that childcare and will be pleased to see this Government trying to address the balance. The damage done under the previous Government meant that 83% of nursery providers said the funding they received did not cover their costs. That is why closures increased by 50% in the last couple of years. This Government have already increased the funding for our nurseries, but while that takes account of increases in wages costs, it does not take account of the increases in national insurance.

I tabled new clause 4, which is about having a review of one element of all that, to ensure that we do not cut off our nose to spite our face when trying to get more people into work. We recognise that extra national insurance costs may have consequences, be they recruitment freezes, reduced staff training or even closures, at a time when we want the sector to expand. Indeed, the majority of nurseries have staff vacancies, so they need extra people already.

[Dave Doogan]

The hon. Lady is making a compelling case of logic as it applies to early years provision, and I do not think anybody in this place could argue with the logic she advances. Is it not so robust, however, that it also applies to primary care, hospices and charities, if it applies to nurseries?

[Ms Creasy]

I hope the hon. Gentleman recognises that I am talking about a specific function of the way in which the childcare sector operates and the fact that it generates public Exchequer funding when we get people back into work. My argument here is that we invest to save. This is specifically about childcare. I am sure the hon. Member has read new clause 4 in depth, by the look on his face.

[Dave Doogan]

indicated assent.

--- Later in debate ---

[Ms Creasy]

He will therefore understand why I suggest that we as a Parliament could look at how we address those issues. Right now, the sector is concerned. I do not think that is a surprise to anyone. It may be a damascene conversion for the Conservative party to suddenly care about it, but there is a concern across the sector about not going backwards.

Clause 3 will increase the employment allowance from £5,000 to £10,500 and will reduce the current £100,000 threshold. It might be perceived that for some small businesses, particularly in the childcare sector, that would be a potential way forward in reducing some of the impact of the changes so those businesses can continue to expand. However, the challenge is right now, with the majority of childcare providers not qualifying for the employment allowance because of the way in which the sector operates and because it has been ignored, dismissed and derided by previous Governments. The majority of positions are produced in the private sector. That means they do not qualify.

There is perhaps an unintended irony in all that, however, which is that investing in more childcare, as we are doing, means that many of those small businesses will not be eligible for the employment allowance. As it is about companies that receive less than 50% of their income from public funding, while many childcare providers were originally in that position before money started going into them, the irony is that many fewer will be in that position in the coming years as a result, meaning that they will be denied the opportunity.

Childcare provision in educational settings will be able to benefit, so it is not a total denial. That means that if we are looking to expand childcare, in the current environment and without looking at how we can make that an equal opportunity for all childcare providers, that will have to be done through the state sector, which means having to find nurseries that can be provided in spare classrooms or childcare settings within an educational setting. That accounts for a small amount of the structures in place at the moment, and there is a risk that we will not see the investment in expansion because expansion in previous times has come through the private sector.

My concern, if I am frank, is that this is a perfect storm of our own making. With the best intentions of investing money from the Budget in childcare, we may inadvertently make it harder to expand childcare. That is why we need a review, because it is not clearcut that that will be the outcome, which is why I have tabled new clause 4. I also urge Ministers to look at business rates, which currently add around £21,000 to the average nursery. We found support in the Budget for those in retail and hospitality. We could look again at the childcare sector on the same basis.

Above all, we need to raise those questions and ask how we can ensure that we do not see a curtailment of childcare in this country, because the reality is that fees will then go up, making it even harder for parents to use it. That is what the Pregnant Then Screwed surveys are showing us: 90% of parents who have a place are terrified that costs will go up in the coming year, and 60% say that if that happened they would reduce their hours or leave work altogether.

This is a tough time, this is a tough Budget, and there are tough decisions to be made. We are not shying away from that and I am proud to be a member of a political party in government that is getting a grip of this country’s needs. However, I am also determined, as I am sure is everybody on the Back Benches, to make sure that we do that in the best way possible. If the Minister will not accept new clause 4, I hope he can tell us what work the Treasury is doing to ensure that childcare as a form of economic infrastructure can grow and support this country as it recovers from the last 14 years of Conservative Government.

We know that all those who will be affected—in the choice to work, to stay in work and to stay open and run a nursery—are literally the ones who have been paying the price of having a Conservative Government. We do not wish to make them pay all over again. The Conservatives broke Britain. We now need to be honest about the work and the investment that it will take to repair it.

[Helen Maguire (Epsom and Ewell) (LD)]

I am greatly concerned about the consequences of this Bill. There are consequences for businesses, for employees and for essential primary care providers in my constituency and across the country. The Bill represents an unfair jobs tax that risks harming the livelihoods of countless individuals and the viability of small businesses at a time when they are already grappling with a multitude of challenges.

I wish to begin by highlighting the impact that this legislation will have on community pharmacies, which are at the frontline of healthcare in our local areas. The owner of Horton Pharmacy and Travel Clinic in Epsom has expressed grave concerns about the financial burden that this increase in employer national insurance contributions will impose. He told me:

“We are estimating that it’s going to cost an extra £12,000 a year. It’s very distressing and making it harder to keep our doors open and help reduce the burden on other parts of the NHS.”

Community pharmacies such as Horton Pharmacy play a critical role in alleviating pressure on our overstretched NHS by providing accessible healthcare and advice, yet the Bill threatens their financial viability, which in turn risks leaving constituents without the local care they rely on, thus increasing the burden on the NHS.

Oral Answers to Questions

Stella Creasy Excerpts

Tuesday 3rd December 2024 Commons Chamber

[Tulip Siddiq]

I understand that lots of people have suffered, as the report explains, which I said I have read. However, I do have confidence in the FCA; I have sent it remit letters outlining what we expect it to do to deliver on its objectives. The FCA is looking at certain things such as its rulebook, which we think is too extensive, to look at rules that no longer need to be applied but, overall, we are working with the FCA closely and we believe that it is trying its best. It is not possible to have a system where nothing ever goes wrong, but we are trying to minimise that and ensure that there is consumer protection. The FCA knows that we are working together to deliver on its objectives.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

5. What assessment she has made of the adequacy of funding for the Money and Pensions Service.

[The Parliamentary Secretary, His Majesty’s Treasury (Emma Reynolds)]

The Money and Pensions Service plays a vital role in supporting individuals to manage their money effectively. Its funding levels are regularly reviewed to reflect demand, inflation and evolving needs.

[Ms Creasy]

New research from the Centre for Responsible Credit shows that 7.5 million people in this country are going without the debt advice that they need. We are in a cost of living crisis, so services are severely stretched. The Money and Pensions Service underestimates need by excluding people who are behind with their bills. That means that the financial levy that it proposes is not what it needs to be. Since a third of those who need financial help borrow from buy now, pay later lenders, and given the delay in regulating those companies, will the Minister meet me to look at the funding model of the financial levy and what more we can do to ensure that those profiting from exploiting our constituents pay to repair the damage?

[Emma Reynolds]

My hon. Friend has been a tireless campaigner on this issue. We are reforming buy now, pay later, as the Economic Secretary recently stated in answer to my hon. Friend in the House. The Government recognise the gap between those who need debt and those accessing it, which is why the Money and Pensions Service is exploring ways to improve accessibility, including through outreach initiatives. We continue to keep a close eye on its funding levels to ensure that they reflect demand.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Stella Creasy Excerpts

2nd reading
Tuesday 3rd December 2024 Commons Chamber

[James Murray]

We know that the tough decision that we have had to take will have impacts—we have been up front with people about that—but we also know that over half of all employers will pay no more or less national insurance than they did before. We acknowledge that this decision will have an impact, but we believe that it is the right decision. I will explain why that is.

[Ms Stella Creasy (Walthamstow) (Lab/Co-op)]

It is clear that the Government are working hard to get this right, but may I press the Minister on the point about the employment allowance? What he says about doubling the threshold is welcome, particularly when it comes to childcare provision, and we all want an expansion of childcare places. He will be aware that the employment allowance doubling that he is talking about will apply to state-provided childcare places, but not to private and co-operative nurseries. Some 85% of places are in private and co-operative nurseries, so will he look at extending the employment allowance that he is giving to state nurseries to private and co-operative nurseries, so we can support the expansion of childcare?

[James Murray]

I thank my hon. Friend for her question, but eligibility for the employment allowance is not changing. It is the same as it was before, and we are maintaining that provision. On protecting small businesses and charities, the crucial thing for us is the doubling of the employment allowance. In individual cases, I would recommend that organisations get the right advice, but the eligibility criteria for the employment allowance will not change as a result of the Bill.

--- Later in debate ---

[Richard Fuller]

Since the hon. Lady is reviewing history, she should look at the Bank of England review by Bernanke, commissioned under the last Government, which looked at the impact on interest rates in the UK compared with other countries and included that period. She will see that the real impact of those changes on interest rates was no different from any other year. The UK stayed in exactly the same place every year. There is a difference between facts and reality and what the Labour party thinks is history.

[Ms Creasy]

Will the hon. Member give way?

[Richard Fuller]

No, I am drawing my speech to a close, because plenty of people wish to speak.

UKHospitality is also concerned. It estimates that our pubs, clubs, hotels and restaurants will have to stump up £1 billion more because of the Bill. It points out that for a typical staff member aged 21 or over earning the national living wage and working 38 hours a week, the jobs tax will increase by 53.9%, from £1,863 to £2,869. Does the Minister honestly think that that will not mean job cuts in the hospitality sector?

The Government claim to have shielded the public sector from the jobs tax, but the reality is murkier. Many of our GPs will have to stump up more money, and our hospices and charities will have to find more money. As we approach the Christmas season, will the Minister give some hope to our charities, voluntary groups, GPs and hospices, and say that they, too, will be exempt from Labour’s jobs tax?

The Labour party in government is stumbling badly. I know from my own experience that no amount of resets will inspire confidence, and certainly not when a Prime Minister is forced into a reset within five months of taking office. The Labour party in government is also getting a reputation for a series of cruel policies motivated by socialism based on hate. The removal of winter fuel payments for the elderly was cruel. The family farm tax, penalising British farmers who have toiled in our fields for generations, was cruel. Today’s jobs tax, attacking businesses, charities, GPs, hospices and employment opportunities and growth is cruel, too. I urge all Members of this House to support our amendment.