The Economy
Stephen Metcalfe Excerpts(5 years, 1 month ago)
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Jeremy Wright (Kenilworth and Southam) (Con)
It is a great pleasure to contribute to this debate about the economy. It is an economy that is changing, and I want to use my few minutes to speak about that change.
Technology has already transformed many of our businesses and much of our economic activity is now happening online, but of course some things have not changed. The Government still need businesses to create wealth to tax and spend on public services, and businesses still need the Government to provide the environment in which wealth can be created. But in the new digital economy, Government policy making needs to be quicker and more imaginative, and it needs to do several things at once.
Policy making needs to provide for necessary infra- structure, including broadband. It also needs to deliver the increased investment in science and research referred to in the Gracious Speech, and an immigration system designed to allow the brightest minds to contribute to our ongoing prosperity. But there is something else that policy has to do. It needs to create the ethical and regulatory frameworks within which technology advances. Now, some fear that innovation is stifled by ethical safeguards, but I think it is the opposite; I think that it can be the absence of ethical safeguards that holds innovation back.
Let us take artificial intelligence as a good example. The real potential for AI is in the intelligent utilisation of data, and lots of it. It cannot bring truly transformative improvement without that data, and much of the data it needs—some of it very sensitive—it is in the hands of individuals who understandably worry about what may be done with it. They will not make their data available if they are not persuaded that there are ethical safeguards in place to protect it. The Government need to design and implement those safeguards.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
Will my right hon. and learned Friend give way?
Mr Deputy Speaker (Sir Lindsay Hoyle)
Order. May I suggest that if there are lots of interventions, people who wish to make speeches are going to end up with a reduced time limit?
Stephen Metcalfe
I just want to make a comment in the light of what my right hon. and learned Friend was saying about ethics in the use of data. Does he agree that the UK has historically led the field in the creation of ethical frameworks, and that we are well placed to do so again when it comes to AI?
Jeremy Wright
I agree with my hon. Friend. In the interest of saving time, he takes me directly to my next point, which is that we in the UK are well placed to do the work to which he refers. We are respected not just for our scientific expertise, but also for our regulatory expertise. I hope very much that the Government will engage fully in that task.
Finally, I urge the Government to maintain their commitment to internet safety and the reduction of online harms. I was very proud to bring forward the online harms White Paper in conjunction with a number of ministerial colleagues, including my right hon. Friend the Chancellor when he was Home Secretary. That White Paper sets out a response to online harms in social media and other user-generated content that seeks to balance freedom of speech with protection of the vulnerable in a fast-moving landscape where, frankly, hardly any rules have been applied so far. I believe that the approach it sets out strikes that balance well, but we certainly heard arguments that said, “Hold back. Let someone else regulate first, in case all the investment coming into the UK now from Google, Facebook and all the rest goes somewhere else instead.” Well, I rejected those arguments then and I reject them now—not least because, as these companies generally accept, if social media and other online spaces are not seen as safe spaces, people will increasingly choose not to be there, and if people are not there, they cannot be sold anything there, so it is good business as well as good policy to make them safer. I am therefore pleased to see in the Gracious Speech a commitment to continue to develop proposals to improve internet safety, but I am disappointed not yet to see a commitment to legislate to do so. I understand Ministers’ preference to pursue pre-legislative scrutiny first, and it is important to get this right, but I urge them not to lose momentum.
At this crucial moment in the development of the digital economy, we should not just act to protect the vulnerable in our own communities; with that well-deserved reputation for both innovating and regulating effectively, we should also be proud to lead the world in making the internet a safer place.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
I am pleased to be able to make a short contribution in response to the Gracious Speech. There is much to be welcomed in this Queen’s Speech, and it is a testament to the Government’s stewardship of the economy that we are able to put some of these actions forward.
I had wanted to remind the House a little bit about the toxic economic inheritance that we received back in 2010 and then how, over the past decade, we have transformed the UK economy, which has allowed us to invest in our important public services, but I fear that I do not have the time. We have come a long way, but there is always more to do. This Queen’s Speech, I believe, starts that process and builds on the progress.
We are putting more money into hospitals. We have heard about the £14 billion that is going into schools, and we are funding 20,000 extra police officers, 135 of whom I will see in my Essex constituency. There is therefore much to welcome, but I cannot make a contribution to this debate without talking about the first and foremost Bill in the Queen’s Speech—the European Union (Withdrawal Agreement) Bill.
I was very pleased when, earlier this week, the Second Reading of the Bill received approval, but I was disappointed when the programme motion failed. Had it passed, there would have been a huge sigh of national relief, and it is a shame that we have a Bill that has passed but can go no further. Some 73% of my constituents voted to leave the EU and, three and a half years on, they cannot understand why we have not left. Just pushing the can further down the road will not solve this problem. Everything that can be said about Brexit has been said twice already. No vote will change because of words spoken in this Chamber. We just need to get on with it. If we cannot get on with it, we will need to have a general election.
There are other things to which I want to refer. I particularly welcomed the announcement of the proposal to introduce the Prisoners (Disclosure of Information About Victims) Bill. I am sure that the hon. Member for St Helens North (Conor McGinn) also welcomes that Bill. It is of particular importance not only to me, but to my constituent Linda Jones. Her daughter, Danielle, was murdered by her uncle, who has continually refused to disclose the location of her body. The Bill is also important to numerous other families affected by this tragic and cruel crime, including Marie McCourt, whose daughter, Helen—after whom Helen’s law is named—was murdered. Although the announcement is welcome, the Government need to ensure that all relevant parole hearings that are in process are paused until the Bill is enacted so that no one is disadvantaged by the timing.
While there are all the other Bills that I welcome, I want to focus on the science aspect of the Queen’s Speech for the last 45 seconds of my contribution. As a former Chair of the Select Committee on Science and Technology, chair of the all-party parliamentary group on artificial intelligence and the Government’s envoy for engineering, I recognise that this Government have done a huge amount for science over the last 10 years and have promised to do more, including by investing £7 billion in our research and development base over the next five years. We are a global science power. We punch well above our weight; pound for pound, we create more citations internationally than any other country. This Government are doing all they can to protect and nurture that base. I ask Ministers to please continue to make scientists from around the world welcome in the UK so that the best and brightest always base themselves here.
Oral Answers to Questions
Stephen Metcalfe Excerpts(5 years, 2 months ago)
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Sajid Javid
The hon. Lady makes an important point, and I am glad that she has brought my attention to it again. As Chancellor, I want to ensure that across Government every Department is doing its bit for the economy. Some of the people she is talking about will be vulnerable people and the current rules are worth looking at again. It is something that the Home Office is taking very seriously.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
The Financial Secretary to the Treasury (Jesse Norman)
I thank my hon. Friend for that question. I have addressed the substance of it, but let me make a point about Sir Amyas Morse. I think that Sir Amyas is a superb choice. As my hon. Friend may be aware, in a debate in the House of Commons on 6 March 2019, the Chamber united across the parties in praise of Sir Amyas. The Chair of the Public Accounts Committee, the hon. Member for Hackney South and Shoreditch (Meg Hillier), called him
“a fearless advocate for what is good in the public sector and for challenging Governments of whatever party”.
The Liberal Democrat spokesman, the hon. Member for Oxford West and Abingdon (Layla Moran), said that he was not only “unfailingly courteous”, but had
“an intelligence of steel. He has a knack for calling out obfuscation, fudge and imprecision”,
and
“a reputation for being completely fair.”—[Official Report, 6 March 2019; Vol. 655, c. 1004-05.]
He is a very good choice to lead this review.
Spending Round 2019
Stephen Metcalfe Excerpts(5 years, 3 months ago)
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Sajid Javid
The good news is we do not have to choose between investing in leaving the EU and investing in Rhondda or anywhere else in the country, and the reason is that, under the Conservatives, we have a strong economy. But if the Labour party were ever in charge, we would not have the money to invest anywhere.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
I thank the Chancellor for his statement and particularly the focus on rebuilding our infrastructure. Of course he is right to ensure that it delivers value for money. May I therefore ask that he has another look at the lower Thames crossing to ensure that it is delivering value for money and that it delivers its primary aim of relieving congestion at the existing Dartford crossing?
Sajid Javid
The general point my hon. Friend makes about infrastructure and value for money is of course absolutely right, and as we spend more on infrastructure we must make sure that that principle is always maintained. He has invited me to take a further look at the lower Thames crossing. I will be happy to do that and to discuss it with him.
Loan Charge
Stephen Metcalfe Excerpts(5 years, 8 months ago)
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Stephen Metcalfe (South Basildon and East Thurrock) (Con)
Thank you for calling me so early in this resumed debate, Mr Speaker. I have to say that I had never imagined that I was going to speak in it, seeing as rain stopped play at about this time last week. I am by no means an expert on the 2019 loan charge, but I, like many others who expressed an opinion last week, have been contacted by numerous constituents who have set out in clear terms how they believe it would impact on them. They are being asked to pay back thousands, tens of thousands, and in some cases even hundreds of thousands of pounds that they never believed would be due.
Do not get me wrong: I believe that everyone should pay their fair share of tax. We know that that is what funds our public services, and we should clamp down on tax evasion at every possible opportunity. However, minimising tax exposure has always been a legitimate part of our tax system.
When looking at this issue, I have been on a journey. Initially I was in two minds about the validity of the arguments presented. Obviously, I had great sympathy for my constituents on both a personal and an individual level, but I felt that the old adage, “If something looks too good to be true, it is too good to be true,” applied. I have now, however, come to a different conclusion. I have looked at the individual cases presented and at the wider issues. To demonstrate why I have come to that conclusion, I want to use the words and sentiments that one particular constituent has sent me. He wants me to do this anonymously, as he does not want to prejudice himself or his case. As an aside, I am not sure that it is a healthy state of affairs when constituents are scared to speak out against a Government agency.
My constituent is a freelance IT professional who was advised to enter one of these schemes. When he entered the scheme, to give himself confidence that it was legally compliant and that what he was being told by his professional adviser was true, he contacted Her Majesty’s Revenue and Customs. The correspondence my constituent has from HMRC shows that in 2012, when he was checking for compliance under disclosure of tax avoidance schemes legislation, he asked HMRC to review the particular arrangements he had joined. I am informed that the HMRC anti-avoidance group concluded that no hallmarks of tax avoidance were in evidence and so HMRC did not assign a DOTAS number to that arrangement.
If that is true, which I obviously believe it is, I think it is fair to say that, under HMRC’s duty of care and due diligence, it had plenty of opportunity to inform my constituent that things had changed and that the particular arrangement that he had entered into would be liable to taxation. HMRC completely failed to notify my constituent that anything was amiss, so for years he relied on the initial HMRC advice he had received and continued as a customer of the arrangement.
Mr Charles Walker (Broxbourne) (Con)
That retrospective and disproportionate approach being taken by HMRC are what concern a number of my constituents. The people I represent are very reasonable, and they would be happy to come to an arrangement with HMRC, but HMRC seems to want to bankrupt its debtors, as opposed to getting some return from them.
Stephen Metcalfe
My hon. Friend makes an excellent point. All the correspondence I have had has been phrased in very reasonable terms. People want to do the right thing, but they feel under a huge amount of pressure.
Bob Stewart (Beckenham) (Con)
I am sure that, every year, my hon. Friend’s constituent sent in a tax return, which HMRC ticked, approved and sent back. Only recently has HMRC suddenly seen the way things are going and said, “Right, this is some kind of tax avoidance. Let’s get it all back, and in one year.”
Stephen Metcalfe
I do not know what the rules are on my hon. Friend reading the next line of my speech over my shoulder, because it says here that my constituent continued with these arrangements and, each and every year, dutifully declared on his tax return the amount he had received in loans and the amounts he had returned thereof. It came as a surprise that, years later, HMRC intends to use its newly granted powers—in what my constituent describes as “winding back the clock”—to retrospectively claim that the arrangements my constituent and others had used were not legal, had never worked and that the tax on the loans was always due.
Dr Sarah Wollaston (Totnes) (Ind)
I thank the hon. Gentleman for making these excellent points. Like me, does he find that he has several constituents who had no option but to be self-employed and were required to enter such vehicles?
Stephen Metcalfe
The hon. Lady makes an excellent point. For many there was no option. In many cases, as in the case of my constituent, people had to enter these schemes. My constituent even checked whether there were alternative options and checked the legitimacy of it, never thinking it would come back to haunt him.
I have to say that I do not like it. It feels wrong. I would like to think that I am a fairly reasonable chap, and when I feel that something is wrong or off and does not feel like natural justice, it tends to be true. Eventually, the Government will come round to my way of thinking, or I very much hope so.
As I said, I am not an expert on tax in general, but the charge is retrospective and HMRC failed to notify scheme users of the tax liability. Users sought professional advice or were advised to enter these schemes and, as in my constituent’s case, annually declared what they were doing.
Bill Grant (Ayr, Carrick and Cumnock) (Con)
Does my hon. Friend agree that, for some caught up in the loan charge, their circumstances may be the result of unfortunate omissions in, for example, professional advice or, indeed, HMRC advice, rather than a deliberate act on their part? For that reason, clemency and reasonableness should be applied by HMRC.
Stephen Metcalfe
My hon. Friend makes an excellent point that stands entirely on its own right, and I hope it has been heard.
Sir Oliver Heald (North East Hertfordshire) (Con)
On giving latitude, does my hon. Friend agree that these cases vary quite considerably? In some cases, it may be about allowing more time for people to pay; in others, it may be about looking at the detail of the debt and whether there is other evidence to suggest it should be less; and in some cases, it is a question of giving latitude on how many years HMRC goes back.
Stephen Metcalfe
My right hon. and learned Friend makes some good points, and I am aware that the Government have set out some of the mitigating measures they want to put in place. I am sure we all welcome those measures, but there is a need for both a pause and a full and proper review of what is being proposed to see whether we are acting in a way that would be considered to be natural justice.
Stephen Metcalfe
I want to continue. In failing to act back in 2012, when it had the opportunity—and surely the duty—to do so, HMRC denied my constituent the opportunity to depart the arrangements and seek an alternative solution for his payroll needs.
Sir Michael Fallon
My hon. Friend has been so generous in giving way that I hesitate to intervene once again. When he says that something feels wrong, he is on to something, because what feels wrong to some of us is that the equivalent effort does not seem to be put into pursuing the promoters of the schemes, or indeed the employers, and that the entire weight of recovering the so-called tax gap is falling only on the employees. That does not feel right.
Madam Deputy Speaker (Dame Eleanor Laing)
Order. Before the hon. Gentleman answers that point, I should explain to the House that we have less than 50 minutes left for this debate, for obvious reasons. He finds himself in the difficult position of being the opening speaker, as it were, and therefore he has been required to take a lot of interventions because people have short points that they want to make, but of course this debate had the bulk of its time last week, and I know from what people have told me that what they actually want to hear is the Minister’s reply to the many questions that were asked last week, and will be asked this week. There will therefore be a very short time limit on speeches—probably two minutes. The hon. Gentleman has been very generous in taking interventions, and I am sure he wants to finish the points that he would like to make. I have no objection to his taking further interventions, as long as the House realises that that will be the bulk of the debate.
Stephen Metcalfe
Madam Deputy Speaker, I hear what you say loud and clear, but I did want to allow Members to intervene because I think it allows them to get their points on the record.
The point that my right hon. Friend the Member for Sevenoaks (Sir Michael Fallon) raised is completely valid. We need to be throwing the net wider to recover some of this money.
I reiterate that my constituent acted only under advice from a chartered accountant, with tax counsel’s opinion, so although everyone has a duty to pay the tax they owe, this feels off. It feels like a retrospective tax grab. We know that it is causing great stress, anxiety and depression. We know that there have been three suicides associated with it. It cannot be right and surely we must have a duty to look at it again.
If I may, I shall quote my constituent, who says:
“Very simply, if the loan charge is not delayed, and comes in as it is, it will destroy my quality of life and that of my family. It may well prevent me from working and lead me into bankruptcy. It has already caused me to suffer extreme stress, and is causing huge anxiety for my family. If the Government ploughs on with this retrospective legislation, it will be responsible for devastating the lives of families across generations.”
I will leave it there.
Will the Minister seriously consider a delay in implementation and a removal of the retrospective nature of the charge, so that it certainly does not go back further than 2017, when the charges were first announced? I hope that he will build on the assurances that he has given Members who have written to him—I am very grateful for those reassurances—by finding other mitigating measures, so that we can demonstrate, as a House, that we can respond positively and that we are capable not only of listening to, but of hearing and acting upon, the words of the people who come to us, asking for our representation.
Several hon. Members rose—
Oral Answers to Questions
Stephen Metcalfe Excerpts(5 years, 10 months ago)
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Elizabeth Truss
My hon. Friend makes a good point. The borderlands deal is an important way of stimulating growth across the border area, although it would also help if the Scottish National party Government followed through in Scotland on things such as the tax cuts we have introduced elsewhere in the UK.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
The Chancellor of the Exchequer (Mr Philip Hammond)
In 2010, the Government inherited from Labour a deficit at a post-war high. Since then, owing to decisions the Government have taken and the hard work of the British people, the deficit has reduced by about four fifths and is forecast to be just 1% of GDP by 2021-22. The Government’s balanced approach is ensuring that debt is falling while also supporting vital public services, keeping taxes low and investing in Britain’s future.
Stephen Metcalfe
I am sure the Chancellor will join me in celebrating the fact that for the first time we are starting to see a sustained reduction in our overall debt. Does he agree that the worst thing we could do is hand over the levers of our economy to the Labour party so that it might leave us yet another toxic inheritance to clean up?
Mr Hammond
My hon. Friend is right. The public finances have reached a turning point. This is the first time in 17 years that we are not borrowing for day-to-day expenditure. Debt has peaked and now begun to fall—its first sustained fall in a generation—and the last thing we want is for the hard work of the British people to be thrown away by the incompetence of a Labour Government delivering higher debt and higher interest payments, which they always do.
Oral Answers to Questions
Stephen Metcalfe Excerpts(6 years, 3 months ago)
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Stephen Metcalfe (South Basildon and East Thurrock) (Con)
The Chancellor of the Exchequer (Mr Philip Hammond)
My principal responsibility is to ensure economic stability and the continued prosperity of the British people, both during this period of heightened uncertainty and beyond it after Brexit. I will do so by building on the plans that I set out in the autumn Budget and the spring statement. This Government will continue to take a balanced approach to the public finances that enables us to give households, businesses and our public services targeted support in the near term as well as investing in the future of this country and getting debt down to cut interest costs and deliver fairness to the next generation.
Stephen Metcalfe
South Essex has the potential to play a huge part in delivering on those aspirations, as I and some of my Essex colleagues saw last Friday as we took a Clipper journey from Purfleet out to Southend and back. It was an extraordinary experience. May I therefore invite the Chancellor to come and join us and see the part that south Essex can play in making Britain great again?
Mr Hammond
I think it comes back to the same point: it depends if my hon. Friend is buying.
Oral Answers to Questions
Stephen Metcalfe Excerpts(6 years, 6 months ago)
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Mr Hammond
Once we have left the European Union the money that was reaching the UK from EU sources will be allocated to the UK shared prosperity fund, and over the course of this year we will consult on both the distribution and the application of those funds and the size that that fund should be.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
The Financial Secretary to the Treasury (Mel Stride)
In the last Budget we abolished stamp duty for first-time buyers for the first £300,000 of a property’s value up to £500,000 in total. That has meant that 95% of first-time buyers have paid less stamp duty and a full 80% of first-time buyers have paid no stamp duty at all.
Stephen Metcalfe
Last November the Chancellor announced an ambitious package to tackle the broken housing market. How many first-time buyers have benefited from that package, particularly in Essex, and where can people find further information about this so we can make hopefully impressive numbers even greater?
Mel Stride
Some 69,000 individuals have already benefited from this vital tax relief and over 1 million will do so over the coming five years. We do not have disaggregated data specifically for Essex, but I can tell my hon. Friend that within the south-east 12,900 individuals have benefited from first-time buyer tax relief.
Oral Answers to Questions
Stephen Metcalfe Excerpts(6 years, 7 months ago)
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The Economic Secretary to the Treasury (John Glen)
The hon. Gentleman has made a very sensible point. The FCA is looking into that proposal and will publish another report in May. I met Andrew Bailey just a few weeks ago to underscore the importance of the issue, and as we proceed with the construction of the single financial guidance body that will deal with some of the challenges of problem debt, I know that this will be another focus of its work.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
Automation, machine learning and artificial intelligence have the potential to offer huge productivity gains. What discussions has my right hon. Friend had with colleagues across Government about providing leadership in this important field so that we can reap the maximum productivity boost and be at the forefront of this exciting technology?
Mr Philip Hammond
As I have said many times in this House, we have two choices: we can either run away from this challenge; or we can run towards it and embrace it. In fact, if we want to maintain the living standards of our people and the status of our economy in the future, we have no choice but to embrace it—and we are doing so. I announced at the autumn Budget funding to support the uptake of digital technologies across Government, allowing the Government to be an exemplar, but we are also promoting these technologies to private business. The UK is at the forefront of many of these cutting-edge technologies.
Oral Answers to Questions
Stephen Metcalfe Excerpts(6 years, 10 months ago)
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Stephen Metcalfe (South Basildon and East Thurrock) (Con)
The Chancellor of the Exchequer (Mr Philip Hammond)
My principal responsibility is to ensure the stability and prosperity of the economy, which means building on the ambitious steps laid out in the autumn Budget to tackle the key challenges we face so that we can create an economy fit for the future. I look forward to doing so, ably supported by my excellent ministerial team. Our balanced approach to the public finances enables us to give households and businesses support in the near term, and to invest in the future of this country, while also being fair to the next generation by reducing a national debt that remains too large.
Stephen Metcalfe
Does my right hon. Friend agree that lowering business taxes, as this Government have done, is not a race to the bottom but is vital in building and maintaining the strong economy on which we all depend?
Mr Hammond
Yes, I agree with my hon. Friend. Keeping business taxes competitive so that we can attract international investment to this country is essential, but there is a quid pro quo: if taxes are low, they must be paid. We are determined to ensure full compliance and to lead in international forums in looking at ways of improving corporate tax compliance.
Oral Answers to Questions
Stephen Metcalfe Excerpts(7 years, 4 months ago)
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Mr Philip Hammond
The hon. Lady is now asking a different question. The Prime Minister has been very clear that Britain is a very large economy in relation to our European neighbours and we would expect to have a bespoke arrangement with the European Union as our long-term future status quo, and indeed a bespoke arrangement for any interim period that is agreed. The hon. Lady is quite right that as we go forward with this process, we need to deliver on our commitment to leave the European, but to do so in a way that protects the British economy, protects British jobs and protects Britain’s prosperity, and that is what we will do.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
T5. Will my right hon. Friend, for the benefit of the House, confirm the cost to the economy of cancelling student debt, say whether that is affordable and explain what effect it would have on the work we have done to reduce the deficit?
The Chief Secretary to the Treasury (Elizabeth Truss)
As the Labour party admits, cancelling student debt would cost £100 billion. The Opposition made that reckless promise, which would see the debt soar, during the election campaign, but now they say it is just an “ambition”. Are they going to say sorry to the people they made their promise to, and are they going to say sorry to the British public for threatening to bankrupt the economy?