Budget Resolutions and Economic Situation

Andrew Griffiths Excerpts

Thursday 21st March 2013 Commons Chamber

[Andrew Griffiths (Burton) (Con)]

I recognise that time is short so I will do my level best to keep my comments as brief as possible. I speak as the Member of Parliament for Burton, the home of British brewing, and as the chairman of the all-party parliamentary beer group. It is therefore incumbent on me to put on record my thanks, and those of the brewing industry, for the Chancellor’s momentous decision yesterday to scrap the beer duty escalator and cut beer duty by 1p. We cannot underestimate the importance of the decision for brewers, for publicans and for beer drinkers across the country.

In his speech today, the shadow Chancellor dismissed the 1p cut in a bit of a flippant way, but I think that the 1,745 people who are employed in brewing and pubs in his constituency will be hugely grateful to the Chancellor, who has shown himself to be on the side of the publicans and beer drinkers of this country. The previous Chancellor of the Exchequer appeared on posters in pubs up and down the country stating that he was “barred from this pub”, because his Government had chosen to introduce the beer duty escalator, which has resulted in beer duty rising by an incredible 42% since 2008. That has contributed to the closure of many of our communities’ pubs in that period.

I am therefore delighted to support a coalition Government who have done more for brewers and pubs than any other Government for a generation. I went to the House of Commons Library yesterday and spoke to the Treasury expert. I asked him when a Chancellor had last cut the duty on beer. He replied, “Mr Griffiths, this might take some time, as it was so long ago. I shall have to go away and research it.” He came back with the answer: Derick Heathcoat-Amory was the last Chancellor to cut the duty on beer, in 1959. Someone who was just old enough to enjoy a pint of great British beer at that reduced price in 1959 would now be 72 years old.

It is important to applaud the campaign that has led to these changes. As the chairman of the all-party parliamentary beer group, I want to thank colleagues from all across the House who have supported it. Members on both sides have worked incredibly hard on behalf of their brewers, publicans and beer lovers. We all recognise the importance of the community pub and the role it plays in the heart of our constituencies. This measure provides us with a real opportunity to support those pubs.

[David Rutley]

I join many others in paying tribute to the great work my hon. Friend has taken forward. I received one tweet yesterday from the Wharf in Macclesfield saying this was

“a good Budget for pubs, the brewing trade and all industry”.

Has my hon. Friend received similar plaudits from people across the country?

[Andrew Griffiths]

I thank my hon. Friend for the support he has given to pubs and breweries as part of this campaign. I agree: I have been overwhelmed by the number of publicans, brewers and members of the Campaign for Real Ale and beer lovers who have welcomed this announcement. He quotes one brewer and I will quote another—Belinda Sutton from Elgood & Sons in Wisbech in Cambridgeshire who said:

“The result could be the saving of our brewery, as this was just what we needed to…stimulate trade in our pubs and hopefully increase production.”

That is so important: every brewery and every pub in our constituency are important employers, so it is fantastic that we can give them this boost. I am absolutely sure that when this cut is introduced on Sunday, beer drinkers across the country will be raising a glass to the Chancellor and toasting his health.

I am hugely sorry that the Economic Secretary is not in his place on the Front Bench, as we owe him a huge debt of gratitude. Within days of him becoming a Minister—I think it was his first ministerial duty—he spoke in a Backbench Business Committee debate to which many Members contributed. He said then that he was listening. He is a listening Minister who has listened on behalf of pubs and brewers across the land.

I would also like to pay tribute to CAMRA and its thousands of supporters who took part in this campaign and who participated in the mass lobby organised by Emily Ryan and Jonathan Mail to explain to Members of Parliament just how important their community pubs and great British beer are to them. I commend, too, the work of the Beer and Pub Association, which works tirelessly to build a bright future for pubs and breweries across the country.

I end my comments there. Let me just say that this is a great Budget for brewers, a great Budget for beer and a great Budget for beer drinkers in Britain.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

I want to raise an issue that is close to my heart—the Scotch whisky industry—not just because it is an excellent tipple when taken responsibly and because I am chair of the all-party group on Scotch whisky, but, more importantly, because that industry provides hundreds, if not thousands, of jobs in this country.

The Chancellor suggested yesterday that he was cutting beer duty to help boost pubs, yet as 40% of pub sales come from spirits and wine, his duty increases on Scotch whisky and other drinks mean that when it comes to pubs, he has given with one hand and taken back with the other.

[Andrew Griffiths]

Will the hon. Gentleman give way?

[Jim Sheridan]

No, I do not have time.

Like the Chancellor, I wish to see British businesses succeed to help to secure British jobs. The Chancellor talked about the opportunity for UK business that a successful free trade agreement would bring. He talked about backing businesses that are a global success. For the Government and the European Commission, improved market access and reduced discrimination are priorities for the Indian free trade agreement talks. In a spectacular lack of joined-up government, in one speech the Chancellor has attacked Scotch whisky—the one industry that is currently investing for international growth to India and elsewhere—by increasing discrimination against it here at home.

[Andrew Griffiths]

Will the hon. Gentleman give way?

[Jim Sheridan]

No.

What sort of signal does that send to overseas markets? British ambassadors around the world who are trying to help Scotch gain fairer trading conditions will be shaking their heads at the example set by our own Chancellor here in this country. This industry accounts for 25% of UK food and drink exports, generating some £134 a second for the UK balance of trade, yet the Chancellor’s only action is to penalise it in its home market. The UK is the third largest market for Scotch whisky in the world, and some companies depend on the UK market for success.

[Andrew Griffiths]

rose—

[Jim Sheridan]

As I have said, this industry employs people in areas where few alternative jobs exist. The Chancellor threatens jobs in such areas, as the Chief Secretary presumably told him. [Interruption.]

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[Seema Malhotra]

My hon. Friend makes her point extremely well. The £225 million proposed in the Budget to support “affordable” homes building is a fraction of the £4 billion that Labour would have invested.

The Government proposed change but this is more of the same. The policies of this Government have failed on jobs, on growth, on the deficit and in the lives of ordinary people. The Budget will do nothing for the 13,000 on the waiting list for a home in my constituency.

[Andrew Griffiths]

Will the hon. Lady give way?

[Seema Malhotra]

I am sorry, but I will not.

The Budget will do nothing for the 74-year-old woman waiting a week for a blood transfusion because of staffing cuts in the local hospital. The Budget will do nothing for the family I met recently who live in one room: two teenage brothers sharing a bed; a mother and father who put mattresses down on the floor; the father who goes to work at 4 in the morning until 2 in the afternoon; the mother goes to work at 11 am and comes back at 11 pm. They are not shirkers, they are hard workers and they will not be helped by the Budget.

The legacy of the past three years in my constituency is rising unemployment, Sure Start centres under threat, longer waiting times in local hospitals and police numbers being cut. Families are suffering for the decisions that the Government have made and are wondering where they will live as the bedroom tax kicks in and makes their homes unaffordable. It is not too late for the Chancellor to change his mind, change course and get a plan for jobs and growth that will deliver for Britain’s families and businesses.

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[Andrew Griffiths]

Does my hon. Friend share the joy of many first-time buyers in my constituency at the fact that this will give them a real chance to get on the housing ladder?

[Richard Fuller]

I appreciate my hon. Friend’s intervention, but I am not sure that I can share his joy. The impetus behind this Treasury document is the notion that enhancing loan-to-value ratios of 95% is somehow a good policy, and I need some more reassurance about that.

Let us compare the average house bought in 1997 at the average loan-to-value ratio of 80% with the average house bought in 2007—after all that price inflation—at a 95% loan-to-value ratio. Over the 20 or 25 years of their mortgage, the people who bought the average house in 2007 will have to spend £234,000 more than those who bought the average house in 1997. Increasing loan-to-value ratios depresses people’s ability to spend money on other things, because they are spending more on their mortgages. I want some more reassurance from the Treasury that this scheme will not have unintended consequences for their ability to spend money appropriately in relation to their incomes.

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[Justin Tomlinson (North Swindon) (Con)]

Given the time constraints, this will, obviously, be a bit of a whistle-stop tour. However, I will set out some of my Budget highlights and, with each one, something on my wish list to try to be constructive for the Government. First, I very much welcome the £10,000 personal allowance. As we know, that is a tax cut for 24 million people and 2.7 million people will be completely taken out of paying income tax. This is genuinely a reward for people doing the right thing.

Some excellent work by the TaxPayers Alliance has highlighted a chronic lack of understanding of the impact of changes to taxation in people’s own payslips. In this week’s The Spectator, I set out a request that when changes to pay-as-you-earn made by any future Government, of any colour, kick in, they should be explained on the employee’s payslip. In that way, we can get greater engagement. I know through my work on the all-party group on financial education for young people that because we now have so many direct debits and standing orders, people are disfranchised from their own bank accounts. Therefore, setting out the information I suggest will help.

I welcome the various measures to support business, such as the 20p rate of corporation tax and the £2,000 employment allowance. It will make a huge difference in the south-west, as 85,000 employers will gain and 40,000 will be taken out of paying national insurance altogether. Some 1.25 million private sector jobs have been created and a quarter of a million new businesses have started since we came to power. My constituency has seen the fastest increase in the number of start-up businesses in the south-west. It is also crucial that we continue to support businesses looking to export to emerging economies such as Brazil, India and China, so that we are not so exposed to the turbulence in the European Union.

I also want more to be done to help promote young entrepreneurs. We all support that principle, but young people face a challenge, as I find when I talk to business students. I was the only one of the 350 who studied business on my university course who ended up running their own business and employing people. When I ask business students whether they would like to run a business, all the hands go up and they are extremely enthusiastic; they have been enthused by “The Apprentice” and “Dragons’ Den”. When I then ask how many will do it, all the hands go back down, because they simply do not know how. When people choose to go to university or take on an apprenticeship—the number of which has increased massively—a clear, defined career path is laid out for them. If they tick the box, get the grades and pass the application process, that is what they will do. We need to do a lot more in that regard.

A couple of weeks ago, I set up a scheme with Swindon college to support a local charity, the Prospect hospice. Those who took part were each given £10 to raise money by trading in the Blunsdon market, a tough trading environment, and between them they raised more than £711. One team was so successful that the market has asked them to come back in the summer holidays to give it a go. Our town centre is looking to use the high street money provided through the Mary Portas scheme to set up pop-up shops, and has also made an offer to that team of very successful girls. Those who are interested might like to hear that they ran a 1950s tea shop-style café, dressed in 1950s clothes and played 1950s music; they understood customer service. My request is that we do more to set out clear career paths in business.

I welcome the good news on fuel duty. People have mentioned the 13p price difference—it is 59p if we use gallons, and sounds even more impressive. Whenever I use cutting-edge social media such as Facebook to conduct a “Fantasy Chancellor” poll and ask about the one thing people would do, fuel duty is always the most popular issue. I ask for no return to the 12 hikes in 13 years we saw under the previous Government. They regarded motorists as an easy hit, but the cost has a tangible effect on people.

The excellent news on beer duty is a credit to my hon. Friends the Members for Burton (Andrew Griffiths), for Nuneaton (Mr Jones) and for Leeds North West (Greg Mulholland). I am a proud member of the save the pub group and the all-party group on beer. I had a text from the wonderful Arkell’s brewery in my constituency, which very much welcomed the move. It is important to the sector.

[Andrew Griffiths]

I thank my hon. Friend for his sterling support for the campaign to scrap the beer duty escalator. Earlier, he mentioned the work of the TaxPayers Alliance. Will he join me in congratulating the TPA on its “Mash Beer Tax” campaign, and The Sun newspaper on its fabulous campaign to scrap the beer duty escalator?

[Justin Tomlinson]

Absolutely. I also commend the constructive and proactive way they lobbied politicians on both sides of the House, so that they realised what a benefit such a move would be to the local economy, as well as for those who enjoy the odd pint in their local pub. It is cause for rejoicing.

I have two further requests. A considerable number of pubs are starting to provide food as a mainstream part of their offer. More needs to be done to encourage hospitality and catering students to consider becoming landlords, as a lot of breweries are struggling to find younger landlords. Secondly, I urge the Minister to consider the excellent work of my hon. Friend the Member for Burton and to commission him to look more widely than the beer duty: to consider why we are losing pubs and what more we can do in that regard, just as we commissioned Mary Portas to carry out the high street review.