Contingencies Fund (No. 2) Bill

Andrew Jones Excerpts

Committee of the whole House & Committee stage
Thursday 11th March 2021 Commons Chamber

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I will keep my remarks as short as possible; I fully recognise that we have a very well-subscribed and important debate to follow.

I read new clause 1 with interest, but it should be rejected. On Second Reading, I outlined the transparency and accountability mechanisms already in place when funds are drawn from the Contingencies Fund. I will not repeat any of that, but what the Contingencies Fund does not need is extra layers of bureaucracy, and that is what the Opposition are seeking to bring in. The whole point of the fund is to facilitate speed of response. Adding monthly reporting to the existing reporting is not necessary, and it goes against the whole purpose of the fund.

For one year, in the midst of the greatest health crisis in a century and the consequential biggest economic crash in three centuries, the suggestion from the Opposition is more bureaucracy. What problem are they seeking to solve? Accounting officers are still accountable. Departments must still notify Parliament. The Contingencies Fund is managed by Treasury officials. The agreed procedures must be followed.

The Opposition also want to bring in extra measures when dealing with the private sector. How does dealing with the private sector reflect the cash flow in a Department? Liabilities are liabilities, to whichever organisations they are owed. Speed of response is need-based, not sector-based.

Basically, what we have here is Labour distrust of the private sector underpinning its suggestion. It is not relevant to the Bill, and it underlines Labour’s lack of relevance to the nation. That is why the new clause should be rejected.

Contingencies Fund (No. 2) Bill

Andrew Jones Excerpts

2nd reading
Thursday 11th March 2021 Commons Chamber

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I will, of course, follow your advice as scrupulously as ever, Mr Deputy Speaker.

This Bill is about cash flow. It is not about all the stuff that we have just been hearing from the shadow Minister. All organisations have to manage their cash flow and meet their liabilities, and failure to do so is a significant reason for corporate collapses. It is, obviously, different in the public sector, but the rule about meeting liabilities remains as Government react to urgent situations. There are also clear mechanisms for making sure that in the event of a cash need, the cash will be there. That is what the Contingencies Fund is.

This Bill is about the Treasury’s capacity to make repayable advances to other Departments, so that they can react to events if needed. Parliament has long recognised that principle. The legislation governing it is 45 years old, but in fact the principle was established by Treasury minute in 1862, when the Contingencies Fund was created. For this financial year—and the next, if we pass this Bill—the threshold allowed in the legislation has been increased, and for obvious reasons. We are dealing with the greatest health crisis in 100 years.

[Jim Shannon (Strangford) (DUP)]

I spoke to the hon. Gentleman beforehand. Although I understand that this is specifically about cash flow, the whole House recognises that there is a real crisis in cancer treatment when it comes to diagnosis and surgical operations, and many people have died waiting for those to happen. Does he agree that covid-19 has increased the demand for cancer care, and therefore all requests that come from the NHS and the Department of Health and Social Care must be treated sympathetically and urgently?

[Andrew Jones]

The hon. Gentleman makes a very good point. There is no doubt at all that we have seen some health treatments delayed as a result of the crisis, and that is a real tragedy. He is right that cancer is one of those where we should be most concerned, and the requests that come in should be treated with urgency and compassion as we seek to catch up on the treatments that the people we represent urgently need. That was a wise point.

I go back to the core purpose of the Bill and why it has been introduced. The Government needed to respond quickly and at scale, and they have done so. The Bill before us is about renewing the increased capacity for the next financial year, and we are only three weeks away from the new financial year. We are being asked to approve a one-year increase in the limit from 2% to 12%. That is, of course, a big jump, which amounts to more than £100 billion. We should also perhaps remind ourselves that the House approved an increase in the limit to 50% for this financial year—truly exceptional in every way.

I support increasing the limit in the Bill. We are not through this pandemic, and it is not hard to imagine circumstances where the Government have to react urgently ahead of the regular voting provision under the normal supply procedure. One of the lessons of the past year has been that the course of the pandemic has not been linear. None of us can guarantee that the future will not require urgent action. In reality, we can probably all predict that it will.

As my right hon. Friend the Minister said, this is quite a dry Bill, but once a Treasury Minister, always a Treasury Minister. That does not mean, however, that we should not scrutinise; of course we should. But the Bill does not increase budgets, and it does not give the Government a blank cheque. These are cash advances, which are highlighted to Parliament through the normal estimates booklets and memoranda, and then we vote on them. There is transparency as funds are drawn upon by Departments. There is guidance agreed between the Treasury, the National Audit Office and Parliament. That means that written ministerial statements are published throughout the year and cash advances are included in the main or supplementary estimates. I hope we will not be facing a contingencies Bill for the 2022-23 financial year. The progress that we are making in tackling the virus is obviously fantastic, but the consequences will be felt for a long, long time.

It is too early to spend time on an inquiry on the lessons from the pandemic, but one thing I am sure we will consider in due course is how well and how quickly government—I am talking about the UK Government, devolved Administrations, local government and, above all, the NHS—have responded. They have been nimble and dynamic in their response. This Bill is simply about facilitating the cash flow to allow that quick response and that is why we should all support it.

Financial Services Bill

Andrew Jones Excerpts

Report stage & 3rd reading & 3rd reading: House of Commons & Report stage: House of Commons
Wednesday 13th January 2021 Commons Chamber

[Madam Deputy Speaker (Dame Rosie Winterton)]

Before I call Andrew Jones, I should say that after Stella Creasy I will reduce the limit to three minutes.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

The core purpose of the Bill is to ensure that the regulatory framework for financial services will continue to be effective now that we have left the EU. Of course, there are other measures in the Bill, on matters such as the open market arrangements with Gibraltar and debt advice; it is wide in scope.

In Committee, we considered the Bill in detail, and I commend my hon. Friend the Minister for his knowledge and vision. It would be fair to say that some of the measures that we looked at were in very specialist areas and were perhaps a little dry; I am thinking about the work to transition away from LIBOR and implement the Basel standards. That obviously had not been easy work; it had been detailed work, and the development had taken place over a significant period.

The Minister has placed certain underlying principles at the heart of his work, and we see them in the Bill. The first is ensuring that the UK will have world-leading prudential standards, and that those will be overseen by regulators with the powers they need. There is no doubt that the world, including the UK, has seen appalling financial scandals; I am thinking about insider dealing, money laundering and bank fraud. Our regulators must be equipped to deal with this fast-moving market. They must be careful that they are not so backward-looking that they are solving the last crisis, but they are also nimble enough to have proportionate regulations for the sector.

The second principle that my hon. Friend the Minister is operating under is the recognition that different types of activity, and different scales of company, require different approaches. The Bill enables the introduction of the tailored investment firms prudential regime. I believe that the whole Committee wanted to see a firmer approach taken to wrongdoing, alongside measures to ensure that the UK’s strong position in this critical sector is maintained. I think that the Bill does that—indeed, that is the bulk of the Bill—but it does, of course, require regulators to enforce that properly.

A further principle of my hon. Friend’s work is helping people with debt problems. We have already heard about clause 32, which introduces changes to the debt respite scheme. Those are of great significance to many of our constituents up and down the country. Essentially, there are two elements: a breathing space and a statutory debt repayment plan, the point being early intervention and recognition of the problem. That will help people escape the cycle of debt, which is sometimes very easy to get into and very hard to break out of.

In our evidence session, the Committee heard from Peter Tutton, head of policy at the debt charity StepChange. Mr Tutton described this as “a cracking scheme”—I wrote down the quote when he gave us his evidence. That is a significant endorsement of the Minister’s work. The Bill also contains a measure to provide a route for a successor account when the Help to Save term matures, so that the balance is transferred to an alternative savings account—again, practical support that will help many people.

There are many new clauses and amendments before us. I welcome Government new clauses 27 and 28 and new schedule 1, which basically broaden—update, really—the Proceeds of Crime Act 2002 to include e-money institutions. I am pleased to see that that is supported by the Labour party in its own new clause 6, which will not be moved. There is clearly a recognition on both sides of the House that the Act needed to be updated and tackled.

New clause 7, in the name of the hon. Member for Walthamstow (Stella Creasy) and many others, looks at the unregulated “buy now, pay later” market. It is easy to see how an interest-free product could help people spread payments for a sofa or other high-cost item, but it could also be a route into debt trouble. I am pleased that the Minister has commissioned a review, which is due to finish very shortly. May I just ask him to consider its recommendations very promptly?

Overall, this is a good Bill. I thought that the Committee scrutinised it well, and I will support it this evening.

Taxation (Post-transition Period) Bill

Andrew Jones Excerpts

3rd reading & 3rd reading: House of Commons
Tuesday 15th December 2020 Commons Chamber

Through all of this, the Government have seized powers for themselves—it is not about taking back control to this place, but about taking control back from civil servants in Brussels to civil servants in Whitehall. We would all be well advised to look more carefully at the powers and how the Government intend to use them.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

We have heard from my hon. Friend the Member for Stone (Sir William Cash) about the importance of the “notwithstanding” clauses and about how unelected people should not seek to overturn democratic decisions. I agree strongly that we have seen attempts to overturn democratic decisions over the past four years, and they have been a stain on the democratic history of our country. We had a vote by the British people that had to be followed through on.

I disagree with my hon. Friend about the clauses, however. Putting them back in will not be viewed as an enormously helpful measure by those negotiating a deal, especially while our Prime Minister is out trying to get a deal that we can accept. Bringing the clauses back in will not be particularly helpful for that.

The Labour party has put forward some suggestions about providing clarity for business. That is a reasonable point because, clearly, we need to provide clarity for business. I come back from a business background, and knowing the environment that one is in helps to facilitate investment decisions. However, I have to say, the Treasury knows that. I spent some time working in the Treasury, and it gets that. It does not need to be told that. It will execute the Bill in as timely a way as it can, providing all the clarity that it can. That does not need to be legislated for.

We have had delays, because people have sought to overturn—ultimately, to negate—a democratic decision. I voted to remain in the referendum, but I immediately understood that it was a vote of the British people, and that the British people are bigger than individual politicians. Only recently have some people been able to work that one out.

The measures in the Bill are about the continuity of trade across all four parts of the UK. That is something that we should all be acutely aware of, because it is bigger than any other trade deal that could possibly be discussed anywhere.

The point in the Bill about creating a more level playing field between the online and the high street worlds of retail is, again, something that I think we should all be able to support easily. Everybody, I am sure, has had representations from retailers in their constituencies about how challenging the past few years have been. Obviously the clock cannot be turned back in any way—this is about embracing the future—but we must make sure that as retailers evolve the offer of our high streets, they are able to do so with a more level playing field. That is the objective we should be seeking in our policy.

I want to see such measures enacted as soon as possible, frankly. We are in uncertain times, and I want us to get to the position in which we can offer business as much clarity as possible, as soon as possible. I will therefore be supporting not the new clauses, but the Bill as it stands.

[Wendy Chamberlain (North East Fife) (LD)]

It is a shame that the Bill has been rushed through the House so rapidly. Members have had a short amount of time in which to get to grips with a rather technical and lengthy piece of legislation. The small number of amendments tabled today speaks to the incredibly tight time limits that have been put in place. Given the impact of the legislation on businesses operating across Northern Ireland and Great Britain, that concerns me, and it should concern us all.

For me, the Bill speaks to the heart of the many contradictions of Brexit—between what was promised in 2016 and what is being delivered today. We were told that Parliament will take back control, but this Executive, peopled by the same individuals who made those promises, have arguably more contempt for the legislature than any before them. That is summed up by an incredibly depressing piece of legislation, presented a couple of weeks ago, to repeal the Fixed-term Parliaments Act 2011, which attempts to engineer the first ever return of powers from the legislature to the Executive in our history.

However, the contradictions do not end there. A case in point is clause 6 of this Bill on the uprating of fuel duty for aviation gasoline, which, for me, is a microcosm of the whole Brexit process. The whole point of Brexit was to get our sovereignty back—was it not?—so that we could finally write our own laws rather than follow bureaucratic regulations from Brussels, the sort of stiflingly dull directives with boring names such as EU energy tax directive (Council Directive 2003/96/EC). We might have thought that directive was exactly the sort of red tape we would finally cut through in Brexit Britain, and yet the Bill proves that the reality is far removed from the rhetoric, because EU energy tax directive (Council Directive 2003/96/EC), which ensures that across the EU a minimum level of tax is applied on a whole type of aircraft fuel, is in this Bill being applied across the whole of the UK.

The explanatory notes rather patriotically inform us that,

“the UK is not bound to comply with the Directive in respect of Great Britain (GB) from 1 January 2021,”

but none the less Great Britain is complying with it anyway. Does that not say a lot about Brexit and the current trade negotiations, where effectively the Government have been toying with the idea of taking maximum tariff pain now in order to allow regulatory divergence that, in all likelihood, is not going to take place?

Turning now to the amendments, I agree with amendments 1 and 2 and new clause 3, tabled in the name of the Leader of the Opposition. Economic assessments have been conspicuously lacking over the past few months, covid notwithstanding: not only a lack of assessments of the impact of any potential deal with the EU, but the refusal of the Secretary of State for International Trade to tell us whether any of the trade deals she has struck will actually leave us any better off than our current trading relationships. The other conspicuous absentee when it comes to the economic impact of all this is the Chancellor. I find it very surprising that he has said very little about the threat of no deal, during a time when the UK finds itself in the midst of its worst economic crisis.

It is entirely right that we carry out proper economic assessments of all that, not least for Northern Ireland. I remember during the election campaign last year the Prime Minister was caught on camera telling Northern Ireland businesses that,

“Northern Ireland has got a great deal. You keep free movement, you keep access to the single market”.

In the words of the Foreign Secretary, Northern Ireland has “a cracking deal” because it has access to the EU market. Meanwhile, as we teeter on the edge of no deal, we are told by the Culture Secretary that things “will be choppy”, but that “we can survive”. I am sure those words will be a comfort to many of my constituents.

Finally, I turn to new clause 1 and new clause 2. During the debate on the United Kingdom Internal Market Bill earlier, I spoke about what a disaster the notwithstanding clauses in that legislation were for the future of the UK and elsewhere. I will not repeat myself, because exactly the same applies here; all I ask is for the Minister to give a guarantee that, if there is no deal with the EU, international lawbreaking clauses will not be introduced in this or any future business. We cannot afford to let a no-deal scenario be a proxy for further actions that are hugely damaging to our international reputation. For that to be the UK’s first action once it left the EU would be a truly regrettable matter indeed.

Taxation (Post-transition Period) Bill

Andrew Jones Excerpts

2nd reading & 2nd reading: House of Commons
Wednesday 9th December 2020 Commons Chamber

[Andrew Jones (Harrogate and Knaresborough) (Con)]

Yesterday in the debate on the Ways and Means resolutions, I said that I would be supporting the Bill because our country needs it. It needs it for the core purposes of the Bill, which are the smooth continuity of business after the transition period, being ready, and creating a more level playing field for UK businesses.

I recognise that leaving the EU is a field full of tough issues, but the most problematic element is the nature of our land border with it. Seeking to deliver Brexit while protecting the Good Friday agreement was the major stumbling block in our endless debates and struggles last year, so I am pleased to see progress made on that issue. We had a statement on it earlier; I will not go over trodden ground.

There are businesses in Harrogate and Knaresborough that do significant trade selling to and buying from Northern Ireland. The Bill will be welcome news for them. More people in Harrogate and Knaresborough are affected by internet shopping, either buying from or selling via online platforms. Even if people do not buy online, they are affected by the struggles on the high street. It is a tough time for retailers and, of course, high streets provide countless thousands of jobs. They are economic hubs. Our high streets and town centres also have a social function beyond an economic one. They provide a community focal point.

Before coming here, I worked in retail and for brands that sell through retail. When I talk to retailers, they say that they just want a level playing field. They are talking widely when they use that phrase, but they are talking about taxation, particularly business rates and VAT. The Bill helps to create more of a level playing field with a new model for the treatment of VAT on goods arriving in the UK from overseas. The collection moves to the overseas seller or the online marketplace where that transaction occurs. As a result, it will be easier to collect VAT and harder to avoid it. The last thing that a business having a tough time needs is for competitors to have a 20% price advantage. High street businesses and online players based here pay VAT, so if overseas businesses are allowed to make VAT-free sales, they are unfairly undercut.

I do not think the measure is controversial; it is entirely reasonable. Indeed, as I mentioned yesterday, there are moves across the world in this policy direction. I commented on the other measures in the Bill yesterday, so I will not detain the House with repetition.

The past year has obviously been one of the toughest on record in peacetime. The economic impact will be felt for many years. We also have the consequences of Brexit. The need for the continuity of business operation is profound. Our whole United Kingdom must focus on growth as we seek to protect livelihoods as we have sought to protect lives. The Bill is part of the measures being taken to secure our business future, and that is why I will support it.

Taxation (Post-transition Period) (Ways and Means)

Andrew Jones Excerpts

Ways and Means resolution & Ways and Means resolution: House of Commons
Tuesday 8th December 2020 Commons Chamber

[Andrew Jones (Harrogate and Knaresborough) (Con)]

It is always a pleasure to follow my right hon. Friend the Member for East Antrim (Sammy Wilson). He is one of the most effective and passionate communicators in this Chamber and, if nothing else today, he has reminded the Labour party that there are two sides in a negotiation.

We have had a very wide-ranging debate so far, some of it even on the ways and means resolutions. Should these actually come to a vote later this evening—we have had some apocalyptic language used, but apocalyptic language does not always follow through into actually voting—I will be supporting them, because we must make sure that preparations are in place for the end of the transition period. This Bill is a part of that, which is why these resolutions should pass. This Bill is also a part of ensuring that we are legally prepared for the different outcomes that could flow from the negotiations, this work in progress. We do not know what it will say, but I just want to put it on the record again that I hope we will have a deal along the free trade lines already agreed.

The Bill is also about ensuring that we have smooth continuity of business. Of the six measures, three deal with Northern Ireland and the protocol. There are colleagues in this House more focused on the detail of Northern Ireland policy than me. I just want to say that I view Northern Ireland as a really important part of the United Kingdom. I want to see the continuity of trade operate smoothly and effectively across all four parts of our United Kingdom, and I am pleased that the Government have made the obligation to the people of Northern Ireland about continued unfettered access to the UK under all circumstances.

I will not add anything further to the contributions on Northern Ireland. Those measures have been talked about in this debate already and very articulately. There are three other measures, which are reforms to the wider tax system. The most significant is the new model treatment for VAT on goods arriving into the UK from overseas. Basically, the collection of VAT will move from the existing arrangements on to the overseas seller or the online marketplace where the sale transaction occurred, making the collection of VAT easier and ensuring a more level playing field, especially for the UK high street. Businesses on every high street in the country have been having a rough time for many years, and one reason for that is the rise of internet shopping. Many businesses have a physical and digital offer—both bricks and clicks—making themselves available to customers through whichever purchase route they choose. These businesses pay VAT and will be unfairly undercut if overseas businesses are allowed to make VAT-free sales. This measure will tackle non-compliance. I understand that similar measures are in place in other parts of the world and, indeed, that the EU is introducing something similar.

The fifth measure is about tackling tax evasion in the insurance sector so that HMRC can prevent tax evasion whether an insurer is based in the UK or not—basically it is the power to issue a liability notice irrespective of location. That is part of the creation of a level playing field for UK businesses, just as the previous measure was. The last measure is very technical in nature, dealing with taxation implications from legacy state aid decisions. All I can say is that as I am glad that my right hon. Friend the Minister is on the case. This measure was perhaps designed for specialists.

Overall, the continuity of seamless trade across the UK is critical for us all. The United Kingdom Internal Market Bill has that at its core. That principle is maintained in this Bill, alongside the measures for a level playing field, which is why I shall support it.

Spending Review 2020 and OBR Forecast

Andrew Jones Excerpts

Wednesday 25th November 2020 Commons Chamber

[Rishi Sunak]

No, it has not been shelved, and I can he tell the hon. Lady that there is extra funding in this spending review for youth services. There is an amount of money for extra capital projects for youth clubs and, of course, funding for the National Citizen Service. More generally, the Government will review their approach to all youth services later this spring, and my right hon. Friend the Secretary of State will set out the details in due course.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I welcome the focus on infrastructure in the statement. As my right hon. Friend knows, I chair the all-party parliamentary group on infrastructure, and I can tell him that the industry has been looking for the certainty that he is providing today. Does he agree that that certainty will allow the industry to plan better and, through that, to deliver better value and develop skills programmes, including apprenticeship programmes?

[Rishi Sunak]

My hon. Friend is absolutely right. It is because of that multi-year certainty, particularly on the capital side, that we can deliver projects more efficiently, faster and at lower cost. That certainty also helps the supply chain to take on new apprentices—helped, indeed, by our apprenticeship bonus as well. He is absolutely right to say that we must train the next generation and create jobs as we deliver this infrastructure, and that is exactly what we are doing.

Financial Services Bill (Fourth sitting)

Andrew Jones Excerpts

Committee stage & Committee Debate: 4th sitting: House of Commons
Thursday 19th November 2020 Public Bill Committees

[Miriam Cates (Penistone and Stocksbridge) (Con)]

Q You said that consumers expect different things in different markets. In your briefing note, you said that the Bill will allow the FCA to develop a methodology that is more accurate and that works for the UK market. Can you give an example of a characteristic that is specific to the UK market and how the Bill will help to meet those expectations?

Hugh Savill: If you are buying insurance in the UK, you tend to buy it online for general insurance, or you will quite often use an independent financial adviser to buy life insurance and savings policies. That does not happen on the continent of Europe. There, there is a little shop in most small towns, and people go and buy their general insurance from that shop. If they want savings policies, whether that be insurance or other kinds of savings vehicles, they will go to their bank, so it is a completely different approach and entry into financial services.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

Q Thank you very much for giving evidence today, Hugh. One quick question about the market access arrangements: do you think there will be any price implications from those for UK consumers? Could we see price inflation via premiums increase as a result?

Hugh Savill: Sorry, from the market access arrangements, did you say?

[Andrew Jones]

Yes, just generally. We are seeing a large provider have access to our markets. That could traditionally see increased supply. Increased supply tends to mean price competition, with consumers benefiting both in quality and innovation of product and in the price they pay for it, but equally it can work the opposite way. So do you think there will be any price implications for UK consumers as a result of these measures?

Hugh Savill: I do not think they would be because of these measures, in that the suppliers from Gibraltar already have 20% of the market, and it is not this Bill that is going to change that. There will be changes in price—there are always changes in price, and there will be other things that drive that—but I do not think that will be driven by this Bill.

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

Q You suggested there was a small VAT benefit to companies being based in Gibraltar. Obviously, this legislation would remove any other bar in terms of being based in Gibraltar but still being able to operate in the UK. Could you clarify what you mean by a small VAT benefit?

Hugh Savill: That is why I offered to write. I am afraid I do not know exactly what the VAT arrangements are, and I will have to write it down. If I said any more, I would get something wrong.

Financial Services Bill (Second sitting)

Andrew Jones Excerpts

Committee stage & Committee Debate: 2nd sitting: House of Commons
Tuesday 17th November 2020 Public Bill Committees

[Alison Thewliss]

Thank you very much.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

Q Peter, thank you for your evidence and written submission, which has been circulated to the Committee. One thing you say in that is that your evidence points to the importance of statutory protections as a key way to alleviate the harm of problem debt. Could you tell us a bit more about that evidence?

Peter Tutton: We spend quite a lot of time looking at the experience of our clients, and we survey our clients and poll them to see what has happened to them. When we were looking, back in the day, at breathing space we were trying to understand what brought our clients to advice and what helped them to recover. What we found was that our clients often had multiple creditors. On average, they would have about five or six. Typically, we find that some creditors, even most, will be very good, but it only takes one creditor to defect from good practice and to push for more money to destabilise people’s financial situation and restart the process of juggling bills and borrowing more to deal with a particularly aggressive, unaffordable payment demand.

There was a very strong message from clients that that impeded their ability to recover. At the same time, we spoke to our clients who were in the debt arrangement scheme in Scotland, and we got a very clear message from them that that kind of guarantee—the statutory framework that the debt arrangement scheme in Scotland gave them—reduced their anxiety and gave them a really good, strong and solid platform for recovery. They knew that if they paid what they could afford to pay and kept doing that, nothing else bad would happen to them in terms of unaffordable demands and escalating enforcement.

In that sense, we have known for a long time that people need protection from their creditors in certain circumstances. Both the experiences of clients who do not have that protection in England and Wales outside of insolvency and the experiences of clients who do have it in Scotland persuaded us that what has become breathing space in the statutory debt repayment plan was a necessary additional protection that we did not have at the time.

[Andrew Jones]

Q That is very interesting. Do you have any data that can quantify some of the anecdotal evidence that you have just been giving us? If you can, could you please circulate it around the Committee?

Peter Tutton: Yes, I will dig some out.

[Stella Creasy]

Q Peter, thank you for articulating so clearly all the different challenges that we face in trying to prevent debt as well as deal with its consequences. I have a couple of questions about the Bill and some of its provisions, and then about your sense of where we might be able to make some progress in strengthening the protection for consumers from unaffordable debt.

With the debt repayment schemes, I think all of us recognise that the breathing space is a very positive development. First and foremost, I want to ask for your view on the midway review element. Do you have any thoughts on what impact that might have as currently drafted?

Peter Tutton: It is a good question. We were very concerned initially about the midway point, simply because it could be very expensive and hard to administer the debt advice. The provision is now not quite as onerous, so we are not having to do full outbound calls and things like that. We are now reasonably comfortable with it as something that is a touching point, where clients touch in with us to ensure that they are still engaged with the process. That is something we do anyway. If someone has come for advice and there is a recommendation that the next step of a particular debt solution requires them to do further things for us to help them, we will follow up and keep in contact with them to ensure that they do not drop out of the process and that they have some help. The initial relief of having spoken to someone about it can lead people to think, “Well, I’ve got that out that way,” whereas it is important to keep going and get people into the debt solution.

There is some element of the midway review that is not dissimilar from the kinds of things that we would do anyway. The important thing is that the way it is done in practice should not become an onerous burden that does not really have any practical use to it. I think we are sort of there. We are talking to the Insolvency Service about the guidance and the way it will work. I think we will get to a place that we can live with. My operational colleagues who are implementing this are not saying it is unworkable at the moment, so we are reasonably comfortable with it, but time will tell. [Inaudible.] If, six months in, it turns out to have been really onerous with no practical effect, that is something we would ask the Treasury to come back and look at again.

Small Breweries Relief

Andrew Jones Excerpts

Monday 9th November 2020 Commons Chamber

[Kemi Badenoch]

I am afraid that the hon. Gentleman is still incorrect. I will come to the percentage of brewers that are actually affected in a moment, but nothing could be further from the truth than to say this is being done to help large brewers. It is not.

Thirdly, there is the criticism that the change will lead to the collapse of the small brewing sector. Simple arithmetic shows that critique does not stack up. In 2019, about 80% of brewers produced less than 2,100 hectolitres, so 80% of brewers are not affected. Meanwhile, less than 8% of brewers produce between 2,100 and 5,000 hecto- litres—the 1,000 pints a day point going forward. Modest tax changes affecting a narrow slice of brewers will not spell the end of craft beer.

Hon. Members have made the point about taxing small brewers in the middle of a pandemic. We realise that, but this long-standing issue in the industry well predates covid-19. As I said, the first review was announced in 2018, and brewers were engaged on the topic well before that. The debate has to be settled. We have been clear that reforms will not come into effect until 2022 at the earliest, to give brewers time to adapt.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I recognise the strength of emotions that we see across the House and are all showing. The Minister is right to say that this policy has been a source of disagreement within the industry, and it has been going on for years. I had a bit of a role in it, having started some of the work that led to the review. I tried to get the industry to come together to find a solution, but that was not possible. We surely need to create a structure that allows smaller and new businesses to be created while also incentivising growth.

One of the most depressing conversations I had in my research on the subject was when talking to a brewer who said he had stopped exporting because, if he continued to do so, that would have taken him over the cliff edge. That is bad for business and bad for UK plc. There is a problem to solve, and the Minister is doing the right thing in trying to bring it to a conclusion and to incentivise growth in this sector, which we all clearly love very much.

[Kemi Badenoch]

I thank my hon. Friend for those excellent points. Having done this job himself, he knows the issues at stake.

I will continue to address points raised by hon. Members. I said that 80% of the total brewing population is not affected, because those producing 2,100 hectolitres—1,000 pints a day—will not face any tax changes at all. It was also proposed that we should smooth the taper above 5,000 hectolitres. That would give the large brewers a big advantage at a significant cost to the Exchequer. We do not think we should give small breweries relief to brewers producing tens of millions of pints.