Tax Credits

Debate between Andrew Percy and Peter Aldous

Tuesday 15th September 2015 Commons Chamber

[Peter Aldous]

I thank the hon. Gentleman for making that point, but I am constrained specifically to the issues we are debating.

It is wrong that the Government are subsidising employers in this way. Moreover, the current system of tapering income thresholds and interconnectivity with other benefits is ridiculously complicated and opaque.

I welcome the Government’s proposals to increase the personal allowance and to introduce the national living wage. It is right that working taxpayers, especially those on low pay, should keep more of the money that they earn as an incentive to work. My concern is that in the short term, over the course of the next two to three years, those who will be hit hardest by these measures are working families, often with children, on low wages. These are the hard-working families—the people doing the right thing—that all political parties say they support and must support.

In my constituency, where the median wage is just under £24,000, many people will be seriously affected by these changes. As of May this year, 4,200 families were receiving working tax credits.

[Andrew Percy (Brigg and Goole) (Con)]

Representing a constituency where the median salary is even lower, at £17,500, I entirely concur with my hon. Friend’s concerns about this measure, and that is why I will not support it. Does he agree, though, that if it goes through, there is time between now and next year to make changes, be they to national insurance, emergency tax codes, or whatever, to mitigate the impact on the poorest?

[Peter Aldous]

I agree with my hon. Friend. I will come to that when I conclude.

Yes, the rise in the tax threshold and the introduction of a national living wage will help, but, as shown in research by the House of Commons Library, they will not on their own make up for what will be significant reductions in income.

Waveney (Coastal Flooding)

Debate between Andrew Percy and Peter Aldous

Wednesday 18th December 2013 Commons Chamber

[Peter Aldous]

I am grateful to my hon. Friend and neighbour for that intervention, with which I agree wholeheartedly.

A further problem with the Bellwin scheme is that the two-month limitation that applies to expenditure means that extensive capital works are excluded if they cannot be completed in that time scale, which in the current circumstances could be very difficult to achieve. The costs of employing additional temporary staff or contractors are also not covered.

In the light of those and other concerns, there is a worry that Bellwin on its own will not be able to achieve the Secretary of State’s objective of getting places back on their feet quickly. In the short term, there is a need for communities to look at a variety of measures that manage flood risk. They include the provision of flood boards and valves in air bricks and in WCs, and liaison with the insurance industry to ensure that, where such protection measures are in place, it provides cover on realistic terms. It is also necessary to plan for the future. I believe that owing to rises in sea levels such events will occur with increased frequency, and I am conscious that in Lowestoft there have now been two such events in the past six years.

[Andrew Percy (Brigg and Goole) (Con)]

I concur with a lot of what my hon. Friend has said, and I congratulate him on securing the debate. As the Minister knows from our debates on the Water Bill last week, hundreds of properties and many villages in my constituency were flooded. My hon. Friend has talked about the future. Does he agree that we urgently need a review and reassessment of all our flood strategy management plans, including the Humber flood risk management strategy plan, so that we can bring forward the works already identified in such plans as necessary to deal with rising sea levels? We need that to happen quickly and we need the funding in place to support whatever works are necessary.

[Peter Aldous]

I am grateful to my hon. Friend for that intervention, and I agree wholeheartedly that we need to address this issue as soon as practicable. One will lead on from the other.

We have had two such storm surges in the past six years, and arguably in both 2007 and 2013 we escaped by the skin of our teeth. In 2007, the wind dropped in the nick of time, while two weeks ago we were fortunate that the wind was blowing in a northerly direction and that there was no heavy rainfall, which would have exacerbated the surge up the rivers. It would be foolish to assume that we will be lucky a third time.

The challenges of rising sea levels and climate change mean that such events will take place with greater frequency. It is important to remember that sea levels along the Suffolk coast have been rising by 2.4 mm per annum since the 1950s. In Lowestoft, research carried out by Halcrow and Bam Nuttall concludes that a 1953-type flood, which was previously considered to be a one-in-1,000-year event, could well now take place every 20 years. There is thus a need for new and improved sea defences, and it is important that these be put in place as soon as practicable.

Preparatory work on a Lowestoft flood defence scheme is nearing completion. It should be submitted to the Government shortly, and I hope it will receive favourable consideration. It is important to the town’s future that work on the scheme starts as soon as practicable. There is the opportunity to attract considerable investment into the town, particularly in the oil and gas and offshore renewables sectors, and the inclusion of this part of Lowestoft in the draft assisted area map will help in this respect. However, businesses will think very carefully before making such commitments unless adequate flood defences are in place.

I have raised a number of issues, but I return to the most important, which is obtaining an assurance from the Minister that the Government are doing all they can to ensure that local communities affected by the storm surge get back on their feet as quickly as possible. In what is the season of good will, we owe it to those many people whose lives have been turned upside down this Christmas to provide an undertaking that they will not be forgotten.

On that note, Mr Deputy Speaker, happy Christmas to you, to the staff of the House and to all colleagues on both sides of the House. I look forward to the Minister’s reply.

Beer Duty Escalator

Debate between Andrew Percy and Peter Aldous

Thursday 1st November 2012 Commons Chamber

[Peter Aldous (Waveney) (Con)]

I am grateful to my hon. Friends the Members for Burton (Andrew Griffiths) and for Leeds North West (Greg Mulholland) for securing the debate and for their hard work and to the 104,000 people who signed the e-petition. I wish to speak in favour of the motion, and there are compelling reasons for doing so. First, if we do nothing and carry on regardless, an iconic British business will wither on the vine—or should I say the hop? Secondly, small businesses will close at an accelerating rate, with a devastating impact on individuals, families and communities, both urban and rural. Thirdly, it is important to base fiscal policy on well-founded and up-to-date research. Times have changed significantly since 2008.

Indeed, the face of the industry has changed dramatically over the past 30 years. In East Anglia, great names such as Lacon’s, Bullard’s, Mann’s, Tollemache and Cobbold have long gone. Visionary and iconic businesses remain: Adnams, St Peter’s brewery and Green Jack in my constituency, the latter being the most easterly brewery in Britain. We owe it to them to promote a level playing field on which they can develop their businesses, play a full role in the economic recovery and create new jobs.

If we go on as we have been doing, we will kill the goose that lays the golden egg. Beer duty has risen by 40% since 2008, yet the pub trade has shrunk by a third over the same period. Britain pays over 40% of EU beer tax but consumes only 13% of beer sold in Europe. Investment in the beer and pub sector has shrunk dramatically, from over £2 billion in the late 1990s to £600 million in 2010. A sector that employs 1 million people, often young people, needs nurturing, not suffocating.

If there was a rationale for introducing the escalator in 2008, it has long since gone. Time are very different: inflation, VAT and input costs are all higher; there has been a poor harvest; energy costs are higher; and these are compounded by a fall in household incomes. The escalator today is in many respects a straitjacket; it is no longer fit for purpose in these straightened times.

It is important to bear in mind the unique nature of the industry, the effect of the punitive form of taxation and its potential for growth if properly nurtured. It is very much a British industry, with a supply chain that creates a significant number of jobs. As we have heard, one job in brewing supports one job in agriculture, one job in retail, one job in distribution and 18 jobs in pubs and clubs. In my constituency, more than 1,200 people are employed directly or indirectly as a result of the industry, and there are nearly 100 pubs and the industry puts £26 million into the local economy. Some 85% of pubs are small or medium-sized enterprises, the foundation stone on which we must build the recovery. They are particularly vulnerable to rises in duty, being less able to absorb duty and other cost increases. It is also important to take into account the community and social benefits of pubs, both in villages and in urban areas.

Pubs are under attack on all fronts. The landlords who lease from pub companies find themselves confronted with excessive rent increases. Landlords find themselves strangled by red tape; lock-ins have long since gone, having been replaced by late-night sessions of burning the midnight oil and completing VAT returns. Many are told, “You don’t want to rely on beer; you want to get into food.” Yet landlords find themselves competing on an unlevel playing field with supermarkets as they have to charge VAT on their sales.

[Andrew Percy (Brigg and Goole) (Con)]

On that point, I commend the Percy Arms in Airmyn, a pub that has transformed itself, but purely around food, because making money out of beer has become almost impossible.

[Peter Aldous]

My hon. Friend makes a good point.

It would be churlish not to commend the Government for the good work they have done. They have made it easier for pubs to put on live events, they have introduced the community right to buy through the Localism Act 2011, and the forthcoming proposed introduction of a minimum unit price for alcohol will help to provide a level playing field.

However, the elephant in the room remains. This brings me back to the motion and the need for a full review of the economic and social impact of the escalator before decisions are made in next year’s Budget. Tax policy must be underpinned by proper research. The research that has been carried out shows that there will be devastating unintended consequences if the escalator is retained. Oxford Economic Research Associates has shown that if the rise goes ahead, there will be 5,000 job losses and the additional beer duty received will be offset by a loss of employment, lower revenues from other taxes and an increase in social security spending. I urge the Government to carry out the review with all haste.