Oral Answers to Questions

Ashley Fox Excerpts

Tuesday 4th March 2025 Commons Chamber

[Darren Jones]

To ensure that we protect the country from the devastating impacts of flooding, we have committed £2.65 billion over 2024-25 to 2025-26 to improve flood defences, and we have established a flood resilience taskforce to feed into our decisions on future spending, which will report in due course.

[Sir Ashley Fox (Bridgwater) (Con)]

T8.   Bridgwater’s 77 pubs, including the Crossways Inn in West Huntspill, are at the heart of our local communities, yet the sector overpays £500 million in business rates relative to turnover. Will the Chancellor commit to the British Beer and Pub Association’s call for a 20p cut in the small business multiplier and 15p off the standard multiplier, in order to secure the future of British pubs?

[The Exchequer Secretary to the Treasury (James Murray)]

We have frozen the small business multiplier this year and we will be introducing permanently lower multipliers for retail hospitality and leisure premises from April 2026, which will benefit pubs. Meanwhile, they also benefit from our decision to increase the duty relief for draft products.

Finance Bill

Ashley Fox Excerpts

Report stage
Monday 3rd March 2025 Commons Chamber

[Jim Dickson]

Thank you, Madam Deputy Speaker. I simply intend to illustrate why the changes proposed in the amendments do not help what the Government are attempting to achieve via the Finance Bill. The FSB said that the Budget

“shows a clear direction in business policy now for the whole of this Parliament to target support at small businesses, rather than big corporates”.

As hon. Members have stated, the Government are supporting SMEs by more than doubling the employment allowance, keeping the small profits rate stable, maintaining the annual investment allowance and freezing the small business rates multiplier. I ask hon. Members not to forget that this is an important piece of legislation underpinning measures announced at the Budget that will help fix the NHS, improve public services, incentivise capital investment and rebuild Britain.

[Sir Ashley Fox (Bridgwater) (Con)]

This Finance Bill implements the 2024 autumn Budget. That was a bad budget and this is a bad Bill. It punishes businesses, discourages entrepreneurship and raises taxes on those trying to make a living. It will lead to job losses, reduced investment and higher prices. It will lead to higher interest rates and higher Government debt, which will lead to lower growth. If we wanted to make a list of things that our economy did not need, this Finance Bill would be a good starting point.

The Bill is built on broken promises. The amendments tabled try to help the Government to keep their manifesto promises. During the election, Labour told the public that its plans were fully costed and fully funded. Its manifesto said that it would increase spending by £11 billion, so how can the Government now justify an increase in spending of £70 billion a year funded by an extra £40 billion in taxes and £30 billion in borrowing? Even if people believe the fairy story of the black hole told by Labour Members—I do not—£11 billion plus £22 billion does not equal £70 billion.

Is not the truth that the Labour party always planned a large increase in taxes and borrowing but did not have the courage to tell the British people in advance? The Chancellor and the Prime Minister insisted that working people would be protected, but it is now clear either that they were wrong or that they do not consider small business owners, publicans or farmers to be working people.

[Noah Law]

Does the hon. Member not recognise that one of the primary challenges faced by the sectors he mentions is that of workers’ inability to afford to live in the areas where they work, such as in Cornwall, and that the changes to stamp duty land tax will go a long way towards improving the ability of workers to be housed in what are currently, in so many cases in Cornwall, second homes? Does he not recognise the potential contribution of that to the workforce?

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[Sir Ashley Fox]

I am sure that there are one or two good parts to this Finance Bill, but the hon. Gentleman was elected on a manifesto pledge to increase spending by £11 billion, and that was fully costed, yet this Finance Bill increases spending by £70 billion. I just wonder why he and his hon. Friends did not have the courage to put that before the British people at the election.

Small and medium-sized enterprises and the hard-working entrepreneurs who run them are the backbone of our economy, and they are the victims of this Finance Bill. In constituencies such as Bridgwater, where SMEs are key to local prosperity, the Government have imposed a huge national insurance hike that will make it more expensive to employ people. This rise, which breaks Labour’s manifesto commitment not to raise national insurance, will cost SMEs £732 more per year for every employee earning £20,000. This tax on jobs will stifle growth and lead to higher unemployment. The rise in national insurance is especially damaging to those in the healthcare sector, and the proposed amendments will help to assess the damage that that causes. Last week, representatives from the social care—

[Madam Deputy Speaker (Caroline Nokes)]

Order. In the interests of complete impartiality, I want to make sure that all Members are aware that they have to speak to the amendments as proposed in this Finance Bill, not any other amendments that they might wish had been proposed.

[Sir Ashley Fox]

I am grateful for your guidance, Madam Deputy Speaker.

People in the social care sector in Bridgwater were particularly concerned that the national insurance contributions rise had not been subject to an assessment. Assessing the damage that it and the other tax rises will do is therefore critical to the successful implementation of this Finance Bill.

[Joe Robertson (Isle of Wight East) (Con)]

I am grateful to my hon. Friend for giving way and for his assessment of the Finance Bill. Does he agree that the best way the Government can raise revenue is not to raise taxes but to grow the economy and increase the money taken through taxes in that way? Does he also agree that the national insurance contribution increases will deliver the very opposite of what the Government say? They will not grow the economy at all; they will stifle it, which is likely to lead to an increase in taxes in the future.

[Sir Ashley Fox]

I am grateful for my hon. Friend’s intervention. Indeed, combined with the rise in the minimum wage and Labour’s Employment Rights Bill, the contents of this Finance Bill seem to deliberately set out to harm small businesses.

The Labour Government’s plan to introduce inheritance tax on farmers and family businesses is more evidence, if it were needed, that they do not understand how farms and small businesses work. Under this Government, a family farm with land, buildings and machinery worth £5 million will incur inheritance tax of £400,000 when it passes to the next generation. That same farm might produce a return of 1%, or £50,000, in an average year, so the Government are proposing to take all that family’s income for the next eight years. I have a question for the Minister: how does he expect that family to live in the meantime? Labour’s response to our farmers has been to sneer at our rural communities. The Treasury offered a Minister to farming representatives, who then spent that time telling them that there was not a problem. This is bad not just for farmers but for rural economies and our nation’s food security.

This Finance Bill increases taxes, spending and borrowing. It makes our public sector larger and the private sector smaller. It does exactly the opposite of what is required. If we want a prosperous society, we need to encourage enterprise. We need low and simple taxes that incentivise people to work hard, to invest and to grow their businesses. This Finance Bill does exactly the opposite, and that is why we will oppose it this evening.

[Nesil Caliskan]

I want to thank the Members who have spoken so far. I have great enthusiasm for the Finance Bill, and I thank the hon. Member for North West Norfolk (James Wild) for his contributions, alongside the Minister at the time, over the several days I sat through the Bill’s Committee stage. I speak in favour of the Finance Bill as a member of the Committee. I recognise that it is part of the Government’s mission to turn the page on what was a period of decline for the country.

There are several aspects of the Bill that I would like to focus on. To begin with, I see the Government’s proposals on non-dom status as a crucial part of our agenda to ensure that we are delivering a fair approach to taxation in this country. Closing the non-dom loophole, alongside extending the levy on oil and gas companies and ending the VAT exemption for private schools through this Bill, will raise the necessary income to deliver what the Government are trying to do: achieve a balanced budget that will stabilise and then grow the economy.

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[The Exchequer Secretary to the Treasury (James Murray)]

At the heart of the Prime Minister’s plan for change is our mission to grow the economy to put more money in people’s pockets. We are determined to make people better off. We know that investment and growth depend on the essential foundations of economic stability, fiscal responsibility and public services being on a firm footing, but this Government inherited a challenging and unsustainable set of future spending plans based on unfunded commitments that had not been shared with the OBR or the British people.

No responsible Government could have let things carry on as they were. That is why at the autumn Budget, my right hon. Friend the Chancellor set out the Government’s plans to fix the foundations of the economy and deliver change—a plan to protect working people, fix public services, including the NHS, and rebuild Britain. That has meant taking difficult decisions on tax, spending and welfare to repair the public finances and support investment in public services, and the Government have done that while protecting people’s payslips. We have also ensured that the UK is one of the best places in the world to grow a business, with corporation tax capped at 25% and reforms that will support small businesses and the British high street. This Finance Bill represents the next step in delivering on the autumn Budget by legislating for several key manifesto commitments, supporting businesses to invest and implementing reforms to the tax system.

I thank all hon. Members for their contributions during the debate; before I turn to the individual amendments, I will briefly address some of the points that they made. I thank my hon. Friend the Member for Loughborough (Dr Sandher) for setting out the importance of growth and making people better off, and for his thorough analysis of all the amendments and new clauses to the Bill, which I seem to recall. Perhaps that was in fact my hon. Friend the Member for Dartford (Jim Dickson), who did go through all the new clauses—I thank him for his contribution. I also thank my hon. Friend the Member for Barking (Nesil Caliskan) for being on the Finance Bill Committee, although I note her description that she “sat through” it, rather than thoroughly enjoying the episode.

I also thank Opposition Members for their contributions to the debate. The hon. Member for Bridgwater (Sir Ashley Fox) recognised that even in his view, he could agree with a few points in our Bill, which I welcome.

[Sir Ashley Fox]

I invited the Minister to explain how the Budget would improve the lot of farmers. In particular, I gave the example of the £5 million family farm that would incur an inheritance charge of £400,000. How will that family pay that out of an annual income of about £50,000? That is eight years’ income, with nothing to live on.

[James Murray]

The debate on this Finance Bill has to focus on matters that are within the Bill and in the new clauses and amendments. As the hon. Gentleman will know, and as Madam Deputy Speaker reminded him, he strayed rather outside the ambit of the Finance Bill by referring to important changes to agricultural property relief that are not dealt with by the Bill or by any of the new clauses or amendments. I gently point out that any of his constituents, whatever industry they work in, will see that the income tax on their earnings does not go up as a result of this Government keeping their commitment in that regard.

Family Businesses

Ashley Fox Excerpts

Wednesday 26th February 2025 Commons Chamber

[Sir Ashley Fox (Bridgwater) (Con)]

I am pleased the Opposition are using our time today to debate the importance of businesses large and small. It is the private sector that creates the wealth on which our society depends, and it is the taxes businesses pay that fund our NHS and other important public services. The policies of this Labour Government, from raising taxes to imposing additional regulations, are putting those businesses at risk.

Having promised during the general election not to increase NICs, the Chancellor immediately broke that promise in the Budget. This national insurance hike will cost employers £900 for every employee earning the average salary. The tax rise disproportionately affects employees on low wages. Someone earning £9,000 a year will cost their employer an extra £600 a year in tax. This is not just a tax on businesses; it is a tax on jobs. Labour has introduced a £25 billion jobs tax that will increase the cost of hiring workers. It has also increased business rates by £2.7 billion. Under the Conservatives, businesses in the retail, hospitality and leisure sectors received a 75% relief on their business rates; Labour has reduced this relief to just 40%.

[Bradley Thomas]

Does my hon. Friend agree that the reduction in hospitality rate relief and the lower earnings threshold, which he has just acknowledged, create a perfect storm for hospitality businesses—not just because of the additional rate pressure, but because they will be less incentivised to recruit part-time workers? As has been acknowledged by other Members, that is often a route for young people into their first employment opportunity.

[Sir Ashley Fox]

My hon. Friend is right: all Labour’s measures will increase unemployment. Although Labour will say it has reduced the multiplier of business rates, this does not fully compensate—it leaves an average pub paying an additional £5,500 a year. This is not a sustainable burden for many businesses that are already struggling with inflation and rising costs. These taxes add up, and will lead to closures, job losses and harm to our communities.

Another troubling decision from the Labour party is the reduction of the cap on business property relief. BPR, introduced in 1976 by Denis Healey, was designed to protect family-owned businesses from being broken up and to ensure these businesses could continue to provide jobs and contribute to the economy across generations. It is extraordinary that Labour has found a Chancellor less sympathetic to businesses than Healey. This decision is a blow to those who have worked tirelessly to build and sustain their businesses, and will force families to sell their businesses or take on crippling debts just to pay the taxman. For many, this will be the end of their family businesses.

The Employment Rights Bill will require employers to spend £150 per employee on additional administrative costs to comply with new rules, including a ban on zero-hours contracts and potential liabilities for third-party harassment. At a time when businesses are already under strain, this is a further unnecessary cost, especially for small businesses that do not have the resources to navigate the red tape.

Having spent 11 weeks going through the Employment Rights Bill line by line, I know just how damaging it will be to SMEs in Bridgwater and elsewhere. Let us take just one example: the so-called day one rights. These rights would mean that if, after less than a week, it became apparent that a new employee was the wrong fit for a company, a complicated process would have to be followed to dismiss them. Speaking as a former—though fully qualified—solicitor, I know that this will have a disproportionate effect on small businesses without an HR department. If they do not dot all the i’s and cross all the t’s, they will be left exposed to being taken to court for unfair dismissal.

[Laurence Turner]

I understand the point the hon. Gentleman is making, but is it not the case that in that specific circumstance, after a week, they would be covered by the new probationary period provision? This provision is writing probationary period into the law for the first time.

[Sir Ashley Fox]

The hon. Gentleman would be correct if, in fact, there was a written contract that included a probationary period. What he forgets, however, is that many small businesses will conclude that contract on a handshake and a verbal agreement—there will not be a formal probationary period. It is exactly those small businesses that do not use a written contract that will be liable to legal action.

Let us take another example. Should a business fail to notify a new employee of their right to join a trade union in writing, it may be liable to pay an additional four weeks’ pay as a compensatory award. In what world is this system really going to work? Do we believe that those running a corner shop, pub or fishmonger are going to give their employees written notice that they have the right to join a trade union? No, they will not—and legal consequences will follow.

We on the Conservative Benches believe that businesses are at the heart of the economy and that they should not be punished by Government policies that stifle growth and investment. It is important to note that, when it comes to business, this Government’s track record is deeply troubling. Just one member of the Cabinet has ever started a business. When decisions are made by those who do not understand the pressures faced by small business owners, it is no surprise that the policies are so harmful. The Labour Government that we face is not a new Labour Government in the Tony Blair model. It is very much an old Labour Government of the 1970s, addicted to taxing, spending, borrowing and regulating. I regret to say that we will see unemployment rise. We will support family businesses, safeguard jobs and ensure that the British economy prospers.

Bank Resolution (Recapitalisation) Bill [Lords]

Ashley Fox Excerpts

2nd reading
Wednesday 22nd January 2025 Commons Chamber

[Emma Reynolds]

My hon. Friend flatters me. It is not that easy to explain in simple terms, but I will do my best. Essentially, if a small bank is in trouble, it is better for it not to go into insolvency but instead to go through resolution to protect its depositors. In the case of SVB, only 14% of deposits were covered by the financial services compensation scheme, because the scheme only covers deposits up to the £85,000 threshold. Had public funds been required to facilitate the sale of SVB to another purchaser—in this case it was HSBC, but it could have been another institution—it would have had recourse to public funds. We are seeking to avoid a situation in which taxpayers in all our constituencies are on the hook for the failures of small banks. Where a bank has high-quality assets, which was the case for SVB, we can avoid the insolvency situation and pay out to depositors who have deposits above the £85,000 threshold. That resolution would be funded by the financial services compensation scheme and ultimately the banks, which contribute to the scheme through a levy. I hope that answer helps my hon. Friend—I am sorry that it was a bit long.

Stability is at the heart of the Government’s agenda for economic growth, because when we do not have economic and financial stability, it is working people who pay the price. We have to bear in mind what we are seeking to do, which is ultimately to protect the interests of the taxpayer and to ensure that we do not have to have recourse to public funds.

[Sir Ashley Fox (Bridgwater) (Con)]

I welcome this Bill, but can the Minister assure the House that, at all times, the aim of the Government is to minimise the liability of the taxpayer? Where losses have to be sustained, they should be borne first by the shareholders, secondly by the bondholders and perhaps thirdly, and regretfully, by the deposit holders. That should be the order in which losses are sustained.

[Emma Reynolds]

I agree with the hon. Gentleman, who puts it very well. He will know that there was a different order in the case of Credit Suisse, but the then Government said at the time that that would not be their order of priority. We are seeking to protect the taxpayer in this Bill, and he is right: had there been a cost associated with the transfer of SVB, it would have fallen first to those people before falling to the taxpayer. If we pass this legislation, for which I hope there is cross-party support, we will avoid that eventuality, because if we follow the order of priority and get to the financial services compensation scheme, the cost will be paid through a levy on the banks in that scheme. I thank the hon. Gentleman for his question.

The resolution regime is a critical source of stability when banks fail, because it ensures that public funds and taxpayer money are protected. This Bill delivers a proportionate and targeted enhancement to the resolution regime to ensure that it continues to provide that important stability. As I said at the start of this debate, it is therefore an important Bill that underpins the Government’s vision for economic growth, and I commend it to the House.

Oral Answers to Questions

Ashley Fox Excerpts

Tuesday 21st January 2025 Commons Chamber

[Sir Desmond Swayne (New Forest West) (Con)]

17. What assessment she has made of the potential impact of the autumn Budget 2024 on levels of debt interest spending.

[Sir Ashley Fox (Bridgwater) (Con)]

19. What assessment she has made of the potential impact of the autumn Budget 2024 on levels of debt interest spending.

[The Chancellor of the Exchequer (Rachel Reeves)]

When we entered office, debt was at highs not seen since the 1960s. My commitment to the fiscal rules is non-negotiable, and we will drive debt down to a sustainable level. There have been movements in global financial markets, and the UK is not immune. The Office for Budget Responsibility will produce a forecast in the usual way, and I will respond with a statement to Parliament on 26 March. I will not be giving a running commentary on that forecast.

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[Rachel Reeves]

Let me have a go. There have undoubtedly been moves in global financial markets this year, and the UK is not immune to those movements. The OBR has not yet started its forecast. It will update that in due course, and I will make a statement on 26 March.

[Sir Ashley Fox]

Since coming to office, the Chancellor has increased taxes by £40 billion and borrowing by £30 billion and her Employment Rights Bill has increased the costs of employers by a further £5 billion. Does she accept that her decisions have led to a loss of confidence in the British economy and an increase in our borrowing costs?

[Rachel Reeves]

I do not think the borrowing costs in every major country in the world can be explained by the decisions made by this Government. As I said to the hon. Member for Hinckley and Bosworth (Dr Evans) last week, the hon. Gentleman has to get real. There have been global movements in financial markets that have affected the United Kingdom, but if he looks at the PWC report from yesterday, the most recent report on market confidence, global CEOs see the UK as the second best place in the world to invest, after the US.

Finance Bill

Ashley Fox Excerpts

Committee of the whole House
Wednesday 11th December 2024 Commons Chamber

[James Wild]

No, I won’t at this stage.

There are more than 100,000 pupils with special educational needs and disabilities in independent schools who do not have education, health and care plans, so they will be subject to this tax. That could make it unaffordable for the parents of those children to send them to the school that they think is best placed to look after them. There will be demand in places where there is not capacity as a result. A number of local authorities have pointed that out. That will just make the problems that councils face with their SEND budgets worse, despite the record amounts we have put into high needs.

[Sir Ashley Fox (Bridgwater) (Con)]

Does my hon. Friend agree that this disastrous education tax risks having a severe impact on those children and pupils with SEND in independent schools? It will force children with SEND out of independent schools as fees become unaffordable for their parents and it risks overwhelming the state provision, as there is not sufficient state provision at the moment.

[James Wild]

Absolutely. My hon. Friend makes the point very well. The knock-on impact and the damage to those children’s education will be considerable.

More than 40% of independent schools are small schools. They are at the heart of their local communities. They do not have big endowments. They operate on wafer-thin margins and simply cannot absorb changes of this magnitude, so it is likely that those schools will cut bursary places that exist due to this new tax that puts their viability at risk.

Oral Answers to Questions

Ashley Fox Excerpts

Tuesday 29th October 2024 Commons Chamber

[The Economic Secretary to the Treasury (Tulip Siddiq)]

The proposed regulations will drive high standards of conduct among “buy now, pay later” firms, ensuring that consumers receive clear information and have access to strong protections. Our proposals will also allow the Financial Conduct Authority to require “buy now, pay later” firms to carry out affordability checks, ensuring that firms lend only to borrowers who can afford to repay.

[Sir Ashley Fox (Bridgwater) (Con)]

During the last election campaign, Labour candidates across Somerset said that a Labour Government would cut energy bills by £300. Will the Chancellor set out the timescale for fulfilling that promise?

[Rachel Reeves]

I thank the hon. Gentleman for his question, and I note the number of Labour MPs we now have in Somerset and across the south-west of England. We will set out more detail in the Budget tomorrow, but our commitment to investing in home-grown energy will boost our energy security, create good jobs here in Britain and begin to reduce people’s bills, as will our programme to better insulate homes, which the previous Government failed to do.

Winter Fuel Payment

Ashley Fox Excerpts

Tuesday 10th September 2024 Commons Chamber

[Sir Ashley Fox (Bridgwater) (Con)]

I speak on behalf of 19,300 pensioners in my constituency who are set to lose their winter fuel allowance. Some 23% of my constituents are aged 65 or over, which is well above the national average. Many retired people in my constituency have done the right thing: they have worked all their lives, paid their national insurance stamp, and now have a small private pension and modest savings. It is because they have done the right thing that many of those pensioners are not eligible to claim pension credit. This Government are choosing to punish them for the prudent and conscientious choices they made through their working lives by withdrawing this important means of support.

Labour justified the decision to cut the winter fuel allowance by talking about its alleged poor economic inheritance. Let us take a moment to clear up some facts. In 2010, the budget deficit was about 11% of GDP at £157 billion. Today, it is about 4% of GDP. In 2010, unemployment was about 8%, and today it has halved and is about 4%. In May 2010, inflation was 3.4%. Today it is 2%. This is not the worst economic inheritance since the war.

[Patrick Spencer]

I am sure my hon. Friend will agree when I say that the economic inheritance that the Government received is incredible, considering that we had to deal with the covid pandemic crisis as well as the Russian invasion of Ukraine. That put huge pressure on our economy.

[Sir Ashley Fox]

My hon. Friend makes an important point. It just emphasises the fact that when the Chancellor says that it is a tough decision that has to be made, she is actually making a political choice. She has chosen to give train drivers earning £60,000 a year a pay rise of 15%. She has chosen to cut the income of retired people with a pension of £15,000 a year. That was her choice, and the British people will judge her and the Labour party on it.

Oral Answers to Questions

Ashley Fox Excerpts

Tuesday 3rd September 2024 Commons Chamber

[The Exchequer Secretary to the Treasury (James Murray)]

As Ministers, we greatly value and respect trade unions and the work of trade union representatives in supporting their members. While it is not appropriate for me to comment on individual cases, I will look into this matter further and respond to my hon. Friend in due course.

[Sir Ashley Fox (Bridgwater) (Con)]

The Chancellor’s decision to cut the winter fuel payment is forecast to save £1.5 billion. Can she advise the House what other options she considered for making savings in the Department for Work and Pensions budget before deciding to make this cut?

[Rachel Reeves]

The black hole we inherited was £22 billion. We announced in the statement on 29 July £5.5 billion of savings to reduce the size of that black hole, but the hon. Gentleman can see there is still work to be done and we will be setting out further measures in the Budget on 30 October to get a grip of the public finances.