Amendment of the Law

Baroness Bray of Coln Excerpts

Thursday 19th March 2015 Commons Chamber

[Angie Bray (Ealing Central and Acton) (Con)]

The Chancellor’s Budget yesterday has been warmly welcomed by business organisations up and down the country. The British Chambers of Commerce, for example, has said:

“The Chancellor’s focus on business growth and prosperity will receive a warm welcome from businesses of all sizes”.

It is certainly the kind of Budget that businesses in my constituency wanted to see, and what is good for businesses is good for our constituents and the communities in which they operate—something that Opposition Members do not always appear to understand.

Despite the strong growth we have seen under this Government, there is no denying that things have been challenging for smaller businesses. Things are getting better, but at my most recent business breakfast club last week, several local businessmen and women raised their No. 1 concern: there is still more that could be done to support businesses, especially smaller businesses and the high street more generally. I expect that they welcomed what they heard yesterday.

In particular, they will have liked the Chancellor’s big announcement that the major review of business rates will report back in time for the 2016 Budget, which is just one year away. It sounds to me like the Government need to be getting on with that, as there is a massive amount of work to do. As he said, business rates have not kept pace with the needs of the modern economy and the whole structure needs rethinking. The advent of online businesses, both commercial and retail, has thrown the whole system out of kilter. When one considers the massive retail giants such as Amazon, one realises that it cannot be right that the businesses on our high streets that continue to trade out of bricks and mortar, in shops and other premises, should have to pay tax on the space they occupy while their online competitors do not. There is no longer the same relationship between the size and location of premises and the contribution businesses make through business rates. As I have said, that cannot be right, so I welcome the decision to have a root-and-branch review.

It is great news that corporation tax is to be reduced again to 20%, which sends an important signal that Britain is really open to business, with

“one of the lowest rates of a major economy in the world.”—[Official Report, 18 March 2015; Vol. 594, c. 776.]

It is to be regretted that the Labour party wants to raise the tax, were it ever to get a chance—what a retrograde step that would be.

Another measure that will surely benefit business is the announcement that fuel tax will be frozen again, making that the longest duty freeze in 20 years. Many small businesses that depend on a van or some other vehicle will continue to benefit from the freeze as well as from the much lower petrol prices at the pump, which we are all enjoying at the moment.

I very much welcome the Chancellor’s continuing commitment to supporting our creative industries. As the Member of Parliament for Ealing Central and Acton, which of course contains the world-famous Ealing film studios, the world’s longest continually running studios, I am delighted that he proposes to make TV and film tax credits more generous, along with expanding support for video games and a new tax credit for orchestras. As a member of the Culture, Media and Sport Committee, I participated in our report on growing our creative industries, which make an increasingly important contribution to Treasury revenues. On a visit to Los Angeles to find out whether the UK is seen as a good place to film and do business, we were given a resounding yes, and our film tax credits were singled out as a major reason for more studios choosing to shoot films over here. I was delighted to learn recently that Ealing Studios is fully booked for the whole of this year. That is a tax credit that earns far more than it costs.

I also welcome the Chancellor’s plans to provide more support for our digital infrastructure, funding work to improve mobile networks, funding free wi-fi in our public libraries and continuing to roll out ultra-fast broadband to nearly every home, which is vital in a world where people work on the move and at home. However, I still make the point that many smaller businesses, as my hon. Friend the Member for Brentford and Isleworth (Mary Macleod) said, continue to get a poor deal when it comes to superfast broadband. In Park Royal in Acton, many businesses complain that they keep being promised that it is just around the corner, but it never actually happens. That is crazy. Park Royal is less than 15 miles from one of the busiest international airports in the world. We need all our businesses to be properly and speedily plugged in. To be fair, I have had an assurance from the Secretary of State for Culture, Media and Sport that this issue is being looked at, but we need it to happen fast if we are not to leave our small businesses in places such as Park Royal at a disadvantage.

Business will benefit from the good news on tax cuts for hard-working people, families and savers. The more comfortable and secure we feel financially, the more likely we are to feel able to spend a little more, so it is great news that yet again the personal tax allowance will be raised. Next month we will see it go up to £10,600, and it will go up again next year to £10,800 and then £11,000. According to the Office for Budget Responsibility, the average taxpayer in 2015 will be better off by £900 a year, compared with 2010. The best news for the low paid is the raising of the minimum wage to £6.70 an hour in October, the largest real-terms increase since 2008. Apprentices will get a pay rise, too—up to £3.30 an hour.

Basic rate taxpayers with savings will be able to enjoy the first £1,000 of the interest they earn on savings tax free. Higher rate payers will benefit from the first £500. From this autumn, savers will be free to take money out of an ISA and put it back in later in the year without losing their tax-free entitlement. These measures are all about freeing up people’s earned and saved money, which can only help businesses.

I welcome this Budget because it does what Conservatives do best—trust the people. We trust the people to make investments in their businesses and to drive growth, and they have. We trust the people to invest in their employees and bring on apprentices, and they do. We trust the people to spend their own hard-earned money in retirement in a way that best suits them, and they will. Put simply, and unlike the Labour party, we trust the people to do the right thing—and it is paying off, with the fastest growth of any major economy in the world. More people are in work than ever before, paying down the deficit and taking more people out of tax. The Opposition may not like it, but the plan is working. As Government Members know, we cannot invest in proper public services, including the NHS, unless we have a strong economy to pay for it. If we cannot get the economy right, we cannot make the investments we all want to see. This Budget puts Britain firmly back in business and I support it.