(2 days, 10 hours ago)
Grand CommitteeMy Lords, I stand as a winding speaker but also as someone who attached their name to Amendment 22 from the noble Lord, Lord Londesborough, which I think gets to the heart of the problem that we have with this Bill. To me, the most pernicious measure has been the dropping of the threshold, which has meant that trapped into employers’ national insurance contributions are the lowest paid and the part-timers. There is a disadvantageous impact on small businesses in hospitality and tourism, which are the backbone of so many communities and employ so many people for whom other work is very difficult to find. That makes it a really significant amendment, and I was very glad to attach my name.
I talked on an earlier set of amendments, essentially, about small businesses but also, more broadly, about tourism, hospitality and part-timers. I will not repeat that; the Committee has listened to me once on those issues and certainly does not need to hear me twice. I just make a small comment on why I am particularly concerned about the approach to small businesses, which is that it seems to me that the Government have put in some protections for what are genuinely micro-businesses but do not use “micro” and instead keep using “small”. The noble Lord, Lord Londesborough, identified the benchmark, which is about seven employees. Then you can start to do better under the changes that the Government have made. However, every time I read about the growth agenda, it requires the upscaling of our small businesses. This, in many ways, has been the British disease.
I was looking at reports from the ScaleUp Institute, which obviously does excellent surveys so you can get a granular feel of what is happening with many of these businesses. Most of them state that the first problem in scaling up is talent, but the second problem is access to finance. For a company that will now have to take on board additional costs—about £1,000 or more per employee—this will exaggerate that problem of access to finance. Many of them will now have to find finance in order to be able to cover the working capital that is engaged in paying higher employers’ national insurance. The noble Lord, Lord Forsyth, in his excellent and interesting Second Reading speech, covered some of the issues associated with that credit.
It was not a Second Reading speech; I was addressing the issues in the amendment.
We will have to beg to differ on that.
I think that the Minister will turn around and say that a great deal is being done for small businesses that want to upscale and that we should look at the British Business Bank. We are talking about an entity that is so small that it really cannot meet this need, so there is a very big problem here to be addressed. It seems to me that the way in which the national insurance contributions increase will work will knock back the effort that has to be made to help people get through what is often known as the credit valley of death, so that they can go from being small to the thriving, upscaled businesses that we need to drive the growth that we need.
(3 weeks, 2 days ago)
Lords ChamberMy Lords, we on these Benches are focused on the substance of this important Bill, which we demonstrated with our regret amendment on Monday. Disputing where Committee stage is debated is very much a second-order issue, especially when, to make progress on the substance, we will have to try to find some common ground. During the years of the Conservative Government, significant mixed Bills of equal impact on people were debated in Grand Committee at Committee stage. We did not seek to vote against that then. I do not see the change of Government as a reason to vote against that now, and we will support from these Benches the Government this afternoon.
My Lords, forgive me for pointing out that on the Liberal Democrat Benches, the turnout in support of their regret amendment on Monday was less than half their complement. They moved a moved a regret amendment; they made fine speeches about how damaging this Bill will be to charities, hospices and other organisations; and then they also, at the end of the debate, made it clear that they would not give the whole House an opportunity to consider this on the Floor of the House. I do not know what is going on between the Liberal Benches and the Labour Party, but what is clearly going on is some kind of deal—a deal that is against the interests of the people of this country, including many charities, hospices and other organisations.
It is completely wrong to argue that in the Grand Committee this Bill can be subject to similar scrutiny. If it is on the Floor of the House, we can vote on some of the measures that we agreed with the Liberal Democrats need to be considered. We can have proper scrutiny. This is simply an attempt by the Government to hide their embarrassment at the atrocious consequences of this unprecedented national insurance Bill.