Start-up Companies: Tax Incentives

Debate between Baroness Vere of Norbiton and Lord Londesborough

Monday 29th April 2024 Lords Chamber

[Baroness Vere of Norbiton (Con)]

The Government have actually monitored the benefits of the tax reliefs and indeed published independent reports at the 2023 Autumn Statement into EIS and SEIS. We have also published annual reports into R&D on whether the schemes are appropriately designed. However, the noble Lord raises a really important point. He is right that there has been an enormous amount of error and fraud, so HMRC has taken action and has boosted the number of people working in fraud from 100 to 500 people who are very much focused on those things. It was also the case that much of the fraud or error was happening using nominated bank accounts. HMRC has now closed the ability for companies to use nominated bank accounts, which will have an impact.

[Lord Londesborough (CB)]

My Lords, further to the previous question, I ask the Minister: when will the Government conduct an impact assessment on both the EIS and SEIS investment schemes, specifically on the sustainability of businesses funded through these tax incentives? I ask because start-ups have a failure rate of around 90% and we should be clear about the costs/benefits when some £30 billion—so far—of taxpayers’ money has been involved.

[Baroness Vere of Norbiton (Con)]

As I said in answer to the previous question, an independent report has been published fairly recently on the design of the two schemes. It is the case that start-up companies sometimes fail and we need to make sure that we get the best value for money for the taxpayer. The Treasury is very focused on that.

Financial Stability: Private Equity Firms

Debate between Baroness Vere of Norbiton and Lord Londesborough

Wednesday 13th December 2023 Lords Chamber

[Baroness Vere of Norbiton (Con)]

My Lords, there are £250 billion of private equity assets under management in the UK, versus £10.3 trillion of total assets under management. It is a smaller part of the financial system. The noble Lord is not right to say that it is unregulated: UK private equity managers are regulated under the alternative investment fund managers regime. They must also comply with the senior managers and certification regime.

[Lord Londesborough (CB)]

My Lords, I declare my interests as set out in the register. It is hardly surprising that private equity is struggling to do deals and sell its portfolio companies in a climate of high interest rates and low growth. In fact, it is zero growth, as October’s dismal GDP figures show that we have seen no growth at all in the last quarter. In view of capital’s recent flight to quality, does the Minister agree that our lack of an economic growth strategy is the biggest drag on private equity in this country?

[Baroness Vere of Norbiton (Con)]

I do not agree with the noble Lord. As he will have seen in the Autumn Statement, the Chancellor set out significant tax cuts to encourage growth. That is where we are focusing our firepower at the moment.

Airports and Airlines: Staff

Debate between Baroness Vere of Norbiton and Lord Londesborough

Tuesday 19th July 2022 Lords Chamber

[Lord Londesborough (CB)]

My Lords, does the Minister agree that the Heathrow monopoly is in the hands of owners who put the interests of shareholders far ahead of customers? Dividends of £4 billion have been drawn out in the last 10 years and the airport has been saddled with £16 billion of debt. Now it wants the regulator to approve hikes in passenger charges of well over 50%, in the midst of the most abject and abysmal service.

[Baroness Vere of Norbiton (Con)]

I reject the noble Lord’s comment that London Heathrow has a monopoly. There are eight slot-restricted airports in England and many other airports beyond that. I simply say to airlines: if you do not like Heathrow, go elsewhere.