Business and the Economy
Caroline Dinenage Excerpts(2 weeks ago)
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Dame Caroline Dinenage (Gosport) (Con)
My hon. Friend is so popular. I am interested by how he is starting this debate, because it chimes with what I am hearing in my constituency, where venues such as pubs, restaurants and cafes, which are such a vital part of the effort to regenerate our high streets and local community spaces, are seeing their margins slashed because of the cost of labour and the increase in business rates. Does he agree that Labour’s jobs tax and the ending of business rates relief is putting the regeneration of our town centres and community spaces at risk?
Andrew Griffith
How tragic is it that from Gosport to Gloucester and everywhere between, businesses on our high streets are closing? This Government do not understand that. If they do understand, they do not care, and if they care, they have not acted. The message from this Government to anyone willing to put their capital, time and energy on the line by taking risk to create wealth as a business owner is abundantly clear.
Andrew Griffith
She is right, and that is one of the chilling headwinds that anyone who wants to grow the economy, and anyone who serves in the wonderful Department for Business and Trade or our Treasury, should confront. We should be going back to officials and challenging exactly that. How can we achieve a culture vibe shift on growth and entrepreneurship? That is the best contribution that we could all make.
Dame Caroline Dinenage
May I just take my hon. Friend back to what he was saying a moment ago about opportunities for young people? I recently met hair and beauty salons in my constituency. As he knows, they have historically been the most amazing employers of apprentices and have given such wonderful chances to young people. I was worried to hear that the rate at which they are taking on apprentices is dropping off. By 2027, there will be no apprentices left in the sector. It is not just hair and beauty saying that; other sectors in my constituency, such as adult social care and early years education, are saying the same. Is he as worried as I am about the lack of opportunities for our younger generation?
Andrew Griffith
Yes, I am enormously worried. We have to understand and make the connection that it is only the private sector that truly creates sustainable jobs. We need people to work in our wonderful public services, but ultimately growth and opportunities come from the expansion of the private sector, which is most encapsulated by female-led businesses, such as those in the hair and beauty sector. They often survive on small margins, deal with lots of different pieces of regulation, and try to keep our high streets and communities alive—as well as performing, I suspect, rather a better service for my hon. Friend than for me and some other colleagues. It is a valuable and vital industry.
Hair and Beauty Sector: Government Policy
Caroline Dinenage Excerpts(1 month, 1 week ago)
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Dame Caroline Dinenage (Gosport) (Con)
It is a pleasure to serve with you in the Chair, Ms McVey. I start by congratulating my hon. Friend the Member for Hornchurch and Upminster (Julia Lopez) on securing this debate and articulating so comprehensively the issues that the hair and beauty sector face. I share her concern and frustrations, and those of the sector.
The hair and beauty industry contributes £5.8 billion to the UK economy. It is not just about how people look; it is important for our high streets, for individuals and for communities, yet the Government seem to insist on seeing the sector driven into the ground. Since the Chancellor’s spring statement, I have received messages almost daily from businesses across my constituency that are seriously concerned about their future. This is existential.
Just this week, a small salon owner who has been in business for over 27 years got in touch with me and said that this is the most challenging period that she has ever experienced. The Government’s changes to employer national insurance contributions and the national minimum wage will see labour costs for an average small salon in my Gosport constituency rise by over £25,000. That is completely unsustainable; as my hon. Friend the Member for Hornchurch and Upminster said, it forces people into the black economy or out of business altogether.
Only recently, the Secretary of State for Work and Pensions set out her Government’s welfare reforms, arguing that they are aimed at incentivising people currently in receipt of benefits back into work and secure employment. But I would love to hear from the Minister how he thinks that tallies with the closure of small businesses in our communities, and the redundancies that will result. On top of that, the Government’s actions are set to make 1,000 apprenticeships across the country unaffordable, closing the door to young talent and diminishing training and employment opportunities. I heard from one local barber who has trained apprentices for years; he has now said that the Government’s changes mean he will not be able to afford to train another apprentice.
Businesses will suffer. Female-led businesses in particular will suffer, as well as female work opportunities. Communities will suffer, and in the end the Government will see declining tax receipts. Will the Minister admit that his party made a mistake, and set out how he will communicate with the Treasury to attempt a U-turn? I do not think that anyone on the Opposition Benches would blame him if his party took that sensible step. On Monday I will be hosting a roundtable for all the hair and beauty salons across my constituency, and I would love to know what the Minister’s message is to them.
The Parliamentary Under-Secretary of State for Business and Trade (Gareth Thomas)
In the usual way, let me begin by congratulating the hon. Member for Hornchurch and Upminster (Julia Lopez) on securing this debate. Let me say at the outset that, as in all the debates that I am privileged to participate in, her and in the main Chamber, there are points in this debate for many other Government Departments as well as my own to consider. I am happy to make sure that those Departments have heard the different insights—let me put it in those diplomatic terms—offered by Members in this debate.
As well as hearing from the hon. Member for Hornchurch and Upminster, we heard from the right hon. Member for New Forest East (Sir Julian Lewis), my hon. Friends the Members for Ribble Valley (Maya Ellis) and for Stourbridge (Cat Eccles), the hon. Members for Bromsgrove (Bradley Thomas), for Gosport (Dame Caroline Dinenage), for Strangford (Jim Shannon), for South Northamptonshire (Sarah Bool) and for Solihull East (Saqib Bhatti), and the hon. Member for Chippenham (Sarah Gibson)—the spokesperson for the Liberal Democrats—and the hon. Member for West Worcestershire (Dame Harriett Baldwin).
Let me begin by responding to a couple of the points that came out in the speech by the hon. Member for Hornchurch and Upminster. I also take this opportunity to commend her and other hon. Members for the support they have shown for hair and beauty businesses across the UK, including in their constituencies.
While I was researching in preparation for this debate, I noticed that the hon. Lady ran a campaign to highlight the very best salons in her area so that they could be nominated for the British Hairdressing Awards. I do not know whether Wyndham Hair was one of those that she nominated, but I certainly wish it well in the coming months.
It is very important that we continue to champion this sector as individual constituency MPs, because of the significance that hair and beauty businesses have to our economy, our high streets and all our daily lives. Many Members have asked about the extent to which the Government engage with the hair and beauty sector, and I can confirm that I regularly meet the sector to understand its views and concerns. The very first business that I visited on my appointment was the excellent Pall Mall Barbers, founded by the remarkable Richard Marshall; he could not read or write when he started in the industry, and he now runs some eight stores in central London and New York.
As well as visits, those conversations with the sector include holding roundtables with key representatives of the industry, the next of which is due next month. I think those are important because the hair and beauty sector is one of the industries that I would gently suggest has been neglected for too long over the last decade. Economically, the industry contributes some £25 billion to the UK economy and employs over 550,000 people. Hair and beauty businesses, as Members have rightly set out, are found on every high street and in every town and village in the UK. They are essential for pulling people to the high street and help to generate the footfall that keeps other local businesses there.
However, it is true that the contribution of the industry is far more than an economic one, and the hon. Member for Hornchurch and Upminster also rightly drew that out in her contribution. It is an industry that should be championed for its female entrepreneurship, for the opportunity it brings to people from all backgrounds, and for its role, on occasion, in combating mental health challenges. For example, over 80% of hair and beauty workers are women, and almost of 90% of businesses in the sector are owned by women. Almost half of all jobs in the sector are in areas with traditionally high levels of unemployment, which I think underlines the contribution that the sector makes in getting people into work and into an exciting and creative career path.
Whether it is getting a fresh haircut, a massage or even just chatting to their beauty therapist, many people relish the conversations that their local salons offer. I am not sure there is much that a beauty therapist in Harrow West could do for me, but I certainly value the conversations and skill of the barbers at Paul’s in north Harrow in my constituency.
In short, hair and beauty businesses are a vital pillar of our high streets and communities. I recognise that it has been an exceptionally challenging decade for high street businesses, and that includes the hair and beauty sector. The pandemic, followed by the cost of living crisis and rising interest rates, forced many hair and beauty businesses into high levels of debt, depleted cash reserves and reduced profit margins.
Opposition Members may not like to hear this, but the Government inherited a very challenging fiscal position, so we had to make some very difficult decisions on tax, spending and welfare at the autumn Budget. Some of the measures in the Budget have concerned the industry, but I believe that those decisions are important for delivering long-term stability and, in time, and even more significantly, economic growth. Many hair and beauty businesses will benefit from some of the other measures that the Chancellor announced.
Dame Caroline Dinenage
It is entirely predictable that the Minister is trying to push the blame on to the previous Government for some of his Government’s decisions. Does he not agree that actually this is such a retrograde step? As a number of Members have tried to explain, what he is seeing from these small businesses is a decrease in the tax take and a decrease in employment opportunities. At a time when his Government have bet the house on growth, all he is seeing is a decline in growth. Surely that is a decision, not a position that he has been forced into, and it is a retrograde step.
Gareth Thomas
I would have thought that the hon. Lady would welcome the measures we took in the Budget to protect the smallest businesses. We increased the employment allowance so that almost 1 million employers pay no national insurance contributions at all. More than half of employers will see no change or gain from that package, and that includes many hair and beauty businesses, as the vast majority of them are micro-sized.
Budget Resolutions
Caroline Dinenage Excerpts(6 months, 4 weeks ago)
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Dame Caroline Dinenage (Gosport) (Con)
You will know, Madam Deputy Speaker, that the Gosport constituency is a community built around a shared history of service in and for our armed forces. Thirteen per cent of my constituents are veterans. Those are good, hard-working people who have served our country and asked for little in return, but they are not wealthy people. They are disproportionately impacted by the Budget, which delivers the opposite of the growth we were promised: it delivers taxes and cuts that will leave my constituents disproportionately poorer. It started with the baffling decision to cut winter fuel payments. Many of my constituents exist just outside the pension credit threshold and are hanging on by their fingertips. The Government’s own data suggests that 13,000 of them will lose that lifeline through the cold winter months. Age UK says that it will be 5,000 more than that, which will be 91% of pensioners in Gosport.
I have real concern for the health of older people in Gosport during these winter months. That concern extends to the future of some of our most important businesses: the care homes and nurseries who do such vital work and employ so many of our constituents. At this stage, I must direct the House to my entry in the Register of Members’ Financial Interests. Those organisations are seriously impacted by the triple whammy of minimum wage increases, employer national insurance threshold decreases and contribution increases.
Hopscotch nursery in my constituency told me that the £25 billion tax increase will impact businesses that employ a high number of low-wage workers. It estimates that the changes will add almost £1 million in costs to their businesses. That cannot be alleviated by productivity increases or headcount reductions, because childcare ratios are set by the Government. The services to which we entrust our most precious and loved family members rely on face-to-face care and human interaction, so the extra costs facing childcare and adult social care services will be borne by their customers—working parents and the vulnerable elderly—and by employees through lower wage growth.
Graham Stuart
My hon. Friend is making a powerful speech. It is good to see the Chief Secretary to the Treasury in his place. I hope he will take on board these arguments, and perhaps the overall settlement can be reworked to minimise the negative impacts that my hon. Friend outlines.
Dame Caroline Dinenage
I agree. I would love to see something done to exempt the childcare and adult social care sectors in particular from the policy.
The Budget also threatens many organisations that are central to the regeneration of our communities. I welcome the fact that the cliff edge for business rate relief for hospitality, leisure and retail has been reduced, but what the Chancellor gave with one hand she took away with the other, because hospitality venues can now expect to see their costs increase by £3 billion. In my constituency, that will potentially cripple 146 businesses, which employ around 2,000 people.
While Ministers talk about the value of our creative industries, tourism and hospitality, they are ignoring their fragile state. The chief executive officer of the Sound and Music charity has said that the measures will impose an extra £7 million in additional taxes on the grassroots live music sector. The Music Venue Trust estimates that, without additional support, 10% of remaining venues will see their doors close. That is up to 120 venues, 4,000 jobs and 25,000 performances opportunities all lost.
As well as being a Budget of broken promises, I suspect that this will become known as a Budget of unintended consequences. The decisions that the Chancellor has taken will have real, tangible impacts on the community and those across the country. Not only that, but we are saddling future generations with billions of pounds of debt to pay for it.
Pub and Hospitality Sector
Caroline Dinenage Excerpts(7 months, 1 week ago)
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Dame Caroline Dinenage (Gosport) (Con)
I pay tribute to my hon. Friend the Member for Mid Leicestershire (Mr Bedford) for raising this important debate. We can see from the number of people here how much this touches every single one of us. In my constituency, local venues, pubs and restaurants are seeing a triple whammy of pressure with increased wage costs, increased energy costs and the significant rise in business rates as rates relief comes to an end. That is having a massive impact. Nationally, these venues are closing at a rate of 50 a month.
I am reminded of work by the Culture, Media and Sport Select Committee earlier this year looking at grassroots music venues, because of course many pubs and restaurants are live music venues as well. They are also the R&D department of our globally successful music industry—they are vital to it—and they are closing at the rate of two a week. Two things the Committee advocated in our report were, first, a levy to go between the big arenas to the small, independent venues and, secondly, a time-limited and very targeted VAT cut. I would like to make the argument for such a cut for small independent hospitality venues.
I do not want to take the argument purely into numbers, because these venues are so important in the way they make us feel—they can regenerate communities and can address social isolation and loneliness—but they are vital for our local economy and for jobs. In the Gosport constituency alone, these venues employ 2,000 people across 146 venues. They are vital. The knock-on effect of venue closure can be devastating. A time-limited and very targeted VAT cut could be a lifeline for some of the venues that are struggling and still have not got back up to speed and back to pre-pandemic opening hours.
Post Office Horizon
Caroline Dinenage Excerpts(10 months ago)
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Justin Madders
I join my hon. Friend in paying tribute to her predecessor, who was tenacious in her pursuit of this matter. We have had a number of conversations with the Scottish Government, and we do not want to see any difference between how this scheme is administered in any part of the country. We are confident that will be the case.
Dame Caroline Dinenage (Gosport) (Con)
This is a national scandal, and it is almost impossible to quantify the loss of trust in the Government and the Post Office that has resulted. Can the Minister set out a little more on what the Government intend to do to ensure that the information and support to make the applications to the redress scheme will be there for every single postmaster who has been affected and every single one who had a conviction quashed?
Justin Madders
The hon. Member asks an important question. Disclosure packs are being prepared for every claimant, which will contain what we believe is all the information they need to assess whether they wish to accept the fixed sum, or to proceed to a more detailed assessment of the claim. The pack will include details of their contracts and remuneration with the Post Office, details of whether they were eligible for the Royal Mail share plan and any other information that the Department can obtain that is requested. We want to work at pace with individuals to ensure they have all the information they need to make an informed decision.