Covid-19: Limited Company Directors

Caroline Lucas Excerpts

Monday 25th January 2021 Commons Chamber

[Caroline Lucas (Brighton, Pavilion) (Green) [V]]

Thank you very much, Mr Deputy Speaker. I am hugely grateful to the hon. Member for Midlothian (Owen Thompson) for allowing me to say a few words in this vital debate, and I congratulate him on his powerful words.

The Minister has engaged with me on a number of occasions about support for small limited company directors, and he can be in no doubt about my concerns, but I am pleased to have this opportunity to stress three points to him again. First, I want to check that he, the Chancellor and Treasury officials fully understand that the DISS proposal does not use dividend payments as the basis for calculating a suitable level of income support for directors. It very deliberately avoids doing that, and is based instead on CT600 taxable profits.

Secondly, as Northern Ireland has managed to develop a scheme that meets its—presumably—equally high standards on avoiding fraud, can the Minister tell us why it has been so difficult for the Treasury to achieve that? Will he take this opportunity to correct the impression that directors of limited companies are somehow less trustworthy than others who have benefited from Government support?

My third point is simply to ask whether, if the DISS does not meet with Treasury approval, the Minister will commit to coming up with something that does. I am running out of ways of explaining that some directors of small limited companies have received nothing in income support from his Government since March last year, and they are desperate. As well as the DISS proposal, he has other options that have been put to him. It is his responsibility to actively continue to engage with those affected and to find a solution.

The speed with which the Treasury developed emergency support schemes is warmly appreciated, but that does not excuse the gaps, and certainly not the fact that those gaps still exist. Company directors are being made destitute because the coronavirus job retention scheme for income taken via PAYE, as well as bounce back loans, rental support, increased levels of universal credit and other business support grants, all exclude them. Mortgage holidays are also on that list, which is especially hard to stomach for directors who are now forced to sell their homes to try to save their businesses. I hope that the Minister and his Department will finally grasp that hiding from reality does not change it. His Government are responsible for dangerous levels of despair and desperation. Up to 7.5 million UK jobs are reliant on small limited companies. If the DISS is not the right scheme, then the Treasury needs to urgently come up with an alternative, because it is both economically illiterate and morally untenable to leave these people with no liveable income.