Finance Bill

Caroline Nokes Excerpts

Report stage
Monday 3rd March 2025 Commons Chamber

[James Wild (North West Norfolk) (Con)]

I beg to move, That the clause be read a Second time.

[Madam Deputy Speaker]

With this it will be convenient to discuss the following:

New clause 2—Energy (oil and gas) profits levy: impact assessment of increase in rate—

“(1) The Chancellor of the Exchequer must, within six months of this Act coming into force, commission and publish an assessment of the expected impact of Sections 15 to 17 of this Act on—

(a) domestic energy production and investment;

(b) the UK’s energy security;

(c) energy prices, and;

(d) the UK economy.

(2) The assessment must examine the impact of provisions in this Act in comparison with what could have been expected had the energy (oil and gas) profits levy remained unchanged.”

This new clause would require the Chancellor to commission and publish an assessment of the expected impact of changes to the energy (oil and gas) profits levy on domestic energy production, the UK’s energy security, energy prices and the UK economy.

New clause 3—Review of impact of tax changes in this Act on households—

“(1) The Chancellor of the Exchequer must, within six months of this Act being passed, publish an assessment of the impact of the changes in this Act on household finances.

(2) The assessment in subsection (1) must consider how households at a range of different income levels are affected by these changes.”

This new clause requires the Chancellor to publish an assessment of the changes in this Act on the finances of households at a range of different income levels

New clause 4—Review of impact of Act on small and medium sized enterprises—

“(1) The Chancellor of the Exchequer must, within six months of the passing of this Act, lay before Parliament a report setting out the impact of the measures contained within this Act on small and medium sized enterprises.

(2) The report must include an assessment of the impact of the Act on the following matters—

(a) the number of people employed across the UK by small and medium enterprises;

(b) the number of small and medium sized enterprises ceasing to trade; and

(c) the number of new small and medium sized enterprises established.”

This new clause would require the Chancellor to conduct an impact assessment of the Act on small and medium enterprises.

New clause 5—Review of the Impact of Tax Changes on Household Finances—

“(1) The Chancellor of the Exchequer must, within six months of this Act being passed, publish an assessment of the impact of the tax changes introduced by this Act on household finances.

(2) The assessment must evaluate how households across different income levels are affected by these changes.”

This new clause requires the Chancellor to assess and publish a report on how the tax changes in this Act impact households at various income levels.

New clause 6—Report on fiscal effects: relief for investment expenditure—

“The Chancellor of the Exchequer must, within six months of the passing of this Act, lay before Parliament a report setting out the impact of the measures contained in clause 16 of this Act on tax revenue.”

This new clause would require the Government to produce a report setting out the fiscal impact of the Bill’s changes to the Energy Profits Levy investment expenditure relief.

New clause 7—Pupils with SEND without an Education Health and Care Plan: review of VAT provisions—

“(1) The Chancellor of the Exchequer must, within six months of the passing of this Act and every six months thereafter, lay before Parliament a review of the impact of the measures contained in sections 47 to 49 of this Act on pupils with special educational needs and disabilities.

(2) The review must consider in particular the impact of those measures on—

(a) children with special needs who do not have an education health and care plan (EHCP); and

(b) the number of children whose families have applied for an EHCP.”

This new clause would require the Government to produce an impact assessment of the effect of the VAT provisions in the Act on pupils who have special educational needs but do not have an Education Health and Care Plan.

New clause 8—Review of sections 63 and 64—

“(1) The Chancellor of the Exchequer must, within six months of the passing of this Act and every six months thereafter, review the impact of the measures contained in sections 63 and 64 of this Act.

(2) Each review must consider the impact of the measures on—

(a) Scotch whisky distilleries,

(b) small spirit distilleries,

(c) wine producers and wholesalers,

(d) the hospitality industry, and

(e) those operating in the night-time economy.

(3) Each review must include an estimate of administrative and operational costs for the preceding 12-month period for each of the sectors listed in subsection (2).

(4) Each review must consider the impact of the measures on the retail price for consumers of products subject to alcohol duty.

(5) Each review must also examine the expected effect of the measures on the domestic wine trade.

(6) A report setting out the findings of each review must be published and laid before both Houses of Parliament.”

This new clause would require the Government to produce an impact assessment of the measures on the Act on distilleries, wine producers and the hospitality industry.

Government amendments 1 to 17.

Amendment 67, page 53, line 30, leave out clause 47.

This amendment removes Clause 47, which removes the VAT exemption for private school fees.

Amendment 68, page 56, line 13, leave out clause 48.

This amendment removes Clause 48, which introduces anti-forestalling provisions.

Amendment 69, page 56, line 13, leave out clause 49.

This amendment removes Clause 49, which sets out the commencement date.

Government amendments 18 to 66.

[James Wild]

I will speak to new clauses 1 to 3, and amendments 67 to 69, tabled in my name. It is 124 days since the Chancellor delivered the first Labour Budget in 14 years—the so-called growth Budget—but it feels like longer. Inflation is up, taxes are up, borrowing is up, unemployment is up and energy bills are up. I could go on, but most tellingly of all, growth is down. The Bank of England has just cut its growth forecast for this year in half, to just 0.75%. Little wonder that business confidence has plummeted, with firms warning of fewer jobs, lower wages and higher prices. Instead of backing risk takers and supporting wealth creators, as the Conservatives do, this Finance Bill and the Budget attack enterprise and deliver lower growth, higher borrowing and higher taxes.

I turn to new clause 1, concerning pensioners. Millions of pensioners were left out in the cold this winter when the Government took away their winter fuel payments. Millions of people in receipt of only the state pension now face paying income tax on it.

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[Dr Sandher]

I could not agree more. Perhaps we should all take a trip to see the great work being done in Reading, because we have to build a lot more homes. My generation is increasingly finding that working hard and getting a good job is no guarantee of owning a home in the end. That is what this Government are fixing with this Budget.

It is not only the young who are not sharing in growth. Growth has gone to capital over labour, and technological change means that machines can do tasks far more cheaply than humans. More payments to capital mean less for workers. The labour share of GDP has fallen by a sixth since deindustrialisation. Today, across the Atlantic, we see the dangers of Bidenomics—

[Madam Deputy Speaker (Caroline Nokes)]

Order. I remind the hon. Member that it is imperative he speaks to the Finance Bill and the amendments, rather than rehashing a Budget speech.

[Dr Sandher]

This Budget is investing in the future, and indeed changing this country. This is a Budget that is moving forward, but I want to cover the bits covered in the Finance Bill. It is a Budget, a Finance Bill, that is investing in labour-intensive sectors such as early years childcare and the warm homes plan.

[Dr Sandher]

I thank the hon. Member for his help and assistance. The aim is not only to improve pensioner incomes. On one side there is the tax change, and on the other side, the triple lock will ensure that the amount going to those pensioners increases by £400 from April. As Members on both sides of the House would agree, the triple lock has helped pensioners immeasurably.

It is right that I now draw my speech to a close. I thank all hon. Members for their help, and I also thank you, Madam Deputy Speaker.

[Madam Deputy Speaker (Caroline Nokes)]

I call the Liberal Democrat spokesperson.

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[Mr Angus MacDonald (Inverness, Skye and West Ross-shire) (LD)]

May I draw the attention of the House to my entry in the Register of Members’ Financial Interests? Let me voice my support for my hon. Friend’s new clause, which would require the Government to review the impact of alcohol duty increases on key sectors. Scotch whisky is one of Britain’s greatest industries, accounting for 22% of the whole of Britain’s food and drink exports and supporting tens of thousands of jobs. Yet despite repeated assurances from the Government, the industry continues to face sharply rising duty costs. Since the duty on Scotch and other spirits was—

[Madam Deputy Speaker (Caroline Nokes)]

Order. The hon. Member’s intervention is slightly too long. He is on the list to speak in due course, so perhaps he will make his point about the importance of Scotch whisky then.

[Daisy Cooper]

I am grateful to my hon. Friend for raising the plight of Scotch whisky. My husband is an Ayrshire boy who is certainly doing his bit to keep the Scotch whisky industry going.

Notwithstanding that, it would help if the Government did not pursue these particular duties. Near my constituency —it was in it before the boundary changes—is an importer of fine wines. One of its products is port—not the kind of drink that many people sit and glug as they might do with a cheaper form of alcohol. [Hon. Members: “Speak for yourself!”] For most families around the United Kingdom, port is a drink to buy for an occasion—a birthday, Christmas, a wedding or something of that kind. It is not typically the kind of drink that someone would glug—with the exception of a few people in the House—in such volumes as other alcoholic drinks. None the less, that business will be impacted by these measures. They will affect a huge amount of innovation in the industry, which is a prize to our economy.

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[Jim Dickson]

I thank the hon. Member for that intervention. It seems to me that by writing to the Chancellor of the Exchequer and tabling parliamentary questions requesting that information, it would be more than possible for her to gain the data she requires and therefore, no doubt, make her case across the House.

New clause 2 refers to the Government’s changes to the oil and gas profits levy. Those crucial changes, which will see an increase in the rate of the levy to 38% from 35% and will raise in total £6 billion to underpin investment in delivering on our missions—getting the NHS back on its feet and supporting growth across the country—are laudable. I would not want to support any amendments that would put those benefits at risk.

New clause 4, tabled by the hon. Member for St Albans (Daisy Cooper), would require the Chancellor to conduct an impact assessment of the Bill on small and medium-sized enterprises. I am sympathetic to her desire to support small businesses, but I am unpersuaded that her new clause is the best way to do it. All the measures in the Budget had tax information and impact notes for them published with the Budget, and I remind everyone listening that it was a good Budget for small businesses.

As the Federation of Small Businesses said on the day,

“Against a challenging backdrop, today’s Budget shows a clear direction”—

[Madam Deputy Speaker (Caroline Nokes)]

Order. We are debating the Finance Bill and the amendments to it, not the Budget.

[Jim Dickson]

Thank you, Madam Deputy Speaker. I simply intend to illustrate why the changes proposed in the amendments do not help what the Government are attempting to achieve via the Finance Bill. The FSB said that the Budget

“shows a clear direction in business policy now for the whole of this Parliament to target support at small businesses, rather than big corporates”.

As hon. Members have stated, the Government are supporting SMEs by more than doubling the employment allowance, keeping the small profits rate stable, maintaining the annual investment allowance and freezing the small business rates multiplier. I ask hon. Members not to forget that this is an important piece of legislation underpinning measures announced at the Budget that will help fix the NHS, improve public services, incentivise capital investment and rebuild Britain.

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[Sir Ashley Fox]

I am sure that there are one or two good parts to this Finance Bill, but the hon. Gentleman was elected on a manifesto pledge to increase spending by £11 billion, and that was fully costed, yet this Finance Bill increases spending by £70 billion. I just wonder why he and his hon. Friends did not have the courage to put that before the British people at the election.

Small and medium-sized enterprises and the hard-working entrepreneurs who run them are the backbone of our economy, and they are the victims of this Finance Bill. In constituencies such as Bridgwater, where SMEs are key to local prosperity, the Government have imposed a huge national insurance hike that will make it more expensive to employ people. This rise, which breaks Labour’s manifesto commitment not to raise national insurance, will cost SMEs £732 more per year for every employee earning £20,000. This tax on jobs will stifle growth and lead to higher unemployment. The rise in national insurance is especially damaging to those in the healthcare sector, and the proposed amendments will help to assess the damage that that causes. Last week, representatives from the social care—

[Madam Deputy Speaker (Caroline Nokes)]

Order. In the interests of complete impartiality, I want to make sure that all Members are aware that they have to speak to the amendments as proposed in this Finance Bill, not any other amendments that they might wish had been proposed.

[Sir Ashley Fox]

I am grateful for your guidance, Madam Deputy Speaker.

People in the social care sector in Bridgwater were particularly concerned that the national insurance contributions rise had not been subject to an assessment. Assessing the damage that it and the other tax rises will do is therefore critical to the successful implementation of this Finance Bill.