Council Tax and Stamp Duty Alternatives

Carolyn Harris Excerpts

Wednesday 17th May 2023 Westminster Hall

[Simon Fell]

My hon. Friend makes an excellent point; I am sure that her electorate in Cheadle will have been listening hard. As I have said, only 33% support keeping council tax as it is. I am sure that that number is even lower in my constituency, where the administration has put up council tax by 3.9%. They are very unhappy with the current situation.

I and many of my colleagues support a move to a proportional property tax system, which is a methodology put forward by Fairer Share. It offers a concrete solution to replace the current convoluted band system with a simple flat tax of 0.48% of property value, and a 0.96% surcharge for second homes, empty homes and non-residential properties.

The benefits of moving to such a system would be significant. Some 18 million households would experience a tax reduction, with an average annual tax saving of £556 per household. Council tax payers outside central London would save £6.5 billion annually, providing a substantial boost to local communities and economies. Over 750,000 house buyers each year would be exempt from paying stamp duty and navigating exemption paperwork, simplifying and reducing the cost of house buying. Increased housing market activity would contribute to a £3.27 billion boost in GDP per year.

Some 1.4 million second homes, empty homes and undeveloped properties would finally contribute their fair share of tax, with the revenue used to lower bills for all taxpayers. That would incentivise owners to rent, sell or develop those properties and increase the housing supply. The calculation is that over the span of five years, 600,000 homes would be released. That includes 250,000 one and two-bedroom homes, which we know young people desperately need right now. The reform would generate an annual surplus of £5.4 billion through surcharges on second, empty and foreign-owned homes. I am sure the Treasury can think of inventive ways to spend that sort of money. Finally, shifting the tax burden to owners, aligning with broad international practice, would also ease administration for councils.

However, it is rare—perhaps impossible—to propose a wide-ranging reform where there are not winners and losers. After all, we are proposing to rebalance the property tax system based on principles of fairness. However, there are several mitigations that could be implemented to soften the blow of any change for those who might have to pay more. First, during the transition to a proportional property tax system, any rise in local property tax could be capped at £100 a month for primary residences. That transitional protection would cease upon sale, but buyers could benefit from the removal of punitive stamp duty. Secondly, a deferral mechanism could be put in place, allowing owners who are genuinely unable to pay to defer their tax payments with a modest interest charge. That deferred amount could be paid later on the sale of their property or home, avoiding any debt-related issues associated with council tax collection. Those measures aim to alleviate the impact on individuals while ensuring a fair and manageable transition to the new system.

Of course, there would also be impacts on local government finance. For councils that would generate less revenue from a proportional property tax compared with their current council tax, the shortfall would need to be supplemented through central Government grants or funds redistributed from councils generating higher PPT revenue. The arrangement is not new, and it is a long-standing feature of local government finance. It could be seamlessly incorporated into the proportional property tax system with the following principles.

First, the Government could fully recognise how the proportional property tax affects the revenue-raising capacity of councils when formulating the funding arrangements for local government. Secondly, councils could be granted new powers to independently generate additional revenue. Some councils may experience a decrease in revenue-raising capacity, but there are opportunities to introduce new revenue-raising powers, such as planning reforms and charging more for increased house construction. Again, that would be beneficial for counties such as Cumbria, Devon and Cornwall that are facing the accommodation and short-term let issues that I mentioned earlier.

Thirdly, while some councils might be sceptical about the transition to proportional property taxes because it could result in severe revenue-raising capacity issues, it is important to note that it is the residents in such areas who will benefit most from a decrease in property tax bills. Finally, the policy may also create incentives for companies and individuals to relocate to areas with lower proportional property tax rates, benefiting those communities and eventually increasing the revenues for local authorities. The measure rebalances the local economy and helps level up left-behind areas in one fell swoop.

If taken up, the measures would address the impact on local government finance by ensuring a balanced transition, exploring new revenue sources and considering the overall benefits and adjustments that can be made to accommodate different council circumstances. The reform is crucial for my constituents in Barrow and Furness. It will benefit 96% of the households there, with an average annual saving of £600. It is no surprise that 58% of voters in my constituency support the policy, with only 9% opposing it, according to polling by J.L. Partners. Nationally, voters overwhelmingly back the policy by a ratio of 3:1—in the north it is 9:1. A majority of voters in every constituency support the reform. I fundamentally believe that we should lead with policy and not follow polls, but those are numbers that are worth paying attention to.

Council tax and stamp duty are fundamentally flawed, and many of us recognise that. Politicians from most of the parties represented in this Chamber, along with think-tanks such as Bright Blue, the Institute for Fiscal Studies and the Institute for Public Policy Research, and campaign groups such as PricedOut, Generation Rent and the Intergenerational Foundation, have endorsed the transition to a proportional property tax. Prominent economists from respected publications, including the Financial Times, The Daily Telegraph, The Economist, and The Guardian have also endorsed the reform.

The policy would significantly increase the disposable income of individuals across the country, directly benefiting households and improving the quality of life in local communities. It would free up properties, encouraging efficient use, and, crucially, it is based on the principle of fairness. It represents a genuine and impactful stride towards levelling up and advancement for all. I look forward to listening to what my hon. Friends and colleagues have to say.

[Carolyn Harris (in the Chair)]

I remind Members that they should bob if they wish to speak. I intend for the first Front Bencher speech to start at 5.08 pm, so I would be grateful for brevity in speeches and interventions.

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[Several hon. Members rose—]

[Carolyn Harris (in the Chair)]

Unfortunately, I will have to impose a three-minute limit. The next speaker is Tim Farron.

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[Several hon. Members rose—]

[Carolyn Harris (in the Chair)]

Order. Unfortunately, we are now down to two minutes for each speaker.

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[Richard Burgon (Leeds East) (Lab)]

I congratulate the hon. Member for Barrow and Furness (Simon Fell) on securing this important debate on alternatives to council tax and stamp duty.

The Government need to look at more progressive alternatives to council tax, which is very regressive, as has been said. I draw hon. Members’ attention to the work of the Fairness Foundation. Its important research on this very issue, which is out later this week, makes the point that low-income households spent two to four times more on council tax, as a percentage of their income, than richer households. The research also makes it clear that people want the Government to do more to tax the richest in society. Council tax is deeply regressive, so the Government must lay out alternatives. Some 68% of people think that the Government should be doing more to tax high net worth individuals—those with £10 million or more—and 79% of people worry that the wealthy do not contribute their fair share. It will be no surprise to hon. Members that I encourage the Government and the Minister to consider real wealth taxes on the very richest.

I also draw hon. Members’ attention to a campaign that is being run by the community union ACORN, which argues that when the Levelling-up and Regeneration Bill becomes law, councils should implement a 100% council tax premium on second homes and empty homes to help to fund important expenditure on council housing. I have lent my support to the campaign, and I will support that proposal if and when the Bill becomes law. We have heard about the issue of second homes and holiday homes, which could be looked at. I encourage the Minister to look at the Fairness Foundation’s research when it comes out later this week; it is about what can be done to move to a more progressive taxation system in which the super-wealthy pay their fair share.

[Carolyn Harris (in the Chair)]

I call Mary Robinson.

[Mary Robinson (Cheadle) (Con)]

Thank you for calling me, Mrs Harris, but I was intending only to intervene in the debate, so I will leave the time for the other speakers.

[Carolyn Harris (in the Chair)]

Thank you very much. I call Chris Loder.

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[Simon Fell]

I shall not sum up further than the Minister has so ably done already, other than to thank you, Mrs Harris, for chairing and to thank Members from both sides of the House for putting politics to one side, embracing an idea and fighting for it. From Fife to Dorset, and from Cumbria to Durham, I think we have put together a rainbow coalition in support of reform. I am glad my hon. Friend the Minister is listening to the calls for reform. We have a piece of work to do to convince him about the democratic deficit of the proposals, but I am convinced we can do it.

[Carolyn Harris (in the Chair)]

Before I put the question, I thank all Members for their discipline and consideration this afternoon in making sure that all who wanted to speak had an opportunity to do so.

Question put and agreed to.

Resolved,

That this House has considered the matter of alternatives to Council Tax and Stamp Duty.

Cost of Living Crisis: Wales

Carolyn Harris Excerpts

Tuesday 19th July 2022 Westminster Hall

[Ruth Jones]

I thank my hon. Friend for her intervention. The workshops sound an excellent idea. People are desperate and need such ideas. She is quite right that the obvious inactivity of the Government is the problem. This debate today is not about party politics or short-term political gain; it is about people’s lives. It is about housing, food, and the ability to have the fan on and be able to pay the bill. It is about survival.

Another Newport West resident wrote to me:

“I have one daughter, 12 years old. I am in full time employment and on benefits. I have cancer. Even before the surge in energy prices many people like me have been struggling to afford the essentials. The cost of weekly food shopping has risen, so has the cost of energy. My rent also increased recently. I have had to make cut backs on most things.”

Like colleagues across Wales, and indeed the House, I came into politics to make Newport West, Wales and our United Kingdom a better, fairer and more equal place to live, learn and work, and that remains my single focus. I hope today to give Ministers the chance to tell us how they can help us make life better for the people of Wales, but I am afraid that the response from Conservatives in Westminster and in Cardiff Bay to their cost of living crisis has been nothing short of insulting. They are out of touch, out of ideas and now out of time.

We cannot wait another day to act, because local people are worried about paying their bills and looking after their families, and have no basic survival abilities. At the same time, Ministers seem to be seriously suggesting that the answers to the challenges facing local people are dodgy loans and Tesco value products. The only conclusion I can draw from those suggestions is that the Conservatives are living on another planet. Although we are pleased to see the back of the caretaker Prime Minister, the current contest for the leadership of the Tory party means that we have no real Government in power. No decisions are being taken and there is no ambition for the people of Wales. There is no commitment to addressing their needs and no plan to get our country out of this mess.

That inaction stands in stark contrast to the decent and pragmatic leadership of the First Minister of Wales, Mark Drakeford. The Welsh Labour Government are not just on the side of the people of Wales; they spend every day doing what they can to mitigate the impact of the Tory cost of living crisis. They have taken a number of steps, which I am sure other hon. Members will mention. In addition to those things, free prescriptions continue to help people across Wales to keep more of their hard-earned money. I note that prescriptions in England under this Conservative Government are currently £9.35 per item.

[Carolyn Harris (Swansea East) (Lab)]

I am grateful to my hon. Friend for raising prescriptions. Does she agree that, had the UK Government delivered on their pledge last year to introduce hormone replacement therapy for one annual payment, women in England would not face the pressure of choosing between feeding their children and paying for their HRT prescription?

[Ruth Jones]

My hon. Friend makes a powerful point. Prescriptions, medicines and HRT are so important to people—[Interruption.] Absolutely, they are free in Wales.

The average band D council tax bill in England is £167 more than in Wales. Even with the UK Government’s recently announced council tax rebate, households in Wales still pay £17 less than in England, which shows that people are better off with Labour.

People being better off with Labour is further exemplified by the Welsh Government’s £244 million council tax reduction scheme, which helps more than 270,000 households with their council tax bills. Although the crisis is real, the Welsh Labour Government are stepping in and stepping up. That helps people in Marshfield, Rogerstone, Pill, Caerleon and right across Wales.

The crisis of food poverty is continuing to grow across the United Kingdom, which is why the Welsh Labour Government committed to provide free school meals to all primary school pupils. An extra 196,000 primary school children benefit from that offer, which shows how the impact of the Tory cost of living crisis can be mitigated by Labour in power. The Welsh Labour Government announced in December 2020 that free school meals would be provided through the holidays to children in Wales through to Autumn 2022, and the First Minister committed to further widen access to free school meals overall. This Tory Government have had to be forced, shamefully and repeatedly, into U-turns by Marcus Rashford’s campaigning and the votes of Her Majesty’s Opposition in Parliament.

As I have said in the House before, the people of Newport West are looking for help. The caretaker Government have no plan to help people with heating their homes, filling their cars with petrol or feeding their families. Last year, I spoke in this House about the 9,000 families in Newport West who had their universal credit cut, and since then I have seen for myself the devastating impact that decision had on families in Newport West and across Wales.

It is not just universal credit: older people and pensioners are at the sharp end of the Tory cost of living crisis, and they urgently need the Government to act. Pensioners spend twice as much on their energy bills as those under 30, and face spiralling inflation, with the prices of petrol, food and energy all soaring. Let us not forget that almost one in five pensioners now lives in poverty.

Our young people are facing the fierce winds of this crisis, with low wages, rising rent and the cost of living going through the roof. My constituent Bobbie said this:

“Hi, Ruth Jones. I would just like to ask a question, see if you can help. I work 2 jobs most weeks between 50 and 60 hours per week just to live. I get paid minimum wages for both jobs. My current outgoings are £1,200, and there is not much left when I pay the petrol, the electricity and done my food shopping. Where is the help for people like me?”

Bobbie is right. Where is the help for people like her?

I pay tribute to some of Britain’s largest charities, including Oxfam, Save the Children and Fuel Poverty Action, which have formed a new campaign coalition—Warm This Winter. The coalition is calling on the Government and all those who seek to lead the Government to support plans to prevent a catastrophic winter energy crisis. Although we currently face record high temperatures, in just a few months families will be struggling again to heat their homes. Let us not forget that all this shows how much the impacts of the climate emergency can affect all parts of our lives.

Rather than help those in need, what are the Conservatives doing? They have whacked up national insurance payments at the worst possible time, hitting working people hard. And let us not forget how Welsh Conservative MPs have used their place and their votes in this House: they voted to cut the £20 universal credit uplift; they voted against free school meals for children during school holidays; they voted for the increase in national insurance contributions; and they voted against a windfall tax. I suspect that the people across Wales, from Delyn to Clwyd South and from the Vale of Glamorgan to Bridgend, will be very clear about their views, needs and wants come the general election that our country desperately needs.

We live in difficult times, but for all the global forces facing us and the world around us, ultimately we need our Government to act, and to act now, because the cost of living crisis is costing livelihoods, costing lives, and costing businesses in Wales and across the UK. Enough is enough—we cannot waste any more time. My message to the people of Wales is simple: help is on the way with a Labour Government, and the sooner the better for all of us.

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[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

It is a pleasure to serve under your chairship, Ms Nokes. I add my congratulations to my hon. Friend the Member for Newport West (Ruth Jones) on securing today’s debate and the passionate way in which she started the case.

It is clear that the Government have a case to answer for their cost of living crisis, which is so damaging for people in Wales and across the UK. The Government’s response to the deepening crisis has been hugely disappointing. At the moment, they are too wrapped up in internal wrangling to care about dealing with the issues that matter to people. It is clear that the Government are out of touch, out of ideas and out of excuses. After 12 years of Conservative Government, we have a high-tax, low-growth economy, with the country suffering the biggest drop in living standards since records began, and the highest tax burden since world war two.

The Government initially refused to implement Labour’s policy of a windfall tax, until the pressure was too much and they finally caved in and had to take action. The Labour party’s plan to deal with the cost of living crisis would cancel the rise in national insurance contributions, which has come in during hugely challenging times. Labour would also cut VAT on home energy bills, and the red tape that has been created by the Prime Minister’s chaotic Brexit. Our policies would make it easier to buy, make and sell more in Britain.

We have had a passionate debate this afternoon. It is disappointing, though not surprising, that we have yet to hear a Tory voice. There are no Tory MPs here to defend their record. We heard from my hon. Friend the Member for Newport West, who talked about the worry and fear faced by many of her constituents. She put the blame for people not being able to provide for their families squarely on the crisis in Downing Street. She highlighted that prescription charges in Wales ease the burden somewhat, compared with the £9.35 cost in England, and that council tax band D properties on average pay £167 less than in England. There is also the £244 million council tax reduction scheme that helps 270,000 households in Wales. All those are policies of the Welsh Labour Government.

My hon. Friend the Member for Llanelli (Dame Nia Griffith) talked about the massive growth in inequality, the need for a redistributive tax policy, and the fact that the UK has the firepower and capacity to take action, but not the will. She gave examples of the work of the previous Labour Government, and some ideas that could be taken forward, such as cutting VAT on fuel. She, along with other Members, talked about the need to tackle issues around universal credit, particularly the five-week wait that causes so much hardship for our constituents.

The hon. Member for Ceredigion (Ben Lake) talked about the impact of the cost of living crisis in Wales, along with the energy price cap. He spoke of his concern, which I we share, about the possible outcome in the autumn, with further increases in the price cap. He talked about the challenges facing rural communities with off-grid energy costs, and the need to tackle the rise in fuel costs. Like other hon. Members, he talked of the need to address universal credit and restore the £20 uplift.

My hon. Friend the Member for Pontypridd (Alex Davies-Jones) talked about how this Government never take their responsibility to Wales seriously, and about the economic firepower of the UK Government—if only they had the will. She talked of her pride, which many of us share, in the Welsh Government, who work so hard and shoulder-to-shoulder with our constituents, to support them through these troubling times. She highlighted the fact that the windfall tax was too little, too late.

My hon. Friend the Member for Cynon Valley (Beth Winter) talked of how we are in a cost of living emergency, and that the freeze on pay over the longer term has caused so many issues. She again highlighted that the Welsh Government are doing as much as they can, doubling the investment over and above the devolution settlement. She raised her concerns about poverty becoming normalised in the fifth richest country in the world, gave examples of parents not being able to buy stationery for children to go to school, and spoke about the need for proper pay for our public servants.

My hon. Friend the Member for Swansea West (Geraint Davies) talked about the impact of the massive cuts on poverty and the family lives of many of our constituents, and pressed the Government to act now. He also spoke about local housing allowance and the recent report by the Bevan Foundation that said that many people are unable to find properties within the local housing allowance rate. Finally, the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) talked about digital poverty and the need for a cap on the price of heating oil in Wales—and, of course, in Scotland.

In about two weeks’ time, I will host a cost of living crisis event in my constituency, and I know many others are doing the same. We are bringing providers and support agencies together to offer our constituents support and advice during this awful time.

In recent weeks, I have talked to constituents who have raised concerns. I talked to a young family a few weeks ago. Both parents work full time, and by the middle of the month they rely on the support of the food pantry to get them through the rest of the month—to feed themselves and their young child.

[Carolyn Harris]

I am sure my hon. Friend is aware of the food and hamper scheme that I have run in my constituency for the past six years. We provide food and hampers at Christmas and Easter, and during the summer. This year, more people who were previous contributors are becoming dependants. Does he agree that we are at a dangerous point, and that demand will eventually outstrip supply and we will not be able to help people?

[Gerald Jones]

I congratulate my hon. Friend on the excellent work she has done over many years on this issue. I absolutely agree that we are in danger of demand outstripping supply. I have talked to food banks and food support organisations in my constituency in recent weeks, and they all tell me of that concern. Week on week, they are extremely worried that their supplies of food will not be able to meet the ever-increasing demand.

Last week, I spoke to another couple, who go for a swim three times a week, which obviously helps with their health and wellbeing—it is supported by Welsh Government funding—but they use that opportunity to have a shower in the baths to save on water and heating at their home. The danger is that such examples are becoming normalised in 21st century Britain. That is worrying, scary and shameful.

I want to contrast the Tories’ record with that of the Welsh Government. As we have heard, the Welsh Labour Government have invested more than twice what they received in consequential funding to support households with the cost of living crisis. My hon. Friend the Member for Cynon Valley talked about the delivery of the £51 million household support fund, which is targeted at people who need the most support. The Welsh Government have doubled the winter fuel support payment to £200, which has helped 150,000 people across Wales.

My hon. Friend the Member for Newport West said that, from September, all primary schools in Wales will begin to receive free school meals; an additional 180,000 primary school children will benefit from the scheme. The Welsh Government’s warm homes programme has invested almost £400 million in more than 67,000 homes since 2011 to improve home energy efficiency across Wales, saving families money on energy bills. More recently, 57,000 unpaid carers across Wales became eligible to receive a £500 support payment.

The budget available for the Welsh Government to support the people of Wales is hampered by the reality that, over the spending review period, it is likely to be worth at least £600 million less than it was when it was first announced last autumn because of rocketing inflation. The Welsh Government’s spending power is likely to deteriorate further because of that. That is why they have called on the UK Government to update their settlement to reflect the significant impact that inflation is having on important budgets in Wales.

We have seen the smoke and mirrors, and sheer uncertainty, around the shared prosperity fund. There has been a lack of investment, despite the explicit manifesto promise in 2019 that Wales would not be a penny worse off; investment would make a huge impact on the cost of living crisis in Wales. As we heard from my hon. Friend the Member for Swansea West, designating HS2 as an England and Wales project, which it clearly is not, also denies Wales an extra £4.6 billion in consequential funding. The Welsh Affairs Committee and even the leader of the Welsh Conservatives agree with that assessment, but instead the Government are intent on short-changing Wales again. Once again, that money could significantly help to tackle the cost of living crisis in Wales.

What we have seen from the Tories at every turn is that they seem to make decisions to take money from people who can least afford it, such as voting to cut the £20 universal credit uplift, which Welsh Conservative MPs all voted for. They also voted to increase tax during the cost of living crisis, but voted against a windfall tax until they were forced by Labour to perform a screeching U-turn.

Our farming communities are suffering, too. Wales faces a UK Government who have broken their promises to the people of Wales. It has become clear that when providing a replacement for EU farm funding, the Government deducted EU receipts that were due to Wales for work that was due as part of the 2014 to 2020 rural development programme. That means that rural communities in Wales are £243 million worse off. Again, that is devastating for farming communities and the livelihoods of our farmers.

It is clear that this Government have no answers. Although the removal of the current Prime Minister is a step forward, none of the candidates for his job has any meaningful ideas to tackle the cost of living crisis and really make a difference to the lives of people in Wales. Rather than playing musical chairs and having the fourth Conservative Prime Minister in six years, what we really need is a UK Labour Government who will build a stronger, more secure economy, working hand in hand with the Welsh Labour Government for the benefit of everyone in Wales, and getting the cost of living crisis under control.

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[David T. C. Davies]

Let me go back to what the Government have been doing. We have been steadfast in our support. We have provided more than £37 billion across the UK to help people with the cost of living challenge. Millions of the most vulnerable households across the UK will receive at least £1,200 of one-off support in total this year to help with the cost of living. The maximum possible benefit for a household is more than £1,600. We put in place a targeted £12 billion energy bill support scheme for domestic electricity customers in Great Britain to help with rising energy prices. We are supporting people across the UK with one-off cost of living payments, including £650 for 8 million households on means-tested benefits, £300 for more than 8 million pensioner households and £150 for around 6 million people who receive disability benefits. We are increasing the national living wage by 6.6% to £9.50 an hour, which was also mentioned here. Along with increases to the national minimum wage, we expect to be able to give a pay rise to 120,000 workers in Wales.

We also want to ensure that people across Wales keep more of what they earn. We are raising income tax personal allowances and freezing alcohol and fuel duty, saving car drivers up to £15 every time they fill up. We have reduced universal credit taper rates from 63% to 55% and we are increasing universal credit work allowances by £500 a year. Those together will see households keep an extra £1,000 a year on average. This July, we raised the national insurance contribution threshold to £12,570, meaning a typical employee will save more than £330 this year. Frankly, I could go on and on.

Opposition Members may say we are not doing enough, but to say that we have slept through this crisis and do not care is ridiculous and outrageous. I have lists and lists of stuff that the Government have been doing to support people across Wales. It is a £37 billion package. To try to suggest that there is not an enormous amount of work going on or that we do not recognise the problem is unfair. We absolutely recognise the problem—I cannot say it enough times. There is a cost of living challenge out there and there are people suffering. I do not want to hide from that in any way. At the same time, it would be nice if Opposition Members could at least recognise that when we put £37 billion into a whole host of schemes, it is deeply unfair to suggest we do not know about the challenge, we do not care about it and we are doing nothing about it. That is simply incorrect.

To take one example, the hon. Member for Newport West, who I greatly respect and who I appreciate is a hard-working MP, made a point about prescription charges. Yes, prescription charges are free to everyone in Wales. Wonderful. I get a free prescription as a Member of Parliament. In England, the number of people who get free prescriptions is very large. People in full-time education, who are pregnant, who have certain medical conditions, NHS in-patients and people on income support, income-based jobseeker’s allowance, employment support allowance, pension credit guarantee or universal credit. Anyone who faces difficulties will not have to pay for their prescription in England, but the hon. Lady did not make that point. She gave us half the story and gave the impression that everyone is paying for their prescriptions in England. That simply is not true. In fact, it is rather more progressive to target free prescriptions at those who need them because they cannot afford to pay than just to give them out to everyone.

It has taken me probably a minute just to rebut that single point. That is the problem I face. There are quite a few other points I would not mind rebutting if I get the chance to do so.

[Carolyn Harris]

I want to raise a point about the English prescription charge. Is the hon. Gentleman aware that men in England who need Viagra are able to get it on prescription?

Oral Answers to Questions

Carolyn Harris Excerpts

Tuesday 15th March 2022 Commons Chamber

[Mr Clarke]

Youth unemployment is lower today than it was pre-pandemic, and the wider success of the scheme has to be judged in the context that the worst-case scenario that we were looking to offset never came to pass because of the interventions that we made. If a scheme does not achieve the headline numbers that were anticipated at the time it was established because the wider economic performance of the country was so much better than anticipated, that is a success, not something to bemoan.

[Carolyn Harris (Swansea East) (Lab)]

4. What assessment he has made of the potential merits for the Exchequer of reforming the gambling industry.

[The Exchequer Secretary to the Treasury (Helen Whately)]

Gambling contributes over £3 billion per annum to the Exchequer. The Government keep gambling duties under regular review to ensure that the sector continues to pay its fair share. The Department for Digital, Culture, Media and Sport is reviewing the Gambling Act 2005, after which the Government will assess the impact of any reforms on the Exchequer.

[Carolyn Harris]

Analysis carried out by both NERA Economic Consulting and Landman Economics concluded that, given that online gambling is “labour intensive” and predominantly based offshore in avoidance of UK corporation tax, its net impact on the British economy is negative, particularly once the direct cost to Government, estimated by Public Health England to be £647 million, is factored in. Will the Government support the upcoming reviews of gambling regulation—the Minister said it is under active consideration—and welcome any moves to reduce gambling harm and the associated cost to society and the economy?

[Helen Whately]

I know that the hon. Lady is a committed campaigner on gambling as chair of the all-party parliamentary group on gambling related harm. Specific to her point about offshore gambling operators, I am sure that she knows that since 2014 gambling duties have been taxed on a “place of consumption” basis, so offshore operators pay taxes on profits related to UK gambling.

To the broader point of the gambling review, I spoke to the Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Croydon South (Chris Philp), who is leading DCMS’s work on gambling, just yesterday, and I assure the hon. Lady that the Government stand ready to take action where there is evidence that vulnerable people, such as those suffering from gambling addictions, are being exploited by gambling operators.

Working People’s Finances: Government Policy

Carolyn Harris Excerpts

Tuesday 21st September 2021 Commons Chamber

[Carolyn Harris (Swansea East) (Lab)]

It is a pleasure to follow the maiden speech of the hon. Member for Hartlepool (Jill Mortimer). It is also wonderful to see her colleagues gathered around her to show her such support—support I know she will be sharing with the hard-working people of Hartlepool who may be suffering from the Government’s fiscal policies.

I am not sure if the Chief Secretary to the Treasury, the right hon. Member for Middlesbrough South and East Cleveland (Mr Clarke), who has now left his place, does the weekly shop, but it is something I try to do myself every weekend. Deliveries would be easier, but I find out far more in the aisle of Morrisons about what is happening in my constituency and about people’s problems than I ever do in casework surgery. At the moment, by far the biggest issue the people of Swansea East are facing is the steep rise in the cost of living, while at the same time the money coming in is being hit hard from every angle. I have lost count of the number of times I have heard, “Have you seen the price of this?” or “I can’t afford to buy that anymore”. Some will blame the pandemic and others will blame Brexit for the reasons behind the rising costs and reduced incomes, but either way, it boils down to the same thing: working-class communities are struggling more than ever before, and this Government need to hold up their hands and take responsibility for that.

I would like to take this opportunity to talk about what it is actually like for families who struggle every week to stay afloat. It was in the summer of 2016 that I became aware of the scale of the problem for families in Swansea East. Just a few days into the school holidays, the local food bank called, asking if my office could put out an appeal for donations as its shelves were almost empty—empty because parents were struggling to replace the free school meals that had kept their children fed during term time. From this, our first kids summer lunch club was born. Every year, my team makes sandwiches and delivers them to local free holiday clubs. Year on year, this has evolved and grown, and now every school holiday we try to do something to help families in the constituency who just cannot make money stretch far enough.

[Sarah Champion (Rotherham) (Lab)]

I thank my hon. Friend for the very hands-on approach she has taken to feeding her families, but does she share my pain and sadness that food banks and social supermarkets have become the norm, not the exception, in the last nine years alone?

[Carolyn Harris]

I certainly do. I see that week in, week out when I visit my communities: there is not one that does not have a food bank facility, albeit an ad hoc version.

This year, we added to the lunch club, delivering a Morrisons bag full of breakfast provisions for a family for a week—so we were providing breakfast and lunch. At least once a month, we distribute what some might consider to be luxury items, such as soap, shampoo, sanitary towels and deodorant, courtesy of the wonderful Beauty Banks charity. We deliver them to a community organisation for families who, if they cannot afford to feed themselves, certainly cannot afford personal hygiene products.

By far our biggest project was last December’s “Everyone Deserves a Christmas” campaign. It is the fourth year we have done it, and last year was like no other. We were inundated with requests and recommendations about families who needed help. Thanks to support from the city’s Swans football club, the Ospreys rugby team, Swansea Council, local businesses, local community groups and people including the incredible Welsh football star Gareth Bale, who personally paid for 300 Christmas hampers, we ended up making and delivering 1,300 hampers. On Christmas eve, we cooked more than 100 dinners and delivered them to people who would not have had a Christmas otherwise.

The highlight for me was when one of the drivers returned from making his deliveries to thank me for letting him be involved in the scheme. He said that he was so touched by the excitement of a child who had opened up the hamper box and rejoiced that it was the best present he had ever had, because among the festive food were a tin of Quality Street and half a dozen Christmas crackers. That family had not had a tin of sweets before, because £4 on offer was too much to spend on something non-essential.

With summer now behind us, we are once again planning our Christmas hamper campaign, but with the scrapping of the £20 universal credit uplift, the steep increase in energy prices and the ongoing fallout from business closures, job losses and reduced incomes for those on furlough, 2021 is likely to have hit even more families than 2020. Thousands more people will be sitting at home right now worrying about how they will get through the next week or the next month, let alone buy Christmas presents and other extras. I worry for the families in my constituency, in my city, across Wales and across the UK. The past 18 months have been cruel to so many, but the Government clawing back more money from those who can least afford it is crueller still.

My team—and Gareth Bale, I hope, if he is listening—will help again. We will happily keep on fundraising, packing boxes and putting smiles on faces in Swansea East with a box of sweets in a Christmas hamper. It is an honour to do so, but anyone in this House who makes that necessary because they think that those families do not need the extra £20 universal credit payment, or that they can spend their already stretched incomes on huge hikes in energy bills, should think of those kids and be utterly ashamed of their actions. When the Minister refers to universal credit as a product, when in reality it is a lifeline, I fear that he sees claimants more as a commodity than as individuals.

Oral Answers to Questions

Carolyn Harris Excerpts

Tuesday 26th January 2021 Commons Chamber

[Carolyn Harris (Swansea East) (Lab)]

What assessment he has made of the potential merits of providing financial support to wholesale food service sector businesses affected by covid-19 restrictions.

[The Economic Secretary to the Treasury (John Glen)]

Throughout the covid crisis, the Government have sought to protect people’s jobs and livelihoods, and support businesses and public services across the UK. We recognise that food and drink wholesalers have been severely impacted by the necessary action we have taken to control the virus, but those businesses have been eligible for a number of our economic support schemes, including the job retention scheme, VAT deferral and bounce back loans.

[Carolyn Harris [V]]

Food service wholesalers have again seen their trade drop by 95% with hospitality businesses closing, yet they continue to supply our hospitals, schools, care homes and prisons at a financial loss. Many now are on the brink of collapse. What more are the Government going to do to help the industry, which is suffering a double whammy of lost stock and ongoing fixed costs?

[John Glen]

I thank the hon. Lady for her question, and, indeed, I met representatives of the sector in my constituency a few weeks ago. The Treasury is in regular discussion with the Department for Environment, Food and Rural Affairs and they are assessing the systemic risks to the food supply chain of the fulfilment of those public sector contracts to schools, hospitals and prisons. We keep these matters under close review, but at the moment there is no threat to those supply chains and, as I referenced, the options that are available to those firms continue to be available.

Additional Covid-19 Restrictions: Fair Economic Support

Carolyn Harris Excerpts

Wednesday 21st October 2020 Commons Chamber

[Carolyn Harris (Swansea East) (Lab)]

Covid restrictions in tiers 2 and 3 have put untold pressure on a wide range of businesses, and while some have been provided for, many have not. Our hospitality industry has taken a huge hit, but what about its supply chains? Food and drink wholesalers have seen a 70% reduction in sales, and with no financial support, many are on the brink of collapse. But it is not just hospitality venues that they serve but our schools, hospitals, prisons and care homes; and some of that is specialist food, which cannot be bought in a supermarket.

Just this weekend, I read that a Treasury spokesman had said that support for the hospitality sector “and its wider chain” was available, so I spoke to the supply sector, and they said that they certainly had not had support. Bidfood, based in my constituency, had seen an almost 50% downturn in sales, and consequently had to make redundancies. They tell me that the food supply industry has not yet been eligible for any Government financial support, despite what the Treasury says. Wholesalers such as Bidfood and Castell Howell, based in Llanelli, are fantastic supporters of community campaigns. They have helped me with my summer lunch club, the Swansea Together coronavirus response and the “Everyone Deserves a Christmas” campaign. But now they need support to help them to survive.

Food and drink wholesalers desperately need the furlough scheme to be extended, prolonged business rates relief and discretionary grants to enable them to survive the crisis. They do not know how long the uncertain times will last—we do not know and the Prime Minister and his Government do not know. But what we do know is that these areas facing additional restrictions need additional support, and they need it now.

Too many times during this pandemic, measures have been put in place too late because of this Government’s failure to be decisive. The First Minister in Wales has taken the decision to introduce a fire-break lockdown, and I have no doubt that many businesses across Wales will be disappointed to be closing their doors again. But they will understand that this has to be done. We must ensure that they get the financial support to see them through this time.

This lockdown is falling between two different Government schemes. The First Minister asked the Treasury to bring forward the job support scheme and to work with the Welsh Government—they even offered financial support to make sure that businesses in Wales would be helped. The Prime Minister constantly talks about putting his arm around the nation. Well, now is his opportunity to do that: embrace the First Minister’s suggestion and make sure that businesses in Wales can survive this pandemic and this lockdown.

Covid-19 Economic Support Package

Carolyn Harris Excerpts

Wednesday 14th October 2020 Commons Chamber

[Carolyn Harris (Swansea East) (Lab)]

It is a pleasure to speak after my hon. Friend the Member for Cynon Valley (Beth Winter).

Yesterday, I received a message from a beauty salon owner, and she told me:

“5 out of 8 appointments cancelled today due to clients being in contact with someone who may have Coronavirus.”

Incidentally, before either of the Members on the Conservative Benches start patting themselves on the back that that was because of the track and trace system; it was not. It is all linked to a local outbreak in a local pub. This woman is a successful business owner, who is now left wondering how long she can sustain this level of cancellations without financial support. Having only been open for two months following the extended forced closure of the industry, she has been attempting a new normal turnover, which is already considerably less than prior to the pandemic. The spike in cases means that, this month, she is looking at being down 20% on that new normal. She is struggling; she is worried; and she is asking when the Government will recognise this industry, which has been constantly overlooked and undervalued throughout the pandemic, and offer it some financial support. My response to her is that I am wondering the very same thing.

Over the past six months, I have asked on countless occasions for support for this industry. I have sat in this Chamber while the Prime Minister openly sniggered when asked a question by one of his own MPs about supporting these businesses. His trademark flippancy and ridiculing of a sector struggling to survive is not welcome, and it has left some 370,000 employees, mostly women, feeling belittled, undervalued and angry.

As co-chair of the all-party parliamentary group on beauty, aesthetics and wellbeing—with my good friend, my hon. Friend the Member for Bradford South (Judith Cummins)—I have heard heartbreaking stories of job losses, businesses collapsing and financial insecurity for those who work in this sector. I have asked in this Chamber for the beauty and wellbeing sector to be taken seriously and to be treated with the same respect as other industries. I have written to Ministers, to the Chancellor and to the Prime Minister, and I have asked for a support package to help these businesses survive, but I feel my pleas have constantly fallen on deaf ears.

This multibillion-pound industry is currently on its knees. It is great to see the Chancellor outlining the money that will be available to support other businesses to help them survive, and I wholeheartedly support this, but where is the help for our beauty and wellbeing sector? The hospitality and leisure sectors have now had a VAT reduction to 5% for more than three months. It has been a real boost to industries that have struggled due to closures at the first peak of the pandemic and reduced income as they started to reopen.

At the risk of sounding like a broken record, I ask again: can this VAT reduction be extended to the hair, beauty, spa and wellness sectors? Can they, too, be given this financial support to help them survive with further measures looking increasingly likely, and if not, can the Minister ask the Chancellor please to tell me and the 370,000 people who earn their living from the sector, why not?

Coronavirus: Employment Support

Carolyn Harris Excerpts

Thursday 19th March 2020 Commons Chamber

[John Glen]

As I said to the hon. Member for Edinburgh East (Tommy Sheppard), people have access to an HMRC support line, which is properly manned and up and running. That should give them bespoke support for their circumstances. I have referred to the package of other measures that the Chancellor announced a few days ago.

[Carolyn Harris (Swansea East) (Lab)]

Charities such as Faith in Families in my constituency are really nervous that they will not be able to pay their wages. Without staff, they cannot deliver the projects for which they are applying for funding, which would provide food and childcare facilities in very deprived areas. That is necessary now; it will become essential in the future. What can the Government do to help those charities?

[John Glen]

The hon. Lady is right with respect to the role that charities play across our communities, binding communities together and working closely with local authorities. My colleague in the Ministry of Housing, Communities and Local Government is working on these matters, and we will make further announcements shortly.

Funeral Plans: Regulation

Carolyn Harris Excerpts

Wednesday 5th June 2019 Commons Chamber

[Neil Gray]

I am well aware of that family-run business, and I share its concerns. My hon. Friend speaks well for them, and it is a point that I wish to make. How do the Government protect competition in the market to make sure that smaller funeral providers and funeral plan providers are not squeezed out of the market by the burden of FCA regulation? Of all the criticisms of the route that the Government have chosen, that is the one that is expressed most keenly by people in the market.

Given the number of funeral plans that have been sold in recent years and the growth in the sector, it is critical that we get the regulation right and ensure that consumers are protected. The Citizens Advice report published a few years ago gave examples of mis-selling—people were promised particular aspects of a funeral, but when the plan was redeemed they were told that that was not part of the deal. Particular cars, coffins or flowers that were chosen for sentimental reasons, for example, were not delivered, although people thought they had paid for them. There have been widespread reports of bad sales practices such as cold calling, aggressive selling and the targeting of vulnerable customers.

Since I introduced my ten-minute rule Bill, which proposed the areas of regulation that the Government now appear to have adopted, a significant amount of change has taken place in the market. The FPA, as I have said, has taken great steps to reform its practices as a voluntary market regulator, and it suggests that 95% of the market has signed up to its regulatory model. There have been great moves across the market to reform practices, including by plan providers themselves. Some of them are moving away from the third-party selling model that appeared to be problematic and was part of the 5% issue that concerns us all. I am pleased that my Bill proposal, which was intended to spark debate and action for change, has led to that progress. I am grateful to the Minister for taking action.

[Carolyn Harris (Swansea East) (Lab)]

I thank the hon. Gentleman for introducing the debate on a subject that is close to my heart. I met him, the hon. Member for Strangford (Jim Shannon) and other Members attending this debate to form a working party, and we intend to consider how we support the Government in looking at environmental funerals, funeral plans and the social fund. While I welcome the Government’s announcement, does the hon. Member for Airdrie and Shotts (Neil Gray) agree that we need to look at the small percentage of funeral plans that are not covered by the FPA? In that two-year window, there is an opportunity for people who can least afford to pay exorbitant fees to be exploited.

[Neil Gray]

I thank the hon. Lady, who is a doughty campaigner in this area, for her intervention. It should go without saying that she has done a great deal, particularly on children’s funerals, and I commend her for her work. She is absolutely right. There is a potential gap, with the two or three-year transition period the Government propose, before moving to FCA regulation. I will turn to my concerns about that in due course, but she is absolutely right to raise the issue and I look forward to continuing to work with her in this area to try to drive the changes we want.

I am pleased that my Bill proposal, which was intended to spark debate and action for change, has started that progress. I commend the Minister in particular. I am grateful that the Government are taking this issue seriously enough to consult on funeral plan regulation and are now proposing moving to a model of FCA regulation. A consultation is now under way until August on what the Government now propose to do in this area. I am grateful to the Minister and to some of his colleagues who also wish to see change and have supported my work, such as the hon. Member for Southend West (Sir David Amess), but I do have some concerns about the direction of travel that I am sure the Minister will be able to answer.

There should be some clear benefits to moving to FCA regulation, such as access to the Financial Ombudsman Service for those who have complaints about the products they have received, but it is not yet clear whether consumers who have a dispute over a funeral plan product will be able to access the financial services compensation scheme.

Gambling-Related Harm

Carolyn Harris Excerpts

Tuesday 19th March 2019 Westminster Hall

[Carolyn Harris (Swansea East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr McCabe, and I, too, congratulate the hon. Member for Inverclyde (Ronnie Cowan) on securing this important debate. Many hon. Friends present have campaigned vigorously for the stake on fixed odds betting terminals to be cut to £2. The blight of FOBTs was eventually acknowledged by the Government, and that stake will be reduced in April this year.

However, the harm caused by gambling goes far wider than FOBTs, as has become apparent to me and others over the months and years that we have been campaigning. For that reason, we have established a new all-party parliamentary group on gambling-related harm, which will be looking broadly at the many harms caused by gambling. It is important to say that we are not against gambling; we acknowledge that, for many people, gambling is a benign, fun activity. However, there are also many instances in which gambling becomes harmful, and it is important to ensure that the right protections and regulations are in place to protect the vulnerable and prevent harm.

[Jessica Morden (Newport East) (Lab)]

I congratulate my hon. Friend on the work she has done on this issue. A constituent approached me recently whose mother had dementia and had gambled away about £50,000, even though the family kept going back into the betting shops to point out that she had this condition. Given what my hon. Friend is saying, does she agree that we should do more to protect vulnerable people, such as those with dementia, and that the industry should look closer at the legislation?

[Carolyn Harris]

I certainly do. It appears that we are able to protect the vulnerable only when we let the press know of such stories, because the industry refuses to take responsibility for its actions.

The first priority of our APPG will be to look at the harms caused by the growth of online gambling. According to recent reports on British gambling behaviour, the prevalence of problem gambling among those who gamble online—at the casino, the slots and the bingo-style games—is very similar to its prevalence among those who play FOBTs. Currently, there are close to 3 million problem and at-risk gamblers in the UK, and 10% of them play online casino, slots and bingo.

The size, scale and structure of the industry are driving the harms that are being caused. The APPG has heard that the remote gambling sector is being run in a way that is totally unsustainable; in some cases, online companies are actively seeking to drive harmful gambling behaviour and large-scale bets to ensure their own profitability. A recent PricewaterhouseCoopers report for the Gambling Commission found that 59% of the profits of remote gambling companies come from people with gambling addictions or problematic gambling behaviour. Those companies’ models are based not on building long-term relationships with loyal customers, but on extracting as much money as possible from people, particularly those who exhibit more risky behaviour and place large bets until they effectively run out of money. The companies then move on to find other customers, and they seek to incentivise their staff to do so. Their constant drive for profit and new customers means that they have no incentive to seek a reduction in problematic behaviour. Problem gambling and high-stakes play are entirely in their interests.

Those companies’ frantic search for new customers and greater levels of spending has, in turn, led to a huge increase in gambling advertising. We have heard about cases of vulnerable gamblers being offered VIP status to encourage them to gamble and rack up huge losses. Equally, we have heard rumours about some operators not paying out to those who have rightly won money; they are happy to encourage those who regularly lose to gamble more, while restricting bets from more successful players. The message is clear: people should not go into online gambling with the expectation that they will win. The only customers that those companies want are those who lose.

There are now more diverse gambling products and experiences on offer than ever before, including live sports betting, in-play gaming and, more recently, mobile gaming. Those are relatively new products that differ from traditional bookmaking, and concerns have understandably been raised about player safety and protection, particularly for the vulnerable. Furthermore, the ease of deposit, the electronic nature of money spent, the slowness of withdrawals, the ability to reverse withdrawals, and the targeting of gamblers who win with offers to encourage further play all have the potential to create a harmful gambling environment.

[Hannah Bardell (Livingston) (SNP)]

The hon. Lady is making an excellent speech, and I commend her for the incredible work that she has done on problem gambling to date. Does she agree that the technology underlying a lot of these online games and gambling products is completely opaque? We have no idea how it is targeting people or how it works, and until we get to the bottom of that issue, much of this problem is going to be difficult to tackle.

[Carolyn Harris]

It has long been acknowledged that technology has left legislation way behind—in the dark ages, in some cases. Whereas there are clear limits on the maximum stakes, prizes and spin speed of gambling machines in betting shops and casinos, and big cash deposits are subject to fraud and money laundering checks, online gambling lacks similar limits. The APPG has met many times with Liz and Charles Ritchie, the incredibly courageous parents of Jack, who tragically took his own life in 2017 following an addiction that began on FOBTs. Jo Holloway’s son, Daniel, also took his own life after becoming addicted to online gambling. Those are terrible tragedies, but they are just the tip of the iceberg. Every day, approximately 70 to 80 people contact me—as I am sure they contact colleagues present—to tell me how desperate a situation they and their families are in.

What should we do to improve things? The APPG is undertaking its inquiry and will make a series of recommendations—I am sure Members would be disappointed if it did not. We will be looking at the need for new legislation, as the current legislation is unable to address adequately the loopholes created by this relatively new part of the gaming industry, and we will be taking detailed evidence from key stakeholders. Our initial view, however, is that there should be far more stringent affordability checks by gambling companies. Banks also have a role to play in carrying out those checks; a number of challenger banks and traditional banks have already put such measures in place, but it is important that all banks and financial institutions follow suit and implement that feature.

Online gambling companies should commit to funding blocking software, and offer it for free to customers who self-exclude from their sites. The sector needs to adopt a more responsible approach to advertising during sports programmes, especially to protect children and the vulnerable. I welcome the whistle-to-whistle television ban, but in order for the advertising ban to be truly effective, those companies need to go further and include shirt and league sponsorship, as well as digital advertising around pitches. Otherwise, children and vulnerable adults will continue to be bombarded with gambling adverts throughout those events.

It is also worth bearing in mind that it is the broadcasters that have been most resistant to the clampdown on advertising. The TV companies have to take an important role and admit that this issue needs to be tackled. Serious consideration must be given to a statutory levy to fund harm prevention projects, support for those who have been harmed by gambling, and research into gambling and suicide. We must also stop the use of credit cards to gamble online; it is inconceivable that somebody should be able to rack up debt in order to gamble.

Above all, the industry needs to take responsibility for itself. Remote gambling is a growing industry, and it must learn the lessons of fixed odds betting terminals. It cannot be that time after time the Government must step in to prevent large and financially powerful industries from disregarding the harm they are doing to the vulnerable in society. The scourge of online gambling is becoming a matter of national urgency. We cannot sit back and let those problems continue, and I will not do so.