(6 years, 8 months ago)
Commons ChamberUrgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
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In a customs union, as I am sure the hon. Lady will know, a country would be bound by the external tariffs set by that customs union. A relationship with a customs union takes the form that I have described, which would be a frictionless interaction of our exports and imports with that customs union.
What special assessment has been made of the risk of medications perishing due to long delays at ports?
With regard to Euratom’s remit over the kinds of isotopes that the hon. Lady is referring to, nothing in our relationship with Euratom, or our lack of involvement with it going forward, will affect the ability of those isotopes to move between mainland Europe and the United Kingdom.
(6 years, 11 months ago)
Commons ChamberI thank my hon. Friend for his intervention, but I do not want to be tempted too far into the negotiations that pertain to matters between the United Kingdom and the Republic of Ireland. However, I will pick up on the point that he and other right hon. and hon. Members have made about readiness. The customs declaration services system that will need to be in place to handle around 300 million import and export transactions and declarations is well on target. It will start to go into use by this autumn and we firmly believe that it will be up and running by next January—well in time for the 29 March deadline.
The Minister is being very generous in taking interventions. Will he tell the House the estimated impact on the beef and dairy sectors in Northern Ireland, following today’s article in the Financial Times that flags up the massive cost to the industry that a completely new customs union system would entail?
Any issues around impacts on the flow of goods or trade necessarily require an assessment of where exactly the deal with the EU and—specifically in the case of the hon. Lady’s question—the Republic of Ireland lands. Until we know exactly where that lands, it is not possible to start opining on those impacts. I come back to my central point: we are negotiating hard, and it is in our interests, and of course those of the EU, to make sure that we have the lowest duties possible between our trading blocs, and that trade flows as freely and effectively as possible.
(7 years ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
I have given way already to the hon. Gentleman, so I will give way to the hon. Lady.
Does the Minister accept that there is a link between the current crisis in numbers of nurses in the NHS and the pay on offer, particularly given the huge student debts that many nursing graduates have? It is up to £54,000 for those at London Metropolitan University. Does he believe that there is any link between a starting salary of £21,500 and a huge student debt of £54,000 for nurses?
I remind hon. Members who wish to intervene on the Minister that there are 10 minutes left. I am sure that people would like to hear from the Chair of the Petitions Committee after the Minister. Time is now beginning to get tight.
(7 years ago)
Commons ChamberIt is a real pleasure to follow my hon. Friend the Member for Bristol South (Karin Smyth) and to speak in this Budget debate.
The outlook for the economy is bleak, with the worst five-year forecast of GDP since the Office for Budget Responsibility was set up, against the backdrop of the drop in sterling and the increase in inflation. As the Chancellor stood up to speak, the cost of Brexit was clear—in excess of £3 billion. Let’s put that on the side of a bus!
Hornsey and Wood Green has been starved of funding over the past seven years. The capacity of our community to educate, house and care for our citizens, as well as keep them safe, has deteriorated and is set to decline further. While London remains, seemingly, a vibrant economy, there is a yawning gap between the haves and have-nots. My hon. Friend the Member for Wrexham (Ian C. Lucas) spoke of his concerns about his region, but there can be inequality within a region as well: in London, we often walk the same streets but inhabit different worlds. Wages are flat, household debt is up, and transport and infrastructure continue to stall, with negative effects on industry and workers alike.
People in three particular housing tenures—those who hope to buy, private sector renters and those who are languishing on social housing lists—are in desperate housing need. Disappointingly, the rough sleeping initiative in the Chancellor’s speech did not include tackling rough sleeping in the capital. I think we all noticed this morning, as we charged in for our meetings and the Budget debate, that there were two homeless men asleep outside the door of the House of Commons. That is what Labour Members want to tackle, but I fear that when we come to the Budget debate next year, there may even be more homeless people lying in sleeping bags outside the doors of the House of Commons.
While London remains one of the top destinations for business and international talent, transport and infrastructure continue to stall, and it is time we all woke up to that. The Borough of Haringey has seen a 40% real-terms reduction in funding since 2010, resulting in £160 million of savings, which have affected disabled people, basic municipal services and children with special educational needs, and have generally had a depressing effect on the local economy. That worrying trend is set to continue, with another £20 million of savings to be found in the finances of one London borough.
A dangerous cocktail of growing demand, cost and inflation combined with funding cuts is putting unsustainable pressure on local government finances. Core funding from central Government is set to have fallen 63% in real terms over the decade to 2019-20. I tell children when I go into schools, “It’s like your mum gives you £1 one day, but only 30p the next. That’s how it is to manage a council these days.” People in Hornsey and Wood Green know the situation well. We have a desperate shortage of housing, but we are also concerned about health.
I am sure the hon. Lady will want to introduce some balance into her speech, because she is very fair-minded. Which does she welcome more: the substantial extra money for the NHS, the substantial investment in transport infrastructure or the cut in stamp duty for millions? Which of those does she think is the most important?
Instead of wasting all these billions on the whole Brexit shambles, I would rather we had more than £1 billion for the NHS. I am afraid that £1 billion is less than what Simon Stevens says we need.
In my constituency, 37 out of 37 schools will have experienced a 6% fall in funding per pupil between 2015-16 and 2019-20. Headteachers, classroom teachers and teaching assistants are all calling for desperately needed change. Police funding cuts barely got a mention, but it looks as though the Home Office will have to swallow a £400 million cut to the police. I was out in the affluent suburb of Highgate on Monday morning, speaking to terrified mothers who had had things stolen from them by youngsters who had ridden up on mopeds and used hammers to smash the windows of the café in which they were sitting; that has happened four times since the café moved into the high street. We are facing a crime wave in London, and it needs to be addressed.
I want briefly to mention the cut of £797 million, or £510 per person, in health funding in the north central London area. Many Members will be aware that there are huge pressures, particularly in mental health, and cuts on that scale will have a huge effect on very vulnerable people with serious mental health problems.
Finally, I welcome elements of the change in approach to small business taxation, but we must go further. As our population continues to grow and people work in different ways, including in small business, we need to be ever mindful of supporting them.
(7 years, 1 month ago)
Commons ChamberI congratulate the right hon. Member for Barking (Dame Margaret Hodge) on securing this important debate. She has been a vigorous campaigner on these issues over many years, and has certainly been very active in the last week; I responded to an urgent question and there was an Adjournment debate in respect of the Isle of Man last week, and now we have this debate as well.
The right hon. Lady said that tax and tax avoidance was one of those matters that should not divide us. I agree, and it seems to me that in the various iterations of this debate that she and I have held across this Dispatch Box there is a great deal on which we can be united rather than divided; I am thinking not least of the shared view across this House—certainly on my side of the House—that aggressive tax avoidance and evasion are utterly wrong. They are wrong for the reasons that the right hon. Lady has given: those who pay their tax fairly should not be penalised by virtue of the fact that some do not pay their tax fairly.
We also know, as the right hon. Lady pointed out, that tax is necessary to fund our vital public services. It is therefore entirely wrong that those who aggressively evade or avoid tax put pressure on our public services—on our NHS, our doctors and our nurses.
Under the last Government, the former Prime Minister David Cameron appointed an anti-corruption tsar. Who is the anti-corruption tsar under the current Government?
I will get back to the hon. Lady on that.
We know that tax is important for our public services, and we know, as the right hon. Member for Barking rightly stressed, that it is important that the Government act, and be seen to act, when we come across aggressive tax avoidance and evasion. As my hon. Friends on this side of the House have eloquently pointed out, we have a very strong track record in that respect. We have raised £160 billion in additional revenues as a consequence of clamping down on tax avoidance, evasion and non-compliance since 2010. We have also brought in £2.8 billion by tracking down those who have sought to inappropriately hide their finances in overseas tax jurisdictions. We have brought in £28.9 billion in additional compliance yield in the last 12 months alone, too.
The right hon. Lady is rightly critical of the performance of the last Labour Government; she raised that this afternoon and raised the same point in last week’s Adjournment debate. The tax gap is the difference between what we could potentially bring in by way of tax and what we actually bring in, and it currently stands at 6%, which is a historical low—a world-beating figure. If the average tax gap today was the same as under the last Labour Government, there would be £45 billion less in our Exchequer—£45 billion not there for those vital public services that the right hon. Lady is keen to discuss.
I will try to take that on board as a suggestion rather than a direction, Mr Speaker. The Minister identified what he thinks should be done, but I will tell him what should be done. In our “Tax Transparency and Enforcement Programme” document, Labour calls for an immediate public inquiry into avoidance, greater scrutiny of MPs, the creation of a specialist tax enforcement unit, and the public filing of large company tax returns and of the tax returns of wealthy individuals earning more than £1 million. We want no public contracts for tax avoiders, the repatriation of contracts parked in tax havens, public contract transparency, a register of beneficial ownership of companies and a register of trusts, and our programme would be enforced by working with the banking sector. We also call for a general anti-avoidance rule in principle, strict minimum standards for crown dependencies and overseas territories, the creation of an offshore companies levy and full country-by-country reporting. All that represents a comprehensive proposal from Labour.
Does my hon. Friend agree that there is an army of tax avoidance facilitators that includes, sadly, the four big accountancy firms, which are often based just down the road in the square mile?
My hon. Friend makes an important point. Transparency is at the heart of all this. I experienced a bizarre situation last week when I was on “Newsnight” with the chairman of the Cayman Islands stock exchange. What an insouciant attitude that man had to tax avoidance. He actually said that there had not been any wrongdoing—maybe not—and called for the journalists to be jailed. That is what he did, and that is the position in which we find ourselves.
It is a pleasure to follow the hon. Member for Hackney South and Shoreditch (Meg Hillier), and I join in the congratulations to the right hon. Member for Barking (Dame Margaret Hodge) on her securing this important debate. I absolutely agree with the conclusions she came to, but I probably took a slightly different route to get to them.
I should start, though, by saying that I do not think it is fair to say that over the past 15 years or so, HMRC, the previous Labour Government and the current Conservative Government have not tried to tackle aggressive avoidance. Look at the number of measures that have been introduced, ranging from disclosure rules for artificial schemes through to more recent measures. Look at a Finance Bill and count up how many targeted anti-avoidance rules have now been added. We have been trying everything we possibly can to tackle the most outrageous behaviour. Many of the schemes that 15 years ago used to be possible or, indeed, quite widespread just cannot be done in the UK at all now.
Does the hon. Gentleman agree that there is a cultural issue and a whole machinery that enables and facilitates these sorts of arrangements, which the 99% of us have nothing to do with, and that we have to be very aggressive in tackling that 1%?
I agree with the hon. Lady exactly, but the point I was trying to make was that I do not think that the size of the tax gap is down to a lack of effort or attempts to introduce new rules or measures. The problem is that the avoiders and evaders are perhaps one step ahead and move on to different things. That is why the Panama papers and the Paradise papers show that people are now just going offshore, or finding artificial ways to go offshore, rather than trying to do artificial domestic planning to get around the rules.
(7 years, 1 month ago)
Commons ChamberUrgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
My hon. Friend is right to point out the difference. The tax gap today is 6%, which is about the lowest in the world and the lowest in the history of our country. As I said earlier, if we had had the same average tax gap as Labour during its term in office, we would be more than £40 billion out of pocket—less money, as the shadow Chancellor put it, for the nurses, the doctors, the paramedics, the police, the Army and the others in our public services.
There are some things we do know, however: some large accounting firms are being investigated for poor practice that assists and colludes in tax avoidance and evasion. Will the Minister clarify what will be done to clamp down on those who collude with those who do not want to do the right thing?
The Finance Bill, which has just gone through the House, contains important provisions to clamp down on those who enable tax avoidance—the category of individual and company to which the hon. Lady refers—and those are some pretty stiff penalties.
(7 years, 2 months ago)
Commons ChamberI completely agree, but the hon. Gentleman misquotes me. I did not say that Government have no role. I said that Government do not create the jobs, but I explicitly said that Government create the conditions within which businesses operate and can create jobs. He is absolutely right about that, and I do not necessarily demur from what he said. The euro and the straitjacket of monetary policy across Europe has led to appalling situations in some countries where unemployment rates are very high, which I do not think is sustainable. That is why our economic performance is incredibly strong. We should not throw that away.
Could the right hon. Gentleman explain how, when he was Chief Whip, Thames Water failed to pay taxation between 2010 and 2014?
My hon. Friend is right. We hear a lot from the Opposition about clamping down on evasion and aggressive tax avoidance, and I give them credit for talking about it a lot. Unfortunately, they did not do anything about it when they were in government. The Minister and this Government talk about it a little bit, but we spend most of our time dealing with it and collecting the money, which is the right balance.
The list definitely dates from 2010—if I am not mistaken, that was when the Tory Government came to power—and includes Google, the Vodafone sweetheart deal, and Amazon. Government Members should concede that, despite some gradual improvements, we are still not where we ought to be and that this group of amendments includes things that taxpayers would like to see this House take much more seriously.
There are a couple of things in what the hon. Lady says. She is absolutely right that we need to do more to ensure that multinational companies pay tax in the appropriate jurisdiction, but we cannot do that unilaterally. We have to work with other countries, because we need international agreement on where a company’s profits are earned. The media sometimes does not understand this, but companies pay tax on profits, not revenues, so the whole argument is about where the profits land and that has to be addressed internationally. This Government are leading that international work, not following it—[Interruption.] It is no good the hon. Member for Oxford East (Anneliese Dodds) shaking her head. UK tax professionals have been leading this work and continue to drive it forward. We have a proud record.
No. First, it cannot just be done at European Union level—[Interruption.] No, we have to do it globally, because many of the companies involved are US companies. The base erosion—[Interruption.] I do not know why the Opposition Front-Bench team are laughing. The base erosion and profit sharing programme comes from the OECD.
I cannot take an intervention when I am still dealing with the first one. The base erosion and profit sharing programme is a global initiative, and we are leading on that work.
As for the point of the hon. Member for Oxford East about the EU, if I remember rightly, the reason why the Government blocked the French-driven proposals for country-by-country reporting was that they were part of an EU plan to try to drive up the total amount of tax that we take from business, not to ensure that companies pay tax in the right way. We are not an anti-tax country. That move was part of an EU plan to avoid countries being able to have competitive tax regimes and to avoid businesses locating in the United Kingdom. The French wanted to stop that because many of their businesses and smartest people now work in London or other parts of the UK, but the change was not in our national interest and I believe that that was why we blocked it. However, we need to continue the international work, and I am pleased that we have been leading on it.
My final point is about workers’ rights. I understand that the hon. Member for Bootle has to do this stuff to please people on his side, but he is absolutely wrong. This Government have absolutely no agenda of the sort that he mentioned. When talking about our leaving the European Union, my right hon. Friend the Prime Minister has made it clear that we want to protect workers’ rights. We stand four-square behind the rights that are in place, and we will be legislating for them in the European Union (Withdrawal) Bill, which I am sure will provide many hours of joy and fun in Committee. You may even be in the Chair, Dame Rosie, to listen to some of those exciting debates. We are going to protect workers’ rights, and there is nothing at all in the proposals to concern somebody who is worried about losing their job. This is about cracking down on people who have been abusing the provisions that protect legitimate workers who lose their jobs, using them as an excuse to get tax-free cash out of the system and cheat the taxpayer. That is what the proposals are about and that is why I hope that the Committee rejects all the amendments and supports clause 5.
This is not about big corporates; I am talking about adequately compensating people who have been sacked or discriminated against at work. In my experience, a sacked worker’s priority is to receive a fair settlement, not to avoid tax. It seems to me to be another example of the Government hounding people when they are at their most vulnerable, when instead they should be helping and supporting them.
The introduction of measures that will allow the Government to reduce the £30,000 tax-free threshold via the backdoor of delegated legislation could lead to profound effects on people’s lives without there being any proper scrutiny in Parliament. That is even more important given the fact that the threshold has not been increased since 1988; had it risen in line with prices, it would be £71,000 today. Amendment 2 would mean the threshold could only be increased, not decreased.
Does my hon. Friend agree that it is curious that, between 2010 and 2014, such a large company as Thames Water paid zero corporation tax, yet here we are talking about sums of £30,000? It is estimated that there is £6 trillion in tax havens, yet we are quibbling the amounts that go to individuals who have had a difficult time in the workplace.
I absolutely agree. The clause will penalise people who have lost their jobs and people who have been discriminated against—
The shadow Minister said that the measures in the Bill are part of a wider pattern of Government behaviour. Indeed they are: they follow in the footsteps of the 75 different measures we have already taken to clamp down on tax avoidance and the £160 billion we have already raised for our public services by doing so. They follow in the footsteps of the changes we have made to capital gains tax, which have increased the amount we have raised and ended the disgraceful situation in which hedge fund bosses were famously paying less tax than their cleaners. They follow in the footsteps of the changes we have made to corporation tax to prevent international avoidance—the so-called Google tax. They follow the changes we have made to the taxation of non-doms to create more balance and end the situation whereby people could be here for 25 years and still claim to be non-doms. So the Bill is part of a wider pattern of behaviour: it is part of an ongoing war on tax avoidance that the Government are waging.
On the specifics of the amendments, it seems to me that the Opposition are incredibly well intentioned. We all want the same things—we all want to drive down tax avoidance—but the problem with amendment 1 is that, in the real world, the Treasury is constantly engaged in a war of attrition with people who are constantly trying to create new loopholes and ways to avoid tax. As quickly as the Treasury closes one loophole, there are people trying to create others.
I shall make some progress.
Realistically, we cannot will the end of reducing tax avoidance without willing the means. The idea that, every time the Treasury needs to make a small change to a definition to clamp down on a new form of avoidance, we should have to come back with not just new statutory instruments but new primary legislation would really put sand in the wheels of the war on tax evasion and slow down our ability to tackle this serious problem.
Amendment 4 brings a more serious problem. If it is accepted, there will be people in the tax-avoidance industry rubbing their little hands together because the Opposition will have created, completely unwittingly, a huge new loophole, which will be used to abuse the system and avoid tax.
I am just about to conclude.
The measures in clause 5 are good, and they are part of a wider pattern of behaviour: a war on tax avoidance that we have waged in order to get more money for schools, hospitals and police in my constituency and others. They are part of a wider economic policy that has delivered not just record employment—the highest since 1975—and record tax cuts for those at the bottom end, but a record increase in the national living wage that will give us one of the highest living wages in the entire developed world. It is a pattern of behaviour that sees us making those who need to pay their tax pay it, so that we can have an economy that works for everybody.
Does my hon. Friend agree that it is a pity that, since the start of the new Government, Mr Pickles, who was formerly a Member in this House and is now in the other place—[Interruption.] To the best of my knowledge, he has not been replaced as the anti-corruption tsar. Indeed, unless the House has been informed otherwise, that particular thread of Government policy seems to be lost.
My hon. Friend makes an interesting point.
The reality is that many Government Members have close associations with the City and with big money. I do not want to accuse anyone individually, but that is the reality. Many have been in hedge funds and wherever. The biggest scandal of all took place within Her Majesty’s Revenue and Customs. A few years ago, Dave Hartnett, who was the boss of HMRC, was involved in sweetheart deals with the corporates, losing countless billions for the Treasury. He was not doing anything illegal, but cosy deals with corporates is not exactly public service. When he finally left HMRC, he set himself up as a consultant, advising the same corporates on how to avoid taxes. That is an absolute scandal. We should be stopping such practices.
Tax officers should be public servants who are driven by the public service ethos. At the grassroots level, the ordinary members of staff are driven in that way. Many of them are members of the Public and Commercial Services Union, with which I am associated. The PCS has argued for many years that we should have more tax officers, and that they should be better paid and better appreciated for the work that they do. I would like to think that, instead of closing tax offices and squeezing the number of tax officials, this Government would increase their number. PCS has told me on many occasions that every tax officer collects many times their own salary, so every time we appoint another tax officer, we get more than their salary coming back. That is what we should be doing. It has been a scandal for many years. Even before this dreadful Conservative Government, we were not collecting sufficient tax. We were allowing tax evasion and tax avoidance to go unchallenged. I want to see a world in which people, particularly those with plenty of money, pay their taxes at the highest level. I am not talking about ordinary working people.
Finally, it was recently suggested that quantitative easing, which is not strictly relevant to this amendment, is benefiting the better-off and not the ordinary people. It would be good if some of that QE could find its way into the Treasury coffers and help the spend on public services. That would be a better way of generating more jobs, more demand and better services in our economy.
(7 years, 5 months ago)
Commons ChamberThe support for solar comes directly from people’s bills. When the costs of installation and generation come down, through efficiencies and economies of scale and production, so should support. We are taking steps to control the cost of support schemes and putting solar on the path to delivery without subsidy.
11. What plans he has to introduce measures to tackle tax avoidance and evasion carried out through non-domiciled status and offshore trusts.
The UK has effective legislation to tackle avoidance involving offshore structures and we have announced our intention to legislate further, making it harder for non-doms to avoid paying tax on funds withdrawn from trusts. I am also pleased to say that we have been at the forefront of international work that has seen 100 countries commit to exchange financial information automatically.
The Conservative manifesto said that the Government would
“take a more proactive approach to transparency”.
Does the Minister believe that enough is being done to tackle companies that promote tax-avoidance schemes, or is there still a tendency for the big four accountancy firms to regulate the big four, via the big four, in order to protect the big four?
The hon. Lady asks if enough is being done to clamp down on tax avoidance. I can assure her that it certainly is. Since 2010, we have raised £160 billion by way of clamping down on exactly those behaviours. In the forthcoming Finance Bill there will be further measures to make sure that over the scorecard period we are bringing in between £7 billion and £8 billion in addition, in corporate tax avoidance measures.
(7 years, 8 months ago)
Commons ChamberUrgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
I am very sorry, but I have been doing my very best to answer the questions that have been asked. Sadly, I cannot be held responsible for the quality or the content of the questions. What I would say is that I am the Minister responsible for financial services, and the Government are responsible for legislating in this place and in the other place. To answer the hon. Lady’s question, the Criminal Finances Bill is an example of what we are doing now, as we speak, to improve things. The FCA is in constant dialogue with not only the banks but the Government to make sure it moves with the times.
If it is found during the investigation that terrorism has been facilitated, what personal responsibility will the Minister take for that dreadful finding?
It is important to say that these schemes operated from 2010 to 2014. The hon. Member for Kilmarnock and Loudoun (Alan Brown) mentioned that The Independent first raised the story in 2014. However, if there is new evidence, it is important that the NCA and the FCA look at it and act accordingly. We set up those bodies to act operationally and independently from Government, and that is right and proper.
(7 years, 9 months ago)
Commons ChamberYes, I absolutely recognise my hon. Friend’s concern. It is for that reason, as well as for reasons connected to the economic sustainability of individual businesses, that we have said that we will look at how best to help those most seriously affected.
What I cannot do is look again at the business rates revaluation, which is an independent statutory exercise undertaken by the Valuation Office Agency. As the hon. Lady will know, if experience is anything to go by, of the 2 million business properties revalued, about 1 million will lodge appeals, so there will be a process of reviewing the way in which the valuations have been conducted. I have said I will look at those small businesses facing the largest increases and see how best to help them.