Finance Bill

Debate between Cathy Jamieson and Graham Stuart

Monday 1st July 2013 Commons Chamber

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

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

The Government have previously declared that we are “all in this together”, and I want to develop that theme. I am sure the Exchequer Secretary will be listening intently. They have insisted that those with the broadest shoulders should bear the greatest burden, but in Work and Pensions questions earlier, we heard that some Opposition Members are somewhat sceptical about that claim. Although the Government have also consistently told us that their priority is to cut the deficit by what they describe as “fair and reasonable means”, in politics it is actions, not mere words, that show priorities. The same Government, in tough times and against the backdrop of falling living standards—borrowing up last year, growth continuing to flatline and drastic cuts being made to benefits for hard-working families—have decided to give millionaires a tax cut. [Interruption.] I hear the hon. Member for Beverley and Holderness (Mr Stuart) call out that that is nonsense. I am more than willing to take an intervention from him should he wish to justify the tax cut for millionaires.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

I am delighted to intervene on the hon. Lady. She will be aware that the art of taxation is to extract the maximum amount of money with the minimum amount of hissing. Is she aware of the principle that a lower tax rate can often lead to a higher tax take, and does she think it might apply in this case, thus meaning that millionaires pay more, not less?

[Cathy Jamieson]

It will be no surprise to the hon. Gentleman that I do not agree with his point.

[Mr Stuart]

Is the hon. Lady aware of that principle?

[Cathy Jamieson]

I am aware of that point of principle and I will come to it in due course, because it is an issue to consider.

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[Cathy Jamieson]

I am glad that the hon. Gentleman recognises the points that I have made. He will, of course, be aware of some of the discussion that took place in Committee on the Finance Bill and the Financial Services (Banking Reform) Bill. It is unfortunate that the Government chose not to accept our amendments to those Bills, and so far we have not seen legislation to enact the change that he mentions. I look forward with interest to further debates on that subject at a later date.

[Mr Graham Stuart]

The hon. Lady is making a powerful speech, but she has mentioned what makes the public angry. I think what makes the public angry is when they see members of a party opposing in principle, and expressing great moral outrage about, the bedroom tax—the spare room subsidy—or the 50p tax rate and then refusing to answer a straightforward question about whether they would reverse one or both of them. It is not good enough, and it is no wonder that the public think politicians are slippery and cannot be trusted.

[Cathy Jamieson]

The hon. Gentleman started by trying to pay me some sort of compliment, saying that I was making a powerful speech, but I simply do not accept his assertion that what outrages the public is politicians standing up to make passionate speeches on their behalf. The points that I am making are the very ones that have been made by my constituents, by the constituents of my hon. Friends and—I am sure—by many of the hon. Gentleman’s own constituents.

It is not good enough for Government Members simply to sit there and say, “What is the Labour party going to do two years from now?” when they are taking no responsibility whatever for what they are doing at the moment. It is a responsible position for us as the Opposition to say, “We understand that there will be an overall spending limit; that will be our starting point, but that does not mean that we have committed to it as an end point, and it does not mean that we are committed to doing exactly what the Government would do.” I am sure that as we move forward, a number of initiatives will be developed and outlined in greater detail.

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[Cathy Jamieson]

My hon. Friend has made her point extremely succinctly and has put on the record why we feel that the future jobs fund was not only important but a successful initiative. I say again to Government Members who think that the proposal has no impact on the lives of ordinary people that all those who went through the future jobs fund programmes and who worked on them say that the fund was a valuable way of getting young people back into work. People in my area would certainly have liked it to continue.

Let me come back to the points about the new clause. As I said, the Government should be tackling tax avoidance—we will debate that further later—but that does not mean that we should compensate the wealthiest at the expense of those on middle and low incomes. I would have hoped, in the light of everything the Government proclaimed around the time of the spending review about fairness and ensuring that growth came back into the economy, that even at this stage they might have dropped the plan for a millionaires tax cut. That is a forlorn hope, however.

The decision to create that tax cut goes to the heart of the coalition’s political vision and beliefs—and by that I mean both sides of the coalition. We face a period of national upheaval at a time when resources are stretched. The Government criticise the Opposition when we take responsible decisions to think about the way forward while failing to explain their positions. At a time when resources are stretched, when people up and down the country are working harder and harder than ever before for less in their pockets and when public services are being cut so drastically, it is even more crucial that our Government should be a uniting force rather than a dividing one. In that context, I must ask again why on earth this is the time for a tax cut for the richest.

The Government try to talk a good game, but as I said at the outset, reality does not match their rhetoric. They do not seem to understand the need for a one nation approach to politics and they are not able to encourage a sense of national mission, no matter how much they talk about being “all in it together”. This Government will go down in history as the most divisive.

[Mr Graham Stuart]

I am grateful to the hon. Lady, who is being most generous in giving way. She said earlier that this matter is about action, not words, and has just said that it is about reality, not rhetoric. She is making an impassioned speech, but will she explain why she did not vote against the 50p tax rate and why, in addition, she is not committed to reversing the measure? Why, after the faux outrage over the spare room subsidy, is she not committed to reversing that either? People outside will think that this has a stench of hypocrisy about it.

[Cathy Jamieson]

The reality for my constituents and those of Labour Members is that they want to know why the Government made the change in the first place. They want to see action taken in the future, but there are two years until the general election—we will lay out how we intend to take things forward in good time for that—and I respectfully suggest to Government Members that we do not know exactly what sort of mess we will be left with. We see no responsibility taken by the Government for the situation that the economy is in at the moment and what has happened on their watch—

Finance Bill

Debate between Cathy Jamieson and Graham Stuart

Monday 2nd July 2012 Commons Chamber

[Mr Graham Stuart (Beverley and Holderness) (Con)]

I am delighted that the hon. Lady has given way. I wonder whether she could bring her speech to a close, so that we might hear from someone who really does have some authority on this subject and who has so ably led the campaign to bring about this change.

[Cathy Jamieson]

I acknowledge that the hon. Member for Harlow (Robert Halfon), to whom the hon. Gentleman is referring, did a lot of work on the campaign. However, given the earlier suggestions that there was a lack of interest in this subject on the Opposition Benches because of the lack of numbers here tonight, I felt it important to lay out our case fully. I hear what the hon. Gentleman is saying, however, and I will bring my remarks to a conclusion.

I want to ask the Minister some specific questions. Now that the Treasury has had a week or so in which to do the number crunching—if it had not already done so—what areas of departmental underspend have now been identified to ensure that the decision to delay the August 2012 increase in fuel duty will be met in a fiscally neutral way? Will the Minister also tell us which Departments have, through budget exchange, already surrendered an underspend in advance of the end of this financial year, and which Departments are expected to have greater than originally forecast savings in departmental spending in 2012-13?

I do not have time to comment on the points that have been raised about biofuels. Perhaps I shall be able to do so in another debate. In conclusion, however, I should like to refer Members to new clause 9. We shall not be pressing it to a vote this evening, but it calls for a review of the relationship between fuel duty, other taxes charged on road fuels, and the cost of road fuel. It was made clear in the recent Westminster Hall debate that such a review might reflect the views not only of the Opposition but of many Government Members —I see some of them nodding—and I hope that the Government will be good enough to listen to that proposal, and to come forward with a plan to establish such a review.

Static Caravans (VAT)

Debate between Cathy Jamieson and Graham Stuart

Thursday 26th April 2012 Commons Chamber

[Mr Stuart]

My hon. Friend is right. All Government Members are committed to the aims and objectives set out in the Budget. We wanted a Budget for growth. We support lifting people out of tax; we support lowering corporation tax; we want investment; we want British industry to be supported. May of us are therefore gently but firmly—and, I hope, powerfully—saying to the Government this evening that this measure should be looked at again, and, as I have said, they have agreed to do so.

Terence Higgins, then Financial Secretary to the Treasury, said in March 1973:

“We have already distinguished between two kinds of caravan; the kind of caravan which is a home or a residence, and not normally the kind that one tows around—because even outside the West Country it would be too large to tow conveniently—and that which is not regarded as a home. Because of the general provision in legislation for relief from VAT for housing it was thought appropriate to include large caravans within the scope of relief.”—[Official Report, 20 March 1973; Vol. 853, c. 393.]

Therefore, any suggestion that that was not considered by this House is false. I hope that will be reflected on.

In June 1989, when my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley) was Economic Secretary to the Treasury, he said that there was no question of withdrawing zero rating from the purchase of static caravans. He was right then, and we should stick with that view now.

I want to give the Minister 10 minutes in which to reply, if no other colleagues wish to intervene on me. [Interruption.] Give him eight minutes? Okay, fair enough. Finally therefore, let me pass on to the Minister some comments from a constituent of mine.

Aaron Cambridge and I live in the same town, Beverley in east Yorkshire. He works at Willerby Holiday Homes, which in the most recent industry returns at the end of last year was listed as having more than 800 employees. It is based in the constituency of the hon. Member for Kingston upon Hull East (Karl Turner), whom I am delighted to see in his place. Even without this proposed VAT increase, Aaron has been on a reduced work schedule of three-and-a-half days a week for the past six months. He told me that he has worked in the caravan industry for 24 years and can never remember such hard times for the industry. That is the situation the industry is in now, before this possible VAT increase. There are 800 staff just at Willerby, which is a manufacturer, and we know that there tend to be many more associated jobs in supplier firms and others around a manufacturing centre.

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

rose—

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[Cathy Jamieson]

Does the hon. Gentleman agree that the Treasury should look again at the impact assessment? It estimates that it will take in some £35 million in 2013-14 as a result of this measure, but it should look again at the impact assessment to compare that with the amount of money that will be lost in the wider economy.

[Mr Stuart]

The hon. Lady is right. I have many more examples, including that of Laura Goldspink, who lives in my constituency and also works at Willerby Holiday Homes. Charles Gillett, who runs a business that is 100% reliant on the caravan industry, has talked of

“an industry on a knife edge, struggling to emerge from the ravages of the recent recession.”

He, too, pointed out that it is not 750 companies affected, but well over 2,000. Peter Smith, the chairman of the Swift Group—one of the leading employers in east Yorkshire, with 800 staff and a turnover of £200 million —has said:

“A very conservative HMRC prediction is a reduction in demand of 30% which would lead to the lowest market figure for over a decade of around 11,000 units,”

as we have discussed. He continued:

“Such a reduction is likely to increase the cost of materials (due to economies of scale), make credit harder to come by and jeopardise the viability of manufacturers and suppliers.”

I have said enough. Peter Smith put his finger on it, as have all the other Members who have spoken. The Budget is all about creating jobs, but if this measure is implemented, it would have exactly the opposite effect. What we ask, from both sides of the House, but particularly the Government Benches, is for the Minister to listen to the contributions to the consultation and reconsider.