Finance Bill

Christian Wakeford Excerpts

Committee stage
Wednesday 30th November 2022 Commons Chamber

[Helen Morgan (North Shropshire) (LD)]

Thank you for your flexibility in allowing me to speak this afternoon, Dame Rosie.

I rise to speak to amendment 2, tabled in my name and that of my hon. Friend the Member for Richmond Park (Sarah Olney), and to amendments 3, 4 and 5, tabled in her name. This Bill is an unfair stealth raid on millions of hard-working low and middle-income earners during a terrible cost of living crisis. Thanks to the Conservatives’ threshold freezes, 6 million people will be dragged into a higher tax band by the end of 2028. Those stealth tax rates are not particularly obvious in someone’s monthly payslip, but that does not mean they are not going to hurt people struggling with the cost of living.

Basic rate taxpayers will pay an additional £340 this year due to the freeze of the personal allowance, and higher rate taxpayers are estimated to pay an extra £1,700. Amendment 2 would require HMRC to write to all those affected by those income tax threshold freezes, to tell them whether they are paying more tax than they normally would and, crucially, whether they have been dragged into a higher tax band. It is vital that the British public have clarity on the Conservative increases to their tax liabilities from April and for that reason I wish to push amendment 2 to a vote.

The Conservatives promised not to raise taxes, as written in their own 2019 manifesto:

“This is a tax guarantee that will protect the incomes of hard-working families across the next Parliament.”

Three Prime Ministers and five Chancellors later, the Conservative Government have delivered an autumn statement with £24 billion in tax rises, all to fill a black hole—or indeed a blue hole—that they have created through their own incompetence. The Prime Minister and his Government are now breaking the Conservative manifesto pledge and the Prime Minister has no mandate for that. The Conservatives could at least make the British public aware that their promise to the country has changed by accepting amendment 2.

In 2019, the Conservatives promised voters a high-wage, high-skilled, low-tax economy. At a time when real-terms wages continue to fall, the tax burden has reached its highest level since the second world war and we have a chronic skills shortage, I would appreciate some clarity from the Prime Minister on the delivery of his party’s manifesto commitments.

I will also speak briefly to amendments 3 and 4. The Liberal Democrats were the first party to call for a windfall tax back in October 2021, when gas prices first began to soar. Through their delay in taking action, the Government allowed fossil fuel giants to get away with half a year’s-worth of untaxed super-profits. Amendment 3 would require the Government to produce an assessment of how much revenue has been lost through their delay. I am pleased that the Government are finally raising the rate of the windfall tax, but I am afraid it does not go far enough. If Shell paid nothing when the rate was 25%, it will still pay nothing when the rate is 35%.

Amendment 4 would require the Government to produce a quarterly assessment of how much revenue has been forgone through the investment allowance and publish the names of the companies that have benefited from the tax break. The lost revenue could have gone to supporting struggling households or protecting our public services, and the British people deserve to know how the money has been spent. I am also concerned about the environmental impact of the investment allowance. The Government state that they are committed to net zero, but at the same time the allowance promotes oil and gas exploration, while refusing renewable generators an equivalent tax relief.

Lastly, I draw attention to amendment 5. At a time when petrol and diesel prices are sky high, the Government should not be making it more expensive to own an electric vehicle. They have already scrapped the plug-in car grant and now they are extending vehicle excise duty to electric cars, which will only slow the road to electrification. I urge hon. Members to support these amendments to improve this Bill and to be honest about the impact it will have on British people.

[Christian Wakeford (Bury South) (Lab)]

It is a pleasure to serve under your chairship, Dame Rosie. I rise to support new clause 2, new clause 5 and amendment 1, which would remove clause 5, as set out by my hon. Friend the Member for Ealing North (James Murray) on the Front Bench.

During the autumn statement, we heard a lot about blaming global issues. While there are global issues, there are also political choices that have got us to where we are right now. We have had the best part of a year of political instability. We have also had the run on gilts caused by the mini-Budget and an increase in mortgage rates. That was not a global issue—it was very much created here in Parliament.

We were promised an autumn statement based on fairness. People are really struggling. Fran has bravely taken on and beaten breast cancer twice. She is now unfortunately terminally ill with bone cancer that has spread to her brain. Instead of making special memories with loved ones, she is spending her final moments worrying about money. She is unable to heat her home, surviving on her husband’s part-time wages, universal credit and her disability payments.

While there was some help with benefits increasing in line with inflation, we had been calling for that commitment for months in order to remove that worry and anxiety. Unfortunately, it took until the autumn statement for the Government to come out and reassure the public who were struggling. Leighane, a 27-year-old mother, was due in court over her unpaid bills. She owed £334 in electricity and £638 on the gas bill, and her rent arrears were £1,500. Sadly, because she thought she had no support and nowhere to turn, she stepped in front of a train with her three-year-old daughter. There was no support for anyone like her in the autumn statement.

John was described as a well-liked man, who was homeless and struggled with drugs—I reiterate my commitment in this place that no one chooses to be an addict and we need to do more to tackle addiction. There was nothing to tackle addiction and no talk about how we are going to fund that through the NHS at any point during this Finance Bill or in the autumn statement. Last week, he made a final bed for his trusted dog and died outside in freezing temperatures.

I will get on to the particular amendments now, Dame Rosie. We have heard about fairness, but the question is, fairness for who? We have a lot of measures about keeping the triple lock and increasing benefits with inflation. I welcome those—I really do—it is just a shame it has taken Opposition day debates, numerous questions on the Floor of this House and numerous written questions to get to that stage.

In new clause 5, we want to make sure that there are particular impact assessments and that the documents are provided. When we think that the autumn statement ultimately included £60 billion of spending cuts or tax rises, not to be able to share any of those documents just seems like ridiculously poor management. The mind boggles that we are not considering any of those elements.

There are also amendments on the Order Paper regarding the increase in tax allowances. Is it fair that the wealth of the top 1% of earners has gone up 185%? No. What are we doing to help low earners? We are freezing tax allowances. I listened quite earnestly to the hon. Member for South Cambridgeshire (Anthony Browne); I know him very well and I know his background in the field, so I will probably have a chat with him over a cup of coffee in the Tea Room about what we can do. However, the people of this country have been clobbered with £25 billion-worth of tax rises.

We have heard slogans before—I know a few things about those—saying “We are all in this together”, but are we really? We have seen no attack on non-dom tax status and no tax on private equity managers. We see a recession that will go on for longer than a year, and all the Government could talk about was softening the blow. Well, I am sorry, but I want to aspire to better than that for this nation. I want us to talk about growth, but I have seen nothing—on Second Reading, in any of the amendments or in the Minister’s speech—that goes in any way towards addressing growth.

We keep hearing a lot of talk and rhetoric about investment. I agree that we need investment, but that is why we have to focus on one of the loopholes and ensure, as the new clauses would, that a windfall tax actually delivers meaningful impact and that large oil generators and producers cannot just get away with investing money back into their own system. They get 90p of support for every £1 they are taxed, and that does not seem fair. It does not seem fair for the people whom I have just spoken about—the people of Bury South and the people of this country—and that is why the amendments are needed.

At the same time, real household disposable income is likely to be at its lowest level, with an estimated fall of 4.3% next year alone. We hear that the Conservatives are the party of sound money, but I just do not see that at the moment. Only Labour can provide the real growth and change that the country needs. Business believes it and the public believe it, and my God, we need it. That is why we should back new clauses 2, 3 and 5, and the plethora of other new clauses tabled by the Labour Front-Bench team, and I urge all colleagues to do so.