IMF Economic Outlook

Debate between Claire Hanna and James Cartlidge

Tuesday 31st January 2023 Commons Chamber

[Claire Hanna (Belfast South) (SDLP)]

The UK’s economic decline, which was started by Brexit but exacerbated by the mini-Budget, is genuinely sad, and it hurts millions of ordinary, blameless people. At the moment in Northern Ireland, we have some protection through the protocol, which, although imperfect, has economic benefits, including dual market access, offering the potential to transform our traditionally sluggish economy. Many businesses are already benefiting from that, and more investment will follow if the UK Government commit to supporting the protocol and that is accompanied by a responsible devolved Government focused on skills and infrastructure.

Will the Minister commit to advocating in Cabinet for a pragmatic EU-UK deal? If not, will he acknowledge that if the protection of the protocol is removed, more and more people in the centre ground in Northern Ireland will ask, “When can we leave this Brexit madness through an agreed, dynamic and inclusive new Ireland?”

[James Cartlidge]

Of course, the hon. Lady knows about the work that is happening across Government in respect of the protocol. She talks about our “economic decline”, but let me be absolutely clear: since 2010, the UK has grown faster than France, Japan and Italy. She knows that, as I said earlier, 14 EU countries have higher inflation than we face at the moment. These are global challenges that we face, but we have the strengths to get through them. One example, as the Chancellor pointed out on Friday, is that there are only three economies in the world with a £1 trillion tech sector. Tech is a huge part of our future economic growth. One of those countries is China, one is the United States, and the other, I am pleased to say, is the United Kingdom.

Oral Answers to Questions

Debate between Claire Hanna and James Cartlidge

Tuesday 15th November 2022 Commons Chamber

[James Cartlidge]

My hon. Friend makes an important point. In my capacity as a constituency MP, I recently met with a domiciliary care company, and it is clear that this cost of running its vehicles is significant. I repeat the point that these approved mileage allowance payments are really there as an administrative convenience, so that employers can support their staff. Employers can pay more, but, obviously, there may be tax implications. The crucial point is that we have cut the tax on both petrol and diesel, and that tax cut was significant. It was only the second time in 20 years that we cut both the main rates of petrol and diesel.

[Claire Hanna (Belfast South) (SDLP)]

13. Whether he plans to review the surcharge rate of the energy profits levy.

[The Exchequer Secretary to the Treasury (James Cartlidge)]

The energy profits levy was introduced from 26 May in response to sharp increases in oil and gas prices and to help fund cost of living support for UK households. It is an additional 25% surcharge on UK oil and gas profits. The Government have calculated that they expect the levy to raise more than £7 billion this financial year. All taxes are kept under review at all times.

[Claire Hanna]

Households and businesses are being crippled by energy costs, with support non-existent in the case of the Northern Ireland energy scheme. At the same time, Shell has reported quarterly profits of £8.2 billion and BP of more than £7 billion, but, under current rules, Shell is not expected to pay any windfall taxes in this year. It is encouraging that there is word that the Government are intending to extend the scope of the windfall tax, and it is not before time. Undoubtedly, there are difficult financial decisions to be taken, but this is not one of them. When even Shell is saying that this tax should be embraced, we know that the policy is in the wrong place. Will the Chancellor commit to increasing the scope of the levy and to closing loopholes on timing, share buybacks and the investment allowances that allow tax to be avoided by diverting profit into polluting and unsustainable fuels?

[James Cartlidge]

To be clear, the levy is an additional 25% surcharge on UK oil and gas profits on top of the existing 40% headline rate of tax, taking the combined rate of tax on those profits to 65%. The hon. Lady is right that the levy contributes to the support that will be going out to Northern Ireland; it will come in a month later, but will be backdated to 1 October, and it will include businesses as well as households.