Finance (No. 2) Bill

Baroness Laing of Elderslie Excerpts

3rd reading: House of Commons
Tuesday 25th April 2017 Commons Chamber

[Jane Ellison]

On a point of clarity, may I make it clear that the Government do not support clause 108? I apologise for not making that clear before. On making tax digital, I refer colleagues to my statement at the beginning of our debate on the first group.

Question put and negatived.

Clause 108 accordingly disagreed to.

Clauses 109 to 126 disagreed to.

Clause 127 ordered to stand part of the Bill.

Ordered,

That clause 127 be transferred to the end of clause 69.—(Jane Ellison.)

Clauses 128 to 133 disagreed to.

Clause 134

Interpretation

Amendments made: 5, page 126, leave out line 17.

Amendment 6, page 126, leave out line 20.

Amendment 7, page 126, leave out lines 22 to 24.

Amendment 8, page 126, leave out line 30.

Amendment 9, page 127, leave out lines 1 and 2.—(Jane Ellison.)

Clause 134, as amended, ordered to stand part of the Bill.

Clause 135 ordered to stand part of the Bill.

Schedule 1

Workers’ services provided to public sector through intermediaries

Amendment made: 10, page 129, line 32 , at end insert—

‘(3) Subsection (1) is subject to subsection (4).

(4) A primary-healthcare provider is a public authority for the purposes of this Chapter only if the primary-healthcare provider—

(a) has a registered patient list for the purposes of relevant medical-services regulations,

(b) is within paragraph 43A in Part 3 of Schedule 1 to the Freedom of Information Act 2000 (providers of primary healthcare services in England and Wales) by reason of being a person providing primary dental services,

(c) is within paragraph 51 in that Part of that Schedule (providers of healthcare services in Northern Ireland) by reason of being a person providing general dental services, or

(d) is within paragraph 33 in Part 4 of Schedule 1 to the Freedom of Information (Scotland) Act 2002 (providers of healthcare services in Scotland) by reason of being a person providing general dental services.

(5) In this section—

“primary-healthcare provider” means an authority that is within subsection (1)(a) or (b) only because it is within a relevant paragraph,

“relevant paragraph” means—

(a) any of paragraphs 43A to 45A and 51 in Part 3 of Schedule 1 to the Freedom of Information Act 2000, or

(b) any of paragraphs 33 to 35 in Part 4 of Schedule 1 to the Freedom of Information (Scotland) Act 2002, and

“relevant medical-services regulations” means any of the following—

(a) the Primary Medical Services (Sale of Goodwill and Restrictions on Sub-contracting) Regulations 2004 (S.I. 2004/906),

(b) the Primary Medical Services (Sale of Goodwill and Restrictions on Sub-contracting) (Wales) Regulations 2004 (S.I. 2004/1017),

(c) the Primary Medical Services (Sale of Goodwill and Restrictions on Sub-contracting) (Scotland) Regulations 2004 (S.S.I. 2004/162), and

(d) the Primary Medical Services (Sale of Goodwill and Restrictions on Sub-contracting) Regulations (Northern Ireland) 2004 (S.R. (N.I.) 2004 No. 477).

(6) The Commissioners for Her Majesty’s Revenue and Customs may by regulations amend this section in consequence of—

(a) any amendment or revocation of any regulations for the time being referred to in this section,

(b) any amendment in Part 3 of Schedule 1 to the Freedom of Information Act 2000, or

(c) any amendment in Part 4 of Schedule 1 to the Freedom of Information (Scotland) Act 2002.’—(Jane Ellison.)

Schedule 1, as amended, agreed to.

Schedule 2

Optional remuneration arrangements

Amendments made: 11, page 160, line 14, at end insert—

“() section 307 (death or retirement provision), so far as relating to provision made for retirement benefits;”

Amendment 12, page 160, line 26, at end insert—

‘( ) In subsection (5) “retirement benefit” has the meaning that would be given by subsection (2) of section 307 if “or death” were omitted in both places where it occurs in that subsection.”—(Jane Ellison.)

Schedule 2, as amended, agreed to.

Schedule 3

Overseas pensions

Amendments made: 13, page 166, line 18, leave out from beginning to “in” in line 23 and insert—

“(a) that, in the case of any money purchase arrangement relating to a member of the fund that is not a cash balance arrangement, no contributions are made under the arrangement on or after 6 April 2017;

(aa) that, in the case of any cash balance arrangement relating to a member of the fund, there is no increase on or after 6 April 2017 in the value of any person’s rights under the arrangement;

(b) that, in the case of any defined benefits arrangement relating to a member of the fund, there is no increase on or after 6 April 2017 in the value of any person’s rights under the arrangement; and

(c) that, in the case of any arrangement relating to a member of the fund that is neither a money purchase arrangement nor a defined benefits arrangement—

(i) no contributions are made under the arrangement on or after 6 April 2017, and

(ii) there is no increase on or after 6 April 2017.”

Amendment 14, page 166, line 24, at end insert—

‘(6AA) For the purposes of subsection (6A)(aa)—

(a) whether there is an increase in the value of a person’s rights is to be determined by reference to whether there is an increase in the amount that would, on the valuation assumptions, be available for the provision of benefits under the arrangement to or in respect of the person (and, if there is, the amount of the increase), but

(b) in the case of rights that accrued to a person before 6 April 2017, ignore increases in the value of the rights if in no tax year do they exceed the relevant percentage.’

Amendment 15, page 166, line 30, leave out

“ignore increases in the value of a person’s”

and insert

“in the case of rights that accrued to a person before 6 April 2017, ignore increases in the value of the”.

Amendment 16, page 166, line 31, at end insert—

‘(6BA) For the purposes of subsection (6A)(c)(ii), regulations made by the Commissioners for Her Majesty’s Revenue and Customs may make provision—

(a) for determining whether there is an increase in the value of a person’s rights,

(b) for determining the amount of any increase, and

(c) for ignoring the whole or part of any increase;

and regulations under this subsection may make provision having effect in relation to times before the regulations are made.’

Amendment 17, page 166, line 32, leave out “subsection (6B)(b)” and insert “this section”.

Amendment 18, page 167, leave out lines 5 to 7.

Amendment 19, page 167, line 8, after “subsection” insert “(6BA) or”.

Amendment 20, page 167, line 10 , leave out from “(7)” to end of line 16 and insert—

‘(a) for “In this section—” substitute “For the purposes of this section—

‘arrangement’, in relation to a member of a superannuation fund, means an arrangement relating to the member under the fund;

a money purchase arrangement relating to a member of a superannuation fund is a ‘cash balance arrangement’ at any time if, at that time, all the benefits that may be provided to or in respect of the member under the arrangement are cash balance benefits;

an arrangement relating to a member of a superannuation fund is a ‘defined benefits arrangement’ at any time if, at that time, all the benefits that may be provided to or in respect of the member under the arrangement are defined benefits;

an arrangement relating to a member of a superannuation fund is a ‘money purchase arrangement’ at any time if, at that time, all the benefits that may be provided to or in respect of the member under the arrangement are money purchase benefits;

‘cash balance benefits’, ‘defined benefits’ and ‘money purchase benefits’ have the meaning given by section 152 of the Finance Act 2004, but for this purpose reading references in that section to a pension scheme as references to a superannuation fund;

‘member’, in relation to a superannuation fund, has the meaning given by section 151 of the Finance Act 2004, but for this purpose reading references in that section to a pension scheme as references to a superannuation fund;”;

(b) at the end insert—

“‘the valuation assumptions’ has the meaning given by section 277 of the Finance Act 2004.”’

Amendment 21, page 167, line 16, at end insert—

‘( ) After subsection (10) insert—

(11) Where the conditions in subsection (6)(a) to (c) are met in the case of a superannuation fund (“the actual fund”)—

(a) any disqualifying contributions made under an arrangement relating to a member of the actual fund are treated for the purposes of the Income Tax Acts as instead made under an arrangement relating to the member under a separate superannuation fund (“the shadow fund” for the actual fund),

(b) any disqualifying increase in the value of a person’s rights under an arrangement relating to a member of the actual fund is treated for the purposes of the Income Tax Acts as instead being an increase under an arrangement relating to the member under the shadow fund for the actual fund, and

(c) any reference in this or any other Act (including the reference in subsection (3) and any reference enacted after the coming into force of this subsection) to a fund, or superannuation fund, to which subsection (3) applies does not include so much of the actual fund as—

(i) represents any contribution treated as made under, or any increase in the value of any rights treated as an increase under, the shadow fund of the actual fund or the shadow fund of any other superannuation fund, or

(ii) arises, or (directly or indirectly) derives, from anything within sub-paragraph (i) or this sub-paragraph.

(12) For the purposes of subsection (11) a contribution, or an increase in the value of any rights, is “disqualifying” if it would (ignoring that subsection) cause the benefit accrual condition not to be met in the case of the actual fund.

(13) For the purposes of the provisions of this section relating to the benefit accrual condition, where there is a recognised transfer—

(a) any transfer of sums or assets to the recipient fund by the recognised transfer is to be categorised as not being “a contribution” to the recipient fund, and

(b) any increase in the value of rights under the recipient fund that occurs at the time of the recognised transfer is to be treated as not being an increase in that value if the increase is solely a result of the transfer effected by the recognised transfer.

(14) For the purposes of subsection (13), where there is a transfer such that sums or assets held for the purposes of, or representing accrued rights under, an arrangement relating to a member of a superannuation fund (“the transferor fund”) are transferred so as to become held for the purposes of, or to represent rights under, an arrangement relating to that person as a member of another superannuation fund, the transfer is a “recognised transfer” if—

(a) the conditions in subsection (6)(a) to (c) are met in the case of each of the funds, and

(b) none of the sums and assets transferred—

(i) represents any contribution treated as made under, or any increase in the value of any rights treated as an increase under, the shadow fund of the transferor fund or the shadow fund of any other superannuation fund, or

(ii) arises, or (directly or indirectly) derives, from anything within sub-paragraph (i) or this sub-paragraph.’

Amendment 22, page 167, line 19, leave out sub-paragraphs (6) to (8).

Amendment 23, page 169, line 13, leave out “Subsection (4) does not” and insert “Subsections (7A) and (7B)”.

Amendment 24, page 169, line 20, at end insert—

‘(7A) If the lump sum is wholly in respect of rights which have accrued on or after 6 April 2017, there is no reduction under subsection (4).

(7B) If the lump sum is wholly or partly in respect of rights which accrued before 6 April 2017, the amount of any reduction under subsection (4) is given by—

R x A/LS

where—

A is so much of the lump sum as is in respect of rights which accrued before 6 April 2017,

LS is the amount of the lump sum, and

R is the amount which (ignoring this subsection) is given by subsection (4) as the amount of the reduction.’

Amendment 25, page 170, line 22, at beginning insert—

“Where the lump sum is paid under a pension scheme that was an employer-financed retirement benefits scheme immediately before 6 April 2017, deduct so much of the lump sum left after Step 1 as is deductible in accordance with subsection (5A).

Where the lump sum is paid otherwise than under such a scheme,”

Amendment 26, page 170, line 23, leave out

“rights, which accrued before 6 April 2017,”

and insert—

“the value immediately before 6 April 2017 of rights, accrued by then,”.

Amendment 27, page 170, line 39, at end insert—

‘(5A) These rules apply for the purposes of the first sentence of Step 2—

(a) “the post-Step 1 amount” means so much of the lump sum as is left after Step 1;

(b) “the relevant amount” means so much of the post-Step 1 amount as is paid in respect of rights specifically to receive benefits by way of lump sum payments;

(c) “reckonable service” means service in respect of which the rights to receive the relevant amount accrued (whether or not service in the same employment or with the same employer, and even if the rights originally accrued under a different employer-financed retirement benefits scheme established in or outside the United Kingdom);

(d) “pre-6 April 2017 reckonable service” means reckonable service that is service before 6 April 2017;

(e) “pre-6 April 2017 reckonable foreign service” means pre-6 April 2017 reckonable service that is foreign service;

(f) the deductible amount is the value immediately before 6 April 2017 of the rights then accrued to payment of so much of the relevant amount as is paid in respect of pre-6 April 2017 reckonable service if—

(i) at least 75% of pre-6 April 2017 reckonable service is made up of foreign service, or

(ii) the period of pre-6 April 2017 reckonable service exceeds 10 years and the whole of the last 10 years of that period is made up of foreign service, or

(iii) the period of pre-6 April 2017 reckonable service exceeds 20 years and at least 50% of that period, including any 10 of the last 20 years, is made up of foreign service;

(g) otherwise, the deductible amount is the appropriate fraction of the value immediately before 6 April 2017 of the rights then accrued to payment of so much of the relevant amount as is paid in respect of pre-6 April 2017 reckonable service;

(h) “the appropriate fraction” is given by—

F/R

where—

F is the period of pre-6 April 2017 reckonable foreign service, and

R is the period of pre-6 April 2017 reckonable service.’

Amendment 28, page 170, line 42, at end insert—

‘“foreign service” has the meaning given by section 395C,’

Amendment 29, page 171, line 17, at end insert—

‘Relief from tax under Part 9 of ITEPA 2003 not to give rise to tax under other provisions

13 (1) In section 393B(2)(a) of ITEPA 2003 (tax on benefits under employer-financed retirement benefit schemes: “relevant benefits” do not include benefits charged to tax under Part 9), after “646E” insert “or any deductions under section 574A(3)”.

(2) The amendment made by this paragraph has effect in relation to benefits by way of lump sums paid on or after 6 April 2017.’—(Jane Ellison.)

Schedule 3, as amended, agreed to.

Schedule 4

Pensions: offshore transfers

Amendments made: 30, page 172, line 23, after “sub-paragraph” insert “(6C) or”.

Amendment 31, page 174, line 21, at end insert—

‘(4A) In sub-paragraph (4) (power to specify whether payments by scheme are referable to relevant transfer fund), after “payments or transfers made (or treated as made) by” insert “, or other things done by or to or under or in respect of or in the case of,”.’

Amendment 32, page 176, line 28, leave out “with the next 5” and insert—“immediately before the next 6”.

Amendment 33, page 177, line 1, leave out “with the next 5” and insert—

“immediately before the next 6”.

Amendment 34, page 178, line 8, leave out

“for the purposes of sections 244L and 254”.

Amendment 35, page 178, line 28, leave out

“for the purposes of sections 244L and 254”.

Amendment 36, page 178, line 48, leave out

“for the purposes of sections 244L and 254”.

Amendment 37, page 179, line 18, leave out

“for the purposes of sections 244L and 254”.

Amendment 38, page 180, line 19, leave out “was” and insert “has been”.

Amendment 39, page 180, line 21, leave out “was” and insert “has been”.

Amendment 40, page 183, line 17, leave out from beginning to fourth “the”.

Amendment 41, page 184, leave out lines 30 to 38.

Amendment 42, page 188, line 8, at end insert—

“17A In Schedule 32 (benefit crystallisation events: supplementary provision), after paragraph 2 insert—

‘Avoiding double counting of refunded amounts of overseas transfer charge

2A (1) This paragraph applies where an amount of overseas transfer charge is repaid (whether or not under section 244M) to the scheme administrator of one of the relevant pension schemes.

(2) The amount crystallised by the first benefit crystallisation event that occurs in respect of the individual and a benefited scheme after receipt of the repayment is to be reduced (but not below nil) by the amount of the repayment.

(3) If the amount of the repayment exceeds the reduction under sub-paragraph (2), the excess is to be set sequentially until exhausted against the amounts crystallised by subsequent benefit crystallisation events occurring in respect of the individual and a benefited scheme.

(4) In sub-paragraphs (2) and (3) “benefited scheme” means—

(a) the scheme to which the repayment is made, and

(b) any other pension scheme if as a result of a recognised transfer, or a chain of two or more recognised transfers, sums or assets representing the repayment are held for the purposes of, or represent rights under, that other scheme.’”

Amendment 43, page 188, line 38, at end insert—

‘(1A) In those Regulations, after regulation 13 insert—

“14 Claims for repayments of overseas transfer charge

(1) This regulation applies where the scheme administrator of a registered pension scheme becomes aware that the scheme administrator may be entitled to a repayment under section 244M of the Act in respect of overseas transfer charge on a transfer.

(2) The scheme administrator must, no later than 60 days after the date on which the scheme administrator becomes aware of that, make a claim for the repayment to the Commissioners for Her Majesty’s Revenue and Customs.

(3) The claim must provide the following information—

(a) the member’s name, date of birth and principal residential address,

(b) the date of the transfer and, if different, the date of the event triggering payability of the charge on the transfer,

(c) the date on which the scheme manager accounted for the charge on the transfer,

(d) why the charge on the transfer has become repayable, and

(e) the amount in respect of which the claim is made.

(4) In a case where the 60 days mentioned in paragraph (2) ends with a day earlier than 14 November 2017, paragraph (2) is to be treated as requiring the claim to be made no later than 14 November 2017.”’

Amendment 44, page 188, line 39, leave out “this paragraph” and insert “sub-paragraph (1)”.

Amendment 45, page 188, line 42, at end insert—

“( ) The amendment made by sub-paragraph (1A) is to be treated as having been made by the Commissioners for Her Majesty’s Revenue and Customs under the powers to make regulations conferred by section 244M(8) of FA 2004.”

Amendment 46, page 190, line 3, at end insert—

‘(4A) In regulation 3(3)(a) (reporting duty under regulation 3(2) expires after 10 years from creation of relevant transfer fund), after “beginning” insert “—

(i) if the payment is in respect of one or more of the relevant member’s ring-fenced transfer funds (whether or not it is also in respect of anything else), with the key date for that fund or (as the case may be) the later or latest of the key dates for those funds, and

(ii) if the payment is not to any extent in respect of the relevant member’s ring-fenced transfer funds,”.’

Amendment 47, page 191, line 26, after “take” insert “place”.

Amendment 48, page 192, line 26, at end insert—

“3AEA  Information provided by member to QROPS: inward and outward transfers

(1) Paragraph (2) applies where—

(a) a recognised transfer or onward transfer is made to a QROPS, or an onward transfer is made by a QROPS or former QROPS, and

(b) either—

(i) the overseas transfer charge arises in the case of the transfer, or

(ii) the transfer is required by section 244B or 244C to be initially assumed to be excluded from the overseas transfer charge by that section.

(2) Each time during the relevant period for the transfer that the member—

(a) becomes resident in a country or territory, or

(b) ceases to be resident in a country or territory,

the member must, within 60 days after the date that happens, inform the scheme manager of the QROPS or former QROPS that it has happened.

(3) In a case where the 60 days mentioned in paragraph (2) ends with a day earlier than 30 June 2017, paragraph (2) is to be treated as requiring the information to be given no later than 30 June 2017.”

Amendment 49, page 194, line 23, at end insert—

“3AK Claims for repayments of charge on subsequent excluding events

(1) Repayment under section 244M (repayments of overseas transfer charge) to the scheme manager of a QROPS or former QROPS is conditional on making a claim to HMRC.

(2) Such a claim in respect of overseas transfer charge on a transfer—

(a) must be in writing,

(b) must be made no later than 12 months after the end of the relevant period for the transfer, and

(c) must provide the following information—

(i) the member’s name, date of birth and principal residential address,

(ii) the date of the transfer and, if different, the date of the event triggering payability of the charge on the transfer,

(iii) the date on which the scheme manager accounted for the charge on the transfer,

(iv) why the charge on the transfer has become repayable, and

(v) the amount in respect of which the claim is made.”

Amendment 50, page 194, line 38, leave out “regulation 3AE(1) to (5)” and insert—

“regulations 3AE(1) to (5) and 3AEA”.

Amendment 51, page 195, line 3, at end insert

“, and

( ) are, so far as they insert new regulation 3AK, to be treated as having been made by the Commissioners under the powers to make regulations conferred by section 244M(8) of FA 2004.”

Amendment 52, page 196, line 28, leave out “potentially excluded” and insert “overseas”.

Amendment 53, page 196, line 32, at beginning insert

“either—

(i) the overseas transfer charge arises in the case of the transfer, or

(ii) ”

Amendment 54, page 196, line 4, at end insert—

‘(3) In a case where the 60 days mentioned in paragraph (2) ends with a day earlier than 30 June 2017, paragraph (2) is to be treated as requiring the information to be given no later than 30 June 2017.’

Amendment 55, page 198, line 41, after “Regulations,” insert—

“and the amendments in regulation 11BA of the Registered Pension Schemes (Provision of Information) Regulations 2006,”

Amendment 56, page 198, line 46, at end insert—

“if it would otherwise be considered for those purposes as charged in an earlier period.”—(Jane Ellison.)

Schedule 4, as amended, agreed to.

Schedules 5 and 6 disagreed to.

Schedule 7 agreed to.

Schedules 8 to 15 disagreed to.

Schedule 16

Employment income provided through third parties

Amendment made: 57, page 607, line 18, leave out from ‘“step”)’ to ‘insert’ in line 19 and insert ‘at the end’.—(Jane Ellison.)

Schedule 16, as amended, agreed to.

Schedules 17 and 18 disagreed to.

Schedule 19 to 23 agreed to.

Schedules 24 to 29 disagreed to.

The Deputy Speaker resumed the Chair.

Bill, as amended, reported.

Bill, as amended in the Committee, considered.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Under the Order of the House of yesterday, we shall now move to the remaining stages, with no amendments on consideration. I shall now suspend the House for no more than five minutes in order to make a decision about certification. The Division bells will be rung two minutes before the House resumes. Following my certification, the Government will table the appropriate consent motion, copies of which will be made available in the Vote Office and distributed by the Doorkeepers.

--- Later in debate ---

On resuming—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I can now inform the House of my decision about certification. For the purposes of Standing Order No. 83L(2), I have certified clause 2 of the Finance (No. 2) Bill as relating exclusively to England, Wales and Northern Ireland and within devolved legislative competence. Under Standing Order No. 83L(4), I have also certified the following amendment as relating exclusively to England, Wales and Northern Ireland—the omission of clause 60 of the Bill in Committee of the whole House. Copies of my certificate are available in the Vote Office and on the parliamentary website.

Under Standing Order Nos. 83M and 83S, a consent motion is therefore required for the Bill to proceed. Copies of the motion are available in the Vote Office and have been made available to Members in the Chamber. Does the Minister intend to move the consent motion?

[Jane Ellison]

indicated assent.

The House forthwith resolved itself into the Legislative Grand Committee (England, Wales and Northern Ireland) (Standing Order No. 83M).

[Mrs Eleanor Laing in the Chair]

[The First Deputy Chairman of Ways and Means (Mrs Eleanor Laing)]

The consent motion for England, Wales and Northern Ireland will now be considered. I remind hon. Members that all Members may speak in the debate, but if there is a Division, only Members representing constituencies in England, Wales and Northern Ireland may vote on the consent motion.

Resolved,

That the Committee consents to the following certified clauses of the Finance (No. 2) Bill and certified amendments made by the House to the Bill—

Clauses certified under Standing Order No. 83L(2) (as modified in it is application by Standing Order No. 83S(4)) as relating exclusively to England, Wales and Northern Ireland and being within devolved legislative competence

Clause 2 of the Bill (Bill 156).

Amendment certified under Standing Order No. 83L(4) (as modified in it is application by Standing Order No. 83S(4)) as relating exclusively to England, Wales and Northern Ireland

The omission in Committee of Clause 60 of the Bill (Bill 156).—(Jane Ellison.)

Question agreed to.

The occupant of the Chair left the Chair to report the decision of the Committee (Standing Order No. 83M(6)).

The Deputy Speaker resumed the Chair; decision reported.

Third Reading

[Jane Ellison]

I beg to move, That the Bill be now read the Third time.

Before I briefly comment in summary of the Bill, may I beg your indulgence, Madam Deputy Speaker, in making some remarks about a couple of colleagues?

The right hon. Member for Oxford East (Mr Smith) was present earlier and made a valedictory speech. I referred to that in my subsequent speech, but I was not then in a position to mention his record of service to the country. Not only has he been a parliamentarian since 1987, but he was a Minister of State for Education and Employment between 1997 and 1999, Chief Secretary to the Treasury between 1999 and 2002 and, indeed, Secretary of State for Work and Pensions between 2002 and 2004. He is no longer in his place, but I ask his party’s Front-Bench spokesman to confer my sentiments to him and to draw to his attention the fact that I—on behalf of the Government and, I am sure, of all colleagues—have placed on record our thanks for his service to the country as a Minister during that period.

With the House’s indulgence, I will pay tribute to a second Member. I have very recently been informed that my right hon. Friend the Member for Chichester (Mr Tyrie) is not seeking re-selection at this election, so I want to make a few comments about him. He has been the MP for Chichester since 1997. He is a former adviser to Nigel Lawson—Lord Lawson—when he was Chancellor, as he was to John Major when he was Chancellor. Members may be aware that my right hon. Friend was a senior economist at the European Bank for Reconstruction and Development before he entered Parliament. He is of course a very senior parliamentarian, and when we moved to electing our Select Committee Chairs, it was no surprise that he was elected overwhelmingly by the House with cross-party support. In recent times, he has served in one of the most senior positions in Parliament, if not the most senior position, as Chairman of the Liaison Committee. In all those roles across his life of public service, governmental service and service to this House, he has been enormously distinguished, and I think I speak for everyone in saying that he is very well liked. I have known him during the years I have been in Parliament, but as a Treasury Minister, I have of course come to know him better in recent months. Indeed, I have responded to his letters on many occasions, and discussed them with him on the sidelines on many other occasions. Throughout those dealings, I have seen all his experience and qualities being brought to bear. I just want to say that to me, as a Minister, he has been kind and wise, and I will miss him enormously.

To move on to my Third Reading speech, the economy is fundamentally strong, and with this Finance Bill we are taking yet another step forward in building a stronger economy and a healthier society. As we have discussed, the Bill is proceeding on the basis of consensus. A number of key policy changes to the tax system, such as measures to tackle tax avoidance, are not being proceeded with now, but will be brought forward in a Finance Bill at the first opportunity after the election.

Even in its shortened form, the Bill takes action in three areas that have been consistent priorities for us in making changes to the tax system. First, the measures in this Bill take further action to reduce the deficit and secure the nation’s public finances, and the Bill raises much-needed revenue to fund the public services we all value. Secondly, the Bill takes the next steps to achieve this Government’s aim of a fairer and more sustainable tax system. It makes it clear that the tax system must keep pace with the different ways in which people choose to work, and ensure fair treatment between individuals. It also demonstrates our continued commitment to tackling tax avoidance and evasion to level the playing field for the honest majority of businesses and individuals who pay the tax they owe. Finally—this cause is particularly close to my heart, as a former Minister for Public Health—the Bill marks an important step in tackling childhood obesity by legislating for the soft drinks industry levy. As I noted earlier, we have achieved a great deal of cross-party consensus on the levy, which will help to deliver a brighter and healthier future for our children. I am delighted that we will be able to put it on the statute book.

In conclusion, this Finance Bill supports our commitment to a fair and sustainable tax system, one that offers support for our critical public services and will get the country back to living within its means. In that regard, it sits with this Government’s long-term commitment to improving the strength of our economy, and I commend it to the House.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Before I call the Opposition spokesman, may I echo on behalf of the whole House the Minister’s kind words about the right hon. Members for Oxford East (Mr Smith) and for Chichester (Mr Tyrie)? We extend those kind words to all other hon. Members who are present this afternoon, who have taken part in the debates on this Bill and many similar Bills assiduously and brilliantly on behalf of their constituents, and who will not be here during the next Parliament. The whole House wishes them all very well indeed.

Finance (No. 2) Bill

Baroness Laing of Elderslie Excerpts

2nd reading: House of Commons
Tuesday 18th April 2017 Commons Chamber

[Jane Ellison]

With the leave of the House, I will close today’s debate, and it is a pleasure to do so. It has been an interesting and wide-ranging debate, and I thank all hon. Members for their contributions. I will try to touch briefly on their contributions, but I suspect, with the time being rather against me, that I will not be able to answer all their questions. As I said in my opening speech, we no doubt have several discussions ahead of us about the next steps on the Finance Bill.

The Finance Bill takes the next steps in helping Britain to succeed both now and in the future. What was lacking from the rather opportunistic speech we have just heard was any willingness to face up to the economy’s strategic challenges. Many are touched on in the Bill and I will refer to some of them now. One theme that emerged—in the speech by the hon. Member for Bootle (Peter Dowd) at the beginning of the debate and in other speeches—was a focus on productivity. Nobody could have been clearer about facing up to the country’s productivity challenge than the Chancellor. I think everyone should be able to support the measures we have laid out to respond to the long-term challenge as a priority, and to take targeted action to invest in innovation and infrastructure.

We are also introducing measures on setting corporation tax to make our economy more competitive. I wholeheartedly reject the comments we hear from the Opposition that try to set small business against large business against medium-sized business. All businesses, over 1 million of them, large and small, will benefit from our cuts to corporation tax. We want to ensure that we offer SMEs enhanced research and development tax relief, and other measures that will help them to grow. I welcome the emphasis placed by my hon. Friend the Member for Richmond (Yorks) (Rishi Sunak) towards the end of the debate on that very issue of how we help businesses to grow. I find it extremely disappointing that the Labour party seeks to pass judgment. We want small businesses to become big businesses and we want to ensure that we help that to happen.

There have been a number of comments, not least from both Opposition Front-Bench spokesmen, about HMRC resourcing. I sprang to the defence of HMRC’s record. It has made sustainable cost savings of more than £1 billion over this Parliament while improving performance. Over the same period, it has collected a record level of tax revenue, reducing the tax gap to a historic low of 6.5% in 2014-15. Measures in the Bill will build on the measures already passed by both this Government and the coalition Government to close the tax gap. I would be very disappointed to think that Opposition Members are not supportive of those measures.

Turning to Back-Bench contributions, my hon. Friend the Member for Amber Valley (Nigel Mills) made an excellent and typically thoughtful speech. It was wide-ranging and I will not be able to respond to all the points he made, but he was supportive of the soft drinks industry levy. He rightly focused on measures to tackle the tax gap in VAT and important new steps we are bringing forward. He spoke about a number of other issues. He asked me about when we might look to turn on the power we took last year with regard to country-by-country reporting. We have always said that we want to make the case at various international forums to work through that in an international context. We will continue to raise the issue and pursue international agreement on public country-by-country reporting.

My hon. Friend also sought reassurance on the compressed interest restriction, a measure that, along with the loss relief measures in the Bill, stands to raise £7 billion across the period in question—very significant sums of money from large corporations. He wanted reassurance that that would not be a block on growth and investment. I think I can give him that reassurance. We have a very open and competitive economy, and we have a very competitive tax system, but we expect businesses to pay the right amount of tax. We are not the only country with an interest restriction: for example, Germany, Italy and Spain have similar rules, and other European countries will be introducing similar rules over the coming years. I hope that gives him a degree of reassurance.

My hon. Friend the Member for Vale of Clwyd (Dr Davies) gave a very thoughtful speech on the soft drinks industry levy. I very much welcome his support, drawn from his experience not just on the Health Committee but professionally. He gave a tour de force speech outlining the reasons for providing a prescription to tackle obesity. Obesity offers a considerable threat to the long-term finances of the NHS. I welcome his support for the levy.

The hon. Member for Dundee East (Stewart Hosie) expressed a degree of scepticism about the work that we have done to support the oil and gas industry. I do not think that that scepticism can be justified. We have worked very closely with the industry, and we now have one of the world’s most competitive fiscal regimes for oil and gas, although we intend to go further. At the time of the 2017 Budget, we published a discussion paper on how taxation could better support the transfer of older late-life assets—an important issue for the basin—and ensure that we could put them into the hands of companies that wished to invest. I have met industry stakeholders to discuss the issue, and I know that the announcement has been welcomed. I think it should also be welcomed by Members in all parts of the House, not least members of the Scottish National party—including the hon. Member for Aberdeen North (Kirsty Blackman), who raised similar issues.

The hon. Member for Dundee East also mentioned insurance premium tax. When we made announcements about the proposed new rate, the Chancellor made clear that it was intended to raise vital revenue to fund our public services. Those who oppose such a rise must themselves make clear where they would find the sizeable revenues that we need to invest in our front-line public services and generate income for our economy. I did not hear many answers to that question during today’s debate.

The hon. Member for Birmingham, Selly Oak (Steve McCabe) spoke mostly about the NHS. Let me respond by saying that a strong NHS needs a strong economy, and that is what we are trying to build.

The hon. Member for East Lothian (George Kerevan) made a thoughtful speech, and I agree with him about the need for long-term investment to address the productivity challenge. He gave a degree of support to the soft drinks industry levy, and sought a number of reassurances—not all of which I can give him tonight—about some of the steps that would be taken in the weeks ahead. I was glad to hear that he thought there was much to be commended in the measure. I expect that we shall return to the issue of the productive growth agenda, but let me repeat what I said to him in an intervention: £800 million of additional capital will flow, in Barnett consequentials, to the Scottish Government as a result of the announcements in the autumn statement about the national productivity infrastructure fund. The hon. Gentleman also talked about household debt. I merely note that the debt interest to income ratio is at a record low: it was 4.5% in 2016, compared to 10.1% in 2008.

Although I was not in the Chamber at the time, I believe that my hon. Friend the Member for North West Hampshire (Kit Malthouse) made a typically robust speech in which he supported all measures to promote investment. He talked about science, the need to encourage entrepreneurs, and the challenge of taxing the gig economy, which the Chancellor has acknowledged to be one of the strategic challenges facing not just our economy but developed economies throughout the OECD area. We are contributing to the international debate on that subject. There is more to be said about it, but measures in the Bill begin to address, for example, how some online trading platforms deliver in terms of VAT. That missing VAT represents one of the big parts of the tax gap, and we hope that there will be widespread support for our measures.

The hon. Member for Aberdeen North referred to the scrutiny of tax policy. I think that she and I can agree about many aspects of the announcement of the move to a single fiscal event. As for her other points, we have worked extremely closely with a number of industry stakeholders on some of the more complex measures in the Bill. I think that those measures have been greatly improved as a result, and the stakeholders have given the Government credit for that. We heard another rerun of the argument about VAT refunds for the Scottish police and fire and rescue services, and once again—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. It is a little impolite to make so much noise that the House cannot hear the Minister. While there may be other matters that Members need to discuss, there is nothing more important than the Minister’s summing up of a debate on the Finance Bill.

Equitable Life Policyholders: Compensation

Baroness Laing of Elderslie Excerpts

Thursday 23rd March 2017 Commons Chamber

[Sir Peter Bottomley]

On a point of order, Madam Deputy Speaker. I would like to correct an oversight. When I intervened on the hon. Member for Leeds North East (Fabian Hamilton), I should have declared that I have a small Equitable Life policy.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

We are grateful to the hon. Gentleman for his correction of the record.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I notice that Members are asking questions that they would like the Minister to answer, so the House will want to hear from the Minister at some length at the end of the debate. I want to make sure there is enough time for the Minister to speak, so I hope colleagues will now restrict their remarks to eight or nine minutes.

Budget Resolutions

Baroness Laing of Elderslie Excerpts

Thursday 9th March 2017 Commons Chamber

[Mr Walker]

I thank my right hon. Friend for visiting my constituency—[Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. If Members want to intervene, they can stand up and intervene, but we must not have chuntering from a sedentary position; or rather—let us be honest about it—when you are sitting down, you do not speak in here. Otherwise, we cannot hear who is actually speaking. We must hear one person at a time, and now it is Mr Charles Walker.

[Mr Walker]

Thank you very much for that protection, Madam Deputy Speaker. It is much appreciated.

I thank my right hon. Friend the Secretary of State for visiting Broxbourne last week. May I divert him from Surrey to Hertfordshire, where a much bigger problem relates to an incinerator application? The awarding local authority, Hertfordshire, is also the planning authority in this instance, which strikes me as a conflict of interests. I suspect that my right hon. Friend cannot focus on that now, but will he take into consideration such conflicts of interest in local authorities?

--- Later in debate ---

[Graham Jones (Hyndburn) (Lab)]

On a point of order, Madam Deputy Speaker. Yesterday in regional newspapers, there was a malicious and false report that the Labour party had somehow entered into an arrangement with the British National party in the seat of Pendle. This matter was raised in business questions by the hon. Member for Pendle (Andrew Stephenson). Having just spoken to the leader of the council in Pendle, I am absolutely assured that no such deal has taken place. In fact, the leader of the council has never spoken to the BNP in eight years, and the Labour party does not speak to the BNP in Pendle unless it is absolutely necessary to do so in committee. These reports should be corrected and I wondered how best to go about doing that, Madam Deputy Speaker.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I can quite understand why the hon. Gentleman wishes to make his point of order, but, as he knows and as the House appreciates, it is not a point that can be dealt with by the Chair. However, he asks how he can set the record straight, and my simple answer is: he has done so, and I am sure his setting straight of the record will be properly recorded in Hansard.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order Believe it or not, although we started off with a lot of time for this debate, speeches tend to expand to fill the time available. Therefore, I now ask that colleagues—being honourable and decent to other colleagues—take no more than 12 minutes each. Twelve minutes is a very long time. I know that I can rely on Mr Keith Vaz, who can count and will know when 12 minutes have expired.

--- Later in debate ---

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

I think it is fair to comment that this Budget has not met with unalloyed joy and enthusiasm across the country and in the media. It may come as a surprise to the House that I am going to demonstrate a degree of enthusiasm for one piece of the Budget that I think is highly commendable.

I am, of course, talking about paragraph 5.10 on page 48 of the Red Book, in which the Chancellor commits himself to reducing the burden on small co-operatives. I am enthusiastic about it because I have been a lifelong supporter of co-operatives, but also, and very personally, because the proposal was in the ten-minute rule Bill that I introduced on 8 November. May I put on record my appreciation to the Economic Secretary to the Treasury, who is in his place, for discussing the implications of the proposal with me afterwards, and may I say how much I welcome and appreciate its incorporation into the Budget?

I gently remind the Economic Secretary that I made a couple of other recommendations in the same ten-minute rule Bill, which have yet to appear in the Budget. I hope that following further consultation I will be able to praise him in future Budget debates for implementing them as well. As a general point, I hope that this will set a precedent for the Government, and the Treasury in particular, listening to Opposition Members and implementing some of their recommendations. I am sure that doing so will benefit future Budgets greatly.

The second thing I want to do—again, I am not being totally critical of the Government—is to put on record my appreciation for the report on the so-called midlands engine, which has been published today. Not only does it recognise the role of the west midlands in the national economy—and our phenomenal, high-quality manufacturing base, which is driving the economy and above all driving our exports—but it identifies the long-standing issues prevalent in the economy that need to be addressed if we in the west midlands are to reach our potential. Those issues are low productivity, skills, and difficulties with connectivity and transport infrastructure.

Although I welcome the proposal and the money that is being invested, may I make a couple of qualifying points? I think there is a very real danger that the potential benefit that accrues from the project will be undermined by some of the proposals in the Budget. My first point is that skills in construction, in particular, must be sustained if we are to improve our transport infrastructure. At the moment, about 10% of the construction workforce consists of employees from outside the country. If the ensuing Brexit negotiations affect their position and construction firms’ ability to employ others to sustain the policies and extra investment in the west midlands, that could undermine the ability of the midlands engine to reach its full potential. I emphasise that provision must be made in the Brexit negotiations for the construction industry to recruit the appropriate level of skilled personnel to fulfil such projects.

My second point, about education and skills, is particularly relevant in my constituency and the Black country. On 24 March, I am due to meet local headteachers to discuss funding problems in their schools, notwith-standing all the fine words that have been spoken about the pupil premium and so on. While the midlands engine will make provision for promoting skills, vocational education and science-based education, there is absolutely no point in putting in that money if we are not providing adequate funding for the original primary and secondary school education to ensure that people have the literacy, numeracy and other qualifications necessary to make the most of such money. There is a grave question mark over that at the moment.

When I meet the headteachers, I guess that one of the things annoying them—this annoys me and a lot of people in the Black country—will be the Government’s preoccupation with investing in unloved, unwanted, selective schools while they neglect to invest appropriately in our existing school estate. I would point to a National Audit Office report saying that there is a £1 billion need for investment in our existing school estate to deal with the immediate problems. There are certainly schools in my constituency that need immediate investment. If such money is used to promote new selective schools, the Government will, quite frankly, be distorting the existing state school system and estate, and failing to realise the potential of the pupils attending such schools. This is totally unacceptable. It is unwanted, and it really sticks in the craw of the people who, day in and day out, try to give our children the best possible education within the existing system.

I have worked out, on the basis of the figures in the Budget, that the £320 million going into the 110 new schools means that there is an average of £3 million for each of them, while the £210 million for the 10,000 state schools in the existing estate means that each will get an extra £21,000 over the course of three years. That huge disparity is bound to prejudice the life opportunities of the many millions of students going to our existing state schools.

Whatever fine words the Chancellor used and however well he packaged the statistics on which the Budget is based—he can, shall we say, tell a good story—the reality is that the previous Tory-led Government and this Government have so far failed. The public sector deficit, which we must remember was supposed to be eliminated by 2015, will certainly not be eliminated by 2021 and may well still be with us in 2025. Whatever happened to the long-term plan that was the mantra of the Tory-led Government up to 2015 and was used in the carefully choreographed comments made by every supporter of that Government to demonstrate the effectiveness—or otherwise—of their economic policy? The fact is that I do not recall anybody saying that the long-term plan might actually last only until 2015. It has now disappeared, or evaporated, from the political lexicon of the House. It would be laughable were it not for the fact that so many millions of people have endured cuts in their wages, cuts in their public services and, in some cases, very real hardship indeed. As a result, we face the perfect storm: the cumulative failure of austerity policies that have failed to generate the necessary tax receipts to pay off an adequate amount of our public debt; the increased demand placed on our public services—particularly social services and health, but also education—that have to be met one way or another over the next few years; and, of course, the uncertainty generated by Brexit.

I could not help but be amazed by the phraseology used by the Chancellor over his decision to waive the fiscal targets in order to make available more money for what has loosely been called a “fighting fund” or “war chest” for Brexit. My understanding of a fighting fund or a war chest is that it is money that is put away out of existing consumption to be used for problems that arise in the future; it is not about heaping debts on future generations to pay for mistakes made in the present, such as the results of Brexit arising from this Government’s policy.

I would like to have gone on, but I will try to stick to the 12-minute limit. The Government are failing to address the big issues that have arisen from their failure to deal with public spending and the economy over the past seven years. I concur with the disappointment expressed by my hon. Friend the Member for Wallasey (Ms Eagle) at the Government’s failure to recognise that and to take the necessary big steps to address it. I think that the Budget is a major failure. It is a sticking-plaster Budget that spends money just to avert a crisis, without examining the underlying crises and the policies needed to address them for the benefit of everybody in the long run.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I appreciate that some hon. Members have been sitting here all afternoon. There is something a little unfair about this but, c’est la vie, I am afraid that I have to limit Members to 10 minutes.

--- Later in debate ---

[Jane Ellison]

No, we have said that it is 20% of the fund, but the vast majority of the national insurance fund pays towards the state pension, which, as has been made clear, is now available to the employed and the self-employed. That is part of an important and necessary step to level up what benefits people get. It is also important and necessary to level the playing field when it comes to what people pay in.

The Prime Minister has asked Matthew Taylor to look at the important issue of employment rights. We will get the Taylor review later this year and will return to look at those important issues. Whether people are self-employed or an employee, if they do a similar job, get a similar wage and receive similar benefits, they should pay a similar tax. That is actually recognised by Labour’s shadow Work and Pensions Secretary, the hon. Member for Oldham East and Saddleworth (Debbie Abrahams).

I really hope that the hon. Members for Ilford North (Wes Streeting), for Bristol East (Kerry McCarthy), for Bootle (Peter Dowd), for Cardiff South and Penarth (Stephen Doughty) and for Feltham and Heston (Seema Malhotra) are not disowning the self-employment review and commission that was launched last November by the hon. Member for Oldham East and Saddleworth, who said that one of the five principles of Labour’s self-employment commission was that self-employed NICs should rise towards employee levels. She went on to say:

“We cannot expect employees to continue to pay more into the system while offering equality of entitlements across employment status.”

I realise that Labour’s Front Bench rotates with dizzying speed—[Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order.

[Jane Ellison]

Thank you, Madam Deputy Speaker. They don’t like it up ’em!

I realise that the Labour Front Benchers rotate with dizzying speed, but I suggest that Labour Members look at the self-employment commission that they launched only last November. The majority of people who are affected by the change will be better off from the combined changes to national insurance contributions. Only someone with profits of more than £16,250 will have to pay more and, as some hon. Members have remarked, the new state pension is worth an extra £1,800 of pension entitlement to those who will now be on it. That is something that the Federation of Small Businesses, among others, has campaigned for.

It is obvious from the critique we have been offered by those on the Opposition Benches that, while they have a plethora of suggestions about how to raise taxes and raise spending, they have absolutely no coherent alternative economic policy. That was clearly in evidence yesterday, in the response we heard from the Leader of the Opposition, and the fact that there are so many former Front Benchers sat behind today’s Front Benchers is also testimony to it. We need to get spending and revenue-raising in balance; that is the mark of a responsible Government, and that balance is what allows us to safeguard the services we all value for the future.

Double Taxation Treaties (Developing Countries) Bill

Baroness Laing of Elderslie Excerpts

2nd reading: House of Commons
Friday 16th December 2016 Commons Chamber

[Roger Mullin]

My hon. Friend makes a very good point.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I appreciate that the hon. Gentleman is answering the point made by the hon. Member for Aberdeen North (Kirsty Blackman), but—I am not particularly criticising the hon. Gentleman, who addresses this House with expert rhetoric and I can always hear what he says—I am taking this opportunity to make a point about other Members who are sitting in that corner of the Chamber. It is not just an old-fashioned rule that when you stand up to speak, you must address the Chair; if you do not, your voice goes into the corner and the Minister, other Front Benchers and I cannot hear what is being said. I appeal to Members that, even though they are currently exchanging interventions with one another in that corner of the Chamber, they please address the Chair, because everybody else wants to hear what is being said. I am not criticising the hon. Gentleman; I am just asking for his co-operation.

[Roger Mullin]

Thank you, Madam Deputy Speaker, for your wise words and for giving me the compliment that others in the Chamber wish to listen to me.

On the post-Brexit situation, I am sure that many hon. Members will acknowledge that there has been great concern about the imbalance between the negotiating ability of the UK Government, who have not employed negotiators for many years, and the capacity of the 27 remaining EU countries, which will have access to all the negotiators. It is thought that the Government will be at a disadvantage by having to face large numbers of really skilled negotiators and using people who may be less skilled.

I ask the Government to think about what we are saying about how treaties are negotiated between a country as powerful as the UK and countries such as Malawi and Namibia. I have been in countries that do not have any of their own negotiators. Even worse, they sometimes have to bring in people from a country in the developed world to assist them in negotiating with that very country. When I was in a country in Africa, I worked alongside a German who was funded by the aid organisation GTZ, and part of his task was to negotiate on behalf of that country with the German Government. We can see that there is scope for difficulty—compromise and the like—in all that. We need to make sure that we build capacity in such countries to enable them to ensure fairness. There is an ethical responsibility on us to ensure that we deal with those countries fairly, which is in the interests of everyone.

The Minister is keen to have sufficient time to respond, so I will leave my remarks there, other than to say that I am very grateful to hon. Members for staying and showing an interest in what, for me, is an important matter. I wish everyone a happy Christmas.

Commercial Financial Dispute Resolution Platform

Baroness Laing of Elderslie Excerpts

Thursday 15th December 2016 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. If everyone who wishes to speak takes approximately seven minutes, everyone will get a chance. If they do not, some people might not get to speak, and that would not be fair.

Equality: Autumn Statement

Baroness Laing of Elderslie Excerpts

Wednesday 14th December 2016 Commons Chamber

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I inform the House that Mr Speaker has selected amendment (a) in the name of the Prime Minister.

--- Later in debate ---

[Mr Gauke]

There is a very important point to be made about how we encourage more women to become involved in engineering and construction. Increasing numbers of employers are taking more steps to do that—Crossrail is another example of where that is happening. The hon. Member for Birmingham, Yardley (Jess Phillips) seems to be objecting to infrastructure spending, which is a strange position—[Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I can hear the hon. Lady—[Interruption]—and she should not be speaking so loudly when she is sitting down, especially when I am speaking. She will have an opportunity to speak soon.

[Mr Gauke]

Thank you, Madam Deputy Speaker.

The global entrepreneurship and development index has ranked Britain as the best place in Europe for female entrepreneurs, which I am sure everyone in this House will welcome and want to see us build on. Our start-up loans programme is helping entrepreneurs set up a business or become self-employed, not only through a loan, but through access to mentors. By the way, this programme issues a high proportion of loans to black and minority ethnic applicants: BME-led businesses represent 24% of start-up loan recipients, with almost 10,000 loans issued to BME recipients so far.

Our support for business goes hand in hand with the historically high employment rate that we have in the UK, with today’s numbers confirming that the unemployment rate remains at an 11-year low, with employment remaining at near record highs.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Before I call the spokesman for the Scottish National party, I should warn the House that a great many people want to speak this afternoon. There were lots of interventions on the opening speeches—quite rightly so, because that is how you have a heated debate, and that is what this is. I make no criticism whatsoever, but that does mean there will have to be a time limit of three minutes on Back-Bench speeches. That does not, of course, apply to Alison Thewliss.

[Alison Thewliss (Glasgow Central) (SNP)]

I am grateful for the opportunity to take part in the debate, particularly as recent figures indicated that there have been 455 female MPs in the history of this House. That is the same as the number of male MPs present in the House today—although not on the Benches, as we can see. That is an important point in terms of the policies the House pursues, because those policies are not always in the interests of women, and women’s interests have not been well represented over the years. We did not always have the 195 women we have today, although those women we have here today have certainly made their voices and those of their constituents heard.

I am grateful to the hon. Member for Rotherham (Sarah Champion), who spoke very passionately and with great knowledge on this issue, and I absolutely support her calls for a gender audit because that would make a massive difference to the way Government policies are analysed.

Research from the Women’s Budget Group, which has been mentioned, noted that women’s incomes will be hit twice as hard as men’s by 2020. Women will be over £1,000 worse off by 2020; for men, that figure will be only £555. Women on below-average incomes will end up over £1,600 a year worse off under this Government, and female lone parents will be £4,000 a year worse off. That is a significant amount in a family budget.

Engender has suggested that, from 2010 to 2020, 86% of cuts to social security will come from women’s incomes. I do not understand how anyone could make up that difference. The research becomes even bleaker when we consider women from black and ethnic minority communities, as well as single parents, the majority of whom are women, and both groups are a significant demographic in my diverse constituency.

Government Members love their soundbites. For quite a long time, they had “a long-term economic plan”, but that has been abandoned, presumably because it was neither long term nor a plan. They now have a new phrase: “a country that works for everyone”. The facts and figures we have heard in the debate so far demonstrate quite clearly that this was not an autumn statement that works for everyone, and I intend to highlight a few missed opportunities in the autumn statement.

I come to the debate with some frustration. The autumn statement was an opportunity for the Government to make changes—to start a slightly new course with a new female Prime Minister. To use an example I have spoken about many times in the House, it is now 526 days since the Government announced in the 2015 Budget their intention to bring forward the pernicious two-child policy for universal credit and tax credits, which is due to come into force next April. In tandem with that, we have the medieval rape clause, which will compel survivors of rape to prove that their third or subsequent child was born as a result of rape. The policy has been widely condemned by faith leaders, women’s welfare groups, rape crisis organisations and organisations such as the United Nations Committee on the Rights of the Child. Ministers would do well to reflect on the seriousness of that widespread condemnation.

Interlink, from the Orthodox Jewish community, has done some research into the issue, as has the Resolution Foundation. Their figures suggest that this policy will push 200,000 more children into poverty. That is a significant figure. There is also a trap inherent in the policy, and families will not be able to earn enough to get themselves out of that trap. Interlink reckons that for every £1 extra a family earns, they will lose 75p as a result of this policy. On taking office, the Prime Minister spoke outside Downing Street about helping the justmanaging families in our society. This autumn statement does not provide that help.

When the Prime Minister was Home Secretary, she won plaudits for her action to tackle gender issues, such as forced marriage, domestic abuse and female genital mutilation. Her actions gave me some hope that this rape clause would be seen as utterly unworkable and immoral. When the consultation reports back, perhaps the issue will be tackled finally. I cannot see how this proposal can possibly work.

Instead of using the autumn statement as a means to ditch the rape clause and the two-child policy, the Government have put it out to consultation for 38 days. In the context of the more than 500 days since the policy was announced, that is a pretty small number. I await the Government’s response, but I do wonder what they expect the consultation to come back with. What do they expect vulnerable women to say when they are asked, in essence, “How would you like to prove your child was born as a result of rape?” It is absolutely despicable.

In this respect, as in so many others, the autumn statement was a missed opportunity. The Government’s austerity agenda is disproportionately impacting on women. It was a missed opportunity for WASPI—the Women Against State Pension Inequality Campaign—and the Office for National Statistics estimates that over 2,600,000 women in the UK are affected by this policy. Despite the efforts of WASPI campaigners the length and breadth of the country and of my hon. Friends the Members for Paisley and Renfrewshire North (Gavin Newlands) and for Ross, Skye and Lochaber (Ian Blackford), these issues are not yet addressed. Those women are not having that unjustness dealt with. That hugely significant unfairness, of which my mother-in-law is also a victim, ought to be one of the Prime Minister’s actions, both as a woman in that age bracket herself and as a feminist. Women should not lose out as a result of this policy.

The Government could also have done more in the autumn statement to address an issue that my hon. Friend the Member for Lanark and Hamilton East (Angela Crawley) has been highlighting over the past few weeks. Sadly, she is not well today; otherwise she would be here herself to raise it. I am sure we all send her our best wishes on her sickbed. The Child Maintenance Service is charging a 4% administration fee for the collect and pay service—a fee imposed only on families who do not share bank details to arrange maintenance costs—and women who have fled domestic abuse are disproportionately impacted. That is patently unfair, and it puts women and children who are trying to rebuild their family life at a distinct disadvantage. The autumn statement was an opportunity to correct that unfairness. I call on Ministers to make progress on this very significant matter.

Half of Glasgow’s jobcentres are to close. In discussion with DWP staff last week, Glasgow’s elected representatives were told that the equalities impact assessment on these plans would be done only after the consultation. The Government are proceeding with these closures, yet only three out of eight are going to consultation while the others will not be consulted on. This is completely inadequate. The plans were drawn up by looking at Google Maps to see how far one jobcentre was from another and which buses people might get. Some of the buses referred to do not exist any more because they have just been withdrawn. When I met representatives of One Parent Families Scotland, they told me that the women with caring responsibilities they have been working with are already finding it incredibly difficult to fulfil their obligations as well as dropping off their kids at school and nursery, and adding the extra burden of travelling across Glasgow on more than one bus will make it very much harder, as well as putting them at serious risk of being sanctioned. It is inexplicable that that would not be taken into account prior to these consultations being issued. It is almost as though the Government are deliberately making it so hard for people to claim what they are actually entitled to.

Another group who have missed out are the under-25s. The Government are keen to trumpet their “pretendy” living wage, but what they never say is that someone under 25 is not entitled to the same pay. Their day’s work is not seen as being as of much value as if they were over 25. The Government sometimes say that that is about experience, but it is not. For someone who walks into their job on their first day at the age of 25, the wage differential is £3.45 compared with somebody of 16 starting on the same day in the same job. That is patently unfair. The national living wage is not an actual living wage; it is a revised minimum wage that is out of touch with the true costs of living in this country.

The real living wage set by the Living Wage Foundation is being actively implemented and promoted by the Scottish Government. In Scotland, the rates of companies paying the living wage are going up. We now have 693 companies in Scotland, across a wide range of sectors and a wide range of sizes, that believe that a fair day’s work deserves a fair day’s pay. The Government’s “pretendy” living wage will not deliver that. In discriminating against under-25s, the Government do not acknowledge that they have bills to pay. They are not going to get a discount on their rents, their messages or their costs of living. They are also, to compound this, not entitled to the same benefits as those who are over 25. It is completely ludicrous.

There is another issue that the autumn statement has not fully addressed—the tampon tax. The SNP was the only party to have that issue in its manifesto in 2015. As the Minister may remember—he was then the Financial Secretary—when I moved my amendment to the Finance Bill, he seemed to think that resolving this would be nigh on impossible to achieve, but I am pleased that he has been able to make progress. I thank the hon. Member for Dewsbury (Paula Sherriff), my hon. Friends and others around the House who have campaigned on this issue. Without that cross-party support, we would not have got nearly as far as we have with the Government.

Although the recent funding announcement in the autumn statement regarding the revenues from the tampon tax were welcome, I would like to press the Minister to answer a couple of questions. How many groups in Scotland have benefited from tampon tax funds? When, for certain, will negotiations lead to the abolition of the tampon tax? We are still waiting. Every month, when I go to buy more tampons at the tills, the Government are still seeing that revenue come in. I want to know when I am not going to have to pay it any longer.

I agree with groups such as the Women’s Budget Group and Engender that this autumn statement was a missed opportunity. It was a missed opportunity on the rape clause and the two-child policy. It was a missed opportunity on pay equality. It was a missed opportunity for the WASPI women. It was a missed opportunity for all women.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I now have to announce the result of today’s deferred Division. In respect of the Question relating to financial services and markets, the Ayes were 297 and the Noes were 151, so the Question was agreed.

[The Division list is published at the end of today’s debates.]

We will now proceed, to begin with, with a time limit on speeches of four minutes, but that might well go down to three minutes very soon.

Small Charitable Donations and Childcare Payments Bill

Baroness Laing of Elderslie Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 15th November 2016 Commons Chamber

[Rebecca Long Bailey (Salford and Eccles) (Lab)]

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

[Madam Deputy Speaker (Mrs Eleanor Laing)]

With this it will be convenient to discuss the following:

New clause 2— Review of operation of gift aid matching rule—

‘(1) The Small Charitable Donations Act 2012 is amended as follows.

(2) After section 16, insert the following—

“16A Review of operation of gift aid matching rule

(1) The Chancellor of the Exchequer shall, no later than the end of the 2017-18 tax year, undertake a review of the operation of the gift aid matching rule.

(2) As part of the review of under subsection (1), the Chancellor of the Exchequer shall consult charities and other organisations that he considers relevant about—

(a) the role of the gift aid matching rule in preventing fraud and abuse, and

(b) the appropriateness of the Treasury exercising its order-making powers under section 14(2).

(3) A report of the review undertaken in accordance with this section must be laid before each House of Parliament by the Chancellor of the Exchequer.

(4) In this section, “the gift aid matching rule” has the same meaning as in section 14(3).”

This new clause requires the Chancellor of the Exchequer to review the gift aid matching rule and to consult charities and other organisations on the appropriateness of exercising the Treasury’s powers to amend or abolish that rule which limits the amount of top-up payments to which a charity is entitled by reference to the amount of gifts made to the charity in respect of which it has made successful gift aid exemption claims.

New clause 3—Regulations on local branches and groups—

‘(1) The Small Charitable Donations Act 2012 is amended as set out in subsections (2) and (3).

(2) After section 5(1) (general provisions on meaning of “connected”), insert—

“(1A) This section is subject to the provisions of regulations made under section 5A (regulations on local branches and groups).”

(3) After section 5, insert the following—

“5A Regulations on local branches and groups

(1) The Treasury shall by regulations prescribe organisations in which local or regional branches or groups may not be considered to be connected for the purposes of sections 4 and 5.

(2) The Treasury shall publish the first set of draft regulations made under subsection (1) no later than 31 October 2017.

(3) Before publishing draft regulations under this section, the Treasury shall consult—

(a) the Scout Association;

(b) the Guide Association;

(c) the Combined Cadet Force Association; and

(d) such other organisations as appear to the Treasury to be relevant.”

This new clause requires the Treasury to identify organisations with local or regional branch or group structures in order that those local and regional branches or groups can be separately eligible under the scheme, and to consult certain organisations about the regulations in draft.

New clause 4—Abolition of Gift Aid donations threshold—

‘(1) The Chancellor of the Exchequer must carry out an assessment of the impact on charities and Community Amateur Sports Clubs of amending the Gift Aid Small Donations Scheme so as to remove the 10% Gift Aid donations threshold that must be met in order to access the Gift Aid Small Donations Scheme, including an assessment of the differential impact on different sizes of charities and Community Amateur Sports Clubs concerned.

(2) The Chancellor of the Exchequer must lay a report of the assessment before the House of Commons within six months of the passing of this Act.”

Charities and CASCs must give gift aid exemption claims on donations received in order to make a claim under the Gift Aid Small Donations Scheme. The total gift aid donations must be at least 10% of the amount of the small donations on which top-up payments are claimed. This new clause would require the Chancellor to assess the impact of abolishing this requirement.

[Rebecca Long Bailey]

New clause 1 would require Her Majesty’s Revenue and Customs to publish in each tax year a report detailing the number of penalties imposed under the Small Charitable Donations Act 2012 and the circumstances giving rise to the imposition of such penalties; HMRC’s assessment of the extent to which charities have been established or have operated for the primary purpose of securing benefits from the small donations scheme; and an assessment of the evidence available on the role of the gift aid matching rule in preventing fraud and abuse. New clause 2 would require the Government to conduct a review of the operation of the gift aid matching rule, which is the rule that the total gift aid donations operation for a charity must be 10% or more of the amount of small donations on which top-up payments are made. The new clause stipulates that the Chancellor should consult charities and other relevant organisations about the role of the matching rule in preventing fraud and abuse, and the appropriateness of exercising the Treasury’s powers to amend or abolish the rule. New clause 4, which was tabled by the Scottish National party, would also require the Chancellor to assess the impact of abolishing the matching requirement.

During the Bill’s passage through the House, we have had extensive debates about the matching requirement—rightly so, because it is the biggest issue affecting the efficacy of the scheme, according to the charities that use it. The sector thinks broadly that the requirement is arbitrary and is a significant barrier to charities being eligible for the scheme. A consultation with members of the National Council for Voluntary Organisations showed that it is the most significant barrier to access for smaller organisations. The survey found that 50% of respondents with an income under £10,000 wanted the removal or reduction of the matching requirement.

Ahead of Second Reading, the NCVO argued that the Government have presented no evidence to demonstrate the extent to which the matching requirement is a necessary mechanism to prevent fraud and error, or that the matching ratio of 1:10 is the minimum necessary to achieve this objective. Despite considerable debate on this matter, we have got all the way to Report and the Government have still failed to provide any evidence that the matching requirement works. I would welcome the Minister’s comments on that today.

New clause 2 would force the Government to produce evidence in the form of a review and report on the operation of the gift aid matching rule, and whether it should be changed or removed entirely. New clause 4 would require a similar review, so we will be happy to support that measure. I would rather not have to press our new clauses 1 and 2 to a Division unless we have to. They call for a review of something that the charity sector says is hindering the scheme. I hope for some movement from the Minister on the issue today, but if the SNP’s new clause is pressed to a Division, we will support it wholeheartedly, as it reflects many of the principles that we have outlined in new clauses 1 and 2.

I am sure that the Minister will repeat her argument that the matching requirement is necessary to prevent fraud. I agree that we need measures to safeguard against such abuses. The Charity Commission has provided figures showing the extent of fraud in the charity sector. In 2014-15, 417 serious incidents involving fraud and/or theft or the misapplication of funds were reported by charities to the commission, and 255 operational compliance cases were completed. As Members are aware, just last week the commission announced in a press release that it was investigating the charity Our Local Heroes Foundation. According to the commission, it had received information about a proposed disposal of land owned by the charity, concerns regarding the founder of the charity receiving significant personal benefit through the charity, and a complaint that the charity was receiving only 20% of funds raised through a fundraising company.

This is just one case, but it is a sad example of charities being used as vehicles for tax avoidance and fraud. It is therefore incumbent on us to make it as hard as possible to abuse charitable status. That is why we have tabled new clause 1, which would require a review of the prevention of fraud and abuse in the small donations scheme. As I said, the review would need to address the number of penalties imposed under the Small Charitable Donations Act 2012 and the circumstances giving rise to the imposition of such penalties. It should include Her Majesty’s Revenue and Customs’ assessment of the extent to which charities have been established or have operated for the primary purpose of securing benefits from the small donations scheme, and HMRC’s assessment of the evidence available on the role of the gift aid matching rule in preventing fraud and abuse.

The Government’s guidance on the scheme explains that if a charity or community amateur sports club

“incurs a penalty in respect of an incorrect Gift Aid claim or GASDS”—

gift aid small donations scheme—

“claim, it won’t be eligible for the scheme both for the tax year in which the incorrect claim was made and in the following tax year.”

I would argue that the link between gift aid and the scheme is stronger than the matching requirement. Charities claiming gift aid can still be, and indeed have been, fraudulent organisations, so simply having a monetary link to the gift aid is not enough. This provision—that if a gift aid claim is wrong, a charity cannot claim through the scheme for that tax year and the following tax year—seems to be a stronger safeguard against fraudulent organisations than the matching requirement. Things might be more complex than that, but a review would clearly be beneficial, because we could assess where the matching requirement actually works effectively. In that way, the Government and the charities sector would be able to see clearly which anti-fraud measures were most effective.

New clause 3 deals with a different matter. Members and the Minister will remember that we made the case in Committee that certain groups—the girl guides, the scouts, and the Army, Navy and Air Force cadet groups—were not able to get the full benefit of the small donations scheme. That was after feedback from the respective charities’ representatives that, because of the structure of the groups, they were able to make only one claim for the entirety of the group, even though individual groups within them fund themselves.

The Minister responded that the measure proposed in Committee was unnecessary because the Bill allowed for what it proposed. She neatly illustrated why she would reject it—because, at the time, it carved out a few selected charities—but we want provisions to benefit a broad range of charities, some of which were not named in the original new clause tabled in Committee.

New clause 3 attempts to address the Minister’s points by allowing the Treasury to make regulations to exempt certain organisations from the connected charities rules. The Government would have to consult the Scout Association, the Guide Association and the Combined Cadet Force Association, in particular, before publishing those regulations. The Minister said she would reflect on the points raised in Committee, so I hope that she will accept the new clause today. It would not carve out a few selected charities, but give the Government the power to consult organisations that are mistakenly affected by the connected charities rules. It would, therefore, make the scheme run more smoothly, which is, after all, the point of the Bill.

I hope that the Minister has listened carefully to the rationale behind the new clauses and recognises that we are genuinely trying to achieve the same end: to make the gift aid small donations scheme work as well as possible for as many charities as possible. I hope that the new clauses will be accepted. We will not press new clauses 1 and 2 to a vote, but we will divide the House on new clause 3, and we will support new clause 4 should the SNP choose to press it to a Division.

Leaving the EU: Financial Services

Baroness Laing of Elderslie Excerpts

Thursday 3rd November 2016 Commons Chamber

[Andy Slaughter (Hammersmith) (Lab)]

My hon. Friend is absolutely right that this is a national issue, but I hope she acknowledges the work the Mayor of London has done in drawing attention to the importance of financial services. It would be curious if London were not represented on a Brexit Cabinet sub-committee but the other countries and regions were.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I appreciate that the hon. Member for Wirral South (Alison McGovern) is in some difficulty because the clock is broken, but she is handling it with great competence. I have been watching. She has taken an intervention and can speak until about 2.25 pm and 30 seconds. I thank her for dealing with the matter so well.

[Alison McGovern]

Thank you, Madam Deputy Speaker. I will do my best.

I thank my hon. Friend for his intervention. I am happier to support the words of the current Mayor of London than those of the previous one, who said that no one could deny that London is the engine of our economy. In financial services, as with everything else, our regions should be on equal footing. One should not be over another. It is a fact that London has extra lobbying capacity because Parliament is located in the city, so a corrective is necessary.

The second point on which I want to correct people’s impressions is that, although the hon. Member for Wimbledon (Stephen Hammond) is right to talk about competitive advantage, which matters, when we talk about globalisation and international markets, not least in the financial service sector, we are talking not necessarily about increased trade but about increased multinationalism. Companies stretch themselves much more over borders, which is why I still believe that our membership of the European Union was important. I accept the result of the referendum, but when we have multinational companies, we need to be involved in global governance so that we can protect the people who work for them in our country. The 1,000 people who work for Santander in Bootle and the 1,000 people who work for Merrill Lynch in Chester work for global companies. They therefore need global protection and global response. I hope that goes some way to answer the points made by the hon. Member for Stone (Sir William Cash), although no doubt he will not agree.

Finally and very briefly, we need to correct the impression of what is required. Passporting is absolutely crucial, as has been described by several Members, but it is not just that. The concentration of financial services in our country’s economy has meant that London has overheated for far too long. Financial services outside London have another crucial role. Building societies and the mutuals sector have been mentioned. We need to use our financial services outside London and the south-east to partner with Government to improve infrastructure investment and investment in small and medium-sized enterprises. Forty-two per cent. of start-ups happen in London and the south-east, which is simply not good enough. That is why I ask the Government not only for passporting but for rebalancing by supporting our financial services.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I am afraid that I shall have to reduce the time limit to four minutes: everyone has taken considerably more than five minutes because of interesting interventions.

--- Later in debate ---

[Joanna Cherry]

On a point of order, Madam Deputy Speaker. It is 49 years today since my colleague Mrs Winifred Ewing won the Hamilton by-election and came to this House as a solitary Scottish National party MP, and of course that means 49 years of SNP representation in this House, although we are rather more than one now. How would it be appropriate for me to mark this illustrious occasion in the history of my party and have it entered in the record?

[Madam Deputy Speaker (Mrs Eleanor Laing)]

The hon. and learned Lady has just proved herself to be a very adept and clever lawyer. Coming from me, that is a compliment. She will appreciate, as the House appreciates, that the point she made is not a point of order and does not, fortunately, require any comment from the Chair. However, she has made her point and it will be on the record that an historic event occurred 49 years ago today. I am sure the House will note that and, in its own way, celebrate it.

Concentrix

Baroness Laing of Elderslie Excerpts

Wednesday 26th October 2016 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Before I call the next hon. Lady, it will be obvious to the House that there are a great many Members who wish to speak this afternoon. We will start with a voluntary time limit of eight minutes for Back-Bench speeches. If that does not work, I will impose a time limit of eight minutes. This time limit, voluntary or otherwise, does not, of course, apply to the spokesman for the Scottish National party, Mhairi Black.

--- Later in debate ---

[Richard Graham (Gloucester) (Con)]

Today’s debate is primarily about the HMRC contractor, Concentrix, the delivery of its contract, its customer service and the impact of its work on those receiving tax credits who were wrongly suspected of fraud or error. The hon. Member for Stretford and Urmston (Kate Green) made some valid points about her constituents who have been affected, and other hon. Members have spoken equally movingly about some of theirs. The debate is about more than that, however. It is about the relative value, efficiency and service of third-party contracts as against the direct delivery of services by the Government or by Government agencies. It is also about how the Government—in this case, HMRC—reacted to the unexpected crisis when mandatory reconsideration appeals rose by 95% in August while the “success” in handling calls dropped off a cliff. It is about how quickly contingency plans were put in place, and what those plans were. It is also about whether the structure of the incentives and the contractor’s commission were appropriate for this type of public service delivery.

It is too early to offer definitive answers today, while the internal investigation is still going on. However, the inquiry by our Work and Pensions Committee and the measured comments from the Financial Secretary to the Treasury today offer some clues. To this, I add my own experience as an MP dealing with constituents who have been affected, and the observations that we made in the Select Committee.

The first point has to be that the goal of reducing HMRC’s estimates of fraud and error was the right goal for the Government to have. The 2014-15 estimates, which are the most recent ones, suggest a net £1.2 billion of fraud and error on tax credits, potentially involving 500,000 people. The Government cannot spend billions of pounds of taxpayers’ money on welfare without ensuring that it is spent properly, just as we expect the Department for International Development to ensure that its accounts are correct and its money is spent in the right way. We also expect the European Union to account correctly for the money it receives from its taxpayers, including our own.

The hon. Member for Paisley and Renfrewshire South (Mhairi Black) is absolutely right to say that rich people, and every company, should pay the right amount of tax. I would add that this is not a case of either/or. It is a case of both. The Government were absolutely right to increase HMRC’s resources for collecting the right amount of tax from those who have tax to pay and to ensure that the right amounts of welfare benefits are received by the right people. It is worth noting that the £270 million recovered through this programme will make a decent contribution to reducing fraud and we must ensure that it is made available to the people who need it most.

Secondly, there has been a cost during this process to our hard-working, not-well-off constituents. In each of the dozen or so cases that I or my office staff have replied to, there has been a degree of hardship and, in some cases, considerable hardship. HMRC’s response to such cases is therefore important. My sense, from our Select Committee inquiry, is that HMRC’s chief executive, Jon Thompson, is looking at how quickly HMRC has responded. It is true, however, that the moment HMRC took a grip, beefed up resources and put extra staff on to the MPs’ hotline, my office—and, I suspect, those of other MPs—was able to resolve these tax credits cases very fast. I am unsure whether all the cases were resolved within 48 hours, but all were done within three or four days, and some within a few hours. Indeed, the Work and Pensions Committee Chairman, the right hon. Member for Birkenhead (Frank Field), said that he could not

“recall an experience where, thank goodness, the Executive, whether Government or delegated, has acted so quickly when they have seen a crisis.”

That should be on the record. It is credit to how HMRC responded. In the evidence we took from affected people, there was one particularly gracious “thank you” to HMRC for resolving one individual’s crisis so quickly.

My third point relates to contracts to third parties and the incentive system within them. The National Audit Office recognised this as a complex area, and the jury is still out on how successful the system has been over the past few years. HMRC’s chief executive responded to my question on that with an interesting remark about

“the balance of incentives on third parties in these kinds of contracts”

which

“is essentially based on commission earned.”

He asked:

“Is that the right kind of incentive mechanism for this kind of public service delivery?”

It is a valid question, and other Members have mentioned it. The HMRC chief executive reflected on it. I also have no doubt that the NAO investigation will discuss whether bringing this sort of contract in-house would ensure better quality control, more experience of handling citizens who are on tax credits, and possibly even a reduced cost. From the evidence to the Committee, it broadly looked like Concentrix will have been paid about £27 million by the time its contract comes to an end on £270 million of fraud or error identified, implying a 10% commission. That feels high, but the figures are probably hypothetical at this stage and will need to be confirmed in due course by the investigation.

In all of this, the Government, HMRC and Concentrix have been absolutely right to start with an apology to those who have suffered. When mistakes are made, it is important that they are recognised immediately. HMRC and Concentrix started the Select Committee sessions by making their apologies—the Minister has added hers on more than one occasion—and that was important. There is the issue of compensation for those most affected, and the fact that, as the amendment states, the Government should “ensure that those people”—people on tax credits—

“are treated by HMRC in future with dignity and respect.”

That should happen all the time for everyone with whom the Government deal, particularly where monopolies such as HMRC exist. We all have a duty to treat our constituents with dignity and respect. That is what happens most of the time. My experience is that HMRC is helpful on every occasion with constituent issues.

In conclusion, today’s debate has been measured and the tone has been reflective and thoughtful across the House. Clearly, there are lessons to be learned. It is correct that tax collection is done, that welfare benefits are spent in the right way on the right people, that mistakes are responded to rapidly and that agencies such as HMRC should hold contingency plans. Poor service should be treated and amended as quickly as possible. I therefore welcome this opportunity to discuss some preliminary thoughts on the lessons that can be learned and I look forward to the NAO report in due course.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Although the hon. Member for Gloucester (Richard Graham) spoke for precisely eight minutes, the previous speakers did not, so I must now impose a formal time limit of seven minutes.