Oral Answers to Questions

Gareth Davies Excerpts

Tuesday 7th May 2024 Commons Chamber

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

8. What fiscal steps his Department is taking to support small businesses.

[The Exchequer Secretary to the Treasury (Gareth Davies)]

Small businesses drive our economy, and we support them to thrive using levers across Government, whether through our small business rates relief, by increasing the VAT registration threshold, or providing reliefs such as the annual investment allowance.

[Stephen Crabb]

In England, many small businesses receive a 75% reduction in business rates thanks to action by this Conservative Government. In Wales, the Labour Administration have cut that level of support to 40%, meaning that excellent hospitality businesses such as Martha’s Vineyard in my constituency must find thousands of pounds more in tax. Does the Minister agree that that is not the way to support the tourism and hospitality sector at a challenging time, and that it is an example of the Labour party saying one thing here at Westminster and doing another where they are in government?

[Gareth Davies]

My right hon. Friend is right that in the autumn statement the Government extended retail, hospitality and leisure relief in England, essentially to cut tax for 230,000 businesses—a tax cut worth £2.5 billion. The Barnett formula allows the Welsh Labour Government to offer similar relief to Welsh businesses, and it is disappointing, if not surprising, that they have chosen not to.

[Helen Morgan (North Shropshire) (LD)]

On Friday, I visited the K C Jones Motor Repairs garage, a medium-sized business of very long standing in Oswestry in North Shropshire. One of the many challenges that it faces, alongside astronomical energy bills and a shortage of skilled labour, is the business rates that it needs to pay because it must have a high street presence in order for people to take their cars there. Will the Minister consider fundamental reform of business rates so that businesses that need a high street presence can continue to exist? At the moment, they are under huge pressure.

[Gareth Davies]

As I was saying, we have a 75% relief for most high street businesses. I encourage the hon. Lady to look at the package as a whole. We have increased the VAT threshold, bringing 28,000 businesses like the one she describes out of paying any VAT at all, on top of a range of other measures.

[Dame Andrea Jenkyns (Morley and Outwood) (Con)]

The cherished independent shops and restaurants that line the streets of Morley serve the lifeblood of our community. In order to safeguard the very heart of our local economy, what bold measures is the Department taking to counter the oppressive weight of skyrocketing business rates imposed by the financially reckless Labour-led Leeds City Council?

[Gareth Davies]

I know that my hon. Friend is a great champion of all businesses in Morley and across Leeds because I have seen it at first hand. I point out to her as well that the Government have reduced taxation on small businesses, we have increased the VAT threshold, and we have a 75% rate relief for retail, hospitality and leisure businesses, which she alluded to. It is this Conservative Government who are on the side of hard-working people and businesses across Morley and around the country.

[Wera Hobhouse (Bath) (LD)]

In the last decade, more than one music venue closed every week, including Moles in Bath. That has resulted in the loss of 4,000 jobs, 14,250 events, over 190,000 performance opportunities, £9 million of income for musicians and £59 million in lost direct economic activity. What are the Government doing to support small music venues?

[Gareth Davies]

We are doing a lot. We are increasing the VAT threshold, and we have a rates relief package. The recent spring Budget was one of the biggest packages supporting our cultural industries that this country has ever seen, and I encourage the hon. Lady to look at it.

[Mr Speaker]

I call the shadow Minister.

[Gareth Davies]

Banking hubs are driven by commercial organisations. Any area that loses bank branches is entitled to get a banking hub. Of course, we want to see more across the country, but we also have to recognise that banking has changed and the ways in which people bank have moved more towards digital, so it is right that commercial organisations take commercial decisions.

[Liz Twist (Blaydon) (Lab)]

10. What recent fiscal steps he has taken to help reduce regional economic inequalities.

[The Exchequer Secretary to the Treasury (Gareth Davies)]

At the spring Budget, we built on the £15 billion of levelling-up commitments made since 2019. We announced a trailblazer devolution deal for the north-east mayoral combined authority and a £400 million extension to the long-term plan for towns.

[Liz Twist]

The cross-party Public Accounts Committee has revealed that the Government’s levelling-up funds were subject to a “worrying lack of transparency”, with rules for accessing funding changing while bids were still being assessed. Will the Minister therefore apologise to the 55 local authorities rejected for funding that were not told in advance that their applications had no chance of success?

[Gareth Davies]

This is the Government who implemented £15 billion of support for communities outside of London and the south-east, which is one of the reasons why median pay growth is higher in every region outside of London and the south-east. Of course, there is a robust methodology and criteria for selecting places for funding, and I encourage the hon. Lady to look at those criteria.

[Peter Gibson (Darlington) (Con)]

With the Darlington economic campus now having passed 750 employees and being well on its way to providing over 1,500 roles in my constituency, what assessment has my hon. Friend made of its contribution to the local economy, to reducing inequalities and to our levelling-up agenda?

[Gareth Davies]

The Darlington economic campus is an important part of this Government’s operations and of our Government estate, but it is also important to the people of Darlington, and not just in terms of the jobs it has created. Of course, it builds on the back of significant funding on my hon. Friend’s watch: the £22 million town deal and the £6 million as part of the shared prosperity fund. That is one of the reasons why the people voted to elect Ben Houchen just the other day.

[Emma Hardy (Kingston upon Hull West and Hessle) (Lab)]

Regional inequality may be made worse by my constituents facing having to pay again for funeral plans after they were sold fake funeral plans by Legacy funeral directors. Many simply cannot afford to pay for those plans again and, instead of having the funeral that their families wanted for them, they will only be able to have the free service offered by the council. Does the Minister agree that banks should offer more discretion when looking at victims of fraud, and will he meet with me to discuss this specific case further?

[Gareth Davies]

I am very sorry to hear of the circumstances that the hon. Lady has described. My hon. Friend the Economic Secretary, in whose portfolio this issue sits, will meet with her.

[Martin Vickers (Cleethorpes) (Con)]

For many years, coastal communities have suffered economic inequalities, and we all know that the best way of changing that is to create the conditions for investment and the jobs that go with them. Despite the good work that the Government have done, we still need more funding in areas such as Cleethorpes. Could the Minister outline what plans the Government may have for bringing forward further schemes in the near future?

[Gareth Davies]

It is right to acknowledge that funding has gone in. I completely appreciate the specific challenges that coastal communities face, but it is important to look at the package of measures to level up—not just funding such as the shared prosperity fund, levelling-up fund and towns fund, but the 13 devolution deals, 13 investment zones and 12 freeports. These are all packages and measures that will help areas such as my hon. Friend’s, but I will always keep his area in mind.

[Mrs Flick Drummond (Meon Valley) (Con)]

11. What fiscal steps he is taking to support households with the cost of living.

--- Later in debate ---

[Carla Lockhart (Upper Bann) (DUP)]

T5. The consistently high price of fuel is making drivers dig deep just to go about their daily business. With a rise of 10p reported since the start of the year and the average cost of filling a family car now £82.50, what efforts will the Government make to help those people in my rural constituency and across the United Kingdom who have little or no access to public transport and are dependent on their vehicles for work and family life?

[The Exchequer Secretary to the Treasury (Gareth Davies)]

The hon. Member is entirely right. That is why we froze fuel duty at the last fiscal event: a measure that costs £6.5 billion and will save the average driver £50.

[Mr Tobias Ellwood (Bournemouth East) (Con)]

May I place on record my thanks to the Chancellor, who in his Budget devoted funds to Bournemouth for a police violence reduction unit? Does he agree that these units have a track record up and down the country of tackling knife crime by not just seeing extra police on the frontline, but engaging with schools to ensure that youths and students understand the folly of carrying a knife in the first place?

--- Later in debate ---

[Ian Levy (Blyth Valley) (Con)]

Cramlington has a world-leading pharmaceutical company, Organon, which employs 700 people and produces medicine for the UK market as well as abroad, with a particular focus on women’s health. Will my right hon. Friend the Chancellor please meet me to discuss the impact on pharmaceutical investment?

[Gareth Davies]

My hon. Friend is absolutely right. The pharmaceutical industry is worth some £14 billion to our economy. I am pleased to tell him that the industry has seen a twelvefold increase in equity financing in just the past decade, and I would be pleased to meet him to discuss that further.

[Wera Hobhouse (Bath) (LD)]

Soaring rent costs are the biggest reason why my constituents in Bath are struggling. The average monthly rent in Bath and north-east Somerset has risen by more than £200 in the past three years. What support will the Government give to people who rent in the private sector?