National Insurance Contributions Bill

George Hollingbery Excerpts

Tuesday 3rd February 2015 Commons Chamber

[Mr Gauke]

There is a reference to employers’ national insurance contribution. The tax summaries state how much is paid in income tax and in employees’ national insurance contributions. There is also a line in the summaries saying, “Your employer has paid this much employers’ national insurance contribution.” Returning to the issue directly before us in relation to apprenticeships, there is an argument—I think a lot of economists would make this point—that ultimately the burden of employers’ national insurance contributions is taken up by the employee, as they receive less in salary as a consequence. There is also a case that it may be a disincentive for employers to take on employees.

We believe this sensible and well-targeted measure will encourage businesses to take on apprentices. We have not focused particularly on the limit, but there is provision to prevent manipulation such as the classifying of premier league footballers as apprentices, which might result in a 24-year-old footballer paying no NICs on a salary of £1 million. We have sought to address such abuses.

[George Hollingbery (Meon Valley) (Con)]

Will the Minister develop that point a little by saying exactly how many apprentices he thinks the change will encourage?

[Mr Gauke]

We anticipate that there will be about 3 million apprenticeships over the course of the next Parliament. The provision will come into effect in 2016-17. Not every apprentice is under 25, so not every apprentice will benefit from the provisions, but a large number of apprentices in the next Parliament will benefit.

Overall, we estimate that about 180,000 employers offering apprenticeships in the UK are likely to benefit from the measure. Apprenticeship data from the Department for Business, Innovation and Skills for England for the 2013-14 academic year show that about 500,000 apprentices under the age of 25 are employed throughout the country, and we estimate that about 130,000 apprentices in England are aged 21 to 24. That group will be directly affected by the measure, with those under 21 already benefiting from the zero rate for under-21s from April this year. I hope that information is helpful to the House.

Many Members were delighted by the Chancellor’s announcement on apprenticeships in the autumn statement, which demonstrated, yet again, the Government’s commitment to apprenticeships. If we wish to succeed in the global race, we need a well-educated and well-trained work force and to support employers who provide the training and experience that young people need if they are to be more productive and effective and more likely to make a substantial contribution to the economy.

Quite rightly, we often debate how to improve living standards, but ultimately it is down to improvements in productivity. As the economist Paul Krugman said—I do not often quote him:

“Productivity isn’t everything, but…it is almost everything”.

As part of our long-term economic plan, one measure we are taking to improve productivity is ensuring a well-trained work force, and encouraging apprenticeships is key to that. It is yet another aspect of our long-term economic plan. It will help us improve our productivity, and as productivity increases, so too will wages, salaries and living standards.

[George Hollingbery]

Will the Minister elaborate on the Government’s own productivity and on whether our investment in apprenticeships has been compared with other possible investments in productivity?

[Mr Gauke]

My hon. Friend makes a good point. As I said, the Government invest about £1.5 billion a year in apprenticeships. In its 2012 report, the NAO suggested that for every £1 spent in this area, we got a return of £18, and studies by the Department for Business, Innovation and Skills suggest that the return might be even greater: £28 for every £1 invested. Therefore this offers good value for money. Our policy on apprenticeships is an additional step, and I am delighted that the tax system can be used in this way. Once again, it demonstrates that the Government are on the side of those who wish to work hard, improve their skills and get on in life.

With those remarks, I hope that the House will agree with the Lords amendment.

Lords amendment 1 agreed to, with Commons financial privilege waived.

Consumer Rights Bill

George Hollingbery Excerpts

Tuesday 28th January 2014 Commons Chamber

[George Hollingbery (Meon Valley) (Con)]

I am listening to the hon. Lady with interest, and one cannot help but agree with her on a large number of issues. I recently had a case in my constituency of people being ripped off on what looked like a DVLA website. However, is there not a danger that if we tried to specify every possibility and detail, the Bill would become far too fine-grained and would ultimately be used much less than if we defined things more generally?

[Stella Creasy]

We can have that argument in Committee, but being clear about pricing is not about any one of the individual issues that I have mentioned. It is a fundamental principle that should be in contracts. That would benefit consumers and mean that businesses could be clear that they had sold goods, so that we would not have some of the problems that we see further down the road. One point for us to consider in Committee is whether we can make clear what should be specified in a contract across a range of industries. That is not being specific; it is a general principle. Surely the hon. Gentleman would want his constituents to know what they are buying in advance of buying it.

[George Hollingbery]

Again, I cannot disagree with the hon. Lady, and that is indeed what the Bill is intended to do. At the same time, she makes specific criticisms about all sorts of cases without recognising that it would be extremely challenging to produce a general rule that would capture them all in a way that the courts could interpret.

[Stella Creasy]

I am disappointed that the hon. Gentleman does not believe that we can clarify what should be included in prominent pricing and at what point in the sale that information should be provided. Perhaps that reflects the Government’s small vision for consumer rights, because we could put that basic principle into the Bill and it would help to deal with a range of issues. The Government have chosen not to do that, and we are going to challenge them about it.

Women and the Cost of Living

George Hollingbery Excerpts

Tuesday 19th November 2013 Commons Chamber

[Gloria De Piero]

I have nothing to add to what my hon. Friend has said. She has put it perfectly.

The next Labour Government will offer a simple deal to employers: 32p off tax on every pound that they spend on paying workers the living wage during our first year in office. Tackling the cost-of-living crisis means taking action to increase wages and keep the benefit bill down.

[George Hollingbery (Meon Valley) (Con)]

Will the hon. Lady give way?

[Gloria De Piero]

I am nearing the end of my speech, so I will continue.

Something is broken when women are being forced to take two or three jobs in order to afford the basics for their families, and are being forced to take out payday loans just to make ends meet until the end of the month. We know that payday lenders target young women with their advertisements, and that the number of women declared insolvent is expected to overtake the number of men in that position for the first time. We need tough action to end the misery of so many women who are facing insurmountable debt. The next Labour Government will cap the total cost of credit. We will place a levy on the profits of payday lenders to double the public money available for low-cost alternatives for families, such as credit unions, and we will ban them from targeting kids with their advertisements.

All that we get from this Tory-led Government is complacency, and sometimes contempt, as I discovered this morning when I read in the newspapers that 42 Conservative Members of Parliament are members of the Free Enterprise Group, which advocates VAT on children’s clothes and on food. Was this some fringe group, I wondered? No. A Treasury Minister is a member, as is the child care Minister, the hon. Member for South West Norfolk (Elizabeth Truss). This is a group that recommends putting VAT on children’s clothes and shoes, baby food, car seats and prescriptions, raising the weekly shop by over £8.

We need a Government who will take on the vested interests, who will stand up to the big six energy companies, reforming the market and freezing prices until 2017; a Government who are prepared to take on the payday lenders, and who will cut taxes for 24 million working people with a lower 10p starting rate of tax; a Government who will cut business rates for small firms; a Government who will provide 25 hours of free child care for working parents of three and four-year-olds and a legal guarantee for every primary school in the country to provide breakfast clubs and after-school clubs, and introduce a compulsory jobs guarantee to bring down the number of women in long-term unemployment: a one nation Britain that values women’s talents, that supports mums back to work, that tackles the pay gap—a Britain where women play their full part. That is Labour’s Britain.

--- Later in debate ---

[Nicky Morgan]

I do not agree on either point. The point about the borrowing is that it is called the automatic stabiliser, and it works. When the economy is in the situation it is in, it is helping out the very families the hon. Member for Ashfield was talking about.

[George Hollingbery]

The shadow Minister was intent on not taking an intervention from me earlier. Would my hon. Friend the Minister acknowledge that the Government have looked at how households work, and at how income comes into them, and recognised that there is a real cliff edge at 16 hours of work? That means that incomes drop away at that point, and that for every pound earned, 95p is taken away in reduced benefits. We are introducing a fundamental change that will alter the position of women and allow them to take on full-time work. That is something that Labour failed to deal with in the entire 13 years it was in government.

[Nicky Morgan]

I could not believe that the hon. Member for Ashfield did not want to hear from my hon. Friend, but, having heard his excellent intervention, I now understand why she did not do so.

Independent Financial Advisers (Regulation)

George Hollingbery Excerpts

Monday 29th November 2010 Commons Chamber

[George Hollingbery (Meon Valley) (Con)]

I, too, will abandon my notes this evening, and restrict my remarks to one or two brief points.

Most of the topics have been more than adequately covered. There have been a great many well-made speeches in which many powerful points were made. There has been a lot of discussion about grandfathering, and I think it is worth pointing out that there are other ways in which IFAs could be grandfathered into the industry other than just a blanket allowance so they can all carry on practising. For example, would it not be possible for IFAs with more than X years of experience to continue advising clients who had been on their books for more than Y years, with their clients’ written consent? I can see no particularly good reason why people should not be able to elect to do that.

Also, if an IFA has X years of experience with no established complaint against their name, might they be able to pay to have an independent examination of their records to establish whether they had been responsible for some of this alleged mis-selling which the FSA is so clear has been going on behind the scenes, but which has not been recognised by many clients? It seems to me that there are ways forward that the FSA could follow to make sure we get the benefit of the experience that exists in the IFA community, and which otherwise looks as though it is going to be lost.

I am very worried that in the short term newly qualified advisers may lose out on the chance to be mentored by experienced colleagues, particularly if large numbers leave the industry. We may well also find that a number of clients suddenly lose the person from whom they have received advice very happily for a number of years, and they might not be at all confident or happy to change that adviser. At a time when clearly so many people have neglected to provide for their later years, it seems to me perverse that we should be reducing the number of suppliers in the market.

[Sarah Newton (Truro and Falmouth) (Con)]

Does my hon. Friend agree that at a time when the Government are making such welcome reforms to our pensions system, people will need independent advice more than ever, and if we press on regardless with these changes there will be increased costs and less access to such independent advice?

[George Hollingbery]

My hon. Friend’s point is, of course, very well made. With auto-enrolment schemes more advice, rather than less, is going to be needed, and there is no doubt in my mind that we need more advice right now. In short, the FSA still has not answered a large number of questions adequately, and I will certainly not be convinced that the retail distribution review is adequate or worth while until we receive some of those answers.

National Insurance Contributions Bill

George Hollingbery Excerpts

Tuesday 23rd November 2010 Commons Chamber

[Mr Gauke]

My hon. Friend raises a fair point. We are determined that in administering the scheme, Her Majesty’s Revenue and Customs will adopt a light touch as much as possible. The problems of bureaucracy and avoidance would be much greater if we tried to drill down to constituency or local authority level as opposed to regional level. I assure him that our assessment is that gains for participating businesses will greatly outweigh any administrative costs that they may face.

[George Hollingbery (Meon Valley) (Con)]

It occurs to me that this is a particularly prescribed aspect of the Bill with three particular areas identified. Will the Minister consider taking powers to himself that allowed him not just to exclude areas, but to keep a register of those he felt could be excluded, therefore allowing some flexibility? Should labour markets deteriorate markedly in certain areas, he could then revisit his decision and decide to support certain areas.

[Mr Gauke]

What we must bear in mind is that we have limited resources. If we were to extend this measure to every part of the country, the cost would increase by around 70%—in other words, £660 million over the course of three years. For the reasons that I set out, it would be difficult to drill this down to very precise areas.

Independent Financial Advisers

George Hollingbery Excerpts

Wednesday 20th October 2010 Westminster Hall

[Harriett Baldwin]

Indeed, that is a helpful intervention. I received a letter from someone in the north of England who was concerned about having to learn a lot about non-domiciled investors, which they did not think was very relevant in Sheffield.

In financial markets wisdom and experience are valued. Someone who has lived through a boom and bust cycle in the past is much less likely to believe that the latest investment fad will defy the laws of investment gravity. Someone who has seen a few economic cycles is much more likely to understand the ravages of inflation on savings. Someone who has been to a range of conferences over the years is more likely to know when something is really too good to be true. No exam can test that. Yet it is those experienced IFAs, who are often sole practitioners, who will find it hardest to take the time required to pass the specified exams.

[George Hollingbery (Meon Valley) (Con)]

Is not the situation also exacerbated by accounting rules? Being compelled to write off goodwill in one year, it is very difficult for groups of IFAs to acquire the business of smaller IFAs, which compounds the problem.

Equitable Life

George Hollingbery Excerpts

Tuesday 20th July 2010 Westminster Hall

[Mr Hoban]

I believe that there will be a statement before the summer recess. I recognise the concerns about Sir John’s work, but it is a useful building block in the process. To dismiss it and not give it due consideration would be an error.

[George Hollingbery (Meon Valley) (Con)]

Has the shape of the Minister’s thoughts on moving this issue forward changed from what he announced as the Conservative party’s plans in March?