Inheritance Tax

Grahame Morris Excerpts

Wednesday 17th January 2024 Westminster Hall

[Grahame Morris (Easington) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Robert. I congratulate my hon. Friend the Member for Hemsworth (Jon Trickett) on securing the debate, which is an opportunity for us as Members of Parliament to think about the sort of society that we wish to create. It is interesting that Conservative Members intervened on my hon. Friend to talk about raising thresholds, fairness and so on. I say to any of my constituents who have tuned into the debate: let us not lose sight of the fact that currently only 5% of people pay inheritance tax. That means that 95% do not pay it. If we are talking about fairness and the type of society that we want to create, we should look at the implications of either abolishing or providing further concessions to those currently liable for inheritance tax.

I know that this debate is narrowly defined. On previous occasions, I have asked whether we are serious about providing additional support for ordinary working people—not the 5%, but the 95%. Why are we not considering a proportional property tax to replace council tax? That would boost the income of every household in Easington on average by more than £750 per year, not 5%. There are levers that can be pulled, and that one would be revenue neutral. It would not involve levying any additional taxes; it would be a simple matter of applying a proportional property tax at a fixed percentage of the value of a property.

[Peter Gibson]

I am grateful to the hon. Gentleman, who I consider a friend, for giving way. I am interested in his points on a proportional property tax. We know from research that northern constituencies like ours would benefit significantly from that. Does Labour propose to include it in its manifesto?

[Grahame Morris]

Regrettably, at this point, no. As the hon. Gentleman is well aware, I am not a Front-Bench spokesperson for the Opposition. Irrespective of which political party grasps this nettle, it will bring enormous electoral dividends. There have been academic studies about the benefits of a proportional property tax. My constituency, the hon. Gentleman’s constituency of Darlington and virtually every constituency in the north and the midlands would be better off. [Interruption.] I apologise, Sir Robert: we are talking about inheritance tax. I was tempted off the subject—it was my own fault, and I am sorry.

The fundamental question is: are we going to champion equality, fairness and social justice, or are we going to perpetuate wealth inequality? Are we a democracy or a plutocracy? The current system is already generous. As my hon. Friend the Member for Hemsworth said, it allows £325,000 to be passed on tax free, and where a child or grandchild inherits an estate including a home, the threshold is £500,000. Above those thresholds, a 40% tax rate is applied, which means that a £1 million estate would pass on £800,000 to the beneficiaries.

As my hon. Friend indicated, there is chronic tax avoidance. In 2016, the Duke of Westminster inherited a huge estate that estimates suggest was worth about £9 billion. Reasonably, the Exchequer would anticipate a tax liability of about £3.5 billion at 40%, but sadly, by employing tax avoidance, using very clever lawyers and getting the best advice on trust laws, the aristocracy and the richest in our society regularly avoid paying their fair share of tax. We should be outraged at that. I suspect that in other countries there would be riots and demonstrations, but that is not our way.

Part of the problem is that the issues are not aired objectively through the mainstream media. This abuse of privilege not only entrenches economic inequality but places a larger tax burden on the vast majority—the 95% who do not inherit large family assets and are struggling in this cost of living crisis with stagnating wages and the highest tax burden in modern history. Tory plans to cut inheritance tax will not help my constituents. Instead of funding tax cuts for the richest on the backs of the poor, the Government should be looking to close the inheritance tax loopholes exploited by the wealthiest.

The sixth Duke of Westminster, Gerald Grosvenor, who passed away in 2016, outlined his advice to entrepreneurs on how to be successful. He was speaking at some sort of conference or event, and he suggested that the best way was to have an ancestor who was good friends with William the Conqueror. As with many tongue-in-cheek comments, there is a grain of truth in that advice.

Inheritance tax is meant to address widening inequality in society by taxing those with the greatest assets. However, wealth and privilege are entrenched in this country. Elite schools dominate our politics: we have had Prime Ministers from Winchester and Eton. The majority of our leaders went to elite universities. Perhaps I should correct that by saying “a single elite university”, since 13 out of 17 post-war Prime Ministers—more than 75%—attended Oxford University. Given that our leaders are entrenched in wealth and privilege, we should not be surprised that the Conservative party seeks to maintain a status quo that sustains that existence. Our society is dysfunctional when the richest 50 families in the UK have more wealth than half the population. Just think about that: they have more wealth than 33.5 million people. Recent analysis by Ben Tippet and Rafael Wildauer from the University of Greenwich found that if the wealth of the super-rich continues to grow at the current rate, by 2035—not too far away—the wealth of the richest 200 families in the UK will be larger than the whole of the UK’s GDP.

There is immense wealth in our society. Most people do not realise that there is sufficient wealth in society to address the range of economic, social and investment challenges that we face. The accumulation of wealth, concentrated in the hands of a few, is detrimental to a fair society. Those with immense wealth are not using it for the good of society. My constituency—no surprise here, Sir Robert—is devoid of benevolent billionaires; I wish we had a few. I am not a believer in trickle-down economics. However, my constituents look to the Government to create an economy and society that uses the wealth that they have generated to improve the quality of life for all. That is a task that this Government are failing to deliver on, not through neglect but through a deliberate policy that entrenches and expands pre-existing economic inequalities.

--- Later in debate ---

[Nigel Huddleston]

My hon. Friend makes an important point. We saw that in the recent autumn statement with the national insurance cuts. Our instinct and wish as Conservatives is to lower taxes, wherever appropriate and possible. We are also responsible with public finances and recognise that every single penny of Government spending is paid for through taxation, either immediately or in the future as deferred taxation—that is, borrowing money. We need to, and do, respect every single penny, because it is the public’s money, not Government money, that we are spending. Taxation is an important issue, and I am glad we are talking about it today. I am confident that it will be a major topic in the run-up to the election.

The Government support wealth creation but also understand the importance of ensuring that wealthy individuals make a fair contribution and pay tax appropriately. We do not have a specific wealth tax, as some other countries do, but if we look at the facts, it is clear that the Government do tax wealth, in a number of ways that generate substantial revenue, while remaining fair. For example, OBR forecasts for 2023-24 indicate that we can expect inheritance tax revenues of about £7.6 billion, capital gains tax revenues of £16.5 billion and stamp duty tax revenues of about £13 billion.

We also have a progressive income tax system, so that the top 5% of income taxpayers pay about half of all income tax. The top 1% is projected to pay about 28% of all income tax. It is also important to stress that in 2010, under the previous Labour Government, the top 5% accounted for 43% of income tax and the top 1% for 25%. Therefore, the system under the Conservatives is more progressive.

[Grahame Morris]

The Minister is putting forward an interesting proposition about progressive policies and taxation. Has he had a chance to consider whether council tax is a progressive form of taxation, when a millionaire, living in a £20 million property in Belgravia, very close to this place, pays less in council tax than my mother in a terraced colliery house worth about £50,000 in Murton?

[Nigel Huddleston]

The hon. Member needs to recognise that tax needs to be taken in the round. There is a variety of taxations—on income, wealth and other areas. Taxation is a broad topic, and individual taxes affect people differently. The hon. Member for Glasgow East (David Linden) made the point about inequality as well, but it is important to remember that, on average, households in the lowest income decile receive over four times more in public spending than they pay in tax. Nobody doubts the importance of a progressive tax system; my point was that the Opposition often try to make out that the tax system was more progressive under them, but it was not. The facts make that incredibly clear.

[Grahame Morris]

Will the Minister give way?

[Nigel Huddleston]

If the hon. Member will give me a moment to proceed, I will allow him to come in later, because I have other points to make in response to some of his comments.

Inheritance tax is a wealth transfer tax and applies to the estate of the deceased. Transfers made in the seven years before death are also taken into account. The estates of all individuals benefit from a £325,000 nil-rate band, and the targeted residence nil-rate band is a further £175,000 available to those passing on a qualifying residence on death to their direct descendants such as children and grandchildren. That means that qualifying estates can pass on up to £500,000, but the qualifying estate of a surviving spouse or civil partner can pass on up to £1 million without an inheritance tax liability. That is because any unused nil-rate band or residence nil-rate band is transferable to a surviving spouse or civil partner.

Finance (No. 2) Bill

Grahame Morris Excerpts

2nd reading
Wednesday 29th March 2023 Commons Chamber

[Grahame Morris (Easington) (Lab)]

Thank you for the chance to speak in this debate, Madam Deputy Speaker. I was quite taken by the Financial Secretary’s remarks setting out the three pillars of tax: making it fairer, making it simpler and encouraging growth. I want to focus on the failure of the Budget, and of this Bill, to address the flaws in the Government’s policy on levelling up that affect my constituency, because Easington has suffered and continues to suffer as a result of Government policy.

I am delighted that the Exchequer Secretary is on the Treasury Bench, because I want to touch on some barbed comments that he made to me and to my good friend, my hon. Friend the Member for Eltham (Clive Efford), in relation to allegations about wealth taxes, in a debate on the Budget. However, the main point that I am trying to make is about the failure of the levelling-up fund and of the Government to identify the resources needed to meet their primary objective of investing in and regenerating the poorest communities and most fragile economies in order to close the economic equality gap in the UK.

I also want to make a suggestion to Opposition Front Benchers: to develop a White Paper on investment and regeneration as part of our Budget strategy to be ready for the first days when we take office, as the Conservative party has been absolutely disastrous on supporting the poorest communities. In a previous speech, I highlighted some alternatives that the Government and my party might want to consider.

The Budget and the Finance Bill are all about political choices over tax. I am a great advocate, having looked into the matter in some detail, of a proportional property tax to replace council tax. It would be a tax cut for more than 75% of households—actually, in my constituency it would be for 100%—which would benefit from an average annual tax saving of £900. Regional economies would effectively receive a £6.5 billion economic stimulus annually, so that levelling up, rather than being a Government investment scheme, would be a feature of the tax system each and every year. It would streamline tax collection and make it more efficient, saving local authorities £400 million a year and meeting the Government’s stated aim of simplification.

In the little time I have, I want to mention the impact on Horden in my constituency. My constituents in the village of Horden were very much involved in the partnership developing the levelling-up bid. Horden is one of the poorest communities not just in east Durham or County Durham, but probably in the whole country. A great deal of time and effort went into developing the bid.

Many of the problems that Horden and my constituency face have been fashioned by Government policy. Does anyone remember the introduction of the bedroom tax? It had significant consequences for my community that we are still living through today. Accent Housing, a social landlord, cancelled a multimillion-pound decent home investment scheme in Horden, citing the collapse in demand caused by the introduction of the bedroom tax: many of its tenants were renting two-bedroom properties and were single people. The consequence was that Accent sold on the properties in a fire sale, so we have a plethora of private landlords.

Sometimes making the wrong policy decisions, particularly on tax, is worse than doing nothing. To my mind, and in the experience of many of us, the Government gimmick of making levelling up a funding competition wastes time, money and resources that could be better spent in the community. There is no way to calculate the cost and time that have been lost on consulting on and raising expectations for the failed bids, but I want to point out to the Exchequer Secretary that all five bids from County Durham were rejected. These are resources that we can ill afford to lose after 13 years of austerity, and cuts of more than a quarter of a billion pounds in Durham’s budget. My constituents are lobbying and protesting at County Hall—and, I should add, the council is now a Conservative-led coalition.

Things are very difficult, and my constituents, like me and like many other people across the country, have lost what little hope, faith and trust they may have had that a Conservative Government and Conservative policies could work in their interest, or indeed the national interest. As we have seen through their recent leaders, the Government are often more preoccupied with their own self-interest and short-term agendas. I am pleased to say that Labour is a Government in waiting, and only a general election away from restoring competent government.

I am seeking a commitment in relation to investment and regeneration. I do not want any gimmicks or games. Labour has set out our mission for government, which will guide policy and everything we do, and I therefore ask that we do not create games and competition on something as important as investment in our communities. Resources should be allocated to those in the greatest need, and I hope that the shadow Minister can confirm that instead of chaotic competition, Labour will produce a clear, targeted commitment with the purpose of closing the economic gaps and disparities and strengthening regional economies. I look forward to campaigning on such a manifesto.

Let me end by once again thanking my constituents from Hordern who are protesting and lobbying at County Hall and making their voices heard. I say to them that what this Government have done to our community is not fair or right, but together we will win, we will secure investment, and we will secure a Government who care and who represent the people.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the shadow Minister.

Alcohol Duty

Grahame Morris Excerpts

Monday 19th December 2022 Commons Chamber

[James Cartlidge]

I am extremely grateful to my hon. Friend, who speaks with great knowledge on these matters. He has been a consistent champion for the Scotch whisky industry, standing up for it in this place, whether on tariffs or duties. I know that he was lobbying the Chancellor and the Prime Minster to continue the freeze, so I hope that he is pleased with the result. On what happens going forward, I will engage with the Scotch whisky industry and indeed all the other alcohol sectors. The clear point is that the extension of the freeze is good news for every single sector and I hope that colleagues welcome that.

[Grahame Morris (Easington) (Lab)]

I am not sure whether I should declare an interest, but I do enjoy a tipple—a glass of beer—on occasions. I thank the Minister for his statement. May I seek clarification in relation to his comments on differential rates of duty? He mentioned the need for certainty and the need to encourage diversity in choice in the small brewery sector. He referred to the new draught relief, worth £100 million a year, to ensure that smaller craft brewers can benefit, and he mentioned that the threshold for qualifying containers will be 20 litres. Can he go further and say something about the duty taper? Are the Government going to address the cliff edge above 5,000 hectolitres for small producers?

[James Cartlidge]

The hon. Gentleman makes a good point. To clarify, the draught relief is the new differential duty between the rate applied to alcohol purchased on draught—in other words, in the pub—as opposed to, for example, in the supermarket. This is about creating a level playing field. Small brewers relief is becoming small producers relief, so it extends to cider makers, for example.

As a general point, I have a chart here—you will be pleased to know, Mr Deputy Speaker, that I will not get it out—showing the old rates and the new rates that will come in under the reform, and it is striking how much leaner the new system is. I am more than happy to write to the hon. Gentleman with details of the taper and the technical points. I think he will observe that this is a much simpler system.

Public Sector Pay: Proposed Strike Action

Grahame Morris Excerpts

Tuesday 1st November 2022 Westminster Hall

[Grahame Morris (Easington) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Edward. I, too, congratulate my good and hon. Friend the Member for Cynon Valley (Beth Winter) on securing this important and timely debate.

It is only right and proper that I refer to my entries in the Register of Members’ Financial Interests. I am a proud trade unionist. I am a member of Unite and chair of the Unite parliamentary group, I am co-chair of the National Union of Journalists parliamentary group and I am a member of several other trade union groups, including the justice unions, the National Union of Rail, Maritime and Transport Workers, the Public and Commercial Services Union and the Bakers Food & Allied Workers Union.

I have discovered that the UK has the most restrictive trade union laws in the developed world. Indeed, the Conservative Government’s pernicious Trade Union Act 2016 introduced very onerous, rigorous ballot thresholds. As my hon. Friend the Member for Rhondda (Chris Bryant) pointed out, few if any right hon. or hon. Members here today would have been elected if those same conditions had been applied to our parliamentary elections. However, trade unions are meeting those thresholds, with unions reporting record turnouts and record “yes” votes.

In the limited time I have, I want to illustrate the situation facing trade union members in just a few of the public sector unions. After 12 years of Conservative cuts, pay freezes, and attacks on pensions and terms and conditions, workers have been left with no choice. The civil service has rarely faced such a huge number of challenges in such a short period. Indeed, the PCS has launched a national ballot for industrial action, which I think closed yesterday, because its members face an unprecedented cost of living crisis. The Government plan to cut 91,000 civil service jobs; in response the PCS is calling for an end to those cuts, a 10% pay rise, a living wage of at least £15 an hour and an immediate 2% cut in contributions that PCS members have overpaid to pensions since 2018. That seems completely reasonable.

If we look at the railways, far from rewarding rail workers for their Trojan efforts during the pandemic, the Government have exploited the economic disruption that it caused and the restructuring that has been brought about on the privatised railways. Workers employed by Network Rail have been told that there will be an open-ended pay freeze from 2021. RMT members in most train operating companies received no pay rise in 2020, and from January 2021 the Government informed them that there was no budget to increase wages. Cleaners are in an even worse position, along with outsourced staff, who have been pushed to the brink of poverty. The RMT has calculated that rail cleaners on the national minimum wage have seen their annual earnings fall by £844 in real terms in the last year, even allowing for the April uplift.

Prison officers, who do an incredibly difficult job, often in hostile environments, are not allowed to take industrial action. It is important to welcome the fact that, after two years, the Government have finally accepted —the Minister is nodding because she was the Minister who did this—the recommendation of a £3,000 pay rise to staff on a fair and sustainable contract. However, that is not enough to make up for 21 years of cuts, as evidenced by the proliferation of food banks in prisons and the number of prison officers leaving the service.

A similar situation is reported by the National Association of Probation Officers. The Fire Brigades Union is in a similar predicament—staff were initially offered 2%, which has been upped to 5%, but with the caveat that the Government will not fund the additional 3%. The industrial action that we have seen across the public sector is a consequence of failed Government policy.

I must stress the vital importance of protecting the fundamental right to withdraw labour. The Government are threatening to introduce legislation to further undermine basic employment law. The right to strike must be protected at all costs.

Cost of Living: Fiscal Approach

Grahame Morris Excerpts

Wednesday 25th May 2022 Westminster Hall

[Grahame Morris (Easington) (Lab)]

It is always a pleasure to serve under your chairmanship, Mr Twigg. I congratulate my good and hon. Friend the Member for Barnsley Central (Dan Jarvis) on securing this important debate and on the powerful way in which he articulated the arguments in his speech.

I want to focus on one issue: the need to replace council tax with a proportional property tax. I want to demonstrate the inherent unfairness of council tax. I have some figures that I hope the Minister will find interesting, as they compare my constituency with hers. A proportional property tax would help families to address the cost of living crisis. It would also support the Government’s levelling up agenda and protect those on low incomes who may be disadvantaged by the reforms. I will explain how that will work.

I start by highlighting that 77% of households—more than 18 million—would benefit through a proportional property tax, with the average household saving £556 every year. A proportional property tax would replace council tax, bedroom tax and stamp duty. Outside London, regional economies would benefit from an overall reduction in property taxes of £6.5 billion, which would be a substantial stimulus for communities in need of levelling up and support those communities most in need. For example, under a proportional property tax my constituents would gain, on average, £900 a year compared with council tax. In the Minister’s South East Cambridgeshire constituency, two thirds of households would save money under a proportional property tax, averaging £350 a year. I hope this is something on which there could be cross-party consensus.

If we look at the effect on the constituency of the Minister’s colleague, the Chief Secretary to the Treasury, the right hon. Member for Middlesbrough South and East Cleveland (Mr Clarke), we will see that his constituents would receive almost £900 a year, similar to the amount that would be received by my constituents. Most people would benefit from this policy.

--- Later in debate ---

On resuming—

[Grahame Morris]

As I was saying before the Division, most people would benefit from the policy of moving from council tax to a proportional property tax. It is certainly true that there will be a small minority of cases where people on a low income but living in a high-value property could struggle, but that is perfectly possible to mitigate at the point of transition. Those struggling to pay the increase could have any rise capped at £100 a month. For those still unable to pay, options could be made available to defer payment until they can afford to pay or until the property is sold.

Council tax is unfair and the inequalities are stark. A £3 million property in Wandsworth pays less than 0.1% of its property value in council tax. We can contrast that with my constituency, where the average household pays more than 2% of the property value in council tax.

A simple system would also reduce admin costs by up to £400 million a year. The tax levied would reflect current property values, instead of the values as they were in 1991. Councils would no longer be forced to chase down council tax debts from people who were unable to pay, as payment can be deferred under a proportional property tax until the sale of the property.

Council tax is one of the most unfair and regressive taxes, taking a disproportionate amount from communities and individuals that can ill afford to pay but that often have a much higher demand for council services. Will the Minister explain why the current system of council tax is fairer than a proportional property tax? If she cannot, will she make the case for change to the Chancellor? I ask my Front Bench, in all humility, to reach out to the Fairer Share campaign. I would be delighted to facilitate a meeting. I think there will be substantial electoral dividends for the political party or parties willing to pick up the baton of a proportional property tax to replace council tax and include it in their manifesto at the next election.

National Insurance Contributions Increase

Grahame Morris Excerpts

Tuesday 8th March 2022 Commons Chamber

[Jerome Mayhew]

The hon. Member made a number of interventions on the Minister, and I refer him to the full responses that were given.

The question that I take from that is: how we will pay for the proposals? It seems to me that there can be only three answers. We can take money from other priorities in Government, we can borrow, or we can increase taxation. So far, I have heard no suggestions of other areas of Government spending that should be reduced. The Opposition typically move to defence spending as a simple way of extracting money for other commitments, but that is unlikely to be an area of future reductions in today’s environment; in fact, I submit that it will be the opposite.

[Grahame Morris (Easington) (Lab)]

The hon. Member is seeking suggestions. What does he think about the £8.7 billion of personal protective equipment that has been incinerated and gone up in flames? Surely nobody in their right mind would suggest that that is a good use of public money. Is it not possible to claw back some of those costs from the suppliers, if indeed the supplies were defective?

[Jerome Mayhew]

I am grateful to the hon. Member for his intervention. I suggest that a very good use of public money was emergency funding for PPE when we most desperately needed it in a national lockdown. It was inevitable that there would be a trade-off between speed—everyone in the House was cheering the Government on at the time—and maximising the effectiveness of every single contract. I hope that the Government make no apology for the speed with which they dealt with the crisis. They should be commended for that.

It has also been suggested that we should crack down on fraud. The hon. Member for Leeds West (Rachel Reeves) referenced a £4.7 billion headline in covid-related fraud, but she failed to give the Government credit for the actions that they have taken to address that. We have the Taxpayer Protection Taskforce, which has recruited 1,265 staff. We also have the work done on powers for the Insolvency Service and Companies House to link company directors directly to their bounce back loans, which has been used on 61,758 companies, catching loans worth £2.1 billion. The combination of those two factors means that the new estimate, which she did not find time to refer to, is not £4.7 billion but £3.3 billion. Fraud is therefore reduced to an estimated 7.5% of contracts, which is at least within spitting distance of the average for Government programmes of, I am sorry to say, as much as 5%.

--- Later in debate ---

[Grahame Morris (Easington) (Lab)]

Thank you, Madam Deputy Speaker, for calling me to speak in this important debate.

Like the constituents of all Members of this House, my constituents are experiencing a cost of living crisis, but for many in Easington, this is not a new or a temporary crisis. We need only look at food poverty and the normalisation of the use of food banks, many of which have been overwhelmed after a decade of Tory policies. In 2010, the Trussell Trust distributed around 40,000 emergency food parcels; last year, more than 2.5 million parcels were delivered. Shocking though those figures are, they do not even count independent food banks, such as those that operate in my constituency, including the much-valued service run by the East Durham Trust and the Dawdon Community Centre. Those figures, which show the exponential increase in food bank usage, are a sign of economic failure. People should be angry at a growing, Government-imposed cost of living crisis in which millions of families are experiencing hardship, as some of them have for more than a decade now.

There is no doubt about it: the Conservative party is making life harder for ordinary families. As many Opposition Members have said, poverty and policies that lead to increased poverty and inequality are a political choice—a political choice that the Government party has made in this case. Prices are rising: food, energy, fuel, diesel, petrol and housing costs are rising. Government Members were all elected on a promise not to increase taxes, and that includes national insurance contributions, which I understand the Prime Minister himself personally signed off.

We know that the Prime Minister’s political promises, whether made at the Dispatch Box or in an election manifesto, are ephemeral. An average worker’s income will be cut by more than £250 a year due to this national insurance hike. It will wipe out the council tax rebate that Ministers have referred to, as well as half of the Government’s mandatory energy loan.

The majority of my constituents will not see the benefit of capping social care costs because of the relatively low value of their properties. The Government’s policies make the poorest pay to protect the assets of the wealthy and the inheritance of the richest in society; I will come back to that in a moment. They will entrench poverty and economic inequality for generations to come.

This is a bad policy and a bad tax for the communities I represent, who face a social care tax double whammy next month. My constituents suffer not only from the policies of the national Conservative Government, but locally from the Tory-led coalition and alliance on Durham County Council. I quote the Tory leader of the Conservative group, who holds the finance portfolio on the council:

“There is no crisis in adult social care in County Durham. Members must take their information from our council reports and not from primary school level BBC National news reports.”

We have all been put firmly in our places.

Councillor Bell, I am sad to say, is being supported and facilitated by the Liberal Democrats, the Green party and the independents. They will be raising the council tax adult social care precept by 3% in Durham, despite having been elected on a manifesto promise that there would be zero increase in council tax. My constituents are being hit by two Tory taxes to pay for the cost of social care. Of the national insurance contribution we are discussing, I am not sure any of it will go to social care, but we shall see.

I will pick up on a point made by my hon. Friend the Member for Sheffield South East (Mr Betts) about the inherent unfairness of council tax. That tax disproportionately hits the poorest living in low-value properties. In my Easington constituency, of more than 40,000 hereditaments or properties, 75% are in band A. A home in band A in Easington, valued at £80,000, is paying around £29.75 a week in council tax. In contrast, a Russian oligarch’s band H home in Kensington, valued at £125 million, pays just £50.52 a week in council tax. It is a disgrace.

The Government have the wrong priorities, and last night’s votes on the Economic Crime (Transparency and Enforcement) Bill showed that. We do not need more tax—we need fairer tax. They should scrap the national insurance tax hike, work with me and others and with the Fairer Share campaign to scrap council tax, and support a proportional property tax to counter the cost of living crisis.

Finance (No. 2) Bill

Grahame Morris Excerpts

Report stage
Wednesday 2nd February 2022 Commons Chamber

[Layla Moran (Oxford West and Abingdon) (LD)]

I rise to speak on behalf of the Liberal Democrats, particularly on new clause 27, which is tabled in my name.

The Liberal Democrats have concerns about this Bill. People who work hard, pay their taxes and play by the rules are seeing their incomes squeezed through no fault of their own. They are being crippled by tax hikes, benefits slashes and skyrocketing bills, and today I am afraid the Chancellor is letting them down. He is providing less in extra catch-up funding for children than he is in a tax cut for bankers. In contrast, the Liberal Democrats are calling for a £15 billion catch-up fund for kids, support for small businesses and protection from energy bill rises for the most vulnerable, and we support all new clauses that help to that end. We live in precarious times and we must do more.

In the context of escalating tensions with Russia, I am also concerned about what is missing from the Bill. New clause 27 has support from both sides of this House. It is similar to new clauses 4 and 11, tabled by Labour and SNP Front Benchers—I am grateful to them for rowing behind this clause—but it also has Conservative Members as signatories, which goes to show the cross-party support for bringing in this measure.

The new clause asks for an impact assessment to be produced on the operation of the new economic crime levy, and would require the Government to assess how a register of beneficial owners of property would contribute to the effectiveness of such a levy. Sadly, due to the scope of the Bill, the new clause cannot introduce such a register, but that does not make the need for it any less urgent.

The register would close the loopholes that allow oligarchs to launder money through British property. Lax regulations have turned London into a playground and a laundromat for Russian oligarchs, with successive warnings from the intelligence and security communities painting the city as “Londongrad”. Prior to the pandemic, Transparency International identified 87,000 properties in England and Wales that were owned by anonymous companies registered in tax havens. A new analysis has found that, of the £6.7 billion-worth of UK property bought with suspicious money, £1.5 billion comes from Russia.

On Monday, the Foreign Secretary spoke about introducing new sanctions, and I welcomed that. It is interesting that The Moscow Times reported on Monday that the Kremlin was “alarmed” at the British threat and vowed to retaliate. The dirty money that oligarchs invest in yachts, football clubs and Belgravia mansions has close ties to Putin’s own wealth. We know how he operates: he gives them the money to buy the assets. If we aim at the oligarchs, we aim at Putin, but there is a problem, because we cannot sanction what we cannot see. Claims from the Government that we are standing up to Putin’s military manoeuvres ring hollow when he and his friends know full well that they have already hidden half the money in our own back garden, and the Government continue to do nothing about it.

Dirty money also undermines our credibility with our allies. The Centre for American Progress, a think-tank closely linked to the Biden Administration, said:

“Uprooting…oligarchs will be a challenge given the close ties between Russian money and the United Kingdom”.

I am afraid to say that the stench of corruption and dirty money wafts over our political system and the whole country, and it is incumbent on us here and the Government to clean it up. There is a way to do that, and it is through the economic crime Bill, but waiting for that feels like waiting for Godot. It should not be this difficult to get the Government to make good on their own promises, because it was a Conservative Government six years ago who said they would introduce it. Two thousand days later and we have had nothing.

Just this week, the Prime Minister stood at the Dispatch Box and announced plans for a register of beneficial ownership, but at this stage it feels like he is the boy who cried wolf. I urge the Minister to accept new clause 27, which has support on both sides of the House, to start those tentative steps, to show Putin we are serious and to make sure that we clean up dirty money from our politics and our country for good.

[Grahame Morris (Easington) (Lab)]

I appreciate the opportunity to speak to new clause 2 and amendment 34. I thank all Members who have co-sponsored or signed the new clause. It indicates extensive support not just from Labour Members, but from Members from across the House and a variety of parties. I must declare my interest as a member of the National Union of Rail, Maritime and Transport Workers parliamentary group, and I refer Members to my entry in the Register of Members’ Financial Interests.

New clause 2 is very important to UK-based employment in the maritime sector. The issue has been raised with the current shipping Minister, the hon. Member for Witney (Robert Courts), who is sympathetic to the arguments we are making, and previously with his predecessors, most notably the right hon. Member for South Holland and The Deepings (Sir John Hayes), who was enthusiastic about what we propose.

Clause 25 of the Bill makes tonnage tax more flexible for ship owners but no corresponding adjustments for seafarer jobs and skills based in the UK, as eloquently pointed out by the hon. Member for Thurrock (Jackie Doyle-Price). The tonnage tax’s original purpose—it was introduced by a Labour Government, by Gordon Brown—was to arrest the decline in training and employment opportunities for British seafarers in an increasingly deregulated labour market. We have seen the increasing dominance of flags of convenience.

I remind those on the Treasury Bench that at the time of the Falklands war—unbelievably, 40 years ago—there were 45,000 British-based ratings and officers in the UK. Today, that number is below 23,000. About a quarter of all seafarer jobs in the UK industry are UK-based. The Bill does not seek to improve the mandatory link to train officer cadets or to create a separate mandatory link for the training of ratings.

The comprehensive spending review Red Book commits the Government to

“explore how best to make use of existing powers regarding the training commitment”.

However, I understand from discussions with the maritime unions that the process, which I inform the Treasury Bench is being taken forward by the Maritime and Coastguard Agency, is not considering any specific measures to train British ratings or to employ British seafarers, including those who were trained on the tonnage tax vessels. This is a real wasted opportunity. If there is to be a Brexit dividend, we really must address that.

Perhaps it is a case of the Government, without taking action, inadvertently damaging the UK maritime sector, but there is an opportunity to put it right. New clause 2 would require the Government to review the impact of clause 25—tonnage tax—on employment and training for British officers and ratings, including the effect of changes to flagging arrangements on qualifying ships.

[Jackie Doyle-Price]

The hon. Member is making the case persuasively. Does he agree that one of the difficulties is that Government policy is siloed in this area? Perhaps that is why the Government are missing the opportunity. He is right that the maritime Minister—the Under-Secretary of State for Transport, my hon. Friend the Member for Witney (Robert Courts)—gets it completely and is sympathetic, but the decision-making capability rests with the Treasury. Does he think that we need to get the Government together to see the right outcome for everyone involved in the shipping industry?

[Grahame Morris]

I am grateful for that intervention, and of course the hon. Member is right. The new clause’s proposal is not revolutionary; it is common sense. It is joined-up Government and application of the principle of trying to ensure benefits for British-based seafarers from the growth predicted for the maritime sector, particularly in relation to zero-carbon and offshore. That is particularly important, given that the Government could seek to use clause 25 to attract more flags of convenience into the tonnage tax scheme. Tonnage tax is a tax break that has already provided £2.165 billion in relief from corporation tax for UK and international ship owners.

In truth, the new clause would be a modest change. The real measure required to boost seafarer jobs and training, including in some of our most deprived coastal communities—including mine—would be a new mandatory link to ratings training, as well as officer cadet training, as advocated by the ratings’ union, the RMT. I do not propose that, however, because that is beyond the scope of the Bill.

Amendment 34, which is linked to new clause 2, seeks to provide the Secretary of State with the power to consult maritime trade unions over compliance with environmental safety and working conditions on non-UK flagships in the tonnage tax scheme. That would be consistent with the minimum standards on seafarer safety that everyone in the House would seek to support and which are part of the maritime labour convention to which the UK Government are a signatory along with all other maritime nations. I could say a little more but time is short, so, in the interests of progress, I shall leave it at that.

[Bell Ribeiro-Addy (Streatham) (Lab)]

I rise to speak to new clause 7, on equality impact analyses. The Government’s efforts to date on equality impact assessments overall have been woeful. There should not be a need for me to speak to any detail of the new clause. We cannot talk about sexism, racism, homophobia, ableism, poverty and regional inequality properly without talking about the economy, because we know that structural inequality and discrimination hold many of our communities back. As my hon. Friend the Member for Ealing North (James Murray) said, we have a right to know exactly who benefits from the Government’s policy agenda, but their continued refusal to publish proper impact assessments for their Bills speaks for itself.

I want to emphasise how the Government and the Bill are deepening already existing inequalities. For all the talk of levelling up, the Government’s policies amount to a sharp widening of all types of inequality, which are already among the widest in western Europe.

Household Energy Bills: VAT

Grahame Morris Excerpts

Tuesday 11th January 2022 Commons Chamber

[Grahame Morris (Easington) (Lab)]

Thank you, Mr Deputy Speaker. In another place, those who were last will be first. It is an honour to follow my hon. Friends the Members for Leicester East (Claudia Webbe) and for Birkenhead (Mick Whitley).

This issue, the cost of living, shows the disconnect at the heart of Government and the realities on the ground for the vast majority of people, including many in my constituency. When the book is finally closed on the last chapter of the Conservative Government, they will leave a legacy of insecurity—the gig economy, zero-hours contracts, fire and rehire and the loss of workplace rights. Sadly, the Conservative party will be remembered as the party of child poverty, food poverty, fuel poverty and homelessness. We see that in the growing queues for food banks, the rising levels of private debt, and the unprecedented numbers of people sleeping rough on our streets. The political choices of the past decade have not put the resources of the state behind addressing these critical issues. Working families are facing tough choices this winter, and, in the months ahead, many will be pushed below the poverty line.

Better Jobs and a Fair Deal at Work

Grahame Morris Excerpts

Wednesday 12th May 2021 Commons Chamber

[Grahame Morris (Easington) (Lab) [V]]

The Government failed Britain’s workforce yesterday, with no mention of an employment Bill in the Queen’s Speech. I have read the briefing notes, including the section on living standards and the plan for jobs, but without an explicit employment Bill there is a major gap in the Queen’s Speech.

Clearly, we need a recovery plan from the covid-19 pandemic, and there must be change. It is uppermost in workers’ minds that furlough ends at the end of September, but once again we see the usual Conservative party response, wanting a return to business as usual. For many workers, that means low pay, insecure employment, zero-hours contracts or limited-hours contracts, and a gig economy with few employment rights and no right of redress against rogue or unscrupulous employers. Labour wants better jobs and a fair deal at work, but that cannot be achieved within the current balance of power, which is skewed so heavily against working people.

The Government have turned their back on workers’ rights in the package of Bills announced yesterday, but I hope that in the private Members’ Bill ballot, which is opening shortly, we have the opportunity to bring forward a Bill to ban the appalling and increasingly common practice of industrial blackmail that is fire and rehire. I declare an interest and thank my own trade union, Unite, and, indeed, all the other trade unions, for highlighting this appalling practice and doing all in their power to campaign to defend the wages, terms and conditions of working people. The Prime Minister will have received a letter from Unite the union signed by over 140 hon. and right hon. Members of this House, by peers and by 20 trade union leaders calling on him to outlaw the shameful practice of fire and rehire. Perhaps unsurprisingly, the letter has been met with stony silence.

To make matters worse, the Government are still refusing to release the publicly funded ACAS report on this practice. If I may, I want to take issue with the Chancellor of the Exchequer’s opening remarks. I am sure that he would not deliberately mislead the House, but he said quite clearly that Ministers were awaiting the report from ACAS. In fact, Ministers received the report on 17 February, so they are already in possession of it. I wonder what inconvenient truths lie in that report that are causing them not to publish it.

This issue needs immediate action. Ministers have allowed a situation to develop where one in 10 workers will be threatened with fire and rehire, with disputes ongoing at a number of companies and organisations, including Go North West, Jacobs Douwe Egberts, Goodlord and Heathrow airport. Indeed, yesterday, the National Union of Journalists condemned an attempted case of fire and rehire at the Oxford Mail and The Oxford Times. The UK lags behind countries, including Ireland, Spain and France, that have already banned it. If a Government committed to protecting bad employers does not make people angry, people should know that many of the companies engaged in this practice have received large sums of public money. Some have seen profits increase substantially, yet this Government place no conditions on the support that they have received.

Many ordinary working people are suffering, so yesterday I was proud to join Unite members, representatives and officers, and Labour MPs to make it plain that we stand with working people. I am immensely proud to do so as a Labour and trade union MP.

Government's Management of the Economy

Grahame Morris Excerpts

Tuesday 23rd February 2021 Commons Chamber

[Grahame Morris (Easington) (Lab) [V]]

I wonder who is really living in a surreal world when I hear some of the contributions from the Government Benches. Perhaps Conservative Members should have a look at the levels of national debt and some of the dreadfully incompetent decisions that are making matters worse, and walk a mile—or a short distance—in the steps of ordinary people and have a dose of reality.

Covid-19 has highlighted the fundamental weaknesses in the UK economy. Clearly, we have suffered some of the worst death rates in the world, coupled with a fall in economic activity suffered by no other major developed economy. Those weaknesses in our economy have been created over the last decade. Compounding the problem is the fact that the governing party has systematically undermined our vital public services.

I am well aware, because I served on the Bill Committee, that the NHS went through a costly and unnecessary reorganisation that has squandered billions of pounds and opened up our health service to privatisation. The problems are so acute that now, after only eight years, the Government have published a White Paper for a new health and social care Bill. I find it difficult to understand when I see the Prime Minister and his Ministers applauding our key workers—surely it is reasonable to ask where they have been during the last decade of public sector pay freezes. On the eve of the pandemic, falling real-terms wages in the NHS contributed to a workforce crisis. Year on year, taking account of inflation, wages have fallen for 10 years.

Nowhere has been more hard-pressed in the last decade than local government. We now have the Government’s council tax bombshell, which is only weeks away. Instead of helping hard-pressed families in areas like mine, a succession of Governments led by the Conservatives have passed on the financial burden for maintaining local services to local taxpayers through higher council tax. At a time when local authorities such as Durham have had £260 million cut from their budgets, we should applaud them and congratulate them on their work with their public health teams to reduce covid transmission.

We should look at the realities of universal credit and what happens, year on year, when Ministers quietly cut the strings of our social security safety net. Sadly and unnecessarily, the Prime Minister maligned my hon. Friend the Member for Leeds East (Richard Burgon) yesterday during the statement for his trade union affiliations. Like my hon. Friend, I am proud of my trade union affiliations and the role trade unions have played in defending the living standards of working people.