Oral Answers to Questions

Debate between Guto Bebb and Mark Pawsey

Wednesday 6th September 2017 Commons Chamber

[Guto Bebb]

In the previous Parliament, the hon. Lady was an Opposition Front-Bench Treasury spokesman, so she will be aware that we need to analyse the benefits and costs of a tidal lagoon. The decision will be made and announced in due course by the relevant Ministers.

[Mark Pawsey (Rugby) (Con)]

There is great support for the tidal lagoon in my constituency, where GE Energy would manufacture the turbines. Is the Minister concerned that our lead in this sector might be lost if we do not make a swift decision?

[Guto Bebb]

Having read the Hendry review, I am aware of the technology’s possible benefits to industry across the UK. That is why we are giving such serious consideration to the report produced by Charles Hendry.

Oral Answers to Questions

Debate between Guto Bebb and Mark Pawsey

Wednesday 13th April 2016 Commons Chamber

[Mark Pawsey (Rugby) (Con)]

3. What recent assessment he has made of employment trends in Wales.

[The Parliamentary Under-Secretary of State for Wales (Guto Bebb)]

The labour market in Wales has never been stronger. Although we recognise the challenges facing the Welsh economy, there is a lot to celebrate. Unemployment has fallen to its lowest since 2008 and the number of people in work in Wales is at an all-time high.

[Mark Pawsey]

I welcome the Minister to his position. He is quite rightly focusing on the issues affecting steel production at Port Talbot, but what assessment has he made of the decision by Aston Martin to build its new DBX car at St Athan?

Transatlantic Trade and Investment Partnership

Debate between Guto Bebb and Mark Pawsey

Tuesday 25th February 2014 Commons Chamber

[Guto Bebb]

On the “Buy American” strategy in America, is it not the case that the concern lies more with politicians than businesses? One business in Philadelphia said that “Buy American” often means paying more for lower quality, and that they do not have their own businesses to develop it.

[Mark Pawsey]

My hon. Friend makes a fair point, but the perception of politicians was that the “Buy American” policy kept jobs in the United States and prevented them from being lost. As politicians, they wanted to ensure that employment in their states was being maximised.

The US does not always give things away and there is not a gung-ho attitude to the free market. Regular reference was made to the 1920 Merchant Marine Act, otherwise known as the Jones Act, being a great example of how America can be protectionist when it wishes to be. That is the legislation that requires all goods transported by water between US ports to be carried on US-flagged ships constructed in the US, owned by US citizens and crewed by US citizens. So the US can be protectionist and prevent other countries from gaining access to its markets. We heard more than once the quote from Benjamin Franklin:

“No nation was ever ruined by trade.”

The TTIP provides massive opportunities for US goods and produce in the EU.

In the UK there is broad support, as we have heard from both Front Benches today, and why would there not be, when we are talking about 50% of world GDP and 30% of international trade? This is an opportunity for us only if our economy, our industry and our service companies are in shape to take advantage of it. That is why the broader policies of this Government to increase our competitiveness and our skills agenda are important. If those are right, we can take advantage of an additional £10 billion to the UK economy.

I am pleased that the Federation of Small Businesses here in the UK welcomes the TTIP negotiations and looks forward to a resolution. A fifth of FSB members are exporters, and the US is the second most important destination for small businesses that export. It is believed that the TTIP could add 400,000 UK jobs. The FSB has set out a wish-list for the TTIP, including a pledge to promote entrepreneurship and a pledge of smart regulation on both sides of the Atlantic.

This has been a very important debate. There are big opportunities for both the EU and the US in growth and jobs. There needs to be a timetable. One of the concerns that I was left with as I came away is that there are rather more serious consequences of not doing a deal than there would ever be of doing a deal.

Commercial Property

Debate between Guto Bebb and Mark Pawsey

Wednesday 17th November 2010 Westminster Hall

[Mark Pawsey]

My hon. Friend, whose constituency neighbours mine, is entirely right. There have been unforeseen consequences, one of which is that it is more sensible for property owners to develop a property rather than retain it for future use.

The rates are almost a form of wealth tax, levied on ownership of an asset rather than the income derived from it, as was originally intended. In times of recession, many small businesses find themselves occupying properties too large for their immediate needs and look for a tenant to take their surplus space. Where they do so, the rents add to their income and the occupier of the business becomes liable for the business rate, but if they cannot find a tenant, they face the burden of further business rates. For most businesses, business rates make up their third biggest item of expenditure, after wages and rents. Also, business rates are a fixed cost. They do not decrease as turnover declines during recessionary times. I am concerned that in many cases, excessive bills are contributing to business failures and leading to higher unemployment.

A further unfairness is that it often takes a long time to find a tenant for vacant commercial property, a fact reflected in the time limit allowed for the non-application of rates. Even in boom times, an industrial property is likely to remain vacant for between 12 and 18 months. In the current economic climate, the loss of a tenant will almost certainly mean additional liability for business rates that might not have been budgeted for.

The effect on rental values has not been what the Government intended. They hoped that rental values would fall, but an April 2009 report by the Royal Institution of Chartered Surveyors suggested that that objective had not been achieved and that property owners were offering other incentives instead, such as rent-free periods. There has also been a detrimental effect on capital values. The same report found that because empty property rates make fewer investors willing to enter the market, investment levels in the sector have fallen.

[Guto Bebb (Aberconwy) (Con)]

I congratulate my hon. Friend on securing this debate. The point about property values is important. In my constituency, responsible landlords have found themselves unable to proceed with property refurbishments and renewal work because they are paying rates on empty properties in other parts of the same area. The rates have a knock-on effect on the quality of the offer in towns such as Llandudno in my constituency.

[Mark Pawsey]

I thank my hon. Friend for his contribution; he makes a very good point. The hope that the application of empty business rates would encourage the property owner to accept lower rents in order to keep their buildings occupied, and that it would support businesses in the economy generally, has not been realised. There is a parallel here with the position taken by Opposition parties in respect of welfare reforms. The Opposition say that there is no point in trying to force people to take jobs because there are no jobs available. Similarly, there is no point in trying to force landlords to let commercial property cheaply if there are simply no occupiers to take up the space. There are absolutely no incentives for property owners to keep their buildings empty and not be active in seeking occupiers. In the case of Mr Summers, his failure over the past two and a half years to find a tenant has not been for the want of trying.

As mentioned by my hon. Friend the Member for Nuneaton (Mr Jones), one way in which property owners can avoid their liability for empty property rates is simply to demolish the property—if there is no building, there is no business rate. The RICS survey shows that the application of vacant property taxes is currently the strongest single factor in determining which buildings are demolished. It is often the older, less attractive properties for which, in times of recession such as now, it is more difficult to find a tenant. However, in most cases such properties are perfectly sound, usable buildings. An unintended consequence of the 2008 changes is that much of such low-cost industrial accommodation will no longer be available. Just as the country starts to emerge from recession, the start-up businesses that will be so important to our future prosperity will not be able to find any premises to operate from.

As my hon. Friend the Member for South Staffordshire (Gavin Williamson) mentioned, given the anxiety of completing a building, not being able to find a tenant and thus becoming liable for empty property rates, it is absolutely no surprise to find that property development companies are no longer developing commercial property on a speculative basis.