Economic Update

Helen Whately Excerpts

Monday 17th October 2022 Commons Chamber

[Jeremy Hunt]

The right hon. Gentleman asks a very important question. I remind him that what I have announced today has been very largely the cancellation of planned tax cuts, rather than being new tax increases. This has a very important impact, in a positive direction, on national finances, but unfortunately it will not be the end of the story. If we are to deliver a credible Budget in which we can demonstrate—my right hon. Friend the Member for West Suffolk (Matt Hancock) asked about this earlier—that debt is falling as a percentage of GDP by the end of the period, we will have further difficult decisions ahead. This Government will not shirk from them.

[Helen Whately (Faversham and Mid Kent) (Con)]

With a pandemic followed by a war, our constituents do not expect this time to be easy, but they do expect us to set out the difficult choices, make the difficult choices and then set out the path to a better future. May I ask my right hon. Friend, particularly considering his experience of many years, to continue to press ahead with our commitment to reforming social care, knowing as he does how social care and the NHS go hand in hand and how important they are to our constituents?

[Jeremy Hunt]

My hon. Friend and I have had very many discussions about social care over the years, mainly when I was a Back Bencher and she was a Minister. The sector is in great difficulty at the moment; I am very aware of those concerns, and I am also very aware of the pressures in the NHS at the moment. I am not making any commitments as to what exactly we will do, but as I said earlier, all these decisions will be taken through the prism of what matters most to the people who need help the most.

The Growth Plan

Helen Whately Excerpts

Friday 23rd September 2022 Commons Chamber

[Kwasi Kwarteng]

We will make announcements about that in due course.

[Helen Whately (Faversham and Mid Kent) (Con)]

I welcome my right hon. Friend’s focus and drive for increased economic growth and for making sure that people get to keep more of what they earn. Will he assure me that, as part of that, the Government will also be absolutely focused on reducing the barriers that sometimes prevent people from working more and earning more—particularly when it comes to skills and childcare?

[Kwasi Kwarteng]

The childcare issue has been raised many times and I am looking forward to a subsequent statement from my right hon. Friend the Secretary of State for Education. That is clearly an issue that can unlock growth and enable people to go out and earn money to protect their families. That is really important.

Oral Answers to Questions

Helen Whately Excerpts

Tuesday 28th June 2022 Commons Chamber

[Mr Gagan Mohindra (South West Hertfordshire) (Con)]

12. What fiscal steps his Department is taking to support small and medium-sized enterprises.

[The Exchequer Secretary to the Treasury (Helen Whately)]

Small and medium-sized businesses are at the heart of our economy, creating jobs and prosperity across the UK. We continue to give substantial support to SMEs by raising the employment allowance; extending the £1 million annual investment allowance; providing business rates relief for retail, hospitality and leisure businesses; and with the Help to Grow programme.

[Saqib Bhatti]

A couple of weeks ago, I met people from a number of hospitality businesses at Nailcote Hall. They expressed not only their gratitude for the support the Treasury gave during the pandemic, but their concerns about the cost of living and about supply-chain costs, which they cannot necessarily pass on to consumers. What assurances can my hon. Friend give the businesses in my constituency, especially those in the hospitality sector, that the Government will keep them in mind in terms of future support?

[Helen Whately]

It is good to hear that my hon. Friend has been speaking to the hospitality sector in his constituency, no doubt drawing on his expertise in those conversations. As he said, we provided substantial support to that sector during the pandemic. We recognise the ongoing challenges for businesses as we recover, which is why we are giving thousands of hospitality, leisure and retail businesses a 50% cut in business rates this financial year—worth up to £110,000 per business.

[Mr Mohindra]

There are more than 7,000 businesses in my constituency, producing excellent products and services in a range of industries. I have held several informative high street walkarounds in towns across my constituency, hearing at first hand from local entrepreneurs, many of whom are worried about competition from online businesses. Will my hon. Friend explain what steps the Department is taking to support our high street businesses in the face of online competition?

[Helen Whately]

I commend my hon. Friend for his campaign in his local high streets and for the work he is doing with local businesses. I agree with him on the importance of high streets and the businesses on them, which is why we are supporting high street businesses with our 50% business rate cut for thousands of retail, hospitality and leisure businesses; our freeze to the business rates multiplier; and funding through the community renewal fund, towns fund and levelling-up fund.

[Tim Farron (Westmorland and Lonsdale) (LD)]

I hope the Minister is aware that one problem facing small and medium-sized employers in Cumbria and elsewhere, certainly in rural Britain, is a serious lack of workforce. Cumbria Tourism reported that 63% of its members last year had to operate below capacity because they could not find sufficient staff to keep going and so they missed out on vital demand. Does she agree that the two key areas are a lack of affordable housing so that people can live close to the place where they need to work in rural communities, and the fact that the Government have yet to come up with adequate visa provisions to allow employers to supplement a local workforce with an overseas one? What action will she take to support small and medium-sized businesses, especially in hospitality, in Cumbria and elsewhere?

[Helen Whately]

There was a great deal in that question, but broadly it was about access to the workforce for businesses. We have a really successful story on jobs, with record numbers of people in payroll employment, but I also hear about the work that businesses are doing to fill vacancies. We are supporting businesses, for instance, with our successful Way to Work scheme and the investment we are making in people’s skills to ensure that they align to the vacancies that employers are looking to fill.

[Peter Grant (Glenrothes) (SNP)]

A big concern for small businesses in my constituency, especially those in construction and engineering contract work, is that they finish the job, the main contractor gets paid, but the people who did the work sometimes wait months to get paid. If the main contractor fails during that time, the money disappears with it. Will the Minister agree to meet me to discuss the possibility of making sure that those moneys are kept in a protective bond, so that if we cannot prevent the main contractor from going bust, we can at least stop it dragging down hundreds of small businesses with it?

[Helen Whately]

I do have conversations with the construction sector and more widely about infrastructure investment in this country. I am happy to meet the hon. Gentleman to talk about the specific suggestion he has to help the construction sector.

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

If the Chancellor really wanted to help British businesses, he would back Labour’s plan to scrap business rates and replace them with a fairer system. He could reverse his tax on jobs and scrap the national insurance hike, and he could use public procurement and other tools to buy, make and sell more in Britain. He has imitated Labour’s policies before: why not follow Labour’s lead again and help struggling businesses?

[Helen Whately]

Business rates and national insurance are an important contribution to paying for public services, which I am sure the hon. Lady’s constituents, like mine, feel very strongly about. I remind her of the scale of support that we are providing to businesses, including a business rates cut worth £1.7 billion this year.

[Esther McVey (Tatton) (Con)]

I appreciate that the Chancellor cut fuel duty by 5p per litre, but that did not really touch the sides. I urge him to be bolder and cut fuel duty by at least 20p per litre, as requested by FairFuelUK, which would make a huge difference to individuals and businesses in my patch, not least hauliers for whom the cost of running a single truck has increased by 17% in the past year.

[Helen Whately]

I hear my right hon. Friend’s request. The combination of the freeze on fuel duty in the Budget and the cut in the spring statement is essentially a £5 billion tax cut. That is substantial support with the cost of fuel for businesses. As I have also said, we are taking further steps to support businesses with business rate cuts. I also remind her of our cut to national insurance, increasing the employment allowance by £1,000, supporting around 500,000 smaller businesses.

[Mr Speaker]

I call Clive Efford.

We have a slight problem. Can the Chancellor answer the question as if it has been asked?

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[Chris Green (Bolton West) (Con)]

9. What fiscal steps he has taken to support investment in UK infrastructure.

[The Exchequer Secretary to the Treasury (Helen Whately)]

We are driving economic growth through investment in infrastructure, innovation and skills. The Budget and spending review confirmed £100 billion of public investment in economic infrastructure to benefit every part of the UK. We are launching a UK infrastructure bank with a financial capacity of £22 billion to crowd in private finance to support more than £40 billion of investment in infrastructure over the next five years.

[Chris Green]

It is clear that when done right, the Government’s levelling-up programme can make a real difference to people’s lives. Does my hon. Friend share my enthusiasm for the proposed Atherton, Leigh and Tyldesley cycling upgrades that will connect local people to job opportunities right across the area, especially because there is such local support for it and it is not an anti-car programme?

[Helen Whately]

Yes, I do share my hon. Friend’s enthusiasm for helping his constituents to access jobs and for cycling as a way of getting to and from work. At the spending review we announced £710 million of new funding for schemes like the one he described, but Bolton is also receiving £30 million through the towns fund and the shared prosperity fund, and work on the electrification of the Wigan-Bolton line has begun, supporting economic growth for his constituency and the wide area.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

In the integrated rail plan announced just six months ago, the Government promised to invest in the east coast main line—a vital route connecting London, Newcastle and Scotland and bringing high-skill, high-wage jobs to our area. However, Ministers are already backtracking on some of these investment promises in other parts of the country, so will the Government make a firm commitment today to fund the delivery of east coast upgrades to provide much-needed confidence and resilience in our line?

[Helen Whately]

As the hon. Lady points out, with our investment in infrastructure—particularly rail, in the £96 billion integrated rail plan for the midlands and the north—we are showing how the Government are supporting the growth of the economy, including through providing the transport infrastructure that we need for that.

[Mr Speaker]

I call shadow Minister James Murray.

[James Murray (Ealing North) (Lab/Co-op)]

Labour welcomes the principle of a UK infrastructure bank moving to a statutory footing, but it is crucial to make sure that public money supports decent jobs that people can raise a family on. Will the Minister therefore support our proposals for all projects funded by the infrastructure bank to come with a good jobs plan and for working people to be given a voice on its board?

[Helen Whately]

We have many measures in place to support people’s jobs. We know about the figures for record levels of payroll employment and also the increase in the national living wage earlier this year. I am glad to hear the hon. Gentleman’s support for the UK infrastructure bank that we are currently legislating for, which is a really important part of our determination to drive regional and local growth across the UK.

[Simon Fell (Barrow and Furness) (Con)]

10. What fiscal steps his Department is taking to support the credit union sector.

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[Patricia Gibson (North Ayrshire and Arran) (SNP)]

T10.   The recent announcement by the Chancellor on support with energy bills was welcome as far as it goes; however, I remain deeply concerned about my constituents in North Ayrshire and Arran who live in park homes, many of whom are elderly and vulnerable, who have no clarity as to whether they will receive the same support for energy bills as every other household in the UK. Will the Chancellor put an end to this uncertainty and confirm today that he will make a firm commitment to ensure that park home residents do not miss out on this vital support?

[The Exchequer Secretary to the Treasury (Helen Whately)]

The hon. Member makes an important point about people living in park homes—I also have constituents who live in park homes—and we are determined to ensure that people receive the help that they need with the increase in energy costs. The Department for Business, Energy and Industrial Strategy has been consulting on how we deliver support to people living in places such as park homes that do not have the same electricity or energy supply as others.

[Mr Gagan Mohindra (South West Hertfordshire) (Con)]

T8.   Yesterday morning, I had the pleasure of hosting a roundtable discussion with farmers from my constituency in collaboration with the National Farmers Union. My constituent Andy Cornthwaite informed me that he was struggling to employ extra staff to grow his business due to the current £85,000 VAT threshold. I am aware that my right hon. and learned Friend recently responded to a written question from my hon. Friend the Member for North West Durham (Mr Holden) on the subject, but will she consider an early review of the VAT threshold due to the increase in labour and/or materials costs for small and medium-sized enterprises?

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[Ben Lake (Ceredigion) (PC)]

Small businesses in Ceredigion have told me how increasing electricity and fuel costs are having a direct impact on their operating costs in addition to an indirect impact in reduced demand for their goods and services. They are concerned that those costs are being disproportionately felt in rural areas. Does the Treasury share that assessment? Will it consider bringing forward bespoke measures to support the rural economy?

[Helen Whately]

The hon. Member and I met recently to speak about the cost of fuel in rural areas. As I also represent a rural constituency, I appreciate his point. As he knows, the cut that we made to fuel duty is benefiting people in rural areas as well as those across the whole country. That, combined with the duty freeze, is £5 billion-worth of help for people. As we have discussed today, we are also providing targeted support to people: in particular, there is the £1,200 for 8 million households on benefits to help with the rising cost of living.

[Mr Speaker]

I call the Chair of the Treasury Committee.

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[Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

The rural fuel rebate was introduced 10 years ago at 5p a litre and remains unchanged. With inflation and the cost of living crisis, what thought has the Treasury given to increasing the rural fuel rebate to at least 10p a litre?

[Helen Whately]

The hon. Gentleman is probably talking about the rural fuel relief scheme, which is specifically targeted at a small number of locations where fuel prices are much higher than the national average, perhaps because they are a long distance from the refinery. In proposing an extension to the scheme, he should consider the potential unintended consequences. For example, people might drive out of their way to go to a petrol station in these rural areas.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

Thanks to this Government, we have record low unemployment and more job vacancies than jobseekers, but almost 9 million people are economically inactive, including many who can work and many who have worked in the recent past. Does my right hon. Friend agree that getting more of this group back into work is key to filling the labour shortages that many Members have spoken about today, and to strengthening our economy for the longer term?

Taxes on Motor Fuel

Helen Whately Excerpts

Monday 23rd May 2022 Westminster Hall

[The Exchequer Secretary to the Treasury (Helen Whately)]

It is a pleasure to serve under your chairmanship, Ms Elliott. I thank the Petitions Committee for organising this important debate and all hon. Members who have contributed today, especially the hon. Member for Gower (Tonia Antoniazzi), who opened the debate.

I also thank the more than 100,000 people across the UK who signed the petition calling for a reduction in fuel duty and VAT. Those signatures are a reflection of how hard high fuel prices are hitting people. As well as being Exchequer Secretary, I represent a rural constituency, and I know that for most people in my constituency, there is no alternative to going by car for most journeys. As hon. Members have said, whether it is getting to work, doing the school run, going to the supermarket, the doctor or the dentist, or visiting family, there is usually no alternative. If we add to those journeys all the business journeys—the man in a van, delivery drivers, logistics and so on—we can see that so much of our economy is reliant on road transport.

The UK has about 30 million drivers, and the vast majority of us fill up our vehicles at the petrol station. As many hon. Members have said today, fuel prices have dramatically increased in recent months, and they reached their all-time highest levels this spring. I know that this comes at what is already a painful moment for many households, with so many pressures—ranging from heating bills to higher food costs in the shops—on people’s budgets. I welcome the Petitions Committee survey assessing the impact of increases in the cost of motor fuel on petitioners, which reflects what I have heard from my own constituents and from people I speak to up and down the country. Whether that is the parent struggling to put food on the table for their children or the care worker providing vital care across her community, we hear you, and the Government have stepped in to help, with support measures that add up to £22 billion.

However, we should not ignore the context. We are part of a global trend, driven by global issues—by the surge in demand post pandemic, exacerbated by Putin’s war in Ukraine. And just as these circumstances are not unique or specific to the UK, so they cannot be solved by the UK alone.

Prices at the pump are not set by the Government, and nor are crude oil prices more widely, but the Government have taken action to help people with recent unprecedented price increases. After the launch of this petition last October, my right hon. Friend the Chancellor of the Exchequer took the decision, at autumn Budget, to freeze fuel duty rates; this was the 12th consecutive year of the freeze. He then went further. In the spring statement, the Chancellor announced that fuel duty for petrol and diesel would be cut by 5p per litre. Unlike many international counterparts, who have introduced shorter-term relief for motorists, we have this measure in place for a full 12 months. This is only the second time in 20 years that fuel duty has been cut, and this time, it is the largest cash-terms cut ever across all rates of fuel duty at once. It represents a tax cut worth £2.4 billion in 2022-23. Coupled with the fuel duty freeze, it is worth £5 billion overall and equates to a reduction in fuel duty of about £100 over the year for the average car driver.

[Justin Madders]

The Minister will have heard the suggestion that the Chancellor has raked in more through increased VAT receipts than he has given away in this fuel duty cut. Will she say whether she agrees with that or not?

[Helen Whately]

The hon. Member comes to exactly the next point that I was going to make in my speech. The petition called for a VAT reduction, as did the hon. Member for North Ayrshire and Arran (Patricia Gibson) when she intervened. Given that VAT is applied on top of fuel duty, the 5p duty cut on petrol and diesel also results in a VAT reduction. It effectively translates to a reduction of 6p per litre overall. That said, a VAT reduction is not generally the best way to provide help with fuel costs, particularly because it would not help many businesses, many of which already claim back VAT paid on fuel for business use. About 40% of fuel is used by businesses. If we had just focused on reducing VAT instead of fuel duty, that would have left businesses more exposed to fuel price increases, in turn impacting the cost of goods for consumers. Making the focus fuel duty rather than VAT means that businesses, as well as consumers, will benefit from that tax cut. Also, by helping businesses with the fuel duty cut, we ensure that the duty cut benefit flows through to people who do not own cars, as well as those who do, because of the importance across the supply chain of the cost of fuel.

[Peter Grant]

Did I mishear the Minister? Is she trying to persuade us that if we cut VAT on fuel, it will lead to an increase in costs to the customer somewhere else? Is that what she is trying to say?

[Helen Whately]

That is not what I just said; I said that if we particularly focused on reducing VAT on fuel, that would not result in a saving to many businesses, because businesses can claim back VAT. By cutting fuel duty, we are benefiting businesses and the whole supply chain, as well as consumers who buy fuel.

[Patricia Gibson]

The Minister, if I understand her correctly, is saying that cutting VAT will not necessarily help business, and that the best way to help them would be by cutting fuel duty. From what the Minister said, I do not know what the answer is. Perhaps the answer is to cut VAT to help consumers, and to put a substantial cut on fuel duty to help reignite the economy, reduce the cost of living and control inflation.

[Helen Whately]

That goes a long way into the broader economic questions about the right way to deal with the crisis we are in, and how we raise money if we are to make further tax cuts to provide further support to consumers. As I have mentioned, and as I am sure the hon. Lady well knows, we have already put in support worth £22 billion to help people across the country with the cost of living. That includes £9 billion to help people with energy bills—some of that will be through council tax rebates of £150—and that money is already going into many people’s pockets. [Interruption.] The hon. Lady shakes her head and says that that is not enough, but the Chancellor has been clear that he stands ready to do more. We do not yet know what the retail cost of fuel will be in the autumn, and we are absolutely concerned about the rising costs to people. We have already taken steps, and that is what we are talking about today.

I want to come back to VAT, because it has been suggested that the Treasury might be getting some kind of VAT windfall. Overall, the Office for Budget Responsibility is forecasting that VAT receipts will now be lower than it had expected in the autumn. There is not some great surge in VAT coming through to the Treasury.

[Justin Madders]

Will the Minister give way?

[Helen Whately]

I will move on and keep to the topic of the petition, if that is okay with the hon. Gentleman. Another question that came up earlier, particularly from the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier), was on the extent to which the fuel duty cut has been passed through. I am well aware of that concern and the suggestion that suppliers have been taking the benefit of the £2.4 billion tax cut.

To provide some context to this, the spring statement was made at a time of sharp rises in international oil markets, which would have taken some time to feed through to the pump. Diesel has faced specific pressures, because of the particular role of Russian exports in the European market. That has, unfortunately, contributed to diesel reaching all-time high prices this month. The background movement in prices makes the 5p cut harder to see. The Government have been clear that we expect all in the supply chain—from the moment fuel duty is owed to when fuel is bought at the forecourt—to pass the fuel duty cut through to consumers.

The Chancellor and the Business Secretary wrote to industry on the day of the announcement to set out that expectation. The Business Secretary wrote to industry on this matter again last week. The Competition and Markets Authority is closely monitoring the situation. To quote its chief executive, Andrea Coscelli, the CMA stands ready

“to take action should there be evidence that competition or consumer protection law has been broken in the fuel retail market”.

He went on to say that a formal investigation may be considered appropriate,

“which could ultimately lead to fines or legally binding commitments”.

The Government will continue to undertake longer-term analysis to establish the extent to which the Chancellor’s cut may have been buried beneath further wholesale price increases, and to ensure that the market does not fail to pass on the benefits of the duty cut to those refilling at the pump.

I have also heard public discussion of something called PumpWatch to regulate prices at the pump. Some comparisons have been made to Ofgem, the energy regulator, and the role of the price cap in the domestic energy retail market. However, that price cap was introduced in 2019 specifically to correct the market failure identified by the Competition and Markets Authority, which showed that the conditions for effective competition were not present in the market. While the energy price cap has shielded customers from volatile energy prices, it was specifically designed to better protect disengaged customers from being offered poor-value deals.

To date, we have not seen evidence that the same situation is happening in the fuel market, because pump prices are conspicuously displayed outside fuel stations to encourage competition and allow drivers to make comparisons and find the best deals, but I reiterate that if the CMA finds evidence of anti-competitive behaviour in the market, it is clear that it will not hesitate to act.

[James Murray]

As the Minister is drawing to a close, will she take this opportunity to let us know her opinion on our plans for a windfall tax?

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[Helen Whately]

It is interesting that the hon. Gentleman asks that question. I noticed that although this is a debate on fuel duty, he and other hon. Members took the opportunity to talk quite significantly about a windfall tax. The Chancellor and the Prime Minister have made it clear that it is not the Conservative Government’s instinct to reach for a windfall tax; that is not the most naturally attractive option to us. We want to see the energy sector invest in North sea oil and gas, which is important to our transition. However, the Chancellor has also been clear that no option is off the table.

To return to the topic of the debate, the Government take fuel duty costs seriously, and we have responded with a substantial duty cut to help motorists across the UK. The Government and the CMA continue to monitor the situation extremely closely, and Members should be in no doubt that further action will be taken if necessary to ensure effective competition. The 5p cut in fuel duty is part of a £22 billion package of support to help people with the cost of living. As the Chancellor has made clear, we stand ready to do more.

Oral Answers to Questions

Helen Whately Excerpts

Tuesday 17th May 2022 Commons Chamber

[Mr Philip Hollobone (Kettering) (Con)]

6. What discussions he has had with Cabinet colleagues on the efficiency of local authorities in delivering the £150 council tax rebate under the energy bills support scheme.

[The Exchequer Secretary to the Treasury (Helen Whately)]

High global energy prices have pushed up bills. That is why we are already helping households through the energy bills rebate package, which is worth more than £9 billion in total and £350 to the majority of households. Our British energy security strategy sets out how we will deliver a more secure energy supply that brings down bills in the longer term.

[Mr Hollobone]

North Northamptonshire Council last week started paying the £150 rebate to residents who pay by direct debit, and rebates will follow for those who do not pay by direct debit. Will the Minister ensure that the Government disseminate best practice to local authorities regarding how to pay the rebates quickly, because getting this money into people’s pockets fast is key to helping residents to deal with the global cost of living squeeze?

[Helen Whately]

My hon. Friend is absolutely right about the importance of getting the money into people’s pockets fast, which is why the first support payment is through the council tax system. I know that councils are working hard to get payments to people, whether they do or do not have direct debits. The Treasury is working closely with the Department for Levelling Up, Housing and Communities to support local authorities with delivery.

[Dan Carden (Liverpool, Walton) (Lab)]

7. What recent steps he has taken to ensure fairness in the application of the tax system.

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[Anna Firth (Southend West) (Con)]

9. What fiscal steps he has taken to support investment in UK infrastructure.

[The Exchequer Secretary to the Treasury (Helen Whately)]

The Government are committed to investing in infrastructure to boost economic growth across the country, and I was delighted to see this at first hand when visiting my hon. Friend’s constituency of Southend West last week, where the local authority has secured £19.9 million from the levelling up fund.

[Anna Firth]

It was a real pleasure to welcome the Minister to the new city of Southend last week. Every station on the C2C line in Southend West is access friendly except for Chalkwell station, where there are 30 steep steps to clamber up and down. What further support or funding can the Minister provide to level up that final station and ensure that it is accessible to all?

[Helen Whately]

My hon. Friend is absolutely right to campaign for better access to stations for disabled people. I am pleased to confirm that Chalkwell is included in the Department for Transport’s £350 million Access for All programme, and that construction will begin to install a new footbridge and lift this autumn.

[Bill Esterson (Sefton Central) (Lab)]

The Government have cut the infrastructure that they promised at the last election, not least in Northern Powerhouse Rail. The economy needs greater rail capacity for passengers and freight, so does not this great rail betrayal show that the Government are not interested in the infrastructure needed for the economy in the north and the midlands to thrive?

[Helen Whately]

I simply do not recognise the picture that the hon. Member is painting. This Government are absolutely committed to investing in infrastructure because that is at the heart of our ambitions for economic growth and levelling up across the country, including £96 billion for the integrated infrastructure rail plan for the north of the country.

[Bim Afolami (Hitchin and Harpenden) (Con)]

I welcome the Government’s increased investment in infrastructure, but as the Minister knows, for the investment to be most useful we need to improve the deliverability of that infrastructure practically on the ground. Could she set out further what the Government are doing to improve the efficacy of all of that money going into infrastructure so that it actually gets delivered?

[Helen Whately]

That is an excellent question from my hon. Friend. We are not only investing in infrastructure but making sure that taxpayers’ money gets put to good use. One way we are doing that is by working with the Infrastructure and Products Authority and with Project SPEED, which specifically scrutinises the most important infrastructure projects in this country to ensure that we are doing a better job of making taxpayers’ money go further and doing it cleaner and greener as we go.

[Mr Speaker]

Tell him yes!

[Helen Whately]

Thank you, Mr Speaker. The growth of tourism is really important as part of the wider economic growth of the country, and I would be delighted to meet the hon. Gentleman to talk about his proposal.

[Martin Vickers (Cleethorpes) (Con)]

The designation of Immingham and Grimsby as part of the Humber ports freeport project highlights the need for increased infrastructure on the road network leading to those ports. Will the Minister agree to meet me and neighbouring MPs to discuss this, and particularly an upgrade for the A180?

[Helen Whately]

I would be delighted to meet my hon. Friend to discuss the upgrade to that road. As I have said, we know that infrastructure is really important in supporting economic growth and levelling up all around the UK.

[Jeff Smith (Manchester, Withington) (Lab)]

10. What recent steps he has taken to help reduce economic inequality.

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[Philip Dunne (Ludlow) (Con)]

13. What fiscal steps his Department is taking to support small and medium-size enterprises.

[The Exchequer Secretary to the Treasury (Helen Whately)]

Small and medium-sized businesses are at the heart of our economy, creating jobs and prosperity across the UK. Last week, we wrote to more than 2 million businesses setting out our support to them, including a £1,000 cut to employment taxes, extending the annual investment allowance limit, reducing business rates and cutting fuel duty by 5p.

[Philip Dunne]

In considering responses to the Treasury’s consultation on simplifying alcohol duty, will my hon. Friend consider a model that broadly relates duty to alcohol strength but without creating massive complexity and cost for the UK’s thousands of off licences and wine shops, including important small and medium-sized enterprises in Shropshire, which create jobs, supporting both the wine import and brewing sectors?

[Helen Whately]

As my right hon. Friend knows, we have set out our plans to make alcohol duty simpler and fairer—a change that is long overdue. That includes a new relief for draught beer, small producer relief for craft cider makers and the end of the higher rate for sparkling wine. I am listening to the sector and I have visited businesses to hear for myself, to make sure that the reforms work in practice.

[Rachael Maskell (York Central) (Lab/Co-op)]

T1. If he will make a statement on his departmental responsibilities.

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[Mr Speaker]

It has to be a yes to that.

[Helen Whately]

My hon. Friend tempts me with a visit to a vineyard in her constituency. She has already made the argument very strongly—when I recently met the wine and spirits all-party group. Representing a wine-producing constituency, she will appreciate, I am sure, our announcement of the reduction in the duty rate for sparkling wine. As I said to my right hon. Friend the Member for Ludlow (Philip Dunne) earlier, I am speaking to businesses in the sector to make sure that we get right the practicalities of introducing these reforms.

[Hannah Bardell (Livingston) (SNP)]

T2. Speaking of broad shoulders, I am interested to know what makes the Chancellor, one of the richest men in the Commons and, indeed, in the UK, in any way qualified to make policy or to help the poorest people in my constituency who, as a result of the Tory cost of living crisis, have to choose between heating and eating, which he and others like him will never have to face?

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[Saqib Bhatti (Meriden) (Con)]

I believe the Conservatives are and ought to be the party of hard-working families. According to a report released yesterday by the Centre for Policy Studies, reducing the cost of childcare can increase GDP by 10% and increase access to opportunities for women in the workforce. Does my right hon. Friend the Chancellor agree that helping hard-working families with childcare costs is good for the economy and that it is the Conservative thing to do?

[The Exchequer Secretary to the Treasury (Helen Whately)]

I completely agree with my hon. Friend. In fact, we do support families with the cost of childcare. One thing we do is to provide families with access to tax-free childcare, which means they can get a 20% reduction on the cost of childcare, up to a cap of £2,000 a year.

[Stephen Farry (North Down) (Alliance)]

T6. The Foreign Secretary is about to make a statement regarding unilateral changes to the Northern Ireland protocol that risk unpicking the trade and co-operation agreement and a trade war with the European Union. I understand that the Chancellor had been a voice for restraint and caution in Cabinet. Why has his view not prevailed?

Oil and Gas Decommissioning Relief Deeds

Helen Whately Excerpts

Thursday 31st March 2022 Written Statements

[The Exchequer Secretary to the Treasury (Helen Whately)]

At Budget 2013, the Government announced it would begin signing decommissioning relief deeds. These deeds represented a new contractual approach to provide oil and gas companies with certainty on the level of tax relief they will receive on future decommissioning costs.

Since October 2013, the Government have entered into 101 decommissioning relief deeds.

Offshore Energies UK estimates that these deeds have so far unlocked approximately £8.3 billion of capital, which can now be invested elsewhere.

The Government committed to report to Parliament every year on progress with the decommissioning relief deeds. The report for financial year 2020-21 is provided below.

Number of decommissioning relief agreements entered into: the Government entered into 2 decommissioning relief agreements in 2020-21.

Total number of decommissioning relief agreements in force at the end of that year: 98 decommissioning relief agreements were in force at the end of the year.

Number of payments made under any decommissioning relief agreements during that year, and the amount of each payment: two payments were made under a decommissioning relief agreement in 2020-21, for £49 million in total. These were made in relation to the provision recognised by HM Treasury in 2015, as a result of a company defaulting on its decommissioning obligations.

Total number of payments that have been made under any decommissioning relief agreements as at the end of that year, and the total amount of those payments: eight payments have been made under any decommissioning relief agreement as at the end of the 2020-21 financial year, totalling £197.6 million.

Estimate of the maximum amount liable to be paid under any decommissioning relief agreements: the Government has not made any changes to the tax regime that would generate a liability to be paid under any decommissioning relief agreements. HM Treasury’s 2021-22 accounts will recognise a provision of £167.1 million in respect of decommissioning expenditure incurred as a result of a company defaulting on their decommissioning obligations¹. The majority of this is expected to be realised over the next two years.

¹This figure takes into account payments made subsequent to the financial year covered by this written ministerial statement.

[HCWS761]

Accelerated Payment Notices

Helen Whately Excerpts

Friday 18th March 2022 Commons Chamber

[The Exchequer Secretary to the Treasury (Helen Whately)]

I congratulate my hon. Friend on securing today’s debate and setting out his argument so clearly. I listened carefully to his constituent’s experience, and I take on board the issues he has raised. As I am sure my hon. Friend knows, I am unable to go into an individual case at the Dispatch Box, but I will set out the Government’s overall position on the accelerated payment notices that are the subject of this afternoon’s debate,.

The top line—as, in essence, my hon. Friend said himself—is that tax is paid for our public services. Without that revenue, schools could not open, roads would go unrepaired, and the NHS would be unable to treat the sick. Therefore, we all agree it is only right that the Government do all we can to make sure the correct tax is paid at the correct time, and that we clamp down on those who shirk their fair share. That is why the Government continue to take tough action to tackle tax avoidance, and Parliament has granted HMRC a range of powers to do so. Accelerated payment notices are one of those tools. As my hon. Friend mentioned, they were introduced through the Finance Act 2014 with the goal of changing the economics of tax avoidance, because tax disputes can often take years to resolve. Before APNs were introduced, users of tax avoidance schemes could purposely string out disputes and unfairly benefit from the cash generated by their liabilities until the matter was resolved. That situation was clearly wrong, especially when contrasted with the behaviour of the majority of taxpayers, who pay what they owe on time and swiftly resolve any queries with HMRC.



There is not, and has never been, any principle that disputed tax should sit with the taxpayer rather than the Exchequer. APNs ensure that the tax in avoidance disputes sits with the Exchequer while that dispute plays out. APNs have meant that the Government could remove this unjust advantage from tax avoiders, so that instead of enjoying unfairly gained cash, avoidance scheme users would have to hand over any disputed tax to HMRC until matters were resolved. That was a significant change.

In the eight years since their introduction, APNs have brought forward over £5.6 billion in revenue to fund those vital public services.

[Mr Steve Baker]

Is not the fundamental problem, though, that whether a scheme is an avoidance scheme is often contested? Is not the problem that whether or not this is a just retention of funds, it is often subject to the judgment of courts to see whether something is or is not lawful?

[Helen Whately]

I absolutely hear my hon. Friend’s point. Let me come to some of the checks and balances, and I take his wider point about HMRC’s powers in that regard.

To take a step back, I recognise, in the specific case we are discussing, how deeply worrying such a dispute can be for the individuals involved. That is one reason why fairness is HMRC’s guiding principle when dealing with such matters and why it is right that although, on the one hand, HMRC has the capability to robustly tackle tax avoidance, that is balanced with checks to make sure that it does not over-reach its powers.

We recognise that tools such as APNs must be carefully targeted. That is why they can be used only in tax avoidance cases and in limited prescribed circumstances, and they have important safeguards. There must be an active dispute between HMRC and a taxpayer either in the form of an open tax inquiry or a live tax appeal. That dispute must be about tax being either underpaid or overclaimed as a result of avoidance. And APNs cannot be issued unless one of the following applies. First, the individual issued with an APN has used an avoidance scheme that has already been defeated in court and they have consequently been given a follower notice—a legal request from HMRC to the individual to settle their avoidance dispute. Secondly, the information on the scheme must have been provided to HMRC under the disclosure of tax avoidance schemes—the DOTAS regime. Thirdly, HMRC must have taken action to challenge the taxpayers’ use of the avoidance scheme under the general anti-abuse rule—the GAAR. In addition to those conditions, APNs can be issued only with the approval of an oversight board of senior policy, technical and legal members of HMRC.

My hon. Friend correctly highlighted that there is no right of appeal against an APN. However, under the legislation, HMRC must examine any representations against a notice, and nothing is due from the taxpayer until HMRC has finished those considerations. I should point out that an APN does not in any way inhibit a taxpayer’s right to continue their dispute with HMRC or to appeal against its conclusions, and taxpayers who believe that their dispute is not being suitably progressed can apply to the tax tribunal to resolve it. I make it clear that if a dispute against HMRC is settled, any disputed sums paid under an APN will be repaid with interest, providing the taxpayer with redress where applicable.

In short, accelerated payments are a fitting response to the problem of individuals who purposefully spin out tax disputes and unfairly benefit from the funds in question. That has been backed up by the courts, which have examined cases where taxpayers have tried to challenge HMRC’s use of accelerated payments and have found APNs to be proportionate, reasonable and fair. Mr Justice Green said in one case that

“the provisions in the Finance Act 2014 are perfectly fair and adequate. There is no need for the Court even to consider the need for supplementation through the implication of additional duties.”

HMRC continues to ensure that APNs are used appropriately. For example, the implementation of APNs was included in a review of HMRC’s powers and safeguards. Following that review, the published guidance on APNs was updated. I stress that APNs do not increase someone’s tax liability. Instead, they simply require an individual to pay the tax they would have owed had they not joined an avoidance scheme.

[Mr Baker]

I am extremely grateful to the Minister for giving way. As she goes through her speech, I am reminded of something that I have impressed on Ministers in the past. A problem with DOTAS is that perfectly decent, normal people who want to pay the right amount of tax can get drawn into schemes because the nature of a DOTAS registration is misrepresented. Could we have a boilerplate that firms are required to place prominently before their customers, so that customers can be told, “The reason this scheme is registered with DOTAS is because HMRC thinks it doesn’t comply with the rules. It is not how Parliament intended things to work, and you will probably have HMRC coming after you later”? If normal taxpayers who intend to pay the right amount tax could see such a boilerplate, they would not be drawn into such schemes and we would not have nightmares such as this.

[Helen Whately]

My hon. Friend makes an important point about how, if I understand him correctly, we can help taxpayers have the information and awareness that they may be taking a tax risk—a risk of doing something that could be seen as tax avoidance. HMRC already takes steps to communicate in that way, and I am happy to take up his specific suggestion with the Financial Secretary to the Treasury, whose area this is, to see whether more can be done.

Returning to the point I was in the middle of making, I recognise that individuals in such circumstances can face significant bills, which is why HMRC is committed to working positively and empathetically with anyone with an APN facing payment difficulties, including, where appropriate, agreeing more time to pay. HMRC teams are trained to identify customers who may need extra help managing their financial affairs. I urge anyone who is worried about being unable to make a payment to contact HMRC to work out an individual approach.

In conclusion, I emphasise that Ministers cannot intervene in HMRC’s operational decisions and individual cases, but if HMRC is directly provided with information about this case, its officers will look into it. The Government value every penny of tax revenue. That is true at any time, but particularly so now as we recover from the economic consequences of covid-19 and face new demands on public finances. That is why HMRC must continue to tackle tax avoidance and pursue the tax owed to the Exchequer.

Question put and agreed to.

Cost of Living Increases

Helen Whately Excerpts

Wednesday 16th March 2022 Commons Chamber

[The Exchequer Secretary to the Treasury (Helen Whately)]

It is an honour to take part in this debate on behalf of the Government. Let me begin by reassuring the House that we in Government recognise the challenges that many households, including of course in Scotland, face with the cost of living. That is one reason why we have provided support worth over £20 billion across this financial year and next; why we are cutting the universal credit taper rate and increasing work allowances to make sure that work pays; why we are freezing fuel and alcohol duties to keep costs down; and why, last month, we announced a £9.1 billion package to help households with rising energy bills.

Given the many steps that we have taken to protect jobs and livelihoods over the last two years, no one can reasonably accuse this Government of failing to act. There was £400 billion of direct support to the economy during the pandemic, including for the furlough scheme, which protected literally millions of jobs. As our focus turns to the economic recovery, we are allocating £600 billion to gross public sector investment over this Parliament, growing the economy, and improving the lives of people up and down the country. That, as much as anything, is the story here. We have supported people, we are supporting people, and we will continue to support people. We are also determined to create the conditions, Union-wide, for them to thrive.

As the global economy has reopened following the disruption of the pandemic, inflation has risen around the world. Global energy prices have increased as factories have scaled production back up, and there is increasing demand, while supply has been disrupted. There has been a further sharp rise in global energy prices following Russia’s invasion of Ukraine. Goods prices have also risen, with global supply chains struggling to meet demand as the world economy recovers. These global factors are the main drivers of higher inflation in the UK.

In that context, we understand that some households, particularly those that are vulnerable, need support with the cost of energy. We have introduced measures to provide exactly that. For instance, the winter fuel payment provides older people with £200 towards their energy bills; it is £300 for those over 80. There are also cold weather payments. Together, those measures provided almost £2.5 billion in support to households last winter. This year, we are increasing the generosity of the warm home discount, and expanding its reach to 3 million households.

The motion mentions VAT on energy bills. Domestic fuels such as gas and electricity are already subject to a reduced VAT rate of 5%, but as the Chancellor told the House in February, a further cut to VAT on energy would disproportionately benefit wealthier households. There would also be no guarantee that suppliers would pass on any reduction to all customers, and the cut would become a permanent subsidy, worth £2.5 billion every year, at a time when we are trying to rebuild the public finances.

[Ronnie Cowan (Inverclyde) (SNP)]

The Minister talks about helping people. How would she categorise the increase to national insurance contributions?

[Helen Whately]

I just mentioned the importance of rebuilding the public finances. We know that the NHS is the No. 1 priority for the general public; it is vital that we reduce the backlogs that sadly built up during the pandemic, and that needs to be paid for.

To come back to the motion, last month we announced an additional package of support to help households with rising energy bills, worth £9.1 billion—a package that, according to the motion, the Scottish National party wants to scrap. Our package to help people includes a £200 reduction in household energy bills this autumn that will be paid back automatically over the next five years, and a £150 non-repayable council tax rebate payment for all households in council tax bands A to D in England, plus £144 million of discretionary funding for local authorities in England to support households who need support but are not eligible for that council tax rebate. As we cannot apply these council tax measures across the whole of the UK, the devolved Administrations are receiving almost £600 million through the Barnett formula. This overall approach is fiscally responsible while helping customers to manage the unprecedented increase in energy bills and helping to spread the increased cost of global prices over time.

[Stewart Hosie]

The Minister mentioned global prices and I was rather struck that she sounded like Gordon Brown saying that it was always someone else’s fault. It is absolutely true to say that there are global pressures causing inflation, but while some countries are capping their electricity price increases at 5%, we are allowing 50%-plus increases in domestic energy prices. For all the big numbers that she has read out, does she not understand that people cannot afford to heat their homes?

[Helen Whately]

We have the price cap in this country, which means that customers have been protected from the volatility in global energy prices over recent months. At the moment there is further volatility following the impact on those prices of Russia invading Ukraine, but that is not going to hit the vast majority of households’ energy bills over the coming months. We will have to get to October to see the implications of that. What we have done—as I have just mentioned; I am sorry if the right hon. Gentleman was not listening—is put in place a support package worth £9.1 billion particularly to help those who will find it more challenging to pay their bills.

[John Redwood]

Over the last year, the economy has grown a lot faster because the Treasury did not hike tax rates but instead went for growth. That was a great policy, so why reverse it? Is there not a danger that these tax rises and massive increases in energy prices will slow the economy down too much? If that happens, the Government will have a revenue problem.

[Helen Whately]

If my right hon. Friend will give me a little time, I will come on to the importance of growth to our economy, which is the right answer for the longer term in ensuring that we improve people’s standard of living.

Pressures on household finances are not generally the consequence of one single price rise; they are typically affected by an amalgam of different factors. Remedying the pressure on households therefore requires taking action on a range of fronts, not just on energy bills. Again and again, that is what this Government have done and are doing. We are acting in dozens of ways to support working families. For instance, over the winter, the £500 million household support fund has helped vulnerable households with the cost of essentials such as food, clothing and utilities. Local authorities in England have allocated the lion’s share of that funding to ensuring that it reached those who needed it most, with 50% ring-fenced for households with children. Additional funding was allocated to the devolved Administrations, including the Scottish Government, in the usual way.

We have also reduced the universal credit taper rate and increased universal credit work allowances by £500 to ensure that work pays. This is essentially a £2 billion tax cut for the lowest paid in society. It is helping around 2 million households to keep an average of an extra £1,000 per annum in their pocket. Next month, the national living wage is increasing by 6.6% to £9.50 an hour, again benefiting more than 2 million workers and meaning an increase of over £1,000 in the annual earnings of a full-time worker on the national living wage. And we are committed to going further, so the national living wage will reach two thirds of median earnings for those over 21 by 2024, provided that economic conditions allow. We have supported working families in other ways too: doubling free childcare for eligible parents, which is worth around £5,000 per child every year, and introducing tax-free childcare, which will provide working parents with 20% support on childcare costs up to £10,000.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for what she is saying, and I welcome the £400 million that is going to Northern Ireland under the Barnett consequentials. The Republic of Ireland has suspended VAT on fuel in the short term to try to address the issue now. Can I ask the Minister whether any discussions have taken place with the Chancellor to see whether that could be done for us here in this great United Kingdom?

[Helen Whately]

I am not sure I heard exactly the specifics of the hon. Gentleman’s question, but in general there is already a lower VAT rate on fuel. Overall, however, if the question is whether we should have no VAT on fuel, the Chancellor has spoken about how that would in fact disproportionately benefit wealthier households, so it simply cannot be the right thing to do when it is the less wealthy households who face the greatest challenges in paying their energy bills.

The list of what we are doing in many different ways to help households goes on and on. Increasing fuel prices are indeed a global issue, not unique to the UK. The price of crude oil has increased sharply over the past year, increasing the price consumers pay at the pump. That is why we have taken action by freezing fuel duty; drivers are being protected by the 12th consecutive year of fuel duty freezes, with the average car driver paying around £15 less fuel duty per tank, saving them a cumulative £1,900 since 2011 compared with the pre-2010 fuel escalator.

On housing, the Government are maintaining the increase to local housing allowance rates for private renters on universal credit and housing benefit in cash terms. That increase was worth an extra £600 on average in 2020-21 for more than 1.5 million households. An additional £140 million has been provided this year for discretionary housing payments for those eligible for housing support who need extra help. All that is on top of existing support for families through the welfare system, which this year will add up to £240 billion of support, including £41 billion on universal credit and £105 billion through the state pension.

Turning specifically to Scotland, on top of our energy bill support scheme, which applies there, the council tax measure in England means the Scottish Government are receiving almost £300 million more than would otherwise be the case, which they can use towards cost of living interventions.

This Government will always do what we can to help those in need, and our actions speak for themselves, but we are also determined to help people to help themselves. The Government’s plan for jobs is helping people into work and giving them the skills they need to progress and earn more, which is the best approach to raising living standards. The Government are building on the success of the plan for jobs with a total of £6 billion on labour market support for the three years to 2024-25, providing targeted additional support to help at-risk groups find work, including younger and older age groups, the long-term unemployed and people with disabilities.

Why are we doing that? Because we know that work is the best way for people to get on, to improve their lives and support their families, and because households on universal credit are at least £6,000 a year better off in full-time work than out of work.

[Stephen Flynn]

I mentioned earlier, and indeed the Minister will be aware, that energy prices for households are rising 14 times faster than any pay rise they may receive if they happen to be in work. What does she say to that? How is that a good thing for consumers?

[Helen Whately]

As I was outlining—I do hope the hon. Gentleman was listening—we have put multiple interventions in place to support people with the rising cost of living. Specifically on energy prices, on the one hand we have the price cap and on the other, the package of £9 billion in support announced literally last month, which his motion says he would like to scrap.

On top of everything we are doing to help people with the cost of living, we are helping people to help themselves through our plan for jobs, and that plan is working. The UK was the fastest-growing economy in the G7 last year, and the International Monetary Fund forecast, produced before Russia’s invasion of Ukraine, was for us to be the fastest-growing major advanced economy again this year. Unemployment has now fallen to 3.9%, below its pre-pandemic rate, and payrolled employees are at a record high.

[Matt Rodda (Reading East) (Lab)]

Will the Minister give way on that point?

[Helen Whately]

I will give way, because I am about to move on to talk about energy.

[Matt Rodda]

The Minister is obviously covering a range of issues, both employment and the cost of living for households. As the right hon. Member for Wokingham (John Redwood) mentioned, is now perhaps the right time to look again at the national insurance rise, given the pressure on families and the stalling rate of growth?

[Helen Whately]

The Chancellor has already been asked about this, and the fact is that we have taken the difficult, fiscally responsible decision to ensure that there is a long-term funding stream, both to support the NHS to tackle backlogs and to fund the cost of social care reform. That has to be the right thing to do, going hand in hand with our determination to invest in growth in this country, which I will come to in a moment.

I will just talk for a moment more about energy. We have talked about the support for people’s energy bills, but the best way to support people with the cost of energy is to tackle the problem at source and reduce the overall cost of energy in the UK, as well as reducing demand for energy, and we have already taken steps to do that. Our investment in renewables in recent years has already reduced our dependency on gas, meaning overall that bills are now materially lower than they would have been.

Looking ahead, now is the time for us to go full steam ahead with our transition to renewables. We are investing in nuclear. We are accelerating our progress on renewables, in which Scotland plays an important part, and we are boosting energy efficiency, investing more than £6 billion in energy efficiency measures over this Parliament, including £3 billion to install energy efficiency measures in low-income homes. That will save low-income households hundreds of pounds a year off their energy bill, as well as being a fabulous growth opportunity for our economy.

The motion we are debating today specifically mentions implementing a windfall tax

“on companies which are benefitting from significantly increased profits as a result of impacts associated with the covid-19 pandemic or the current international situation”.

I am sure that SNP Members are talking about a windfall tax on North sea oil and gas. I say to them, and in particular the hon. Member for Aberdeen South (Stephen Flynn), that North sea oil and gas are important to our energy transition.

The UK Government place additional taxes on the extraction of oil and gas, with companies engaged in the production of oil and gas on the UK continental shelf subject to headline tax rates on their profits that are currently more than double those paid by other businesses. To date, the sector has paid more than £375 billion in production taxes. Those of us on the Government side of the House support the North sea oil and gas sector and its role in our energy security and our energy transition.

This Government have consistently acted whenever and however necessary to support families and businesses. It is our responsibility on their behalf to protect the public finances. Our level of debt means we are and have been vulnerable to shocks, including changes in interest rates and inflation. A sustained one percentage point increase in interest rates and inflation would cost more than £22 billion by 2026-27. Events in Ukraine are a clear reminder that there will always be the risk of further economic bumps in the road, and we must be ready. To that end, as we come out of the pandemic, we must focus even more on boosting productivity, growth and investment across the whole UK.

We are focused specifically on the three priorities that the Chancellor outlined in his recent Mais lecture: capital, people and ideas. That will help us foster a new culture of enterprise and drive growth. The Government continue to support business through the temporary super deduction to encourage firms to invest in productivity-enhancing plant and machinery assets. We are committing to unprecedented levels of investment in ideas: increasing investment in research and development to £22 billion a year, reforming and improving our tax credit system, improving access to finance, and helping small businesses through our flagship Help to Grow programme. The £4.8 billion levelling up fund will invest in infrastructure that improves everyday life across the UK, while the £2.6 billion shared prosperity fund will support our wider commitment to level up all parts of the UK. In these cases, we have public investment crowding in private sector investment, which is what will drive the growth of our economy. The spending review also confirmed a total of £100 billion of investment in economic infrastructure over the spending review period. Together, that adds up to an extraordinary, and extraordinarily ambitious, programme of investment in the UK.

The Government understand that this is a challenging time for British households, including in Scotland. That is exactly why we have acted in dozens of ways on multiple fronts for the entire United Kingdom, but it is also why we are looking to the future, focusing on our economic recovery, on growth and on skills—elements that together will raise the living standards of millions of people all across the Union.

Oral Answers to Questions

Helen Whately Excerpts

Tuesday 15th March 2022 Commons Chamber

[Carolyn Harris (Swansea East) (Lab)]

4. What assessment he has made of the potential merits for the Exchequer of reforming the gambling industry.

[The Exchequer Secretary to the Treasury (Helen Whately)]

Gambling contributes over £3 billion per annum to the Exchequer. The Government keep gambling duties under regular review to ensure that the sector continues to pay its fair share. The Department for Digital, Culture, Media and Sport is reviewing the Gambling Act 2005, after which the Government will assess the impact of any reforms on the Exchequer.

[Carolyn Harris]

Analysis carried out by both NERA Economic Consulting and Landman Economics concluded that, given that online gambling is “labour intensive” and predominantly based offshore in avoidance of UK corporation tax, its net impact on the British economy is negative, particularly once the direct cost to Government, estimated by Public Health England to be £647 million, is factored in. Will the Government support the upcoming reviews of gambling regulation—the Minister said it is under active consideration—and welcome any moves to reduce gambling harm and the associated cost to society and the economy?

[Helen Whately]

I know that the hon. Lady is a committed campaigner on gambling as chair of the all-party parliamentary group on gambling related harm. Specific to her point about offshore gambling operators, I am sure that she knows that since 2014 gambling duties have been taxed on a “place of consumption” basis, so offshore operators pay taxes on profits related to UK gambling.

To the broader point of the gambling review, I spoke to the Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Croydon South (Chris Philp), who is leading DCMS’s work on gambling, just yesterday, and I assure the hon. Lady that the Government stand ready to take action where there is evidence that vulnerable people, such as those suffering from gambling addictions, are being exploited by gambling operators.

[Andrew Bridgen (North West Leicestershire) (Con)]

The term “gambling” covers a broad spectrum of activities. Does the Minister share my concerns that over-zealous regulation of the gambling industry as a whole could lead to some damaging unintended consequences, such as driving vulnerable individuals to the black market, which is completely unregulated, loss of revenue to the Exchequer and damage to the greyhound and horse-racing industries, which employ lots of people?

[Helen Whately]

My hon. Friend makes an important point. There is the basic principle that people should in general be free to spend their money as they see fit. There are about 100,000 jobs in the gambling industry in this country. It is important to ensure that we protect people who are most vulnerable from exploitation, and I know that the gambling review I mentioned is looking carefully at the best way to do that.

[Stephen Farry (North Down) (Alliance)]

5. What discussions he has had with Cabinet colleagues on the potential merits of reviewing the inflationary uplift in universal credit in response to the increase in the cost of living.

--- Later in debate ---

[Damien Moore (Southport) (Con)]

9. What steps his Department is taking to encourage regional growth across the UK.

[The Exchequer Secretary to the Treasury (Helen Whately)]

At last autumn’s Budget and spending review, we announced a comprehensive package of investment to level up the UK and encourage regional growth. This included the £4.8 billion levelling-up fund, the £2.6 billion shared prosperity fund and £1.6 billion of investment in the next generation of the British Business Bank’s regional investment fund.

[Damien Moore]

Does my hon. Friend agree that town deals are one of the most progressive ways of supporting regional growth, and that the one for Southport will kick-start our economy locally?

[Helen Whately]

I congratulate my hon. Friend on his hard work to secure the £37.5 million town deal for Southport, which will be truly transformative for his constituents. That funding will bring in more private investment to his constituency, building on public funding and providing new jobs and opportunities for his constituents. It will be levelling up in action.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

The stark reality in the north-east is that we have seen rising child poverty and reliance on food banks in recent years, and the poorest households lost £1,000 when the Government cut universal credit in the autumn. Rising prices look set to take away another £1,000 from households, before the economic impact of what is happening in Ukraine. Ahead of the spending statement next week, may I urge the Treasury please to do more to tackle the destitution that will be inevitable if nothing is done to intervene to support households in the north-east, who will then support the local economy to grow?

[Helen Whately]

As other Ministers have outlined, we are supporting households with the rising cost of living, including a package worth £21 billion of support. In particular we are supporting those on universal credit by reducing the taper rate to ensure that work pays. Looking further ahead, through our commitment to levelling up we are investing across the country in skills and infrastructure, with the levelling-up fund to improve growth, boost prosperity, opportunities and pay, and thereby improve people’s standard of living.

[Bim Afolami (Hitchin and Harpenden) (Con)]

The Minister will be aware of the positive contribution that financial services can make to levelling up all over the country. With that in mind, and with the work of my all-party group on financial markets and services on levelling up, will she commit that the Treasury will work with the industry to spread opportunity within the financial services sector, to help that sector spread opportunity through all regions of this country?

[Helen Whately]

My hon. Friend makes an important point, and I know he is knowledgeable about this sector. It is important to remember that financial services are to the benefit of the whole country, with two thirds of jobs in financial services being outside London and the south-east. Financial services are absolutely an important part of our ambitions for levelling up.

[Tim Farron (Westmorland and Lonsdale) (LD)]

In rural communities, especially Cumbria, we are deeply concerned about the Government’s apparent lack of concern about growth in the rural parts of this country. Is the Minister aware of the enormous damage being done to farming in the UK, just at the moment when we need our farmers the most, by the reduction in basic payments? That started in December when farmers lost between 5% and 25% of their basic payment, without any availability of anything to replace it for years to come. Will she intervene now to keep basic payments where they currently are, so that we can keep Britain farming?

[Helen Whately]

I thank the hon. Gentleman for his question. I also represent a rural constituency with significant agricultural interest, and I assure him that we have protected agricultural funding through this Parliament. We are committed to levelling up across all parts of the UK, in rural as well as urban areas.

[Mr Steve Baker (Wycombe) (Con)]

What steps is the Minister taking with our right hon. Friend the Secretary of State for Levelling Up, Housing and Communities to ensure that areas that need levelling up are able to attract private sector investment?

[Helen Whately]

That is a very important point. Levelling up is not just about public sector investment—indeed, the lion’s share of investment in future growth in our economy will come from the private sector. One important thing that the British Business Bank is doing with its regional fund is crowding in private sector investment, so that we will get more private sector investment on top of the public sector investment we are putting in.

[Dan Jarvis (Barnsley Central) (Lab)]

The shared prosperity fund could be one of the Government’s most effective means of encouraging regional growth across the UK, but only if the investment goes where it is most needed. Does the Minister believe that the Treasury should apply the funding commitments that were rightly made to Cornwall also to the Tees Valley as well as to South Yorkshire?

[Helen Whately]

We are making a substantial investment through the shared prosperity fund and other funds across the country. We have committed to ensuring that the shared prosperity fund will be at least as much as parts of the country received before through EU funding, and I am committed to the hon. Gentleman’s area just as much as to Cornwall and other parts of the UK.

[Peter Gibson (Darlington) (Con)]

11. What assessment he has made of the impact of the levelling-up fund on job opportunities and the economy across the UK.

[The Exchequer Secretary to the Treasury (Helen Whately)]

By investing in local infrastructure, the levelling-up fund will strengthen local economies, boost job opportunities and improve the day-to-day lives of people across the UK. So far, we have committed £1.7 billion to 105 projects, and at the end of the month the Department for Levelling Up, Housing and Communities will publish its monitoring and evaluation strategy for the funding.

[Peter Gibson]

With £23.3 million invested through the towns fund, £105 million for Bank Top station and 1,700 civil service jobs coming to Darlington, we are a leading example of how the Government’s levelling-up agenda is benefiting communities in the north-east. The second round of the levelling-up fund will continue that work. Will my hon. Friend outline the timescales for the delivery of that round?

[Helen Whately]

My hon. Friend is a fabulous campaigner for Darlington, as evidenced in all the funding that his local town has secured. I am a regular visitor to Darlington, as are my Treasury colleagues, and have seen those investments already making a difference. He asks about the second round of the levelling-up fund. It will open for business this spring, with further details to be published shortly.

[Mr Ben Bradshaw (Exeter) (Lab)]

12. What steps he is taking to tackle illicit finance.

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[Bill Esterson (Sefton Central) (Lab)]

T4.   Waste recycling businesses face an increase in tax on red diesel of thousands of pounds per month from April. I take it that the Chancellor agrees that waste recycling has important economic as well as environmental benefits, so what plans has he to address the sudden rise in costs for businesses that process and reuse waste materials?

[The Exchequer Secretary to the Treasury (Helen Whately)]

The changes to the taxation of red diesel were announced back in 2020, were confirmed in spring 2021 and are coming in this year, so businesses, including in the sector that the hon. Member refers to, have had plenty of time to prepare. It is absolutely right that we tax fuels that are highly polluting; unfortunately, diesel is one of them.

[Jill Mortimer (Hartlepool) (Con)]

T7.   Hartlepool proudly stands with Ukraine and fully supports the sanctions imposed on Putin’s regime. How will the post-Brexit windfall refund of £200 million from the European research fund for coal and steel be spent on supporting our steel industries?

[Helen Whately]

My hon. Friend is an active campaigner for the steel sector in her constituency. I can assure her that energy-intensive industries such as steel receive substantial support from the Government, including free allowances from the emissions trading scheme and the £315 million industrial energy transformation fund, to help them to cut energy bills.

[Sammy Wilson (East Antrim) (DUP)]

A statutory instrument entitled the Customs (Amendment) (EU Exit) Regulations 2022 was on yesterday’s Order Paper for approval by the House. It amends the customs arrangements for the United Kingdom by excluding Northern Ireland from them, changing the term “United Kingdom” to “Great Britain”. That runs totally contrary to the assurances given by the Prime Minister that Northern Ireland would remain part of the UK customs territory; it runs contrary to article 4 of the Northern Ireland protocol; and it now means not only that Northern Ireland is part of the single market under the European Court of Justice, but that it is outside the UK customs territory. The motion relating to the instrument was not moved. Can the Financial Secretary give an assurance that it will not be brought back to the House until there has been a meeting to explain why it is necessary, what its impact on Northern Ireland is and why the Government have brought it forward?

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[Mark Menzies (Fylde) (Con)]

T8. I thank my right hon. Friend the Chancellor for his swift actions to protect Fylde consumers from rising energy prices. However, we are all aware that emergency intervention is not sustainable in the long term, and undermines our need to end our reliance on foreign fossil fuels. Fracking is not the solution. What steps will my right hon. Friend take to invest in domestic renewable and nuclear energy—the fuel for which is manufactured in Fylde—as well as in improved energy efficiency?

[Helen Whately]

My hon. Friend has made an extremely good point. Now is the moment for us to go full steam ahead with our transition away from fossil fuels. We are investing in nuclear, we are accelerating our progress on renewables, and we are boosting energy efficiency in homes across the country. This is how we will bring bills down, improve our energy security and tackle climate change.

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

When the Government set up the coronavirus business interruption loan scheme, they recklessly failed to agree any guidance on early repayments. As a result, businesses are now being charged extortionate fees and are facing bankruptcy. Why is the Chancellor putting the profits of unscrupulous lenders above the recovery of our small businesses?

[Felicity Buchan (Kensington) (Con)]

T9.   People in my constituency who live in mansion blocks where heating is paid for centrally do not currently benefit from the energy price cap. That is clearly an anomaly. Will my hon. Friend meet me to discuss ways in which we might ameliorate the situation?

[Helen Whately]

My hon. Friend has made an important point. We recognise that some people living in mansion blocks are part of a heat network and are not covered by the price cap. I draw my hon. Friend’s attention to the £144 million in discretional funding that went to councils as part of the recent £9 billion energy support package, and to forthcoming legislation in which we will give Ofgem new powers to regulate prices in the sector as a matter of priority.

Oral Answers to Questions

Helen Whately Excerpts

Tuesday 1st February 2022 Commons Chamber

[Kenny MacAskill (East Lothian) (Alba)]

7. What recent estimate he has made of the value of infrastructure projects to be delivered through the national infrastructure and construction pipeline.

[The Exchequer Secretary to the Treasury (Helen Whately)]

The 2021 national infrastructure and construction pipeline set out nearly £650 billion of planned and projected public and private investment in infrastructure over the next 10 years. Last year’s Budget and spending review set out how we will deliver on commitments in the national infrastructure strategy, and go further in providing more investment to every part of the UK.

[Kenny MacAskill]

The first great energy revolution of oil and gas saw Scottish communities largely miss out, other than in Shetland. The offshore renewables revolution is occurring off East Lothian’s coast and landing on its shores, largely then to be cabled south. Where are the jobs and benefits for the county, or the revenue that accrued to Shetland? Will the Minister agree to meet me and representatives of East Lothian Council to ensure that the offshore renewables revolution benefits the communities where it actually lands?

[Helen Whately]

The Government are committed to ensuring that the whole of the United Kingdom benefits from our investment in renewables and our transition to net zero and the growth that that affords us, and I am happy to look into the matter that the hon. Gentleman raised.

[Tom Hunt (Ipswich) (Con)]

9. What steps his Department is taking to increase wages and support the lowest-income households.

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[Selaine Saxby (North Devon) (Con)]

T5. Does my hon. Friend have plans to help high streets such as that in Barnstaple in North Devon, which has many large vacant units with several storage floors above them, with measures such as business rates reform or a redevelopment fund, to enable those empty buildings to be repurposed and become smaller units combined with much-needed housing, so that town centres can bounce back after covid?

[The Exchequer Secretary to the Treasury (Helen Whately)]

Like my hon. Friend, I am keen to support high streets in towns such as Barnstaple. At the autumn Budget, we announced business rates relief for thousands of retail, hospitality and leisure businesses to help them get through the pandemic and adapt to wider economic changes. I would also point my hon. Friend to the £4.8 billion levelling-up fund and encourage Barnstaple to apply for round 2, which will be opening this spring.

[James Murray (Ealing North) (Lab/Co-op)]

Last month, the Government came out against Labour’s plan to help people on modest incomes pay their energy bills using a one-off £1.2 billion windfall tax on the profits of oil and gas producers. The Education Secretary complained that oil and gas companies are “already struggling”. The truth is that pensioners and people on modest incomes are the ones who are struggling. Oil and gas companies are expected to report near-record income this year. Will Ministers now admit that the Government have got it wrong and commit to looking again at our plan?

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[Robin Millar (Aberconwy) (Con)]

I welcome the Government’s intent that levelling up should be measured by more than simply spending money. Indeed, the data that is collected across the UK to measure its effect varies. What is my right hon. Friend doing to address that, and will he reassure Aberconwy residents of an effective UK-wide levelling up?

[Helen Whately]

Absolutely. My hon. Friend makes an important point, and we should indeed measure success in outcomes, not just inputs. The Department’s delivery of levelling up ambitions will be monitored, and it will of course be held to account. I point my hon. Friend towards the levelling up White Paper, which will be published shortly.

[Valerie Vaz (Walsall South) (Lab)]

Going after money means that the Chancellor is recovering a debt, so there is a hole in the finances. Will the Chancellor tell the House this: why did Lord Agnew resign?

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[Peter Gibson (Darlington) (Con)]

I commend my right hon. Friend for the steps he has taken to level up in Darlington, with the establishment of the Darlington economic campus. Will he update the House on the progress to bring high-quality, well-paid jobs to my constituency?

[Helen Whately]

I am delighted to update the House on the progress the Treasury is making with our Darlington economic campus. We have already recruited more than 100 Treasury employees to be based in Darlington, and we are on track for our ambition of 300 employees based there.