Vehicle Taxation Reform

Huw Merriman Excerpts

Wednesday 19th October 2022 Westminster Hall

[Wera Hobhouse]

Absolutely. We see that people are facing great problems in rural communities and it is important to make short-term interventions to help them. However, I am really talking today about what vehicle taxation will look like in the long term, once we transition to net zero. Nevertheless, I fully take the point made by my hon. Friend.

On the other hand, drivers of electric vehicles pay no fuel duty. The Government need to continue incentivising the use of electric vehicles for environmental reasons. However, there are many ways in which that can be done without subsidising fuel duty. One option is to increase the number of public electric vehicle charging points. So far, the UK has only 31 electric vehicle charging points and only six rapid charging points per 100,000 people. If the Government are serious about encouraging the uptake of electric vehicles, they must ensure that the infrastructure is there. That would be of great benefit to my constituents in Bath and to the wider south-west, as our region is the second largest in the country for electric vehicle uptake.

Other incentives could include providing grants for electric car conversion. The conversion of old cars has significant benefits. For example, the carbon footprint of producing a new car is far higher than that created by continuing to use an old car. Currently, buying a new electric car is not an easy option for many people who do not have off-road parking or their own charging facilities. The conversion of older cars would help lower-income families who are struggling with the cost of living crisis, while also being part of the movement to less carbon-intensive transport options.

If we are to transition to net zero sustainably, the Government must find a way to fill the taxation income gap caused by declining fuel duty. The Government’s own net zero strategy from 2021 states that the taxation of motoring must keep pace with electric vehicles. I understand that the Treasury has said in the past that the level of income from motorists should stay about the same in future, but how can that be achieved?

[Huw Merriman (Bexhill and Battle) (Con)]

I congratulate the hon. Lady on securing this excellent debate. The Select Committee on Transport, which I chair, has put a series of recommendations to the Treasury, and we work closely with it. In advocating a form of road pricing, she rightly says that there will be a fiscal black hole. Some 4% of the entire tax take comes from motoring taxes. The evidence we received from the Treasury was that that figure would plummet to zero by 2040, so that means a loss of investment not just for roads, which account for just 20% of that total tax figure, but for schools and hospitals. Does she agree that the reason why we need road pricing is not just to fill the hole, but because devolved Mayors, in using their powers, are creating a patchwork of road-pricing schemes, and it will be difficult for the Government to get into that space with that patchwork already in place?

[Wera Hobhouse]

I totally agree. We need some clarity and something that motorists across the country can see as a coherent strategy, rather than the patchwork that the hon. Gentleman spoke about. One approach would be a scheme based on mileage. Other factors, such as emission levels or road type, could be added into the mix. Road pricing, as it is often referred to, is not a new idea. The Liberal Democrats proposed a version of it in our 2010 manifesto. It has been explored in depth many times. So far, no noticeable progress has been made towards its adoption and the hon. Gentleman is absolutely right that we need to act and find ways forward quickly.

Nearly 20 years ago, the then Transport Secretary said that road pricing was 10 years away, but we do not have another 10 years to waste. The motivation then was to cut pollution and reduce congestion, particularly in larger cities. Our most urgent need now is getting to net zero and, while doing that, looking at the immediate financial implications that I have mentioned.

I want to draw the Minister’s attention to an excellent report released just a few days ago by the Campaign for Better Transport. The report tested options for a national road pricing system with a large cross-section of the public. The good news is that the public appear to be open to the idea of road pricing, otherwise known as pay-as-you-drive. In the survey, nearly 50% of respondents felt that fuel duties were unfair. That is unsurprising. Low-income households are more likely to have older, more polluting and less fuel-efficient cars and to pay more fuel duty per mile travelled. That is in contrast to wealthier households with newer, more fuel-efficient vehicles. According to Policy Exchange research, someone with a new car could pay half the amount of fuel duty compared with the owner of an older car. Other findings from the report show that 65% of those surveyed believe that electric vehicle owners need to pay tax to use the road system. Drivers felt that people with electric vehicles are effectively driving tax free, while those who are unable to switch—largely for financial reasons—must pay.

We must encourage the take-up of electric vehicles to reach net zero. However, the public are acutely aware that Britain’s finances are under pressure after the recent economic shocks. Money must be found somewhere. There is evidence that the current vehicle taxation system is not fit for purpose, and the public agree. In the Campaign for Better Transport report, 60% of respondents agreed that there was a need to reform the vehicle taxation system. What options are available to Government and are these options fair in the eyes of constituents? Pay-as-you-go, or pay-as-you-drive, is worthy of consideration. It is widely regarded by experts as a progressive step forward. A pay-as-you-drive system could charge drivers directly per mile driven with a set distance charge. Another alternative could be smart road pricing, whereby the charge per mile varies depending on different factors. The Treasury would have the option of applying this equally to all vehicles. Alternatively, it could create a series of levels based on emitting status and/or the location where the person is driving.

The Climate Change Committee report to Parliament this year noted that road pricing “will be necessary” in the longer term. It recommended that the Government implement it “later this decade”. The Select Committee on Transport has recommended smart pricing, as has the Policy Exchange, the AA, and the Social Market Foundation.

For the first time in a long time, consensus is beginning to emerge. When pay-as-you-drive was initially pitched in the Campaign for Better Transport survey, 42% of respondents supported the idea, with 21% saying “No”. After the concept had been explained and questions answered, the percentage in favour rose to 49%, with opposition dropping to just 18%.

Pay-as-you-drive can come in many forms, but there are three options worth considering. One is a flat per-mile charge for electric vehicles. That would keep fuel duties as they are for existing petrol and diesel vehicles, and those duties would wither away as those cars disappear from our roads. Another option is replacing fuel duty and vehicle excise duty, with a set per-mile charge based on the emissions level of the vehicle. That could be estimated at the annual MOT mileage check. Lastly, we could replace fuel and excise duty with a smart per-mile charge that varies with vehicle type, emissions, location and time of day.

The main argument in favour of pay-as-you-drive comes from the need to reduce the number of people driving to lower congestion and reduce air pollution and carbon emissions. The transport sector is now the biggest source of domestic greenhouse gas emissions and accounts for 28% of all emissions. Cars make up 55% of that figure, while lorries and vans make up 32%. Buses, coaches, and rail collectively account for just less than 5%, according to Government figures.

A system based on rewarding those who drive less, rather than a flat rate, could lead many members of the public to use their cars less and use public transport more. The idea that drivers who drive more should pay more in tax, and that those who drive less should pay less, was popular in the survey and it is clearly the right direction to take.

There is no doubt that ensuring investment in public transport, including reforms to the integration of bus and rail ticketing systems, is critical to a functioning pay-as-you-drive system. Those reforms cannot exist in a vacuum and must be part of a wider conversation on how we move people away from private cars and on to environmentally friendly public transport.

In the Campaign for Better Transport survey, 69% of respondents stated that a key element of making the entire system fairer for drivers was to make public transport cheaper. The Liberal Democrats would seek to give new powers to local authorities and communities to improve transport in their areas. That would include the ability to introduce network-wide ticketing, like that in London, and greater powers to franchise bus services and simplify the franchise application system. We would also reverse the ban on local authorities setting up their own bus companies, which should give councils the tools to make transport accessible for everyone.

Reforming the system towards pay-as-you-go would also bring transparency to vehicle taxation. Many drivers are unaware of the level of fuel duty that exists within the price that they pay for fuel. It is important that we bring clarity and openness to the vehicle taxation system when we reform it.

We must do everything possible to reach our net zero targets. However, that transition needs to be sustainable and accessible. Pay-as-you-drive is a progressive way of solving the problem of declining fuel duty revenue. In particular, it would encourage much more sustainable transport habits. Clearly, pay-as-you-drive schemes must be combined with more investment in public transport and environmentally friendly infrastructure. I look forward to the Minister’s response.

Delivery of Public Services

Huw Merriman Excerpts

Tuesday 28th June 2022 Commons Chamber

[Huw Merriman (Bexhill and Battle) (Con)]

I will keep to the eight minutes you have asked of us, Madam Deputy Speaker. I will take the opportunity to focus on three issues. Two of them, long waits for driving licences and backlogs at the airports, are mentioned in the motion; the third, delivery of rail, is not. However, while it may not have made it on to the motion, we are certainly all aware it was an issue for us last week and will continue to be so.

Looking first at the backlogs at the airports, there have been issues and challenges there. The Chief Secretary to the Treasury is absolutely right to say that we are not alone: Schiphol had a cancellation rate of about 11% during the period in question, while Gatwick’s, for example, was 2%. The situation has been poor across Europe, but it is particularly challenging for passengers to have their flights cancelled at the last minute.

One large reason for it is that only on 17 March did the industry get complete clearance for travel restrictions to be dropped in their entirety. Airlines were also required by Parliament to use 70% of their slots, or they would lose them. A combination of those two factors, and the fact that many airlines had taken out covid loans and had to start paying them back, led to a decision that they would ramp up over summer. However, it has been challenging for them to do so. There were 5,000 jobs lost in the international travel sector in this country on a monthly basis, and that has had an impact.

The airports collectively lost £10 billion, so it has been very difficult for them to ramp back up, and it takes a long time to get staff on to the frontline. It can take as much as three months to go through the vetting and clearance process. Of course, that has to be strict—it is for security—but I will shamelessly plug the Transport Committee’s recommendations here.

The first recommendation was for Her Majesty’s Revenue and Customs to help with a personal statement where people cannot fill in all the parts of their five-year employment history as required. It is great to see that that is now in place. Many people worked in different sectors and parts of industry that have gone under during covid, and it has been difficult to get that five-year map. That is a great change, as is the ability to train workers while they are in their final vetting stage; again, the Government have accepted the recommendation for more flexibility. The ability to train more people within the line of sight has also helped. I praise the Government for the work they have done to make that easier.

However, the number of flights being cancelled at the last minute is just not good enough for passengers or for the industry. I welcome the steps the Government have taken to ease the 70% rule: for airlines that cancel with 14 or more days’ notice, that flight will go towards their 70% rather than counting towards them losing the slot. That is the kind of flexibility the industry needs.

I particularly praise Gatwick airport, which has taken the novel approach of capping the number of flights. It could see that the industry was trying to fly at 2018 figures but did not have the staff to do so, as I have just mentioned. The cap should make for a more bearable experience for passengers. The flights that are cancelled would just be those flying to the same destination on the same day; otherwise, the airlines would have to pay out. Sensible measures have been taken, and I welcome them. I would just say to those on the Front Bench: can we please get the Civil Aviation Authority more up-front powers? It is still going through the court process from the Ryanair industrial action of 2018 because it does not have the ability to stop poor behaviour when it occurs. However, I do welcome what the Government have done.

On long waiting lists for driving licences, as has been mentioned, drivers have been unable to take up work because there has been such a long delay to the paper-based process. According to the DVLA, at one point, due to social distancing, reductions in staff on-site and industrial action, the backlog got to 1.6 million. We have continued to write to the DVLA as a Committee and hold it to account. It last reported that the backlog was down to 890,000. It always has a run rate of 400,000 at any one time but assured us that the rate will get down to the business-as-usual rate by September. We will continue to hold it to account. At that time, it was the one sector of the civil service, or agency, that seemed to be struggling, and there are questions for the management as to whether people really can work from home in a manner that for other parts of the civil service and agencies seems to work quite well. Management are on notice that they need to do better.

The third aspect, which is not referenced in the motion but is so important, is rail. I talked about the 5,000 jobs lost each month in the airline industry because it had to make its own way through. We supported rail to the tune of £16 billion. There were no redundancies apart from a package of voluntary redundancy that was announced, and got a high uptake, last year. In direct contrast to what the airline sector saw, the rail system has been supported by us all. It is incredibly disappointing to see the strikes. I call for the unions to look at the reforms as not just a way of increasing productivity that will give their members a pay rise, but as making the railways safer for the workforce and for passengers. Why do we still require people on the track when technology can do it better, so it is safer for them and safer for passengers? We need both parties to work together to end the strikes. Rail is not being delivered, and it would have been nice if the Opposition had recognised that we all need to support it.

My last point is on the impact of inflation. In all three sectors I have talked about, industrial action has been occurring or is ongoing. Inflation-busting pay increases are completely counterproductive for those who are seeking them but also for the wider public who have to pay for them, because all they do is put up inflation even more and take away the pay rise at that end. They also have to be paid for. Let me give an example. The refuse strike at Wealden District Council in my constituency has been settled at a cost of 27%. That will be paid for by all council tax payers in my constituency. The last increase in council tax has all been eaten up by the previous pay settlement, so there will not be enough to fund this one, and all the benefits we could bring to the district council are being taken away. How will it be paid for? The council cannot go into deficit and therefore there could be job losses, so one person’s pay rise is somebody else’s job loss.

With the cost of living challenges, I understand that there will be pay demands in the public sector, but we all know—certainly Conservative Members do—that somebody has to pay for that, and it will be all our voters. We also know that inflation breeds inflation, and so it knocks out the pay rise. It effectively becomes a zero-sum game. I hope that all of us in Parliament can call for restraint—for people to be sensible and reasonable, and try to find productivity gains to pay for those increases—but if we are not careful things will get very bad indeed in the public sector and that will not benefit anybody in this place.

--- Later in debate ---

[Stephen Kinnock (Aberavon) (Lab)]

I would like to start by thanking all the hard-working people who keep our public sector and our public services going day in and day out. They are not responsible for the fact that our country is so bogged down in backlogs and bureaucracy. Indeed, as we have heard throughout this debate, their professionalism and dedication to public service stand in stark contrast to the shambolic performance of this Conservative Government.

I would also like to thank hon. Members, particularly those on the Opposition Benches, who through their speeches and interventions in this important debate have expressed genuine concern on behalf of their constituents about the desperate state of the Prime Minister’s backlog Britain, as opposed to those who have attempted to defend the indefensible.

My hon. Friend the Member for Bristol North West (Darren Jones) made a thoughtful speech and pointed out that if Ministers were running a business it would be bankrupt by now. My hon. Friend the Member for Birmingham, Hall Green (Tahir Ali) gave a barnstorming speech: “Welcome to backlog Britain, thanks to 12 years of a Conservative Government.” is the line that came through very clearly. My hon. Friend the Member for Reading East (Matt Rodda) called on the Government to learn the lessons and focused in particular on the chaos of the Passport Office. My hon. Friend the Member for Ellesmere Port and Neston (Justin Madders) recounted the appalling costs to his constituents of the backlogs and dysfunction at the heart of this Government, demonstrated by the failure to answer his basic parliamentary questions.

Conservative Members consistently attempt to blame covid and the lockdowns for the mess in which we now find ourselves, but backlog Britain cannot be blamed simply on covid and the lockdowns. The reality is that the underlying causes of the mess we are in predate the pandemic and the challenges we now face have got worse since the end of lockdown. That is because backlog Britain has been created by two basic failures: first, a failure of resilience caused by a decade of underinvestment by the Conservatives in British businesses and public services; and, secondly, a failure of governance caused by Ministers walking away from their responsibilities and utterly failing to plan for the end of the covid restrictions. The combination of those two fundamental failures with the fact that we have a lawbreaking Prime Minister who has lost the confidence of 40% of his own MPs and has basically become a national embarrassment provides all the ingredients for a catastrophic breakdown in the systems and institutions that keep our country going.

On the failure of resilience, the decade leading up to the pandemic was defined by a staggering lack of investment by the Government in the private sector, which led to low growth and weakened British business—so much so that Britain became the European capital for hostile foreign takeovers. The Conservatives failed miserably to meet the average growth rate for similarly developed countries and as a result the Government unlocked less private investment than in all but two of the 38 comparable countries. If the Government had matched that growth rate, the Treasury would now have £12 billion extra in the Exchequer, and if they had matched the growth rates achieved by Labour Governments between 1997 and 2010, they would have an extra £40 billion to spend.

Low growth meant less money to invest in public services. NHS waiting lists were already at record highs, and as the shadow Chief Secretary to the Treasury, my right hon. Friend the Member for Wolverhampton South East (Mr McFadden), pointed out in his opening contribution, there were already more than 100,000 staff vacancies while court backlogs were already growing by 23% in 2020. Lower growth inevitably meant weaker public services and less flexible local government, resulting in a less resilient economy and public sector. It also left our critical national infrastructure dangerously reliant on China for everything from personal protective equipment to our nuclear energy supply.

Resilience is about being able to absorb and bounce back from shocks when they hit, but that lost decade of underinvestment removed our shock absorbers: the British state was surviving hand to mouth—it was walking on thin ice; it was hollowed out by the toxic combination of incompetence and indifference that has characterised successive Conservative Governments since 2010. And now we see that this ice is breaking and the result is backlog Britain.

[Huw Merriman]

Given that there have been four Conservative election victories—or, at least, four Conservative Governments—is the hon. Gentleman saying that the people cannot be trusted, that the Conservative Government are not as bad as he says, or that the Labour party has been particularly hopeless at giving an alternative message? It must be one of those three things.

[Stephen Kinnock]

The British people participate in democratic elections, and when we see the desperately bad results that this Conservative Government are delivering, I am absolutely confident that at the next general election they will deliver a landslide Labour Government. Then we will see the changes our country needs, rather than the incompetence and indifference we see from the Conservative party.

That leads me to the second fundamental failure: the failure of basic competent governance. Mr Deputy Speaker, you do not have to be Mystic Meg to know that when the pandemic abated, the lockdown restrictions would be lifted. We all knew that GP, A&E and hospital waiting lists were skyrocketing, with 4,500 fewer GPs to take appointments than 10 years ago. We also knew that the court backlog was at a record high, with the victims of the most serious violent crimes, including rape, having to wait two or three years for a case to come to court. We also knew that people would want to go on holiday and that they would need passports.

There was no need for a crystal ball—it was happening in front of our very eyes—but while AstraZeneca and the NHS were rolling out the vaccine at speed, the UK Government were patting themselves on the back and wheeling suitcases full of booze into No. 10. Backlog Britain represents a shameful dereliction of duty by a Prime Minister who is utterly out of his depth. Instead of meeting Britain’s challenges, he prefers Government by gimmick. There are lots of big, flashy announcements, but nothing ever seems to get delivered. The Northern Ireland Protocol Bill is not designed to solve any of the immediate problems, and it will take months to get through Parliament. The Bill of Rights is an empty distraction that will just increase the backlogs in the courts system, and the Government have sent £120 million of taxpayers’ money to the Rwandan Government for a press release.

There is a world of difference between campaigning and governing, and the Government appear to be permanently stuck in campaign mode, constantly hunting for wedge issues that will enable them to pick fights and sow division, inflaming tension, rather than building consensus. They are not even campaigning for the Conservative party. No, their campaigns are focused on one aim and one aim only: throwing red meat to Back Benchers so that the Prime Minister can carry on squatting in Downing Street.

One of the many fundamental differences between Government Members and Opposition Members is that we believe in an active state. We believe that the state should work in partnership with the private sector and civil society to facilitate sustainable economic growth and the smooth running of the systems and institutions that underpin and empower our economy and our communities. We believe in investing to help the private sector to grow so that British businesses can create jobs, improve productivity and compete internationally rather than sell out to the highest foreign bidder We believe in investing in public services so that NHS hospitals do not have to choose between treating covid and screening cancer, and we know that the backlogs are clogging up our courts, our ports, our A&E departments, our GP surgeries, the Passport Office, the DVLA and our asylum system. That is holding our country back.

Government Members do all they can to avoid any state support whatsoever. They see government as the very last resort, and the result is the mess that we are in. The result is backlog Britain.

A Government who fail to plan are a Government who plan to fail. A Government who fail to build resilience are a Government who leave us exposed to shocks. A Government who blame anyone and everything for their own failures will never step up and take responsibility for cleaning up the mess they have made, and a Government led by a man who is utterly unfit for public office are bound to end in disaster. Backlog Britain is the consequence of all those failings. The British people deserve better than this.

Economy Update

Huw Merriman Excerpts

Thursday 26th May 2022 Commons Chamber

[Rishi Sunak]

We have not changed the structure of how the price cap works—it covers what it covers. But what we have done is provide discretionary funding—already half a billion pounds this year between spring and autumn, and now an additional half a billion pounds from October through to next spring—to pick up all those who might be in particular circumstances that need additional assistance.

[Huw Merriman (Bexhill and Battle) (Con)]

May I welcome the Chancellor’s economic package? It is thoughtful, innovative and incredibly generous—much more so than some of the ideas that some are saying he has taken from the Opposition.

Last week, I met our fantastic citizens advice team, who work so hard locally. They had a number of measures, and he has delivered on them all. There is one remaining: they were concerned that one-off payments, generous as they are, can sometimes be difficult for people with particular challenges to manage. Will he look at that in the roll-out and ensure that we can help the people who perhaps need it the most?

[Rishi Sunak]

I thank my hon. Friend for his support and join him in paying tribute to our fantastic citizens advice bureaux for the fantastic work they do. He makes a good point, which is one reason why the payment will be staggered into two tranches. It will not come all in one go: the first tranche will come in July and the second later in the autumn. That will help to address the issue that he raised.

Financial Statement

Huw Merriman Excerpts

Wednesday 23rd March 2022 Commons Chamber

[Huw Merriman (Bexhill and Battle) (Con)]

I congratulate the Chancellor on the statement and particularly on the 5p reduction in fuel duty, which I note is temporary. Will he remind all Members of this House that temporary does not mean permanent, and that as the reduction costs £5 billion, if it becomes permanent we will not be able to reduce income tax, which also costs £5 billion, if we are to meet our tests of fiscal responsibility?

[Rishi Sunak]

I thank my hon. Friend, as ever, for his support. He is right: the fuel duty cut will benefit all our constituents, particularly those in more rural areas and on lower incomes. He is also right to make the point that we need to remain disciplined on public spending. We have fully accounted for the income tax cut in our plans, but it will require collective discipline to deliver those tax cuts and others that we want to see over the remainder of this Parliament.

Health and Social Care Levy

Huw Merriman Excerpts

1st reading
Wednesday 8th September 2021 Commons Chamber

[Huw Merriman (Bexhill and Battle) (Con)]

It has been a pleasure for us to sit here for the past four hours and exercise by seeking to catch your eye, Madam Deputy Speaker, no doubt contributing towards alleviating our future social care needs.

In the next 20 years the population of England alone will increase by 10%. The number of over-75s in England will increase by 60%, which is an extra 2.7 million people. In 2020-21 there were 1.9 million inquiries for social care in England. The system is creaking. A third of my constituents are over the age of 65.

This tells us that we need to act now, and I applaud the Government for taking decisive action now. I have concerns about the action we are taking, but we need to act now and the Government are acting now.

I have three concerns about this particular measure. First, we have a health and social care levy that will, in its initial existence, go towards health. I am concerned about when we take that money out of the NHS and put it into social care. We know how difficult it was to convince people that a temporary lift to universal credit was just temporary. How on earth are we going to challenge the equivalents of Marcus Rashford when it comes to the NHS and persuade people that it is not a cut but was always the plan for a period of time before moving the money into social care? There does not seem to be any guarantee on that, and I am concerned that it will be politically difficult for any Government to do so.

Secondly, I am concerned about the intergenerational unfairness that could be seen in this measure. Along with others here in the Chamber, I have advocated a measure that looks for retired people who have a nest egg to pay more for the service they use, rather than expecting the younger cohort, through national insurance, to have to pay for it when they do not have a home of their own.

The German model was built because of the regional imbalances of reunification, and the Germans considered this model and made a provision that everybody would pay in, workers and employers—the retired had to pay both parts—and no one would have to pay more than €138 a month. That took the political heat out of the system, and it uses the private insurance market for delivery. People are incentivised to look after their parents in their own home, and they can take money from the insurance fund to do so. I would like to look further at that model.

If that does not work for the more catastrophic situations, what about the noble Lord Lilley’s proposal of taking a charge against the property, so that a premium is paid out—he estimated about £16,000—and on death the charge is released from the sale of the property?

Both plans look more towards the people using the service having to pay into it. Those who are older would see the fairness of that, because it is their children and grandchildren who have to pay the national insurance.

Thirdly, I am concerned about the overall tax take. We will have to rein in public spending, as this has to stop. We need to allocate money towards the NHS with strict criteria on where it will be spent, because it cannot be right that a 27-year-old graduate who is paying back their tuition fees is seeing 42% of their pay go towards tax. That is not what Conservatives set out to do; we set out to give people the opportunity to build dreams.

That said, we need to act now and I recognise that the health service needs an injection of funding. I will be supporting the Government, but I want to see my three proposals developed before it is too late.

Finance (No. 2) Bill

Huw Merriman Excerpts

Committee stage & Committee of the Whole House (Day 1)
Monday 19th April 2021 Commons Chamber

[Stephen Timms (East Ham) (Lab) [V]]

Clause 31 relates to the decision to cut the £20 a week uplift in universal credit and working tax credit in six months. I want to focus my brief remarks on that decision, highlighted by my hon. Friend the Member for Ealing North (James Murray), because it will be key in the impact analyses in new clause 23 and amendment 15. A Work and Pensions Committee report in February drew attention to the Joseph Rowntree Foundation’s finding that withdrawing the temporary increase

“will risk sweeping 700,000 more people, including 300,000 more children, into poverty”,

and that

“500,000 more people could end up in deep poverty (more than 50% below the poverty line).”

It goes on to explain that

“people who were already more likely to be in poverty were most affected by the economic storm caused by COVID-19: workers in low-wage sectors or part-time jobs, people living in areas with higher rates of deprivation, families with children, disabled people, or those from BAME backgrounds…around 60% of the families who lose out being in the bottom 30% of the income distribution.”

It goes on to say that

“60% of all single parent families in the UK will experience this overnight cut to their incomes”

when the £20 a week is removed.

Under the Government’s plans, the cut will happen just as unemployment is forecast to peak. The last time anything like this happened in such circumstances was 90 years ago under the national Government of Ramsay MacDonald. It will devastate the finances of a large number of struggling families. Ministers will find it extremely hard to justify, so I particularly welcome today’s reported call by more than 100 Conservative MPs to make the £20 a week uplift permanent.

The Resolution Foundation’s “Living Standards Outlook 2021” in January said that rising unemployment and removing the £20 uplift would push 800,000 adults and 400,000 children into relative poverty—the biggest annual poverty rise since the 1980s. A Northern Ireland woman told the Joseph Rowntree Foundation:

“The £20 uplift to Universal Credit has meant I have just about managed to keep my head just above water. I’m living day to day trying to pay my bills and keep my house warm for my child. Taking this away now or in six months means I will be drowning in debt.”

A London woman said:

“We’ve relied heavily on food banks…That £20 is often the difference between light and heat or no light and heat. If you don’t have gas, you can’t cook.”

A Leeds man said:

“I am aware of the extra—if it wasn’t for that I don’t know how I would survive. Living on Universal Credit is hard; it’s extremely hard. It is literally living day to day and working out where my next food is coming from.”

Twenty pounds a week should not be taken away from people like that just as unemployment peaks. Iain Porter of Joseph Rowntree told the Select Committee that the current benefit level without the £20 uplift is

“at the lowest level since around 1990 in real terms”,

and that as a proportion of average earnings, it is the lowest ever. Inflicting that just as unemployment is peaking is indefensible.

The principal policy manager at Citizens Advice told the Select Committee:

“At the very least, if the uplift is not made permanent, we think it needs to be in place for at least 12 months while we go through the tricky part of recovery from this crisis.”

I hope Ministers will reflect and, having done so, decide after all not to make this cut in September.

[Huw Merriman (Bexhill and Battle) (Con) [V]]

Thank you very much indeed for allowing me to contribute to this afternoon’s proceedings, Dame Rosie. I want to talk about clause 5, on the freezing of personal allowance for four years from 2021-22, the resulting amendments, which would push the freeze back by a year, and the general position across the proceedings this afternoon with regard to allowances and the freezing or otherwise of them.

In the six years that I have been a Member of Parliament, it has been a matter of great pride that we have reduced the personal tax allowance. It was half the level that it is now, since it was raised to £12,500. That is the highest basic personal tax allowance across all G20 countries and means that a typical taxpayer is saving £1,200 in tax. More importantly, it has really sent out the message that work pays. It is no coincidence that, as well as the increase in personal allowance and the introduction of the national living wage levels that we have, we have seen record levels of employment and record lows in unemployment. It is a great success story. The covid pandemic has put all that at risk, though,which is why I find myself in the bizarre position of supporting the personal allowances freeze and intending to vote against any amendment tabled by those on the left to delay that freeze for a year. Ultimately, if we do not do something about our finances, we will do the country a great disservice and end up costing individual taxpayers—or non-taxpayers —even more by mismanaging our national debt.

Spending Review 2020 and OBR Forecast

Huw Merriman Excerpts

Wednesday 25th November 2020 Commons Chamber

[Rishi Sunak]

My priority throughout this crisis has been protecting jobs. I am pleased to see that that is something the OBR, the Bank of England and the IMF all acknowledge has happened as a result of our interventions. We currently have an unemployment rate that is lower than Italy, France, Spain, Canada and the United States. So, yes, I do think what we are doing is making a difference to millions of people up and down the country.

[Huw Merriman (Bexhill and Battle) (Con)]

Can I commend all the work that the Chancellor has done this year? Many constituents I speak to credit him personally with keeping them in a job. I am also pleased to see that, despite the financial pressures, the Chancellor is investing in transport. We see multi-year settlements for road, rail and active travel, and changes to the way infrastructure projects are appraised to increase the number of transport projects in deprived parts of the country, as well as a green book, a national infrastructure strategy, a red book and a £4 billion levelling up fund—and I am pleased to see that the Department for Transport is a sponsor. Can I ask him to keep a watchful eye on how all that is spent? Will he continue to place transport investment at the heart of our recovery and his long-term vision for this country?

[Rishi Sunak]

I am very grateful for my hon. Friend’s intervention. He is absolutely right, and he has championed tirelessly for his constituents and the country the importance of transport in our levelling-up agenda and in helping to drive growth and spread opportunity. He is also right that we should be careful about how this money is spent and make sure that it is delivered. I talked about Project Speed earlier, and I would welcome his involvement and advice on that. He will notice in the spending review document a new focus on outcomes across public services with a new public value framework. That will deliver what he is asking for.

Support for SMEs: Covid-19

Huw Merriman Excerpts

Tuesday 10th November 2020 Westminster Hall

[Huw Merriman (Bexhill and Battle) (Con)]

It is a great pleasure to serve under your chairmanship, Sir Edward, and I congratulate my hon. Friend the Member for Carshalton and Wallington (Elliot Colburn), who gave a fantastic opening speech and really set the scene. So many of us agree with him. I pay tribute to the three Members who spoke before me, all from various parts of Yorkshire—God’s own county. When we hear representatives from Yorkshire calling for more money to be spent, we know that we are indeed in unusual times.

I will focus on my concerns for small and medium-sized enterprises in my constituency, what we can do to urge our constituents and residents from across the country to support them before Christmas, and what the Government can do to support them. It is fantastic to see the Minister in his place. I worked with him before my political fortunes changed. It is great that he is in post, which means we have continuity for him to help in the Treasury.

My concerns with small business lie in the demographics of my constituency. We do not have large business in Bexhill and Battle. Small businesses, as my hon. Friend the Member for Carshalton and Wallington said, are the lifeblood at the heart of our local communities. They certainly are in my Bexhill and Battle constituency. I also have one of the highest proportions of workers on the living wage. Without the small businesses, we would not have the jobs that are there, but even the jobs that we do have are very low paid indeed. I am very concerned that those small businesses will not survive. That is why, with regret, I have been unable to support the Government’s November restrictions. Those businesses had done their best and survived during the first lockdown, but I was concerned they were going to really struggle to survive through the second. On a more optimistic note, it is fantastic news that it looks as though the vaccine is within reach. Ultimately, what our small businesses need is the consumers who will drive business, and I hope this will bring optimism back to them.

Despite the restrictions, the bigger operatives such as supermarkets are able to open up to all while smaller businesses complain that they are unable to open, which is regrettable. Having said that, we saw what happened in Wales when supermarkets tried to close certain aisles—it simply does not work. I want to focus instead on what we can all do before Christmas, because all retail businesses are able to open online. I would like to see a national campaign focused on November, a crucial month for many small and medium-sized enterprises, so that we buy local. Ultimately, we need to discourage people from doing their Christmas shopping on Amazon. A good example is a bookshop in Battle, Rother Books. We can buy its books through an online organisation called Bookshop.org, whereby the local bookstore gets the profits that it would receive if someone had purchased in the shop. I urge hon. Members to look at that for their constituents. I am also really encouraged by my Alliance of Chambers in East Sussex, the chambers of commerce, which is appealing for people to buy local, buy later and buy local online. I very much hope that constituents will do that. Again, it is important that we all take the lead and show our residents and constituents how they can find those businesses, and it is important that businesses innovate so that they are able to open during what will be a difficult month.

What more can the Government do before Christmas? I should align myself with some of the points made by my hon. Friend the Member for Carshalton and Wallington. When I visited businesses in my constituency over the summer, they could not have been clearer that without the Government’s furlough and the discretionary grant process, they would have gone under, so the Government really have stood by smaller businesses. I know that the Government’s target of 33% of total procurement spend each year by 2022 should be on SMEs. Given that we have nationalised large parts of the economy, I challenge the Minister to see whether we can make that target perhaps a little earlier.

In the remaining 30 seconds, I want to point out three areas to the Government. On house building, we have lost our small builders, but we will need them if we want to build back. We lost them during the recession of 2008, and it is vital that we let small builders start building so that we get the homes we need. Secondly, wearing my Transport Committee Chair hat, travel agents have been particularly impacted, and I would like to see a suspension of the package travel regulations so that insurers pay out for cancelled holidays, rather than the travel agent. We should better align our regulations so that when airlines are still flying but passengers cannot realistically go to destinations, it is not the travel agents that pay out, but the airlines.

Lastly, on aviation—the Treasury has an interest here—it is vital that we get people flying again. There are so many small and medium-sized enterprises that rely on aviation either indirectly or through the number of passengers who come through. Can we please find a way to reduce the number of quarantine days so that there is an incentive to pay to have the test? People will then end their quarantine early and start flying again. That is all I have to say, Sir Edward. I hope I have not gone too far beyond your limit. I warmly welcome the motion and hope that the Government will continue to support small and medium-sized enterprises.

Covid-19: Economy Update

Huw Merriman Excerpts

Thursday 22nd October 2020 Commons Chamber

[Rishi Sunak]

Maybe the hon. Gentleman knew something that the TUC and every other business group did not when they warmly welcomed the introduction of the job support scheme, but I am grateful to have his thoughts. He might also want to have a word with his colleague the hon. Member for Edinburgh North and Leith (Deidre Brock), who said that it was wrong to give support to large businesses that were benefiting from this crisis. That is exactly why it would be wrong to extend the furlough scheme. The job support scheme is more targeted in its approach, makes sure that those types of businesses are not able to access support and, as I have mentioned, is more generous to employers than the October furlough scheme.

[Huw Merriman (Bexhill and Battle) (Con)]

I warmly welcome the Chancellor’s statement and thank him and his colleagues, and indeed the Department, for everything they are doing. It would take the most churlish of people to claim that this is anything but flexible, nimble and massive support for business. I recognise that, in making the job support scheme more generous, the Chancellor is now providing support for businesses that are open, and that is absolutely welcome. What steps are being taken in respect of those businesses that are open and perhaps do not need as much support—or, indeed, there could be fraudulent claims—to protect the taxpayer?

Black History Month

Huw Merriman Excerpts

Tuesday 20th October 2020 Commons Chamber

[Huw Merriman (Bexhill and Battle) (Con)]

It is an absolute pleasure to follow the hon. Member for Bradford West (Naz Shah), particularly because she reeled off so many names of those who have contributed so much to her constituency. I find it interesting listening to her, because I represent a part of the country—the county of East Sussex—where perhaps I would not be able to do that, because of our demographics. None the less, I feel moved to speak, because it is important for all constituents who feel the burning desire of justice to have all their representatives speak up. We should not just have certain voices speaking; we should all speak and speak up for our constituents who are very concerned. They want to celebrate Black History Month and the achievements that the community has made, but they also push us all in this place to do more. Those are really the sentiments that I come here to speak for.

I congratulate the hon. Member for Erith and Thamesmead (Abena Oppong-Asare) on securing this very important debate. Last time, we secured a debate together on aviation. It is a delight to be here to support her again. I apologise for coming here a little late. I was chairing a Select Committee meeting, but I wanted to be here, rather than just say, “I can’t do two things at once”, because it is vital that we use our voices here to show our support.

During the recent controversies that we saw in terms of the Black Lives Matter movement, what moved me were a lot of young people, particularly in my constituency, who wanted change. Perhaps some of them felt that they were not negatively impacted, but they believed in justice for their fellow students and their fellow people around the country, and they expect their representatives to do more for them. After writing to them all, a number were still not satisfied with what I was doing. I talked about what I had done in the past before I became an MP, working with youth groups in inner-city London to try and make things better and working to combat knife crime, but ultimately it was a question of, “What have you really done to celebrate the cause in Parliament?” The answer was, “Well, actually, I haven’t really, because we haven’t really had the opportunities to do so in Parliament.” Nothing was going to stop me being here this afternoon to make my voice heard on behalf of the constituents who expect better when it comes to equality and justice and who would perhaps agree that we have made great strides compared with when I or my parents were younger, but that there is still a long way to go.

Complacency is the root of all evil. If we tell ourselves that everything is fantastic when so many people are subject to prejudice and are being held back, and their talents are not being harnessed, quite frankly, we are not doing our job properly in this place. I want to see everyone do that. I know that the Minister has that passion as well and will do so, and I want my Government to do more.

I want to touch on the controversy of history. I am a firm believer that we learn from history only if we evaluate it and re-evaluate it, but not if we eradicate it. I hope that we will reflect on that. My predecessor from 200 years ago was a somewhat controversial figure. He did some good—he was a sponsor of Michael Faraday, provided money for the Royal Institution and campaigned for the pauper’s badge to be taken down—but he was also a supporter of slavery and made his money from slavery at a time when that had become unacceptable even in this place. He is without doubt a controversial figure who should be looked at in terms of the bad that he did as well.

In my constituency, a number of monuments have been left to my predecessor, and the big debate is whether we should let them crumble. In my view, we should not. We should make sure that they are there so that we can have a good debate and discussion with young people who can come out and see what was done, what was controversial and what was wrong at his time. If we allow them to crumble and fall, we will never, ever be able to shine a light on the bad things that people in this place did and that were done in history. I very much hope that we can perhaps rebrand monuments and statues and look at them differently to explain the bad that came from some of those who went before us, but that we will not eradicate history, because otherwise we will never learn from it.