Farming and Inheritance Tax

James Cleverly Excerpts

Wednesday 4th December 2024 Commons Chamber

[Charlie Dewhirst (Bridlington and The Wolds) (Con)]

I share the frustration of my right hon. Friend shadow Secretary of State that the Secretary of State for Environment, Food and Rural Affairs cannot be with us today. I wanted to offer him some sympathy, because I do not believe that either he or the farming Minister cooked up this terrible plan. It was thrust on them by the Treasury because, as has been said before, the Treasury knows the price of everything and the value of nothing. It clearly does not know the value of a family farm or the value of our farmers to this country.

The purpose of this policy, as was outlined by the Chancellor in her Budget statement, is to stop wealthy individuals avoiding inheritance tax, but to protect family farms. As my right hon. Friend the Member for Stone, Great Wyrley and Penkridge (Sir Gavin Williamson) said, the CLA has highlighted that the average 300-acre arable farm owned by a couple would have to spend 99% of its yearly profit over a decade to afford an inheritance tax bill. More starkly, a single farmer with 200 acres would have to pay 136% of their yearly profit to cover the bill. Clearly, that is unaffordable.

A real-life example was sent to me by a constituent. He is a farmer whose elderly father is still alive but no longer works, and whose son is at a local agricultural college and hopes one day to follow in his footsteps. Such an inheritance tax bill makes his farm unviable and puts his son’s future in doubt. His father is distraught. He said to his wife that morning, “What is the point of even going to work?”

[Mr James Cleverly (Braintree) (Con)]

I have had correspondence from an agricultural accountant in my constituency who says that, since the Budget, his job has changed from being an accountant to being a counsellor as more and more farmers contact him with serious concerns about their mental health, because of the fear that has been introduced by this policy and the fact that their children are now telling them that they do not want to go into the family farm.

[Charlie Dewhirst]

My right hon. Friend is absolutely correct. Farming is a lonely existence at times, and farmers have traditionally suffered from mental health difficulties. This policy is making things far worse, and for small family farms it really is devastating.

As others in the House have said, tenants have not been taken into account in any of this. The impact of business property relief is far greater than any of us have discussed so far, because it does not just relate to farms. It relates to any unquoted business, which could be a local haulier, an abattoir or a feed merchant. All of these—the tapestry of our agricultural economy—are impacted by these measures. It really is a devastating attack on our way of life.

If we take the Treasury’s figures, which show that £500 million will be taken each year by these taxes, that is £500 million that will no longer be spent in the rural economy. For example, a farmer who wants to expand his livestock herd needs to build a new shed, and that means paying a planning consultant, a construction firm, a mechanic and an electrician. It means a greater feed bill for his new livestock, and he has to buy the livestock. All of those things are part of the wider economy. It is not just the farmers who will be hit by this policy; it is everyone in rural communities.

The Secretary of State told us at the Environment, Food and Rural Affairs Committee that it will all be fine because farms, under his tutelage, will become more profitable. The only way to make farms profitable that quickly is by greatly increasing food prices. If we are to go down the route of food inflation and of inflation more widely, then fine, but the Government are going to have to explain that to consumers in the supermarket.

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[Joe Morris (Hexham) (Lab)]

It is always a privilege to speak on behalf of my constituency, which is the largest in England and one of the most rural. I start by paying tribute to the farmers I have engaged with, both as a Labour candidate—I had my selection meeting at a Hexham farmers market—and since I have been elected, whether in London, on their individual farms, through the NFU or otherwise. have had genuinely balanced and informative conversations about them, and I have shared the outcomes of those conversations with Ministers and through the appropriate channels. What really strikes me is that this is an unserious motion brought by an unserious party; one that fails to understand the countryside and fails to understand why it lost seats that it had held—in the case of Hexham, for 100 years. The Conservative party undermined the confidence of young people to remain in the communities where they grew up, and it cried foul at any attempt to provide housing in my local community.

I spent this morning meeting with Hexham Community Partnership to talk about the appalling overcrowding in Hexham and the need for genuinely affordable housing. The problem is having a devastating effect, forcing people out of the towns they grew up in. The Conservatives had oversight of that in my part of the world for 100 years. They need to look in the mirror and genuinely consider why rural communities turned against them so much.

[Mr Cleverly]

Will the hon. Member give way?

[Joe Morris]

I will. The vast expanse of green on the Opposition Benches reminds me of the British countryside.

[Mr Cleverly]

Does the hon. Member think that perhaps the reason the good people of Hexham voted for him is because they were promised explicitly that his Government would not do what they are currently doing?

[Joe Morris]

When we start a new job and find that the previous person in that job had not paid invoices for the previous year and deliberately withheld financial information, we have an honest conversation with the public about what is achievable. In any business, we have to be honest with people about deliverables. [Interruption.] Well, ultimately people in my constituency were sick of the chaos. They were sick of seeing Liz Truss plastered all over the newspapers.

When I speak to my farmers, I hear a real cry for security and genuine forward-planning from a DEFRA that listens and is not turned into a political football, as it was too often by the Conservatives. I know, having grown up in a rural community alongside the children of farmers, that they value roads that are not full of potholes, a stable economy and libraries that are not falling down—exactly the public services that every one of us expects.

Newcastle United Football Club: Regulation

James Cleverly Excerpts

Thursday 24th January 2019 Commons Chamber

[Mims Davies]

I turn to the points that have been raised in this debate. Newcastle United are 17th in the premier league, with some uncertainty about the manager and no signings so far in the transfer window, but last week they had a good win in the FA cup. I would like to say that not all football clubs are feeling that pain, but there others at the bottom of the premier mix, including Cardiff, Fulham, Burnley, Huddersfield, Southampton and Crystal Palace. I have to declare an interest when it comes to Southampton, which is very near to my constituency and has many fans. I also understand the impact on the economy when they are not winning.

I am surprised not to see the hon. Member for Strangford (Jim Shannon) here, because we are talking about football—I am surprised not to be interrupted by him. My hon. Friend the Member for Walsall North (Eddie Hughes) spoke about the love and affection in north Walsall for the football club there. I was in that area recently to visit a local school, and there was huge affection for the club. The area has so much to look forward to with the Commonwealth games. It is not all doom and gloom.

[James Cleverly (Braintree) (Con)]

I have to confess that I am here under slightly false pretences. I came to take part in a debate about a fantastic football club that wears black and white stripy jerseys and black shorts, only to discover that it was Newcastle United, not my own Halstead Town football club. The passion that the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) displayed for her local team is matched by the passion I display for mine, and I am grateful to have the opportunity to take part, briefly, in this debate.

[Madam Deputy Speaker (Dame Eleanor Laing)]

I am not sure it is in order for the hon. Gentleman just to mention a team because they play in black and white like Epping Town.

Oral Answers to Questions

James Cleverly Excerpts

Tuesday 3rd July 2018 Commons Chamber

[Mr Hammond]

I assure the right hon. Gentleman that I will be setting out for my colleagues, in the privacy of our Cabinet meeting on Friday, the Treasury’s assessment—indeed, the cross-Whitehall economic group’s assessment—of the implications of potential routes forward. However, as the Prime Minister has said, we cannot give a running commentary in public on a matter about which we are in intensive negotiation with our European interlocutors. I have said before, and say again today, that when the time comes for Parliament to vote on our proposed package, I will make sure that all the available material is put into the public domain so that Members of Parliament are properly informed.

[James Cleverly (Braintree) (Con)]

T7. In Braintree, in Halstead and in the villages of my constituency, including my own lovely village of Earls Colne, there are a number of thriving businesses in retail, manufacturing and other sectors, but at the moment there is a disparity between the tax treatment of physical businesses and that of digital businesses. What plans do Ministers have to rebalance the tax treatment of those two types of businesses?

[The Financial Secretary to the Treasury (Mel Stride)]

My hon. Friend raises a very important point. The Government are determined that we should have an international tax regime that is appropriate to the digital businesses to which he refers, particularly search engines, online marketplaces and social media platforms. We are working with the OECD and the European Union on a multilateral response. In the absence of that, we are prepared to act unilaterally to make sure that fair taxes are paid by those businesses.

A120 Dualling

James Cleverly Excerpts

Tuesday 19th June 2018 Westminster Hall

[James Cleverly (Braintree) (Con)]

I beg to move,

That this House has considered the proposal to dual the A120.

It is a pleasure to serve under your chairmanship, Mr Hollobone. A line in my maiden speech to this House in 2015 was a request of the Government. I said that I would fight for the Government to

“help relieve congestion on the A120, a road so regularly and heavily congested that many drivers cut through Braintree in order to bypass the bypass.”—[Official Report, 10 June 2015; Vol. 596, c. 1287.]

It got a chuckle at the time, if not today. The point was that much of the town of Braintree, after which my constituency is named, is regularly blighted by heavy congestion and long tailbacks. My commuters and residents experience frustration because the A120 is regularly backed up to both the east and west of Galley’s Corner, a major interchange. To the west, people trying to get to the major retail site at Freeport are often stuck in traffic, as are people coming home from work. To the east of that junction, a number of small villages that straddle the A120 are brought to a standstill because of the tailbacks.

For those who are unaware of the geography of the A120, the section we are speaking about starts just to the south of Braintree and stretches across to the junction with the A12. It is part of a major east-west arterial route in a significant part of the country in both cultural and economic potential terms. Stansted airport is on it, and at the other end is the seaport of Harwich. There is a natural flow from an airport to a seaport, yet in the middle—the section we are speaking about—it reduces to an unsegregated minor road with one lane in each direction.

[James Cartlidge (South Suffolk) (Con)]

I congratulate my hon. Friend, who has been a doughty campaigner on this issue, on bringing the debate forward. Does he agree that the A120 is a road of national significance because our region is a net contributor to the Exchequer and that, if it wants that to remain the case, we need the infrastructure in East Anglia and the south-east that supports Essex, Suffolk and the whole region?

[James Cleverly]

I thank my hon. Friend for that point. He is right, and he invites me to come on to what I think is a credible pitch for why this road needs improvement. I am certain that my parliamentary colleagues who have constituencies along the route will enhance and reinforce some of the points that I will briskly make, to give time for others to speak.

I have already mentioned having a major airport and a major seaport at either end of this section of road, but ambitious plans have been discussed by local government at both district and county level to unlock the economic potential of this part of Essex and, in doing so, reinforce the economic potential of one of the few net contributory regions to the UK economy. The east of England is one of the net contributors to the UK economy. We want to contribute more, and we would be able to if we could unlock the entrepreneurialism and business acumen of the people who live and work in our part of the country.

Both at district and at county level, there are ambitious plans for business investment and housing investment. Housing is interwoven with the necessity for good quality infrastructure—transport infrastructure, as well as digital and water infrastructure, and social infrastructure such as schools and doctors’ surgeries. It is absolutely key. The road is currently well out of date; it is at best a 1950s or 1960s road, dealing with a 21st-century level of traffic. Improving and dualling this road, rerouting it and taking away the pinch point at Galley’s Corner will not just benefit my constituents in Braintree—although as their representative here that is what I am passionate about—but it will benefit the county as a whole and the country as a whole.

The reason I talk about residents, local government and businesses is that we speak with one voice on this issue. It has been incredibly important to us that local residents, local small businesses, local businesses, Members of Parliament, district council and county council are all on the same page. We are keen not to miss the chance to get funding from Government in the next few years to relieve the pressure on a congested and often dangerous road.

I conclude by saying to the Minister that at this time we need to ensure that the whole of the UK economy is optimised. We have a fantastic opportunity ahead of us. We are now talking about international trade really, for the first time in a generation. For a road in the home counties, with an airport and a seaport, to still be so under-resourced is no longer acceptable. I ask Government to look seriously and sympathetically at the route that Essex County Council has put forward as its favoured option, because if the Government are able to support it, we can help the Government to pay the bills.

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[Will Quince (Colchester) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hollobone, and to follow my hon. Friend the Member for South Suffolk (James Cartlidge). I congratulate my hon. Friend the Member for Braintree (James Cleverly) on securing this debate on a hugely important topic—a stretch of road that is hugely important to so many of our constituencies across the eastern region.

The A120 does not, in fact, touch my constituency at all, yet it is hugely important to it and to its future prosperity. In the past few years, tens of thousands of homes have been built in Colchester, but without adequate or appropriate transport infrastructure to support them. We have had the housing but we have not had the roads, locally or regionally, to support that massive growth. In fact, ours has been the fastest-growing town in the country for some time.

My hon. Friend made a very valid point when he asked whether there could be another road in the country that links a growing international airport and an international port, which is also growing, by a road that is single track in some parts. It gets so congested that people can get stuck behind a slow-moving vehicle and it can delay their journey by a considerable amount of time, and yet the road is of major strategic importance.

My right hon. Friend the Member for Witham (Priti Patel) made a valid point about the economic case. That is not in question. My hon. Friend the Member for South Suffolk so eloquently made the point that the Government will see a return on this investment and then some. We know that because Essex and the eastern region are already powerhouses for the British economy.

[James Cleverly]

Does my hon. Friend agree that not only will there be an economic return on investment in this road, but, because of the particular nature of the local and regional economy, the return on investment in the road will be greater and quicker than those on similar investments in other road projects around the country?

[Will Quince]

I thank my hon. Friend for that intervention; I could not agree more. I have touched on the international airport and the port, but there is so much more. Colchester, which is sandwiched between those two important infrastructure projects, is hugely important in terms of business growth. The University of Essex, which is just across in the constituency of my hon. Friend the Member for Harwich and North Essex (Sir Bernard Jenkin) but hugely important to both our constituencies, is growing and contributing to huge amounts of business growth; it is attracting businesses to the area.

We know that this is coming. There are plans, as part of the garden settlement movement—that is a debate for another day—for a business park larger than the biggest business park, in Cambridge. If we get it right and if we get the transport infrastructure piece right, this will be a prosperity corridor, stretching from Stansted airport to the port of Harwich, and we can benefit from that.

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[Rachael Maskell]

I am not suggesting that at all. I am talking about intermodal choice, which is important. Going forward, people need to have real options in how they travel, whether for work or leisure. We want to see those choices expanded. Many people at the moment, as I highlighted, have such limited choices that they have no option but to use the car. If we truly are to make the intermodal shift, we need to see more options being made available for commuters and people travelling for leisure.

[James Cleverly]

Unfortunately, the hon. Lady has missed quite a fundamental point and I will reinforce it, if not for her benefit then for the ears of the Minister. This proposal is not about taking existing transport patterns and just making them happen on an improved road. What this proposal is about is unlocking residential and employment opportunities within the region, so that people are not forced to drive or take the train to London, for example, to get good-quality work. So the idea behind this proposal is to develop sustainable communities and sustainable economic activities in and around the region itself, reducing the need for long and polluting journeys, and increasing the opportunities for people to work close to where they live, where their children go to school and where they have amenities around them.

[Rachael Maskell]

I fully understand the scheme; I have read it in much detail. That is why I am making the case that it is so important that we give people real choice.

In my closing remarks—

--- Later in debate ---

[James Cleverly]

I thank the Minister for her comments. What I take away is that although she was careful not to prejudice her Department’s decision, and we completely understand that she is duty bound to go no further than she has, I think I speak for all Members representing the A120 route and the region when I say that we are pleased to hear that, on behalf of the Department, she recognises the strategic importance of the road, the economic opportunity that improvements would unlock and, perhaps on a personal note, the passion of all of us in the room. Although it is always iniquitous to single out individuals, I know that my right hon. Friend the Member for Witham (Priti Patel) and my hon. Friend the Member for Harwich and North Essex (Sir Bernard Jenkin) have been fighting this fight for a very long time. If for nothing more than their sanity, I urge the Minister to take back the message to the Department that the passion overflows among regional MPs.

It is disappointing beyond belief that where we have geographical unanimity we seem not to have been able to get as reassuring a set of noises from the shadow Minister. To say that her response was lukewarm would be an exaggeration beyond my capabilities. Therefore, we rely on the good offices of the Minister and the Department to turn what I believe is a genuinely held recognition of the road’s problems—the congestion, the danger and the negative impact on the ability of businesses to maximise their potential in what is already a great part of the country to do business but which could be so much better—into a relatively modest investment in the A120.

I thank the Minister for listening intently and for what I know she will do next, which is to take the passion of the Members present back to the Department and reinforce the case that has been made by us, by local government at both district and county level, by local businesses and by groups such as the A120 campaign, to which we all subscribe and give our energies. If ultimately we are successful in securing the funding to improve the road, I give the Minister our collective guarantee that we will personally hand over the large bags of cash that will inevitably flow from the investment into Treasury coffers, to be deployed in the great work that public expenditure does around the country.

[Mr Philip Hollobone (in the Chair)]

There have been no hold-ups or congestion today, and we are finishing within the scheduled time.

Question put and agreed to.

Resolved,

That this House has considered the proposal to dual the A120.

Leaving the EU: UK Ports (Customs)

James Cleverly Excerpts

Monday 19th March 2018 Commons Chamber

[Mel Stride]

I refer the hon. Gentleman to the comments of the Secretary of State for Exiting the European Union this morning. I believe he has confirmed that Gibraltar will be part of the agreements that we are expecting the European Council to agree to very shortly, and that they will also extend to our Crown dependencies and overseas territories as appropriate.

[James Cleverly (Braintree) (Con)]

Will my right hon. Friend take as inspiration the workings of DP World, the deep-water port in the south of Essex where thousands of lorries-worth of containers flow into the country from outside the customs union swiftly, slickly and smoothly? Will he look upon that as a potential solution for the Dover border?

[Mel Stride]

I thank my hon. Friend for that point. I have no doubt that that is just one more example of where facilitations and technology can ensure that goods move efficiently across a customs frontier.

Finance (No. 2) Bill

James Cleverly Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Wednesday 21st February 2018 Commons Chamber

[Wes Streeting]

The speeches from Conservative Members have been so rousing that I have been moved to speak to take on the sheer absurdity of the arguments we have heard this afternoon. Member after Member has told us that they oppose new clause 9 because the Government already do this. If the Government already do this, why do they not support new clause 9?

The fact is that the Government do not already do this. What the Government do is publish an impact assessment with a distributional analysis of Budget measures by households depending on income. That measure was introduced by a previous Chancellor, until the current Chancellor’s predecessor decided it was politically inconvenient and got rid of it. The present Chancellor, to his credit, decided to bring it back. That assessment is interesting and useful. It informs Ministers when they are making decisions, but it does not cover the measures that new clause 9 addresses.

The fact is that the Government’s Budget and the Finance Bill are a reflection of their political priorities and tell the country about the problems the Government want to address and how they intend to do so through sufficient provision of resources. The simple fact is that if the Government made an equality impact assessment of their Budget measures, we may not be in a position where women in their 50s are being clobbered by changes to their state pension age at a time in their life when they have little time or opportunity to address it.

As a result of the Government’s refusal to listen to argument, evidence and reason, I see constituents in my surgery on a Friday afternoon—women in their 50s—who tell me that they have lost their job and are not able to access their pension when they expected. They had planned for retirement, and as a result, they can no longer make ends meet. There is nothing they can do about it at that stage. Had the Government considered the evidence, they might have made a different decision.

Had the Government assessed the equality impact of their Budget, we might not be in a position where disabled people have been consistently and repeatedly clobbered by changes to welfare and other areas of public policy. If, as local authorities do, the Government looked at the equality impact of their decision, they might seek to take steps to mitigate the impact on disabled people. Instead, nationally and locally, disabled people have too often had the books balanced on their backs, which is totally unjustifiable.

If the Government looked at the impact of their Budget measures on black and minority ethnic people, they might well take a different approach to the provision of resources in education to address the imbalances. They might also find, through analysis and research—words that have become anathema to this Government in their approach to public policy making—some surprises, such as the fact that detrimental changes to small businesses have a disproportionate impact on BME communities. They may choose to do something about it, or they may not, but at least their policy making would be better informed.

In the debate on this Bill, someone has to stand up and make the case for reasoned, evidence-based public policy making. It is a total disgrace that in the democratic discourse of this country, we now see the trashing of experts. We are warned that if we adopt new clause 9, academics may debate it—God forbid that people with some degree of expertise should debate the laws that we pass, because goodness knows it does not happen in this Chamber often enough. What is it about expertise and data that the Government are so afraid of? What it is about information that they find so terrifying?

[James Cleverly (Braintree) (Con)]

rose—

[Wes Streeting]

Perhaps the hon. Member for Braintree will tell us. I look forward to hearing what he has to say.

[James Cleverly]

I am curious. The hon. Gentleman expresses his desire for experts to have a role in the production of Finance Bills. Does he therefore not regard Treasury officials as experts?

[Wes Streeting]

Unlike Conservative Members, I have high regard for Treasury officials, and I do not trash the data produced by civil servants in the way that Ministers of the Crown do. I think civil servants are a very good example of experts, and I would like the expertise of the Treasury and the civil service to be drawn upon to produce exactly the kind of equality impact assessment that Labour is calling for in new clause 9.

It is because I have faith in civil servants’ insight and ability to gather and garner evidence to inform Ministers that I would like to see a more evidence-based approach to public policy making. If we had such an approach, we would undoubtedly have a better quality of government—and goodness knows we need that, when we look at the current state of things. We would also have a better quality of debate in the House about what our priorities are, the challenges facing the country and how to tackle them.

Finance Bill

James Cleverly Excerpts

Tuesday 31st October 2017 Commons Chamber

[Kirsty Blackman]

As for the opportunity with Brexit, Scotland will be £30 billion worse off as a result of it. My city will be the worst off place in the UK outside the City of London—that is according to work done by London School of Economics and Political Science on the cost of Brexit; it is not a biased point of view. I do not see positive outcomes for the UK from Brexit. On the tax code, I want to make it clear that we reject moving towards a tax haven Britain and anything that could increase the number of loopholes. We are pleased about the Government’s anti-avoidance changes; we would like them to go further, but that will always be the case, and we will always say that to the Government. We are pleased that they are making positive moves, and pleased with some of their anti-avoidance measures. I agreed with almost everything that the shadow Minister, the hon. Member for Bootle (Peter Dowd), said about non-domiciled people and offshore trusts. We will support the Labour party if it pushes new clause 1 to a vote.

[James Cleverly (Braintree) (Con)]

As I am sure you agree, Mr Speaker, we all love a familiar tune that we can hum or whistle along to, the bars and notes of which come effortlessly to mind, so I imagine that a warm feeling of familiarity washed over all Members when they heard the tune being played by the Labour Front Bencher, the hon. Member for Bootle (Peter Dowd). It was the familiar one about the Conservatives not taking tax seriously, being on the side of tax dodgers and so on. We have heard it so many times.

It is nice to see the hon. Gentleman using this gargantuan Finance Bill as a stage from which to play that tune. It brought to mind that wonderful 1970s Morecambe and Wise sketch with André Previn; I do not know whether you are familiar with it, Mr Speaker. Eric Morecambe is at the piano; discordant notes are flooding from it, and André Previn says, “Stop, stop! You’re playing all the wrong notes.” Eric Morecambe replies, “No, sweetheart; I’m playing all the right notes, but not necessarily in the right order.” That was an awful accent; I apologise. The hon. Gentleman was not playing the right notes, and definitely not in the right order. Some of the claims made by Labour Front Benchers are built on sand. Far from being on the side of tax dodgers and tax avoiders, this party in government has put measures in place that have generated an additional £160 billion of tax revenue since 2010, and the Bill will, if enacted, bring in additional billions of pounds to the Treasury, so the hon. Gentleman was singing the wrong notes.

Yes, moves to close the tax gap were initiated by a Labour Government—it would be churlish not to concede that—but far from preventing or rowing back on the closing of the tax gap, this Government have continued the pressure to make sure that the gap between the taxes that should be collected and the taxes that are collected continues to decrease. As a Conservative, I am proud of this Conservative Government’s role in ensuring that the people who should pay taxes do, and pay at the appropriate level.

My right hon. Friend the Member for Wokingham (John Redwood) was absolutely spot on when he said that it is corrosive when we start blurring the definitions of tax avoidance and tax evasion. When we talk about people who act in a financially pragmatic way, completely within the law, in the same way that we talk about conmen and criminals, it sends a massively corrosive message, at a time when the world is getting smaller, in terms of where people can base themselves and their business.

While it is perhaps fun for Opposition Members to vilify people who transact their business internationally and can choose where in the world to rest their head at night and to make them sound like—to be topical—a Halloween villain, that is counterproductive. Although each individual utterance will make little difference, they combine and build to create the background music of intolerance of international business and successful people that will ultimately mean their locating somewhere else. Rather than getting the tax income from them that this country deserves, a different country will generate those tax revenues. A pound—or a euro or dollar—that is taxed somewhere else in the world is a pound that cannot be used by this Government to pay for the public services that we value and the public servants who deserve our thanks and reward.

It may feel superficially pleasant to see an international business, an international business person or a non-domicile flee from these shores. People may say, “If they do not want to be here, let them go.” It is a nice soundbite but ultimately it is massively counterproductive to the job that we should be doing as parliamentarians and that the Government should be doing in office.

[Anna Soubry (Broxtowe) (Con)]

I am enjoying the very good speech that my hon. Friend is making. Obviously, I do not want to get into a Brexit debate. Heaven forbid that he and I fall out in some way, or even worse do our impersonations of bygone sketches, which he clearly could not remember because he was not born then, but, on a serious point, does he share my concern that we are already seeing great businesses looking at relocating as the time comes for us to leave the EU, along with individuals who do not feel welcome in our great country?

[James Cleverly]

I thank my right hon. Friend for her intervention. We may not necessarily agree on the Brexit decision or on its impact on international businesses and British businesses that might be international, but it is fair for her to highlight the fact that we should do nothing that gives businesses cause for concern. It would be unfair to suggest that the decision to leave the EU has no impact on business decisions. As someone who campaigned for Brexit, I have an additional duty to prove her wrong. I know that she is of such a generous nature that, if in our dotage we are sharing a glass of wine, looking back at the events in the immediate aftermath of Brexit and I were to be proved right, she would be more than willing to concede that point. However, we have a duty to give businesses as much confidence as possible about being based in the UK. Having a tax regime that supports business and enterprise is an important part of doing that.

[Charlie Elphicke]

Does my hon. Friend agree that the Bank of England and the Treasury have a duty to talk this country up, not talk it down, and to ensure that, when they talk about investment versus disinvestment, they do not make up terrible numbers, as a continuity of “Project Fear”, when the Bank said that Brexit would mean a loss of jobs, growth and tax revenue, particularly non-domicile tax revenue? We have seen that that is not the case, with the lowest unemployment for 40 years and continued strong growth. It is wrong for the Bank to carry on saying such things, as it has today.

[James Cleverly]

I will be more than happy to invite Treasury officials and Mark Carney to the end of days party that it seems I will be throwing for my hon. Friend and my right hon. Friend the Member for Broxtowe (Anna Soubry). We can sit down to discuss such things, sharing my beautifully aged claret—[Interruption.]. Or indeed some wine from the constituency of my hon. Friend the Member for Wealden (Ms Ghani), which produces some fantastic wine. We will discuss the implications for the British economy of fear-mongering.

[Vicky Ford]

We are debating a new clause that suggests that, within 15 months of passing the Bill, there should be another review. Fifteen months would be February 2019, a month before Brexit. Financial services companies are already having to rethink their operations to cope with Brexit. Does my hon. Friend agree that the new clause is a distraction that the sector does not need and that the sector contributes more than £70 billion in tax to the UK economy, which we want to keep?

[James Cleverly]

My hon. Friend is spot on. I cannot help but think that new clause 1 is more to do with Labour Members feeling that they need to table revised clauses because they do not know what to say. A call for a review of this kind invariably occurs when people are not sure what to say.

Mr Speaker, you will be disheartened to hear that I am about to conclude my comments. I strongly urge Members on both sides of the House to reject the new clause. We should do everything we can to send a positive message to businesses currently in the UK, to businesses that may think about coming to the UK and to business people who are deciding where they will domicile and to pay tax. We need to let them know that the UK is open, ready to do business and welcomes business people, as long as they pay their fair share in tax and help to support the public services that we value.

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

I felt that, as I was going to speak this afternoon, I should listen to speeches by colleagues in the House.

Finance Bill

James Cleverly Excerpts

Committee: 1st sitting: House of Commons
Wednesday 11th October 2017 Commons Chamber

[James Cleverly (Braintree) (Con)]

“The narrative”—those were the words used by the Opposition Front-Bench spokesman in response to the measure. We should remind ourselves that the narrative is that we are discussing employment-related tax treatments against a backdrop of a significant increase in employment and a significant decrease in unemployment. That goes to the heart of this whole debate. Employment is something that we all want to see expanding through the UK economy. Having started and run a small business and having recruited people to that business, I know that no employer recruits someone with the intention of kicking them out. I hope that that goes without saying, but I have said it nevertheless.

[Rachel Maclean]

Does my hon. Friend agree that a small business owner with just a couple of staff has to go through a lot of stress in the whole process of making someone redundant? We should not forget that small business owners are people as well, often quite low paid because they are sacrificing salary. That can lead to mental health issues, stress and anxiety.

[James Cleverly]

My hon. Friend is absolutely right. I will respond to her point in a few moments, but it is a very important one and we must not overlook it.

We have had a jobs boom over the past few years, in stark contrast to many other developed economies around the world and across Europe, which has struggled. In particular, in the UK, which is dominated by small and medium-sized enterprises and, indeed, microbusinesses, which often have only one or two principals and one or two employees, it is important that we continue to give confidence to those businesses, many of which do not have a large administrative back-office function. That is often the case, as it was in the business that I started. I was doing the client interaction and sales, and a colleague of mine was doing the journalism side of the business, but we were also the accountants and the HR department. To give confidence to small and microbusinesses that they can employ people, it is incredibly important that everything to do with employment is as simple and transparent as possible.

At the moment, the tax treatments around severance payments are very competitive. Depending on the combination of events, the payment can be taxed any one of a number of ways. Although I did not speak about this set of clauses on Second Reading, I did welcome the Bill, and I welcome this general move to simplify, to clarify and to give small businesses in particular—although of course this affects businesses of all kinds—the confidence to employ people, knowing that the HR and financial treatment around that employment will be as simple as possible.

The Opposition spokesman kept talking as though severance payments were not taxed at the moment, and of course they are. They are taxed—

[Anneliese Dodds]

indicated dissent.

[James Cleverly]

Above the £30,000 threshold, there are tax treatments. Through the Bill, the Government are seeking to make the treatment of the figure above £30,000 most important and straightforward—[Interruption.] I absolutely welcome that.

[Anneliese Dodds]

The threshold.

[James Cleverly]

Yes, but at the moment it is £30,000, and that is what it says here—[Interruption.]

[The Second Deputy Chairman of Ways and Means (Dame Rosie Winterton)]

Order. There are too many sedentary interventions, and it makes it rather difficult for the Hansard writers, as well as everyone else.

[James Cleverly]

I am happy to take interventions, but I have never been a particularly good lip reader, so the Opposition will have to help me out on that one.

The Opposition suggested that somehow there would be some terrible Government sleight of hand to try to diddle people out of their money at a point at which they have lost their job, but it has been made absolutely clear by the Minister and in the speech made by my right hon. Friend the Member for Forest of Dean (Mr Harper) that there will be transparency in any changes. None are proposed, but if they were, they would follow the affirmative procedure, which would mean a Minister at the Dispatch Box, in front of the House, being quizzed and questioned by the House. They would have to be voted on by the House. So the idea that there would be some sort of back-office sleight of hand in this is inaccurate.

At a time when we have, unfortunately, heard news of proposed job losses in one of our key businesses, the Opposition’s approach is unwise. I understand why their Front Benchers have done this—they want to attack the Bill—and I am sure that if I were in their shoes, I would find whatever means I could to try to criticise the Bill. The simple truth is that there are no such proposals and nothing in the Bill to imply that there would be, but it is right that the Government maintain the opportunity to be flexible in the future.

[Peter Dowd]

Does the hon. Gentleman agree that in the light of the shake-up in these organisations and the dreadful stress that these people are under, introducing this clause at this time is completely inappropriate and heartless? The Government can bring it back another time if they wish.

[James Cleverly]

The hon. Gentleman will be unsurprised to hear that I do not agree with him. The Bill is where the proposal is and the passage of the Bill has been timetabled in the way that it has. The idea that we delay changing the tax treatments of severance payments to a point in time when no one in British society is in the process of losing their job is farcical, as I am sure that, on reflection, he will recognise.

As has been said, the £30,000 threshold means that 85% of termination payments are completely unaffected. I am sure we have all heard anecdotes about businesses seeking to manipulate the definitions of the various elements of severance payments specifically to avoid the tax that is owed. Surely, Opposition Members would wish to make sure, as Government Members would, that tax is applied fairly, dispassionately and transparently, and that it affects all people equally. Once again, a disproportionate burden would otherwise fall on small businesses, which do not have that administrative back-office function and cannot play manipulative games to avoid tax. They are the ones that have to pay the full tax, as is right.

Some companies may have clever back-office accountants looking at ways in which to massage the definitions of the various elements of a severance payment to minimise the tax—tax that is due to the Treasury and that we want and need to fund public services. Surely, the Labour party is not suggesting we should turn a blind eye when a clever set of accountants can massage figures, making sure that the burden falls wholly and solely on small businesses, which do not have the opportunity to employ people to do that kind of smoke-and-mirrors work? I cannot imagine that is what Labour would want to do.

Amendment 4 proposes including the words “injured feelings”. Again, I am sure that this is being proposed with the best intentions, but the Labour party must realise that putting into a Bill a definition that is so vague and open to abuse is just inviting unscrupulous businesses to use it as a means of avoiding the tax that should be fairly paid upon a severance.

[Kirsty Blackman]

I am guessing that the hon. Gentleman is unaware—perhaps he is not—that “injury to feelings” is a legal term. It is used within that profession, and it is recognised and understood. Therefore, it is completely reasonable to include it in an amendment.

[James Cleverly]

I thank the hon. Lady for informing me of that. I am more than happy to look in more detail at that definition, because I do not have it at my fingertips, but putting it in the Bill would present to unscrupulous employers something that looks like an invitation to use this as a back-door route to avoid the tax that should rightly be paid upon severance. It would be unwise for that to go through, because it would send exactly the opposite signal to what we are trying to achieve with the relevant clauses elsewhere in the Bill, which is to say, “If you play by the rules, fine.” The vast majority of people who receive severance pay have no need to concern themselves and neither do the vast majority of businesses. The only individuals who should be a little distressed by what is going through in the Bill are the very small number of companies that have abused the severance payment structures to avoid paying the tax that is fair. I have little sympathy for those companies. If they play by the rules, we are on their side. If they seek to bend or break the rules, I have no sympathy whatsoever.

[Kit Malthouse (North West Hampshire) (Con)]

I am seeking to ensure my hon. Friend understands that this does not benefit the companies; this is of benefit to individuals who take advantage. There is no tax benefit to the companies because it is income tax that is payable. [Interruption.] Well, there is national insurance—employers’ NI.

[James Cleverly]

I thank my hon. Friend for that intervention. There is little direct financial benefit to the company—

[Chris Philp (Croydon South) (Con)]

NI.

[James Cleverly]

Although, as I am reminded, there is an NI implication. Again, I have heard a number of anecdotes about conversations with departing employees from not the most honourable of companies in which things have been said such as, “If this complaint were to gently disappear, I am sure we can squeeze a little more money into your severance payment, using this route or that one.” This is one of the areas where simplicity and clarity are important, because companies may be using massaging methods to try to get a bit more money into the pocket of a departing employee, so that employee does not to have recourse to the law where inappropriate behaviour has taken place. Dangling some cash in front of them may be being used as an enticement not to take a constructive dismissal case, for example, and that is exactly the kind of thing we want to avoid.

In conclusion, I will be generous in spirit and assume that these amendments are just poorly thought through, rather than anything that is attempting to be more damaging. They would undermine the core direction of travel of the Bill, so I will not support them.

[Ellie Reeves (Lewisham West and Penge) (Lab)]

I am grateful for the opportunity to speak in this debate. Before entering this place, I was an employment rights lawyer for more than a decade, so this issue is very important to me. I represented dismissed and discriminated against employees for many years, and saw at first hand the devastating effect that the way they had been treated had on their lives. The Bill clearly seeks to narrow the scope of termination payments. Of course tax avoidance should be clamped down on, but the Government’s own consultation did not reveal evidence of widespread abuse. The hon. Member for Dover (Charlie Elphicke) said that there was tax avoidance on an industrial scale in this area, but that simply is not borne out by the evidence or indeed my experiences as an employment rights lawyer.

Finance Bill

James Cleverly Excerpts

Tuesday 12th September 2017 Commons Chamber

[James Cleverly (Braintree) (Con)]

It gives me huge pleasure to follow such an assured and impassioned maiden speech by the new hon. Member for Liverpool, Walton (Dan Carden). I was born and brought up in south-east London, with a lot of family in Essex in the constituency I now represent, but my mother came originally from Sierra Leone, and the first part of the country that she set foot on when she arrived here in the early 1960s to set up a new life, and ultimately meet my father and have me, was the port of Liverpool. So the hon. Gentleman speaks of the Liver Birds alive in his stomach during his maiden speech, and my mother before she passed away recounted seeing those iconic buildings of the Royal Liver building, the Port of Liverpool building and the other one—

[Dan Carden]

The Cunard building.

[James Cleverly]

Yes; the three graces. Let me give the hon. Gentleman a piece of advice: never put lists in speeches, because everyone who does always forgets one of the elements of them.

The hon. Gentleman maintains that great Liverpudlian tradition of being a firebrand in the making, and I have no doubt that his contribution to this House will be significant even if I and my Conservative colleagues do not agree in every respect with the points he raises. I look forward, I hope for many years to come, to our crossing swords, linguistically at least, across this Chamber. I congratulate him on his maiden speech.

Turning to our Second Reading debate, Finance Bills are always important, and I will, with your indulgence, Madam Deputy Speaker, start by speaking in more general, almost philosophical, terms, before coming on to address a number of specific clauses. Having read through the briefing notes for the Bill—because, as my right hon. Friend the Member for Forest of Dean (Mr Harper) highlighted, it is in its entirety a bit of a weighty tome, and although I am pretty good at reading well into the small hours of the night, even I would be pushed to cover every single dot and comma of this gargantuan document—I am pleased to speak in support of the general tone of the things contained within it. Its main measures include the shift to reduce the tax burden on the majority of people, particularly those at the lower end of the income spectrum, and to reduce the tax burden for businesses to enable them to grow, recruit and employ, and to build the economy from a broad tax base. That goes back to one of my right hon. Friend’s points about reducing tax rates to stimulate economic activity both in the commercial sector and in people’s private lives, generating the financial fluidity that can then be harvested by Governments in order to invest in the public services that we value the most.

As Conservatives we should not be afraid of the concept of taxing and spending. There, I have said it out loud, and it was not even that painful. We have committed and are continuing to commit to increasing expenditure on the key public services on which we all rely. I spoke about my mother earlier, and she spent her entire professional life in the national health service as a nurse and then a midwife. We agree across the House that the NHS both deserves and demands increased Government investment, but the question is not just about how we spend, but about how we raise the money to invest. The rebalancing, over time, of the route taken by this Government on taxing economic activity is philosophically the right direction of travel. As we have done in Budgets and Finance Bills over the years that we have been in government, we should look at every opportunity to reduce the tax burden on individual taxpayers and businesses.

The topic of small businesses has come up several times already this afternoon, and my view has always been that if we have in our minds the economic impact of our political and financial decisions on the small business sector, we will rarely go wrong when it comes to the economy in general. If we look to relieve the financial burden on small businesses, they will without a shadow of a doubt be able to grow, expand and recruit, and big businesses will continue to do well in a more buoyant economic environment. The Bill contains several measures to relieve pressure on small businesses, but if I were to have a criticism, it is just that I would like to see that go further and faster. Particularly after we end our membership of the European Union, we should consider every opportunity to unleash the potential of the British business sector. Let us use that as the starting gun in a race for good ideas to unlock our small and medium-sized business sector, particularly digitally enabled micro-businesses.

Clauses 48 to 59 specifically address a phenomenon that has been brought to my attention in constituency advice surgeries. Smart, innovative British-based businesses are being unfairly undercut by the fulfilment houses of overseas businesses, which make it impossible for British businesses to maintain a sensible living, driving a number of them out of business. Those international players are not paying their fair share of tax. They are putting the squeeze on the sparky, hard-working, innovative, entrepreneurial, often back-bedroom businesses, many of which have been started by people who, demographically, are not as well represented in the British workforce as they should be; they are often ethnic-owned businesses. Women starting entrepreneurial digital businesses are being put under incredible pressure by big overseas players that are undercutting them unfairly. I am pleased that the Government have taken notice of that concern. This is a big step in the right direction, and I will keep a close eye on how it rolls out.

We continue our drive to ensure that non-doms who—“take advantage” is the wrong term—make use of our services and the positive environment we create also pay their fair share, and in this Bill I am pleased to see the Government continuing on that route to ensure that the people who use our public services and who live under the umbrella of protection we provide also pay their fair share.

I will now bring my comments to a conclusion. [Hon. Members: “Hear, hear!”] That is the best thing I have said thus far. I will be supporting the Government on this Bill, and I would encourage everyone to do so because its philosophical underpinning is exactly right. We need to continue making tax simpler, fairer and more effective.

Economy and Jobs

James Cleverly Excerpts

Thursday 29th June 2017 Commons Chamber

[John McDonnell]

Interestingly, Labour was the only political party that published a costed programme. I repeat: the only numbers in the Tory manifesto were the page numbers—nothing more. We will send the hon. Gentleman a copy of the costing booklet—I thought he had already received it but clearly he has not. We increased our expenditure by £48.6 billion, and that is covered by a range of revenue sources, all of which are identified and advised on, and ensure that day-to-day expenditure is covered. The IFS told us that we would comply with Labour’s fiscal credibility rule, reducing the overall deficit over a rolling five-year programme, and reducing the debt within that period.

[James Cleverly (Braintree) (Con)]

Will the right hon. Gentleman give way?

[John McDonnell]

I will come back to the hon. Gentleman.

It is not only the Labour party that highlighted the consequence of the Tories’ failed economic approach. Last week the Governor of the Bank of England warned of “weaker real income growth”. He spoke about “markedly weak investment” and “rapid consumer credit growth”. Worryingly, he warned that the extent to which the UK’s current account deficit has moved closer to sustainability “remains open to question”, as we continue to rely on what he describes as the “kindness of strangers” to fund us.

--- Later in debate ---

[John McDonnell]

It was a great speech, though. I am quite used to throwing red books about in this place. I will send the right hon. Lady a copy of the manifesto my party is united behind.

[James Cleverly]

United!

[John McDonnell]

Yes, united behind. I am proud to say it.

The failed and deeply unpopular austerity programme, the deeply divided rudderless Cabinet, the directionless Brexit negotiation strategy and a contentless Queen’s Speech surely confirms it is time for this Government to now go. It is time for change. Our amendment addresses the change that is needed. As the Labour party demonstrated during the general election campaign, there is an alternative. We can address the deep-rooted problems our economy faces. The Labour party has forged ahead with a serious credible alternative to the Government’s failed approach. Our society can afford decent public services. We are the fifth-richest economy in the world. If we have a fair taxation system, we can end the cuts to schools’ budgets. We can end the horrific sight of children sleeping on chairs in hospital corridors. We can end the bedroom tax and the punitive benefits sanctions regime. We can do that, as the IFS confirmed, while remaining on target to eliminate the budget deficit in accordance with our fiscal credibility rule.

It is not just about a fairer taxation system. We need a Government to invest what is needed to secure our future: not the derisory numbers floated by the Chancellor in the autumn statement with so little to back them up, but a serious, long-term vision of the economy that tackles the regional disparities and the changes taking place in the labour market. We need a Government committed to driving up productivity by increasing investment, as demanded by the CBI and many others, and to delivering a serious industrial strategy. It is a transformative programme that we look forward to implementing in government shortly.

This Queen’s Speech does nothing to solve these problems. It confirms a Government isolated from the real world in which our people live. Labour’s amendment today sets out the alternative our country so desperately needs. I urge all hon. Members to support the amendment.