Covid-19: Government Support

Debate between Jesse Norman and Patricia Gibson

Wednesday 7th July 2021 Westminster Hall

[The Financial Secretary to the Treasury (Jesse Norman)]

It is pleasure to serve under your chairmanship, Mr Mundell. I am grateful to the hon. Member for Midlothian (Owen Thompson) for bringing the debate to Westminster Hall and to colleagues across the House for their comments and remarks.

I have been very struck by the difference in tone among the contributions made. There has been a lot of denunciation, but there has also been a rather fair-minded strand of discussion that acknowledged the extraordinary circumstances in which we as a nation have been placed, and the scale and effectiveness of the Government’s interventions. I particularly thank my hon. Friend the Member for Somerton and Frome (David Warburton), the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) and the hon. Member for Stirling (Alyn Smith) for their fair-minded engagement with the issue.

If I may, I will talk a little about where we are and then come to the questions raised by colleagues. Let me be perfectly clear—it is important, as the hon. Member for Midlothian and others mentioned, for us to be tonally clear—that the Government absolutely understand the depth and difficulty of the situation that people have faced throughout the pandemic. That is why we have tried to support as many people and businesses as we possibly can, and to do so as quickly and as effectively as possible. The hon. Gentleman was highly dismissive of that, but actually, I am pleased to say that other hon. Members were not; they recognised that the Government provided a very wide-ranging package of national financial assistance worth over £350 billion, and that international commentators have recognised that. I think of the International Monetary Fund, which described it as

“one of the best examples of coordinated action globally”.

Those packages and bits of concentrated but wide-ranging support include the coronavirus job retention scheme—CJRS—which has supported 11.5 million jobs since its inception, and the self-employment income support scheme—SEISS—which has so far provided grants to almost 3 million people.

[Patricia Gibson]

Will the Minister give way?

[Jesse Norman]

I am not giving way; I am sorry. I have no time whatever and I want to respond to all the comments made in the debate.

It is understood that the schemes continue to be the most generous of their kind in the world, and it is recognised by all fair-minded people that as restrictions start to ease, economic activity and demand will pick up. The Government need to tailor support accordingly, and that is why—I refer to the hon. Member for Edmonton (Kate Osamor)—we have announced that the fifth and final SEISS grant will have the value of the grant determined by a turnover test. That is because of the need to target support towards those most affected by the pandemic. I do not think that is a principle that people should wish to contest, given the overall financial impact of the crisis on taxpayers. For that reason, in relation to CJRS, we have also introduced an employer contribution.

Let me focus for a moment on the effects of that set of interventions. In its May forecast, the Bank of England projects the economy to return to its pre-crisis level by the end of the year—significantly earlier than previous forecasts. At the start of the crisis, forecasts suggested that unemployment would reach 12% or more. The numbers are now close to half that, which could mean almost 2 million fewer people losing their job than originally feared. We hope it must be so.

The five SEISS grants combined will have provided individual claimants with support of up to £36,570. That makes clear the scale of the support. I recognise, of course, that some people have not been eligible or not been able to receive support from those schemes. That is why so many other aspects of the interventions, including the support for local authorities, have been put in place.

If I may, let me pick up on some of the points made by colleagues. It was suggested by the hon. Member for Midlothian that the Government were somehow dismissing solutions that have been put in front of us by reputable independent groups for, as he put it, “spurious reasons”. Nothing could be further from the truth. As the hon. Member for Caithness, Sutherland and Easter Ross recognised in another context, we have leant into all those debates.

We carefully scrutinised the TIGS and DISS—target income grant scheme and directors’ income support scheme—proposals. In different meetings, I have met groups including the Federation of Small Businesses, ForgottenLtd, ACCA—Association of Chartered Certified Accountants—the gaps in support group, the Refused Furlough Group, the maternity petition campaign, Forgotten PAYE and a host of others. We will continue to entertain, and we very much welcome, thoughtful interventions designed to help us, recognising the constraints under which we operate.

The trouble, as I think colleagues understand, is that we are caught by the need to put in place schemes that respect fraud and error concerns. Let me remind colleagues, including the hon. Member for Glenrothes (Peter Grant) who raised this, that the very people who would denounce the Government for failing to extend support would themselves be the very ones to denounce the Government if it turned out that the fraud and error incurred by overly expensive support were to lead to a loss of revenue to the taxpayer. People cannot have it both ways. We are trying to bend over backwards to support those groups, and in many respects we are doing so.

Let me pick up a few other words. The hon. Member for Midlothian talked about “straw-manning”, but nothing could be further from the truth. There is no suggestion on my part that any limited company director is a fat cat—absolutely not. We recognise that in many cases those are extremely effective individuals. What we are trying to do is find an effective way to meet all the constraints I have described when supporting the wide range of people who have been affected.

The hon. Gentleman talked about debt management. Let me remind him that we have put in place a pioneering VAT deferral new payment scheme and that HMRC has made it clear that it is trying extremely carefully to manage the impact of different tax schemes and tax reliefs, and the withdrawal of those reliefs, on different groups.

The hon. Gentleman talked about whether the Government will show appreciation for the charities that support people through the crisis. Of course we will. We have expanded support for voluntary and charitable groups with HMRC. We very warmly support and recognise—and, as I said in another context, I work closely with—the Low Incomes Tax Reform Group, specifically trying to support people on low incomes. Of course we are working as hard as we can, and we have been for 15 or more months, to make things work.

Let me pick up a couple of important points made by other colleagues. The hon. Member for Stirling kindly referred to the work that the Government have done. He acknowledged, rightly, that the devolved Administrations and local authorities do have resources in part—they are heavily resourced by UK Government. In many cases, they have the capacity to amplify and extend their resources through local taxation of their own. That flexibility is one that they may wish to use in support of local people. I would support and welcome that as an exercise in devolved responsibility. With that, let me sit down.

Covid-19: Access to and Acceptance of Cash

Debate between Jesse Norman and Patricia Gibson

Thursday 3rd December 2020 Westminster Hall

[Jesse Norman]

The Government absolutely recognise—I am not going to comment on the shape of what is to come, because I do not think that would be appropriate—the concern about free access to cash. As the hon. Lady will know, a lot of work has been done on trying to preserve inclusivity in the face of markets and pandemic-induced change that may be prejudicing that access.

[Patricia Gibson]

Will the Minister give way?

[Jesse Norman]

I really do not have much time, and I want to respond to the comments and to give my hon. Friend the Member for Blackpool North and Cleveleys the chance to wind up, so let me press on with a couple of key things.

It is worth mentioning that the industry is already taking action to support cashback. Mastercard and Visa have already announced incentives, and of course we have the community access to cash pilots.

The set of authorities that govern this area has been raised. It is important to say that the Government’s view is that the FCA may well be best positioned to take on the function of co-ordinating in an overall responsible way, while we also intend for the PSR and the Bank of England to continue their existing functions. As colleagues will know, the FCA already has a statutory objective to secure an appropriate degree of protection for consumers and existing regulatory relationships with industry.

My hon. Friend asked about wholesale cash distribution. As I think he knows, there was a previous consultation paper by the Bank of England on the future of the wholesale cash distribution model, which set out a high-level road map. A lot of work is being done between the Treasury and the Bank to address those issues.

The hon. Member for Makerfield will be aware that there are existing policies within the LINK ATM network, in particular, to protect the distribution of free cash through ATMs. The Treasury is supporting the Bank of England in trying to enable a sustainable model—sustainability is important—to permit effective wholesale cash distribution.

I ought to sit down now. I thank colleagues very much indeed for their interesting and constructive contributions to the debate.

HMRC Tax Office: Cumbernauld

Debate between Jesse Norman and Patricia Gibson

Tuesday 14th January 2020 Commons Chamber

[Jesse Norman]

The hon. Lady is right to say that the Government take the needs of towns seriously. That is why we have a towns fund, which, in turn, works with a much wider spread of support that we are giving to cities. Of course towns have their uses and functions, and cities have theirs. HMRC is seeking to use the benefits of the city: the capacity to agglomerate services and bring people together, and give them proper communications and technology support. Those are things from which both HMRC and those staff will benefit.

I have taken a lot of interventions and I now have a limited amount of time, so I will make progress. HMRC has already opened three new regional centres in Croydon, Bristol and Belfast, with staff planned to move to the Edinburgh regional centre later this year. Construction is under way at all the remaining new locations, including Cardiff, Leeds, Liverpool, Manchester, Nottingham, Birmingham and Stratford.

In addition to the 13 regional centres, HMRC will keep eight transitional sites open across the UK for several years to help retain key skills during the transition period, as well as five specialist sites for work that cannot be done elsewhere. For example, HMRC will retain Telford as a site for some of its specialist digital teams. Through this phased approach, HMRC will seek to minimise disruption to business operations.

The overall programme will deliver savings to the taxpayer of around £300 million up to 2025 and then rising cash savings, estimated to be more than £90 million by 2028. It also avoids additional costs of £75 million a year from 2021, when the current PFI contract with Mapeley, agreed by the last Labour Government, comes to an end.

[Patricia Gibson]

I am grateful to the Minister for giving way as I know he has points that he wants to go on to make. Can he explain to me, and to the House, how the savings he has talked about and the reduction in staff can help mitigate and tackle the £35 billion tax gap that will inevitably grow with fewer staff?

[Jesse Norman]

The hon. Lady rightly raises the tax gap. When expressed as an absolute number, £35 billion is a large amount of money. Some £7 billion or £8 billion of that sum is caused by people not filling the forms out correctly, and there are many other components to it. As she will know, at 5.6% the tax gap is not only near to its historic low in this country but low against international comparators. It is key to see it as a percentage in the context of the overall amount of money the Revenue collects. HMRC remains an extremely efficient tax collection agency.

It is important to stress that the strategy that HMRC has adopted is not just about cost savings or bricks and mortar. The new office in Glasgow, as well as the other sites, will allow people to develop more fulfilling careers. There will be a wider variety of jobs and, therefore, of career paths to senior roles, as a wider range of work will be based in single sites. The judgment has been that the current office in Cumbernauld does not provide the kind of space that HMRC wants for its staff; nor does HMRC judge it to be fit, over time, for a tax authority operating in the digital age. Modern buildings such as the Glasgow regional centre will deliver a better working environment and experience for HMRC’s workforce. Such buildings will increase HMRC’s attractiveness as an employer, enabling it to recruit and retain the next generation of skilled professionals.

Draft Airports Slot Allocation (Amendment) (EU Exit) Regulations 2019

Debate between Jesse Norman and Patricia Gibson

Monday 28th January 2019 General Committees

[Jesse Norman]

I am happy to respond to the concerns raised by the hon. Member for North Ayrshire and Arran. She has said that the instrument is a missed opportunity to support Scottish airports; unfortunately, that is a misreading of the secondary legislation. The only purpose to which the legislation can be put, under the European Union (Withdrawal) Act, is to transfer EU legislation—suitably corrected—into UK legislation. The question of whether to approve any future legislation that might affect those terms is a further decision for Parliament; all that can be done under this piece of law is to “lift and shift”, which is what this instrument does. In my remarks, I made it perfectly clear that nothing has been done through the instrument that could in any way affect the public service obligations from which Scotland benefits.

The hon. Lady raised the matter of discussions. The Department and the Government have always been engaged, ready and willing to have discussions about the terms of an air services agreement. The concern has not been on our side; the concern has been about what position the EU wishes to take. I am sure that the hon. Lady will be reassured that many of the moves that have been made over the past few weeks have been positive ones, notably the declarations that there will be overflights over EU states, that there will be a 90-day period of visa-free access, and that security checks and other measures will not be replicated in the aftermath of Brexit.

The hon. Lady asked a question about the briefing from the Airport Operators Association. I am afraid that I have not seen that briefing, so I cannot comment on it, but I invite her to send it to me if she would like.

[Patricia Gibson]

The Minister has said that he has not read the briefing from the Airport Operators Association, but does he understand the very serious concerns about the prospect of a no-deal Brexit, for which we seem to be preparing today?

[Jesse Norman]

If I may say so, those concerns are no more than the concerns we within the Government have expressed about the need for a deal, and that is what we are pressing for. As we have said repeatedly, we support a deal and are pressing for one. We invite the hon. Lady’s party to support a deal, which it has so far failed to do. The fact that the deal is being impeded in part by the votes of her own party casts her comments in an ironic light. However, that has not been the problem; the problem has been on the other side of the equation.

The hon. Lady raised the issue of whether Scotland is being short-changed by this legislation. In fact, the exact opposite is true: the interests of Scots are being fully protected within the legislation, and we would expect them to remain so.

I am happy to answer questions, as I have done so far. This is an important and small, but technical, piece of legislation that we need in order to continue to prepare for Brexit, and I commend it to the House.

Question put.