Insurance and Genetic Conditions

Jim Shannon Excerpts

Monday 8th January 2018 Commons Chamber

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

May I wish you a happy new year, Mr Speaker? I hope you had a restful festive period. I know that, like me, you will have spent the time wondering why Paisley did not win the city of culture in 2021, and why Coventry still has not won it. I am grateful that you are in the Chair this evening.

I am delighted finally to fulfil a promise that I made to John Eden, the chief executive of the Scottish Huntington’s Association, to bring to the Floor of the House a debate on the difficulties that both individuals currently suffering from genetic conditions and those with a high likelihood of developing such a condition in the future have in securing insurance. Those with complex neurological conditions, such as Huntington’s in particular, have real trouble in trying to access affordable and fair insurance that allows them to secure a range of services that the rest of us, quite frankly, take for granted.

From the outset, I readily admit that this is not an easy issue: there is no easy fix. It is not a black-and-white issue, but the barriers facing those affected remain deeply unfair. In highlighting this problem, I intend to look at some of the problems that exist with genetic testing, as well as at how many insurance companies are able to bypass the voluntary concordat and moratorium on genetics and insurance by demanding that any applicant provides their full family history before they decide whether to insure someone.

This issue was brought to my attention by the Scottish Huntington’s Association, which is based in my constituency. The SHA is the only charity in Scotland that is exclusively dedicated to supporting families affected by Huntington’s disease. As well as providing a range of specialist support services for those who suffer from this condition, including a world-leading team of specialist youth advisers and a financial wellbeing service, the SHA campaigns to help improve the life chances of those who suffer from this complex neurological condition.

Across the UK, Huntington’s affects between five to 10 people per 100,000, but Scotland has one of the highest rates of prevalence, with about 20 in every 100,000 in Scotland having HD, and 5% to 10% of cases develop before the age of 20. Huntington’s is one of life’s most devastating illnesses. People with it can suffer from repetitive involuntary movements resulting in mobility, balance and co-ordination problems, as well as difficulties with speech and swallowing. Huntington’s can also develop a type of early-onset dementia that affects an individual’s ability to process information, make decisions, solve problems, plan and organise. Those affected by HD can also experience a decline in their mental health and may eventually lose the ability to walk, talk, eat, drink, make decisions or care for themselves, requiring support for most or all of their activities on a 24-hour basis.

Despite the challenges that those with Huntington’s have to live through each and every day, they still need to live their lives, and that requires access to insurance. That particular issue is not new to this House, as it has been debated and discussed in the past, although it has not been raised as often as it should have been. The use of genetic testing in insurance can be traced back to debates held in this House in 2000. Unfortunately, as I will discuss later, it appears that not enough has been done by the UK Government or the insurance bodies to help rectify the matter properly.

Individuals need to secure insurance on many different aspects of their lives. We need insurance to be able to drive a car. Most of us will require home insurance if we want to secure a mortgage, and families who want to go on holiday will need to secure travel insurance before setting off. Many of us will take out life insurance to protect us and our family and cover any tragic or unplanned event.

Securing insurance is the responsible thing to do, but many individuals and families are prevented from doing so, as they are either unfairly refused outright or priced out of the market. Trying to find the right insurance is never fun, but it has never been easier. With the advent of comparison websites, five minutes is all it takes for most of us to access the most suitable and cheapest insurance. However, there are thousands of people out there who dread the thought of even trying to access insurance, because for them it is not the simple and straightforward task that it is for most of us. It is an extremely time-consuming experience, often fruitless and always very expensive.

A survey completed late last year by Genetic Alliance UK found that 65% of respondents had problems accessing insurance. I am certain that that figure would have been higher had the survey asked questions only of Huntington’s sufferers.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on securing this debate. I asked him for permission to intervene. I am a member of the Northern Ireland Rare Disease Partnership, an organisation that focuses on many rare diseases including Huntington’s. As the number of those with rare diseases and genetic conditions continues to increase and insurance cover becomes a greater problem for a greater number of people, does the hon. Gentleman agree that it is time for the Government to review the insurance situation and ensure that the problem he has outlined, which I know about in my constituency, is addressed urgently?

[Gavin Newlands]

I thank the hon. Gentleman for his intervention, and I wholeheartedly agree with him. I will come on to discuss the particular review relating to Huntington’s, but I totally agree with him.

The reasons cited by survey respondents for not being able to access insurance included affordability, lack of understanding of the condition and the length of time the process takes to complete. Insurance policies by their very nature are designed to assess the level of risk before they choose to insure someone. We all know and accept that. If someone has previously crashed their car or had a bad credit rating, the chances are that they will either be denied insurance or face paying higher premiums for accessing insurance. It has always been thus. However, we should not equate having a bad credit rating to having a certain health condition, but that is exactly what is happening at the moment. Individuals with certain health conditions are experiencing great challenges to be able to access affordable insurance.

Genetic testing will be one of the ways in which insurance companies try to determine whether someone is destined to develop Huntington’s.

Christmas Adjournment

Jim Shannon Excerpts

Thursday 21st December 2017 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

As always, it is a pleasure to be called to speak. Just as an introduction, let me quickly focus on the real meaning of Christmas. It is about not the actual date, but the remembrance. The very word “Christmas” means a Christ celebration. This is a time that has been set aside for people around the world to remember the fact that Christ gave up his divinity to come to earth in human frailty as a baby, to grow up tempted and tested, as each and every one of us has been, and ultimately to be the key part in God’s plan of salvation for every person on this planet through his death and resurrection. There is no point in Christmas if we do not have an Easter, and I am very pleased to celebrate them both.

This is a time when people of every nation, tribe and tongue have time to recognise not a date, but a promise fulfilled; not a time of birth, but an offer of a new birth to all who believe and accept Christ; not a birth certificate, but a plan from a loving God to a most beloved people. That is what Christmas is really all about. I love Christmas as a time to remember what the Lord did for us. I know that Christians throughout the world are joining me and others to thank God for the real meaning of Christmas.

At this time of year, we must also remember those across the world who, due to persecution and deliberate verbal and physical abuse, cannot go to their church and worship God as we can. I urge people inside and outside this House to pray for those people and to keep them very much in their thoughts.

In the short time that I have, I will mention a scripture text that I received, “Labour for the night cometh”. I thought very much about what I wanted to say. I know others have talked about this, but I very quickly want to focus on the volunteers and say a most sincere thank you to the people in our communities who work day and night, week day and weekend, sacrificing themselves nine-to-five, indeed a lot more, to provide help and assistance to people throughout the UK. They will not be able to spend the whole day at Christmas with their family, as they will be taking care of other people’s families. I am also thinking of NHS staff, healthcare staff, auxiliaries, porters, cleaning staff, GP services, lab technicians, and members of the Police Service of Northern Ireland, the police services, and the intelligence agencies. They do not sleep in their beds so that we can sleep in ours. I am also thinking of the fire service, the prison officers and all the staff in the road services. There are also those in uniform, whether in the Royal Navy, the Army or the Air Force. People posted in other parts of the world will not be close to their families. We should take a moment to think of all of them.

I also wanted to take this time to highlight the fact that our nation would not work the way that it does without the help and support of the literal army of volunteers who daily give their time and energy to make a difference and help people throughout this land. We simply could not live our life without them.

We live in a nation of givers: people who give charitably and generously throughout the whole year. It always makes me feel very, very proud to be British when I think about our giving mentality. I know that people in Northern Ireland perhaps give above the national average, but everybody, in all regions of the United Kingdom, gives and we should keep that in mind.

I am also very conscious of the fact that I should mention a few charities. I do not have time to go through them all, but let me mention very quickly the food banks and the people who work for them. There are 1,235 Trussell Trust food banks and 700 independent food banks. Staggeringly, volunteers do almost 3 million hours of unpaid work each year. That is equivalent to a basic wage of some £22 million. That is what the volunteers in the food banks do for us. We should consider that, as well as having this mainly volunteer-based support, this one sector has thousands who donate to food banks to help people in their communities. We all make a contribution to that.

At this Christmas time, I want to express my sincere thanks to all those who, throughout the year, have volunteered and helped out in churches and community groups in my constituency of Strangford and in the rest of our great United Kingdom of Great Britain and Northern Ireland. Our society simply would not work without people going out of their way to help others. That selflessness is so clear at Christmas as we hear of people donating to the food banks, of churches providing gifts, of people carol singing to the elderly and of people inviting neighbours and relatives to eat with them.

Christmas is very much about families. Mr Speaker, you will have your family with you at Christmas time, and I wish you every enjoyment with that. All of us will hopefully have our families around us as well, but there are those who do not have families, and we should be ever mindful of them.

I offer my most sincere thanks to everyone who has played a part in making someone’s life better this year—whether that is the Salvation Army helping individuals or the homelessness organisations that hon. Members have mentioned. We all have a focus on people, because we all try to work on behalf of our constituents.

I thank you, Mr Speaker, for your patience with us all in this House. It is quite something. I know that I have said this many times, but I do say it with sincerity. In fact, you probably show more patience to me than to anybody else. Next year, I am really going to try not to use the word “you”. I will endeavour to make that happen; it has only taken me seven years to remember and I will try to remember it in the year to come, if we are spared.

As other hon. Members have said, the right hon. Member for Chorley (Mr Hoyle) is very much in our thoughts. We keep his family very much in our minds and our prayers at this time.

I thank the other Deputy Speakers, who—like you, Mr Speaker—treat us very fairly, with so much patience and kindness. Mr Speaker, you are very much a champion of the Back Bencher. As a Back Bencher who has no aspirations to be anything other than a Back Bencher, I particularly enjoy the opportunity to participate in the debates in this House.

I thank the Hansard staff, who have been able to understand my accent and my Ulster-Scotsisms, which have actually been quite challenging for me at times, so they must be much more challenging for anybody else. I also thank all the staff, including security, who look after us in the House.

I hope that all hon. and right hon. Members in this House, Her Majesty, the Prime Minister, Her Majesty’s Government and Her Majesty’s Opposition have a very merry Christmas and a happy new year. I also publicly wish my constituents in Strangford, who I have the privilege to represent, a merry Christmas, and a happy and blessed new year.

[Mr Speaker]

The hon. Gentleman has spoken in the spirit that we have come to expect from him, and it is hugely appreciated.

Finance (No. 2) Bill

Jim Shannon Excerpts

Committee: 1st sitting: House of Commons
Monday 18th December 2017 Commons Chamber

[Mr Jones]

I do not disagree with the right hon. Gentleman, but unless we do some work on where we are going to house these people and families, we will be throwing them out to the market. That is why the last Labour Government introduced the early support for members of the armed forces who wish to purchase their own property, a move that was cancelled in the first Budget in 2011. There is a mixture here: some members of the armed forces want to buy, while others will want to rent as they move around.

To do this without any thought about how we are going to provide the housing behind it is a little strange, and I cannot understand why this measure is being brought in now. The right hon. Gentleman said people are not going to be forced, and I agree, but if they think it is attractive and then suddenly realise it is not, will they be able to go back?

Instead of having a piecemeal approach like this one, or putting the cart before horse, we should have waited for the new housing model before this proposal was brought forward. As part of this mix, I would also like people to be able in some cases to opt not for rental allowance, but for support for mortgage payments; we introduced that, but it was cancelled in the first Budget in 2011.

[Jim Shannon (Strangford) (DUP)]

I am doing the armed forces parliamentary scheme, which gives me the opportunity to speak to Army, Royal Navy and Royal Air Force personnel. The issue that comes up all the time is accommodation for families. If we do not get the accommodation right for families, we will not retain the personnel. We need to retain the personnel, so does the hon. Gentleman agree that we need to work on those issues and that the introduction of this policy could provide an opportunity to ensure that Army personnel can be retained and that the accommodation is up to standard?

[Mr Jones]

I do agree with the hon. Gentleman. Anyone with a close involvement with the armed forces, as he has, will know that we rely on those men and women to go on operations and that a key issue for morale is to ensure that their families are supported during those times.

I am a bit wary about this proposal for another reason. When the Australians introduced this type of rent allowance, they did it gradually, over a 10-year period. There was therefore a transition period with new starts and other people coming in. The proposals in the Bill seem a bit piecemeal, and if they are not done in a thought-out way, we could end up in a situation in which Annington Homes retracts the existing accommodation and people’s options become limited. Again, I think this is the right move forward but it is not being done in the right way. Anything that the Treasury can do to extract the Ministry of Defence from the Annington Homes contract would be universally welcomed—[Interruption.] The right hon. Member for Hemel Hempstead is shaking his head. He has obviously looked the same thing as me. Let us wait and see what the new housing model delivers, but let us hope that it adopts a joined-up approach that will be of benefit to members of our armed forces.

I want to turn now to stamp duty. My right hon. Friend the Member for Warley (John Spellar) asked the Minister which regions would benefit the most from this proposal. The Minister, as usual, sidestepped the answer, but it is in fact quite clear. The average house price in County Durham is £138,000. In London, it is £488,000, so it is quite clear where the money will go. As my hon. Friend the Member for Wirral South (Alison McGovern) said, the Government are completely ignoring the idea of trying to eradicate inequalities throughout the regions. Indeed, they will actually increase them through these moves.

There is a broader point, however. I passionately believe that people who aspire to own their own home should be able to do that, and we should be able to help them to do it. The problem with this Government, however, is that they have one trick in their armoury, which is the idea that the private sector should deliver all this. They believe that the only way to achieve the mythical 300,000 new homes is to allow the private sector to deliver them. Well, I am sorry, but if they are going to rely on the private sector to do that by supplying 300,000 new homes for purchase, that will not deliver the homes that we need in most areas—not just in London but throughout the regions.

RBS Rural Branch Closures

Jim Shannon Excerpts

Monday 18th December 2017 Commons Chamber

[Ian Blackford]

I agree with my hon. Friend. That is why I say to the Royal Bank of Scotland that it should please listen to the justifiable anger that there is throughout the country. RBS has been a much-loved institution, and one that has been cherished by our communities. We are appealing to RBS to think again, to stop and to reverse these closures.

[Jim Shannon (Strangford) (DUP)]

I congratulate the right hon. Gentleman on bringing this matter to the House for consideration. I have had five banks close in my constituency: three Ulster Bank branches, one Trust Bank branch and one Bank of Ireland branch. Does he agree—many in the House will suspect this to be the case—that people, especially elderly people, will not use banking services, but will keep their money in their house? Is there not a fear that that will lead to more robberies, more violence and more unrest?

[Ian Blackford]

I hope that that is not the case, but the hon. Gentleman raises a justifiable concern about the safety of our elderly citizens in their community, and it is another good reason why RBS should think again.

Budget Resolutions

Jim Shannon Excerpts

Thursday 23rd November 2017 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

We have all been waiting with anticipation for the sight of the red briefcase and for the Budget contained therein. It is a time when we can all be forgiven for being slightly parochial and looking at how our constituents will fare, as well as looking at the big issues that affect us all.

I welcome the Chancellor’s statement of the additional allocation of £650 million to Northern Ireland over a three-year period. That—on top of the £1.4 billion that we were able to secure in the confidence and supply deal—means that we are delivering not only for Unionists, but for nationalists and everyone across the whole of Northern Ireland. Everyone in Northern Ireland is gaining from that deal. I am pleased to see some of that money going to Departments and worthy projects such as the Ballynahinch bypass in my constituency, and I hope that we will see that project soon.

I am also pleased about the increase in nurses’ wages. The Chancellor said yesterday:

“Our nation’s nurses provide invaluable support to us all in our time of greatest need and deserve our deepest gratitude”—[Official Report, 22 November 2017; Vol. 631, c. 1054.]

The Government are delivering for nurses. The Democratic Unionist party is quite happy to be a part of that, and we have used our influence to try to make that happen. As you know, Mr Speaker, I have been in hospital three times in the past six months, so I understand just how much nurses do for us all. I should just say that the surgical gown is the most unattractive garment that any person could ever wear, and I have had to experience that three times in the past six months. Such experiences give us an idea of what nurses to do.

Fuel duty will remain the same. That will benefit my isolated rural constituents greatly, although—I have to be honest—not as greatly as a drop would. The freeze in air passenger duty will also benefit businesses and enhance our connectivity to the UK until we can scrap APD, which would greatly level the playing field for Northern Ireland businesses. I welcome the news that the high-strength ciders will see a rise in duty. However, I would have preferred to see a larger increase to address the issue head-on and to be more effective in tackling young people who are drinking just to get drunk.

I am pleased that steps are being taken to address the issue of digital economy royalties relating to UK sales that are paid to a low-tax jurisdiction. They will now be subject to income tax as part of the tax avoidance clampdown. This is expected to raise about £200 million a year. I think that that it a conservative estimate, as I expect the figure to be much higher. I welcome the Government’s commitment to abolishing the stamp duty on homes worth less than £300,000. That will certainly be of benefit to many of my constituents across Strangford and, indeed, to people across the whole of Northern Ireland.

We need a Northern Ireland Assembly that works. Hon. Members will understand that we do not have a functioning Assembly at this time, but we need accountable delivery. The obstruction lies, very clearly, with Sinn Féin. They are not delivering; they are not even sitting on these Benches. They are elected, but they do not come here. If we asked the nationalists and the Unionists in Northern Ireland what they want, they would say that they want effective health, effective education and effective roads. They do not want an Irish language Act.

In the remaining time, I would like to make a plea to the Minister and to the Department regarding the marriage tax allowance. Three quarters of breakdowns of families with children under five come from the separation of non-married parents. Children are 60% more likely to have contact with separated fathers if the parents were married. The prevalence of mental health issues among children of co-habiting parents is 75% higher than among those of married parents. Children from broken homes are nine times more likely to become young offenders.

I make this plea to the Minister because the key thing to recognise is that the marriage commitment is a key driver for stability, quite apart from wealth. In that context, it is entirely appropriate that our tax system now recognises marriage, but it is not right to tell a stay-at-home spouse looking after children that the unpaid work they do is not worthy of 90% of the personal allowance.

Let me quickly draw some comparisons. The income tax burden on a one-earner married couple with two children is 70% greater than the burden on a comparable French family, twice that on a family in the USA and 15 times that on a German family. The 10% marriage allowance is far too small. I ask the Minister to look at that.

The Government should introduce a fully transferable allowance and pay for it by reducing the scope of the allowance to married couples with young children. I believe that it can be done. I know that it is not something for this Budget, but I ask Ministers to consider it for a future one.

Recent ComRes polling suggested that support for increasing the marriage tax allowance is much greater, at 58%, than support for bringing in yet further increases in our personal allowances, at 21%. With that in mind, I ask the Government to consider that issue. Again, I welcome the Chancellor’s statement.

Public Country-by-country Reporting

Jim Shannon Excerpts

Wednesday 22nd November 2017 Westminster Hall

[Deidre Brock (Edinburgh North and Leith) (SNP)]

It is a pleasure to serve under your chairship, Mrs Main. I commend my former colleague on the Public Accounts Committee, the hon. Member for Amber Valley (Nigel Mills), for securing this debate and adding his voice to calls for—I think this was his phrase—the clear sunlight of transparency, for territory-by-territory reporting, and for the UK to show the world that it leads on this issue by example. I particularly noted his comments on how companies already have significantly greater requirements nowadays to comply with duties such as corporate social responsibility, and his questioning of how those responsibilities differ from their responsibilities to pay tax.

It is also important to recognise the contribution made by the right hon. Member for Don Valley (Caroline Flint) over the past few years. She, too, has done much to make sure that the issue has stayed front and centre. I particularly note the concessions that she squeezed out of the Treasury last year, including the amendment to the Finance Bill that paved the way for more transparency. I also recognise the right hon. Member for Barking (Dame Margaret Hodge) and all the work that she did in her time as Chair of the Public Accounts Committee.

The right hon. Member for Don Valley spoke of the increasing number of investors calling for companies to come clean over the amounts of tax they pay, and of the significant reputational damage that they can suffer if found wanting. That is a really important point. She also asked how many countries need to sign up to greater transparency before the crest of the wave is high enough to force real action. The right hon. Member for Barking noted and welcomed the cross-party nature of the support for these proposals that has been a distinguishing feature of all the debates around this issue. She called for leadership and a real willingness to step up as the first country to really take on these measures.

[Jim Shannon (Strangford) (DUP)]

Does the hon. Lady agree that it is essential that multinational companies simply do the right thing and pay what they owe for the benefit of the nation—something that small and medium-sized businesses do throughout this nation every day of the week? Such payments allow them to have the freedom to trade and make money. There is a moral obligation to deliver those payments, and they should.

[Deidre Brock]

I echo the hon. Gentleman’s call, and agree that there is a moral obligation. We clearly need rigorous regulation, to create a tax system that is fair and works for everyone. The hon. Member for Ealing Central and Acton (Dr Huq) spoke of offshore financial transparency, or lack thereof. She referenced the Paradise and Panama papers, and called for the long-awaited anti-corruption strategy to be instated as soon as possible. It will be interesting to hear the Minister respond to that point.

It is also appropriate to note the action—small, but welcome—announced by the Chancellor today about assessing the activities of firms trading here. It is not enough, but it is a start. Profit-shifters—the shape-shifters of the corporate world—seem only too glad to accept the benefits that come from operating in our communities, such as policing, road maintenance, street lighting, and so on, but seem far more reluctant to pay their share of the costs. I appreciate that there are people—some of whom are, or have been, legislators in this Parliament—who also stash cash offshore or use interesting, tortuous schemes to avoid paying tax. Successive Governments have not done enough to stop them. However, corporations that routinely play the three-card trick with their profits are truly appalling. As the right hon. Member for Barking mentioned, the excuses that are routinely offered by Apple, Starbucks, Google, Amazon, and the rest—that they abide by the letter of the law and pay what is demanded of them—stink. Legal or not, the behaviours that they exhibit are immoral; they should be willing to pay for the services they receive.

Paying taxes is the price of getting society’s benefits. Companies should be willing to pay, and Governments should be forcing them to pay. Enforcement has to get harder, and investigations have to be tougher. Instead of having so many civil servants chasing down benefits claimants, for example, the Government really must invest more time in the pursuit of tax-dodgers. It is just not good enough that there only 522 officers in Her Majesty’s Revenue and Customs’ high net-worth unit, and only 518 in the affluent unit. That, of course, measures up against the more than 4,000 officers that the Department for Work and Pensions has, chasing those on benefits for a few pennies here and there. That is not only immoral, but not even good value for money.

Individuals and corporations that dodge tax need to be brought to book, and Governments need to be hunting them. We need international co-operation to get better results—we could have done with staying in the EU for that, of course—but Governments can and should act now, by starting to force the issue and taxing them properly. Billions of pounds in lost revenue is a huge gap that needs to be closed.

Paradise Papers

Jim Shannon Excerpts

Monday 6th November 2017 Commons Chamber

[Mel Stride]

The hon. Lady may know from my earlier comments that the wealthiest 1% in the country pay 28% of all income tax. She should also be aware that in 2010, during her party’s time in office, the proportion was only about 23%. Ours is the party that is standing up for the poorest and the least well off in our society, and as part of that process we have taken almost 4 million of the lowest-paid out of tax altogether.

[Jim Shannon (Strangford) (DUP)]

Will the Minister, and the Government, consider writing a letter to all those mentioned in the Paradise papers news leaks, gently reminding them of not only their financial obligations but their moral obligations to all citizens of the United Kingdom of Great Britain and Northern Ireland?

[Mel Stride]

I totally agree with the hon. Gentleman that everyone has a moral obligation to pay their fair and legally due share of tax, and when it is found as a consequence of these disclosures that some have failed to do so, HMRC will be on their case.

Taxation: Beer and Pubs

Jim Shannon Excerpts

Tuesday 31st October 2017 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to speak in this debate; I congratulate the hon. Member for Dudley South (Mike Wood) on securing it. The Northern Ireland hospitality industry sustains some 60,000 jobs, including more than 45,000 in food and drink. I advocate drinking responsibly, and many of the public houses in my area have a reputation for removing keys from locals if they have ordered enough drinks to be approaching the limit, even if the drinks are not completely drained. I am thankful for that. I ask more people and businesses to take that step, to ensure that people never drive at or close to the limit.

[Norman Lamb (North Norfolk) (LD)]

Does the hon. Gentleman agree with me and other hon. Members who have spoken that there is a need for a comprehensive review of the business rate, which puts pubs and other small businesses at a disadvantage—particularly in comparison with cheap booze from supermarkets and other larger businesses?

[Jim Shannon]

No one in the Chamber today would disagree with that.

The Government rightly tried to incentivise the production of lower strength beers, up to 2.8% ABV, in order to encourage moderate drinking. Unfortunately, because of the taste of 2.8% beer, that has not stimulated the relevant part of the market. Current HMRC duty receipts show that those lower strength beers make up only 0.15% of total UK volumes. However, the industry has provided concrete evidence that the consumer will drink lower strength beers at 3.5% ABV, which is still significantly below the UK average strength. Legal advice has also been provided, which shows that the Treasury can indeed add another duty band between 2.8% and 3.5%, which would enable the Government to incentivise the production and consumption of lower strength products, in the interests of moderation. There no excuse for that change not to happen now; the current advice is compliant with the EU structures directive, but the Government have so far chosen not to act, or to ignore it. We should not be prevented by the EU, when we are trying to bring in a progressive policy that would benefit the UK.

The contribution of the hospitality industry in Northern Ireland in wages alone is £653.4 million. Tourism in Northern Ireland provides 58,000 jobs; the wider tourism economy contributes £1.6 billion to Northern Ireland’s GDP; and food and drink account for more than 30% of visitor spending. Those are significant figures, on which we can build.

[Giles Watling]

Tourism is vital to my constituency, but does the hon. Gentleman agree that the issue is also communities, and talking to each other? It is a question of talking to each other eye to eye and having a proper discourse—maybe, God forbid, about politics—instead of being on Facebook and Twitter.

[Jim Shannon]

Yes, I do hold with that. We all agree—it is very much a part of what we are about.

In Northern Ireland we are happy that we offer world-class shopping, spa facilities, eateries that are second to none, scenic views, and the friendliness of the local populace, but there is a need for Government to keep us competitive. The Republic of Ireland has much lower tax, and we need to address that. The Northern Ireland Assembly has set a target for the number of tourism jobs to grow by an additional 8,000 by 2025. As the House will know, the Assembly is in some disarray at the moment—it is not functioning, so it may fall to us in this place to help the industry. One step would be reducing taxation, something I want to support by taking part in the debate.

Tourism is an export generator—the value was £545 million in 2015. There is no point in being able to get a hotel room for £67 per night if a meal will cost £100; we must address the issue, and take action on what is a false economy. Previous attempts to increase Government revenue through duty rises proved ineffective. As a result of the beer duty escalator, from 2008 to 2013 duty increased by more than 42%, but Government revenues increased by only 11.5%. During that time beer sales in pubs fell by 24%, total beer consumption fell by 16%, 75,000 jobs were lost and 3,700 pubs closed.

Conversely, the Centre for Economics and Business Research found that an additional 750 million pints were sold in 2013-14 as a result of the first cut in duty after the escalator was stopped. It is necessary to spend money to make money. We may believe that increasing tax will help bring income to depleted coffers, but it has been shown that that is not the case. People simply drink at home, as has been said—or in a friend’s home, where no one is watching the limits, counting how many drinks have been had, or considering how safe it is for them to be in control of a vehicle.

In my constituency there are 39 pubs and two breweries—670 jobs and £7 million in wages, with a £14 million contribution to GDP and £5.4 million in tax paid. The issue is about more than a couple of people complaining about the price of beer in their local; it has the potential to be a factor in increasing tourism and helping local businesses. I ask the Minister seriously to consider what is being proposed.

Oral Answers to Questions

Jim Shannon Excerpts

Tuesday 24th October 2017 Commons Chamber

[Mr Speaker]

Order. Just for the benefit of the hon. Gentleman, may I say that the Opposition’s plans for taxes are not a responsibility of the Government? This is a lesson we all have to learn; in my case I learned it early in my first Parliament, and the hon. Gentleman has learned that lesson today.

[Jim Shannon (Strangford) (DUP)]

Across the whole United Kingdom, and not just in the east midlands, small and medium-sized businesses have created not hundreds but thousands of jobs. Small and medium-sized businesses in my constituency tell me that they are over-regulated and that bureaucracy restricts their ability to employ more people. What is the Minister doing to address that?

[Mel Stride]

The hon. Gentleman is absolutely right about the critical importance of small and medium-sized enterprises. We have more than 5 million small businesses in our country, and they are right at the heart of generating the wealth that generates the taxes that support the public services we all wish to see thriving. I have already explained that we are working closely with the Office of Tax Simplification to make sure that, wherever possible, the Government get out of the way of business, rather than standing in its way.

Taxes on Small Businesses

Jim Shannon Excerpts

Wednesday 18th October 2017 Westminster Hall

[Derek Thomas (St Ives) (Con)]

I beg to move,

That this House has considered the effect of taxes on small businesses.

It is a pleasure to serve under your chairmanship, Ms Dorries. I am grateful for the opportunity to raise this issue, which affects small businesses in west Cornwall and the Isles of Scilly, in the constituency of St Ives.

Some 87% of business enterprises in my west Cornwall constituency are classed as microbusinesses, meaning that they employ fewer than 10 people. In fact, 99% of all businesses in my constituency are small and medium-sized enterprises, employing fewer than 250 workers. Those small, locally run businesses provide the lion’s share of jobs and are the drivers of our local economy. If that is true in St Ives, it will be true elsewhere in the country, which is why understanding how the tax system helps or hinders small business is so important and why I am pleased to raise the issue today. It is also why I have dedicated a considerable amount of time since being elected in 2015 to meeting small businesses and understanding the issues facing them. In fact, I had a small business of my own until my election in 2015.

I know that this Conservative Government recognise the considerable contribution of small businesses, and I acknowledge and appreciate the work that has been done to address the tax burden and support small employers. Many of the 3 million jobs created since 2010 are within small businesses, which is, in part, a credit to Government policy. I recognise that there is no shortage of priorities for the Government and that navigating our way out of the EU will be time-consuming, to say the least. Despite that and—dare I say it—because of it, if there was ever a time to radically address the way businesses are taxed, it is now. While reform will be a challenge, it will undoubtedly yield benefits for our economy by improving productivity, driving wage growth, boosting full-time employment and spreading wealth across all corners of Great Britain, which is a particular concern and interest of people in the far west of Cornwall.

Time does not permit us to consider every aspect of business taxation, and I am not gifted with the brain that is needed fully to understand the complexities of the issue. However, I wish to cover three tax-related issues that stand out to me as clear opportunities for the Government to remove barriers for small business and demonstrate an understanding and recognition of the life of a small business owner.

The first issue is the VAT threshold. Small business owners in coastal communities such as Cornwall and the Isles of Scilly choose to curtail their business to duck under the VAT threshold of £85,000. That is not necessarily about tax avoidance, but more a desire to avoid another level of administration. One business owner on Scilly contacted me because the gallery she runs is set to cross the VAT threshold. She will then have to raise prices by 20% to break even. Since only one of the gallery’s 30 artists is VAT-registered, being able to claim back VAT would not compensate for that change. The gallery must either take the leap and accept that burden or close for the rest of the season.

The effect of the stifling VAT threshold in my constituency is reduced activity during shoulder and winter months, reduced employment opportunities, reduced Government tax income, depressed town centre activity and greater pressure on the hospitality sector during peak season. A guest house owner wanting to avoid registering for VAT may also choose to close early, reducing the availability of beds for visitors and removing altogether the potential spend of the visitor within the wider community.

I raise that issue now because leaving the EU presents an opportunity for the Treasury to consider raising the threshold to, for the sake of argument, £120,000. The Isles of Scilly would be a great place to look at if the Treasury wanted to assess the possible impacts and implications of such a change. The Government may find that it is a cost-neutral proposal.

Another benefit of that proposal is the potential to create greater job opportunities and encourage fresh blood into the tourism sector. That is particularly relevant in Cornwall, Scilly and other rural areas across the UK that struggle to retain young people. I am not suggesting that the proposal would address the skills gap entirely in remote and rural areas, but it would be a step in the right direction.

I assure the Minister and everyone here today that the need to address the VAT threshold in coastal communities is regularly brought to my attention by business owners. I am interested to hear if the Minister is minded to consider such a proposal and possibly a pilot in the constituency of St Ives.

[Jim Shannon (Strangford) (DUP)]

This is a very complex matter. I was doing some research on it and found that 59% of homes now own a tablet, 71% of UK adults have a smartphone and 97% of small and medium-sized businesses have access to online services. I make a plea to the Minister on behalf of craftspeople—people who know nothing about computers but everything about their hands. The person who has a computer in their house is probably a 13-year-old—

[Ms Nadine Dorries (in the Chair)]

Order. Mr Shannon, please keep it to an intervention, not a speech.

[Jim Shannon]

Does the hon. Gentleman agree that that point is not fully taken into consideration when it comes to the digitalisation of everything?

[Derek Thomas]

If the hon. Gentleman is happy to wait, I will be pleased to address that issue later.

I will move on to business rates, which have been quite a contentious and well-documented issue in recent months. There is no doubt in my mind that if the Treasury were inventing a taxation system from scratch today, the current business rate system would not feature in its proposals. The Government should scrap the current system of business rates and develop a fresh solution, injecting fairness into the tax system for small businesses and taking into account the growth of online shopping and supermarket home delivery services.

Structurally, there are many things wrong with business rates. The tax bears little or no relation to the success or activity of a business. The method used to calculate it is arbitrary. Colleagues will be aware that rates are calculated by multiplying the rateable value, based on the assumed rental value of the property, by a multiplier set by Government. Almost in recognition of that, and in an attempt to spare small businesses the business rate burden, the 2010 Conservative-led coalition and the two successive Conservative Governments have sought to address the problems associated with business rates. As a result, some businesses are eligible for rate relief, with many paying no rates at all. Others, for reasons that are beyond the understanding of most lay people, find they are charged 100% business rates, with many in my constituency experiencing considerable increases following the revaluations earlier this year.

The owner of a small independent delicatessen in Helston, where rents are relatively lower, approached me for help in March. Her current rateable value stands at an extortionate £17,750 per year. To rub salt into the wound, her rates are calculated as £149 per square metre, which is the second highest on the street. A chain bakery operating next door pays just £101 per square metre—32% less—and a national clothing chain on the other side of the street pays just £66 per square metre, which is over 56% less. If she enjoyed the same rate per square metre, she would be liable for no rates whatsoever. Because of her business rate charge, she is not sure that she can afford to stay in business.

The current business rate calculations unfairly discriminate even between businesses in the same part of the high street and do not enable businesses to operate on a level playing field. The great tragedy is that that example is not unique. There are similar cases of an independent photography shop in Penzance and a car paint-spraying business that is run by two youngsters who find that their business rate charge bears no comparison to similar units on the same industrial estate. In both instances, there is little hope for the businesses unless the Government act quickly.

Furthermore, in this age of online shopping and supermarket home delivery services, there are businesses essential to the health of the high street that find competing in today’s world nigh on impossible, despite their so-called privileged position on the high street. Historically, a place on the high street gave an advantage to the shop owner, and consequently the business rate levy reflected that. The ability of supermarkets to provide a delivery service direct to the door has undermined that advantage, and in many cases, despite the modern reach of supermarkets as a result of home delivery services, the supermarket pays relatively less in business rates than the high street shopkeeper. In fact, in St Ives, business rates for some supermarkets reduced this April.

To add insult to injury, rents in St Ives town are being pushed up by the perceived popularity of this iconic place. This year, because rate charges relate to rental values, independent business owners have seen their business rate charge rocket. Traditional retailers, such as bakers, butchers and grocers, face the risk of closing after decades of trading. High street chains move in, and ironically the very thing that drives visitors to St Ives is being lost, partly because of what I believe is a flawed business rate system.

Could it be that the cost of running a high street business, including a business rate charge, means that a greengrocer can no longer compete with a supermarket 20 miles away, now that it can deliver groceries to the family living in the flat above? Surely a modern-day business tax should recognise such changes in consumer behaviour. Furthermore, business rate charges take no account of external factors such as high parking charges, poor upkeep of the local area, closure of local public toilets, or a downturn in the economy, most of which have been experienced in Cornwall in recent years.

I have worked hard with a number of business owners who have found the business rate system profoundly challenging. That group includes a local pub owner, who came to the trade recently, full of enthusiasm. The pub employs 14 locals and is a focal point for the community. A rate review means that the pub now faces a 280% increase in business rates, which equates to an extra £13,000 a year. I recognise that the Government have done some work, and Cornwall Council is also doing some work, to help with that, but the fact remains that that rural pub owner’s rates have increased by 280%. As rural pubs close around us and communities are losing their rural services, issues such as this are hardly encouraging to new entrants.

Another major drawback is that business rates hinder aspiration. Should a small business benefiting from full rate relief wish to take on a second property, expanding both the business and the workforce, it will lose its rate relief and pay rates on both the new and the existing outlet. That step change discourages growth and innovation, and stifles all the benefits that growth brings, including job opportunities, staff training and career progression. That is hardly the intention of what I believe is a small business-friendly Conservative Government.

Before moving on, I want to stress the potentially unique role that traditional independent retailers such as bakers, butchers and grocers have in looking out for vulnerable people in the community—for example, the elderly. That is reason indeed to consider the potentially devastating impact of an outdated business rate system.

Finally, I would like to address the Government’s Making Tax Digital plan. I am in favour of moving across to digital tax reporting and I recognise the Government’s ambition to move to a fully digital tax system during the next few years. Will the Minister ensure that SMEs, including sole traders, have easy access to reliable software and training? Have the Government considered that for some businesses, a transition to digital-only tax will present a further serious administrative and financial burden? Strange as it may seem, there are still significant numbers of traders who are not naturally acquainted with online activity. I am reluctant to single out individuals, but I have met a number of sole traders who are not tech savvy, and the idea of making tax digital fills them with dread.

At present, I can see that there may be a benefit to Her Majesty’s Revenue and Customs in making tax digital, and I know that the Government are making allowances for areas of poor digital connectivity and plan to exempt some on very low self-employed incomes. Can the Minister please ensure that those exceptions are properly supported by accurate data, so that those who are not yet in a position to take part in the brave new world of digital tax reporting will not be unfairly penalised or discriminated against?

In conclusion, I believe that the Government could send a clear message that Brexit does not mean that important domestic priorities are being left on the back burner. The Government can do that by ensuring that small business growth is not stifled by out-of-date and grossly unfair tax systems. Taxation must promote growth so that, as a nation and within our communities, we can maximise all the benefits that a vibrant economy brings. As changes in consumer behaviour and better digital services lead consumers to gravitate towards online shopping and supermarket home delivery, we must ensure that the Government have a fair system of taxation and make changes to unlock the potential of our country’s entrepreneurial small businesses.

The Government must recognise that the negative impact of business rates and the profit hit from VAT registration often go hand in hand. Both taxes kick in at the crucial point when an enterprise is on the cusp of growing to a size at which it can be of useful benefit to the local economy and community. Will the Government please consider scrapping business rates once and for all, in favour of a tax that reflects the economic activity of all businesses concerned? Will the Government explore opportunities to raise the VAT threshold in coastal and rural tourist areas, and will the Government continue to listen carefully to those who recognise the move towards digital tax reporting but ask that we approach it with caution and understanding?

[Ms Nadine Dorries (in the Chair)]

I call Jim Shannon.

[Jim Shannon]

Ms Dorries, I withdrew my name this morning.

[Ms Nadine Dorries (in the Chair)]

Well, it is still on my list. We will go to Robert Jenrick.