Cryptoassets: Regulation

Jim Shannon Excerpts

Wednesday 7th September 2022 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to follow the hon. Member for Rother Valley (Alexander Stafford), and I thank him for his contribution. I particularly thank the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) for raising this issue. He put forward a detailed but succinct presentation, and his knowledge of the subject is impressive. I thank him for sharing it in such a way that our understanding inside and outside the Chamber is a lot better.

As everyone will know, I am not great with technology. To be honest, I like to be able to feel my money in my inside pocket and to know what is in my wallet and in the bank, so crypto is not something that I will ever venture into, but there are a great many who do. I am aware that this is an evolving topic and has a lot of popularity, especially among young people, so it is great to be here to discuss how we can help people go about these things in the right way and, more importantly, safely and with the knowledge of what the gamble can mean—both success and failure.

It has been estimated that 2.6 million people across the UK use cryptocurrency, with around 100,000 people in Northern Ireland using it as a form of finance. Interestingly, from my studies, it seems that outside of London, Northern Irish people buy the most Bitcoin, with 15% of people admitting to purchasing it—I am one of the 85% who do not. The fact that 15% do tells me, first, that there is a great interest in it and, secondly, that many people have faith in it, and they wish to be reassured in that.

[Alexander Stafford]

Why does the hon. Gentleman believe that Northern Irish people like cryptocurrency more than Scottish, English and Welsh people do?

[Jim Shannon]

That is a question I cannot answer. I think that there are those who are prepared to take a gamble and those who are not. Perhaps people in Northern Ireland like the element of uncertainty, or perhaps investors like the certainty of the value of their investment. I will give an example of that, because it illustrates the situation very well.

Some 38% of people in Northern Ireland say that they have thought about purchasing cryptocurrency but have not yet done so. What some forget is that Bitcoin is a form of finance. Some bars and restaurants across the UK accept it as a form of payment, so it must be regulated. What I am seeking to do today, as someone who does not have any real knowledge of how the system works, and what I always look to do, is to consider how we can do things better and how we can regulate crypto and make it safe.

We have heard many stories of how accessible and worthwhile Bitcoin and cryptocurrency can be. I know the hon. Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) has a great interest and knowledge in this subject matter. One of my constituents, who is only 28, invested £1,000 in Bitcoin when he was 23. The value of that today is £40,000. What an investment that young fella made! It was probably not a big amount for him, but at the same time he took the gamble. Knowing when to stop is one thing, but continuing the gamble and risk will not always work out well for everyone. People are making extortionate amounts, but it is important that the dangers and risks of addiction are highlighted. Those are some of the concerns I have on safety, and that is where regulation from the Government and the Minister would be most noticed.

Many have heard the story—I wonder how it could ever have happened—that in 2013 a British man accidentally threw away a laptop hard drive that contained what would be worth £280 million today, so cryptocurrency can be incredibly volatile and has been described as overhyped. The Bank of England has strongly highlighted the consumer risks of cryptocurrency and has tended to downplay the threat they may cause. In addition, the FCA has regulated some cryptocurrencies, which tend to function like shares or investments.

It is essential that cryptocurrency assets follow anti-money laundering guidelines. However, there is a link between cryptocurrencies and organised crime. Not every investor is involved in that, but clearly there is a link. In 2021, the National Crime Agency seized £27 million in cryptocurrency assets. The lack of regular oversight of cryptocurrency makes it attractive for criminals seeking to partake in illicit financial crime, not only in the UK, but all over the world. In addition, the largest seizure of that kind in the UK was undertaken by the Met police, when they seized £180 million-worth of cryptocurrency linked to international money laundering in London. That underlines the importance of regulation, and being able to follow the money and catch illegal money.

Although crypto can seem appealing to many, and a hobby for some to build their assets, the potential dangers must be brought to light. Government and FCA regulation is crucial to ensure that people are aware of what they could lose. There is always a risk with crypto, but it is about ensuring that people know the risks. The cryptocurrency market crashed twice—we, and investors, must be reminded of that—in 2018 and 2020, losing large sums of money for hundreds of people.

The Government have some regulations in place to address cryptoassets, but this debate is about doing that better. The hon. Member for West Dunbartonshire put that forward, as others have, in a concise and helpful way. I look to the Minister to share the Government’s thoughts about how that can happen. Finance is an essential component of our economy and one that needs rules, regulations and laws in place. We must get this right and protect people from economic crime, which is all too prevalent.

I am aware that this issue will be referenced in the upcoming Financial Services and Markets Bill, and maybe the regulations could be strengthened to offer us some reassurance. We must look UK-wide when addressing the issue. It is not just an England issue, but a Scotland, Wales and Northern Ireland issue; it is for all of us together. I urge the FCA and Her Majesty’s Treasury to engage with local Administrations in Scotland, Wales and Northern Ireland to ensure the regulations are knitted together administratively in all regions, and to ascertain what more the House and the Minister can do to regulate the use of cryptoassets and currencies. Again, I thank the hon. Member for West Dunbartonshire for securing this important debate. I very much look forward to what the Minister has to say.

Financial Services and Markets Bill

Jim Shannon Excerpts

2nd reading
Wednesday 7th September 2022 Commons Chamber

[Tulip Siddiq]

I agree with my hon. Friend, and I have seen examples of that in my constituency, especially the parts where people are from lower socioeconomic backgrounds.

[Jim Shannon (Strangford) (DUP)]

The hon. Lady is outlining the case on behalf of those who live in rural communities, who comprise about 50% of my constituents. A number of banks have closed in our constituency—I believe there have been 10 or 11. Each of those banks—Danske Bank, Ulster Bank and all the others—has made exorbitant profits. I am not saying that they should not make a profit, because they should, but their profits are so high that they could well keep their branches open to ensure that people who live in a rural area can have access. Does she agree with me on that?

[Tulip Siddiq]

I agree with the hon. Gentleman’s point, especially as regards constituents in rural areas. I hope the Minister will take on board the comments that are being made.

I was delighted to hear the announcement from the Cash Action Group this week that the sector will be launching additional banking hubs on a voluntary basis, but these services must be protected by legislation. Will the Minister kindly set out in his summing up when the Treasury will be publishing its cash access policy statement, and whether it will ensure that in-person services are protected under the legislation?

It is also disappointing that the Bill fails to address the growing problem of financial fraud. Labour fully supports clause 62, which enhances protection for victims of authorised push payment scams, but the Bill does nothing to strengthen fraud prevention. Under this Government, the amount of money stolen directly from the bank accounts of hard-working people and businesses through scams and frauds has reached an all-time high of £1.3 billion. That would be bad in a normal time, in the best of times, but it is especially bad when we are in the middle of a deepening cost of living crisis. This Government have completely failed to get to grips with modern fraud and scams, such as identify theft and online scams, which have seen people’s lives stolen and their economic stability put at risk.

The former Business Secretary, who is now the Chancellor of our country, was asked about fraud earlier this year. He dismissed it, saying that fraud and scams are not a part of most people’s everyday lives. That is breathtakingly out of touch. Why does he think that? It is shocking. Martin Lewis, the money saving expert, said at the time that

“denigrating the experience that people in this country have with scams, and the lives that have been lost or destroyed because of scams, is an outrage. And he must and needs to apologise if he has any shred of decency in him.”

We still have not received an apology from the Chancellor, but he can put things right by taking immediate action to rectify the amount of fraud and scams that people are facing. I ask the Minister to explain in his closing statement why his Government continue to fail to take fraud seriously and push responsibility solely on to the banks. The Bill ignores the fact that digitally savvy criminals are increasingly exploiting a range of financial institutions, such as payment system operators, electric money institutions and crypto asset firms, to scam the public. In his summing, can he also please explain why the Bill would only provide for the reimbursement of fraud victims who send money using the faster payment system, and why other payment systems have not been included? That seems baffling.

Another area in which I feel the Bill lacks ambition is support for the mutual and co-operative sector. While clause 63 contains some welcome and long-overdue provisions, such as enabling credit unions to offer a wider range of products, the Bill does little to address the outdated regulatory regime faced by credit unions, building societies and co-operative banks. We have seen numerous building societies threatened with demutualisation in recent years, while the number of mutual credit unions has plummeted by more than 20% since 2016. Unlike the USA and many other European countries, the UK is uniquely lacking in mutually or co-operatively owned regional banks. That lack of diversity in the financial services sector has had devastating consequences for financial inclusion and resilience, with many desperate families forced into the arms of unethical lenders. I have seen that first hand in my constituency, especially in Kilburn.

A clear first step in addressing this issue would be to require the Financial Conduct Authority and the Prudential Regulation Authority to have an explicit remit to report on how they have considered specific business models, including credit unions, building societies and mutual and co-operative regional banks, to ensure they are given parity of esteem with other providers. I would be grateful if the Minister addressed that in his closing remarks—I recognise that I have asked many questions that I want him to answer.

Turning briefly to food speculation, Global Justice Now has brought to my attention concerns that the Government’s proposed reform to the position limits regulations under MiFID II have not been adequately assessed for commodity market speculation risks. I ask the Minister to provide some reassurance that these reforms will not adversely impact commodity prices, such as energy and food prices, in the midst of a cost of living crisis, and to explain what role the regulators will play in monitoring this.

Finally, turning to the points that have come from the Opposition Benches, it is striking how little the Bill has to say about green finance. We of course welcome clause 25, which formalises the responsibilities of the FCA and PRA under the Climate Change Act 2008—introduced, I remind the House, by the last Labour Government—but the Government promised much more radical action. Indeed, we were promised that the UK would become the world’s first net zero financial centre, but instead, we are falling behind global competitors.

A recent report from the financial services think tank New Financial revealed that the UK is a long way behind the EU in both share and penetration of green finance in capital markets. It is possible that the Minister has not read that report; I am happy to send him a copy. If he reads it, he will see that it says in black and white that the UK is behind the EU. It found that green finance penetration in the UK was at half the level of the EU, and roughly where the EU was four years ago. When the Minister closes, if he does not agree with me, will he please explain why nothing in this Bill commits the Government to introduce sustainability disclosure requirements, a green taxonomy plan, or a green finance strategy for the sector? If he does not agree with the report I have quoted, could he tell me whether it is wrong?

I look forward to debating and, hopefully, addressing these issues with the Bill when it is in Committee. Once again, I thank the Minister in advance for his closing remarks, which I am sure will give detailed answers to all the points I have raised today.

--- Later in debate ---

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to speak in the debate. The Bill is substantial and weighty, and rightly so. Our financial services sector is vital—perhaps never more so than today, given the cost of living, for people at the mercy of the financial institutions to lend them money to carry their businesses through this period, for families looking for a low-interest loan to fix their cars, and perhaps even for the housewife trying to buy a second-hand washing machine. Those are the ordinary things that people have to face.

The regulation of financial services is essential. We must get it right and rectify the remnants of regulation where Europe was unsuccessful in fostering businesses and protecting individuals. I am keen to support clauses 8 to 23, which will grant additional powers to regulators, allowing for greater regulation of financial promotions. This morning in Westminster Hall we spoke about cryptocurrency and cryptoassets. The Minister answered some of our questions, but that is a really important subject. It is estimated that some 2.6 million people across the UK, and 100,000 people in Northern Ireland, use cryptocurrency. Some 15% of people in Northern Ireland use it, and 38% say they have thought about using it but have not yet done so. The regulation of this up-and-coming form of investment and spending is necessary.

Clauses 24 to 46 seek to ensure appropriate democratic accountability for the regulators, given that the Bill gives the FCA and the PRA new secondary objectives to advance the international competitiveness and medium to long-term growth of the UK economy. I have spoken about this a number of times in the House, but I am not entirely convinced that the new regulations for the FCA are strong enough to make a difference, or that the Bill goes far enough in this respect.

I think regularly of one of my constituents, whose case I know exceptionally well. The episode of Panorama broadcast on 16 August, titled “The Billion-Pound Savings Scandal”, detailed a scheme in which some £47 million of life savings was taken from consumers. The initial figure was £16 million, yet although it seems the FCA had ample evidence of wrongdoing and the powers necessary to act, nothing was done. That constituent and a number of others have lost money through that scheme. I am not sure that the Bill goes far enough in that respect.

An essential component of the Bill must be the protection of access to cash. I am old-fashioned, Mr Deputy Speaker; I use cheques all the time, and I use cash. I have the jingle of cash in my inside pocket, and I have the pound notes—sorry, I am going back too far; I have the £20 notes here in my wallet. I heard the right hon. Member for South Northamptonshire (Dame Andrea Leadsom) refer to her daughter getting a cheque. I get them every day, and I write them every day—that is who I am.

Access to cash and its use is essential, particularly for the small business with a small profit margin. The Post Office announced that just last month it handled more than £800 million in personal withdrawals, the most since records began five years ago. That tells me that cash is still king and we should not disregard it.

I am old enough to remember the ’60s and the early ’70s, when my mum and others, on a tight budget, used envelopes to set aside money for the gas, the electric, food and the rent. That meant that the management of the moneys for all the bills was done right. I believe that history will repeat itself and we will see that happening once again. Cash will be more important than ever.

The right hon. Member for East Hampshire (Damian Hinds) referred to the growth of credit unions. In Northern Ireland, credit unions have been an incredible success. They can do better for everyone. In some cases, they have replaced banks where those have closed. Will the Minister say what can be done to ensure greater use of credit unions?

I am concerned that, as we approach the autumn and winter, many will suffer from malnourishment, freezing homes and depression in the coming crisis. I believe that the Bill will do more than just regulate the financial regime; it will ensure that we can support the people we are privileged to represent and keep them protected this winter.

Independent Brewers: Small Brewers Relief

Jim Shannon Excerpts

Tuesday 6th September 2022 Commons Chamber

[Owen Thompson]

The hon. Lady makes an excellent point. I will speak later about some of the issues that businesses currently face with regard to energy costs.

[Jim Shannon (Strangford) (DUP)]

In my constituency, as in the hon. Lady’s, we have breweries. I am reminded of Bullhouse Brewery in Greengraves Road in Newtonards, a local family business. It produces an incredible product that sells well, but it is a small brewery. It really is in that category. Without the assistance of small brewers relief, there is no guarantee that our independent brewers would be able to survive. Does the hon. Gentleman agree that to ensure that our local brewers are able to reman comfortably on their feet, there must be greater relief on their beer duty to ensure that they are not penalised by crippling tax in years to come? The very fact of what local brewers do means that they are intensive users of electricity so the costs for them are multiplied to a place where they may not be able to survive.

[Owen Thompson]

I agree with the hon. Gentleman. Many small family brewers are so much a part of their local communities. It is not just about the business, it is what they do for their local communities.

Each proposal that the Government have brought forward so far has been a step up from the last, but has missed the mark in crucial ways. So let us look at the most recent reform package that the Treasury has put on the table—what it gets right, which it does, and where we still have some way to go. I welcome last year’s announcement that the 50% rate would be reduced to 2,500 hectolitres. This came off the back of a great deal of lobbying from campaign groups and Members across the House, and demonstrates the cross-party willpower to get this right for our brewers. That is not to mention a public petition of more than 50,000 signatures. But issues remain.

Brewers cannot wait any longer for another half-right, half-wrong proposal. This time, the Treasury must listen to brewers’ calls, act decisively, and implement that decision. No more leaving brewers in the lurch. They have a right to know the final details of what the Government are planning and when it will be introduced so that they can be prepared for the changes. So, having spoken to SIBA and to local brewers in Midlothian, I am asking the Treasury to address the following problems in its most recent proposals with transparency and urgency. I and many small brewers have serious concerns about the ways in which these reforms could turn small brewers relief into big global brewers relief. Time and again, the current proposals open the door to benefiting the big players, and it is almost starting to look as if that is a feature, not a bug. For one, the Treasury needs to scrap its plan to set the start and end point of relief depending on the UK’s average alcohol by volume. This nationwide average is heavily skewed towards global brewers, and it needs to be the average of small brewers instead. Then we have the fact that the reduced rate of SBR will be widened from 2.8% to 3.4% ABV, at £8.42 instead of £19.08.

SIBA has told me that it is concerned that this allows large brewers to undercut smaller ones—they could easily cash in on the benefits by altering their recipes to a lower ABV. Not only would that cost the Treasury an estimated £200 million a year in lost revenue, but it would fundamentally go against the spirit of SBR. On top of that, we have the Treasury’s decision to maintain the Farmgate exemption, which exempts 80% of cider makers from paying any duty. Small cider producers absolutely deserve parity of support, but there is no getting round the fact that the cider sector has a very different landscape. Global producers account for 87% of the cider sold in pubs, so it is global producers again that disproportionally benefit from the Farmgate exemption.

According to SIBA, taxing cider at the same rate as beer could raise £360 million a year for the Treasury, so why is it not happening? Are the Government scared of upsetting big business yet again? Using SBR reform as a means of opening the door to advantaging global brewers just does not make sense, yet it seems to be the direction of the Treasury. At best, this is an honest oversight. At worst, it is as if the Treasury is trying to stick to these plans no matter what. I think that questions need to be asked about what communications and hospitality the Treasury might have received from some of these large global brewing companies. I urge the Minister to ensure that that is not the case and that small brewers relief is genuinely to support small brewers and not be that in name only.

Aspects of the latest proposals for SBR reform also undo some of SBR’s spirit of innovation and growth. When calculating a producer’s average ABV, the proposed new small producer relief will include everything the producer makes—beer or otherwise. I am sure that it has not escaped the notice of the Minister or others in the Chamber that many small brewers are branching out and not simply making beer but also spirits such as gin or whisky, and this innovation should be welcomed. However, under the current plans, producing spirits will send a brewer’s average ABV skyrocketing. Small producer relief will act as a roadblock to innovation. Instead, the average ABV calculations should only include products of up to 8.5%—the same amount that actually qualifies for relief.

The Treasury also needs to urgently clarify some issues around its simplification of ABV bands surrounding SBR. It is welcome that SBR will now apply to beer below 2.8%. That can only encourage a trend of lower alcohol beer to aid in healthier drinking habits. However, will this affect brewers that currently receive up to 50% relief on beer between 2.9% and 3.4%. There is zero clarity on this and brewers need an answer. I urge the Minister to address this in his response.

Furthermore, under the current proposals, the Treasury is planning to introduce a reduced rate of about 5% for draught products below 8.5% ABV in large containers of at least 40 litres. This is a positive step forward, but why stop there? The Minister will be aware of SIBA’s “make it 20” campaign. Small brewers and community pubs often use 20 or 30 litre containers to keep the beer fresh. Even some of the larger pub chains are using that size of containers because of the freshness of the product. Will the Minister commit to expanding the reduced rate to include containers of that size? Go on, prove that the Treasury does actually care about the wee guys after all. Crucially, the Minister needs to guarantee that this is full SBR, by ensuring that relief fully applies in cash terms to the lower rate, main, higher and the draught products rate so that small brewers can continue to compete.

On top of this, the way in which the small producer relief is calculated is a completely untested system. Rather than using a simple percentage, brewers will have to consider different cash reliefs at different alcohol bands, based on hectolitres of pure alcohol. It is unnecessarily complex and could act as a cash cap, once again discouraging brewers from innovating.

Brewers do not just need solutions to those issues; they need them to happen now. Frustratingly, however, delay and confusion have been the name of the game so far. First, brewers were promised an announcement on the final details of SBR reform before the summer, but it would appear that the Government have been a bit too busy over the summer to have got around to it, so it never happened. I hope the Minister will take today as an opportunity to give a long-awaited update and maybe even a date of publication for it. Secondly, SBR reform has been rolled into the wider alcohol duty review. Small brewers simply cannot wait for that review’s findings, so I hope the Minister will listen to calls for the reform to be progressed on its original timetable for February 2023.

This is not good enough. The urgency of supporting the brewing sector is possibly more serious now than ever before. Under this Government, the mass closure of pubs and breweries is more likely than it has ever been. The industry is facing a multi-faceted crisis of covid recovery, energy price hikes, Brexit and climate issues.

The brewing industry was one of the pandemic’s worst-hit sectors, with pub closures locking it out of 80% of its sales. Production fell by 40% in 2020 and remained 16% below 2019 levels in 2021. On average, each small brewer came out of the pandemic with £30,000 of debt. The Scottish Government’s brewers support fund provided millions of pounds of direct support for the sector, but there was no equivalent from the Westminster Government, whose wider package of hospitality support failed to include hundreds of brewers. As a result, the UK lost 160 active brewers during the pandemic and has lost between 40 and 60 more this year.

Yet there is a growing consensus in the sector that the current crisis is far more worrying than even at the height of the pandemic. Skyrocketing energy bills are putting brewers’ futures at risk. One Midlothian brewer told me that their electricity bill was currently triple what it had been a year ago, at an unimaginable £90,000 a year. They estimated that by next year it would reach £180,000. Another local brewer is paying £21,600 more on energy this year than it did last year, almost enough to hire yet another a new employee.

The energy crisis also has indirect effects on the supply chain, as the energy cost of producing certain materials skyrockets. For example, I have been told that the price of buying cans to put beer in has risen from 9p to 14p, leading to massive increases in costs.

Then we have Brexit, which has created not only product movement issues, but a change of attitudes among buyers on the continent. At a time when the cost of living crisis could mean people spending less money in pubs, the last thing brewers need is a complicated export processing system, but that is exactly what Brexit has given them. A brewery in Kent that was chosen by the Department for International Trade as a Brexit export champion recently revealed that it only has one EU customer left. When EU buyers look at the paperwork needed to trade with UK brewers, it seems the conclusion they come to is, “Why bother?”.

The climate crisis is also wreaking havoc on the industry. With the recent high temperatures and drought, hop harvests in Europe are expected to be down 20% to 40% on last year, which means higher prices yet again in the coming months. As if that picture was not worrying enough, there is yet another shortage of CO₂, a key part of the brewing process, again partly due to energy prices.

There are glimmers of hope that I have seen when speaking to local businesses throughout the summer. Many are responding to energy prices and CO₂ shortages by installing green technology to help with renewable energy generation, storage, electrolysis and CO₂ recovery. The Government might not be engaging with long-term planning to adapt to this crisis, but local businesses in Midlothian certainly are. They are turning up the dial on the green revolution in the place that matters most: their own back yards.

However, that kind of long-term investment is exactly that—long term. The up-front costs can be prohibitive for many, while Government funds such as the industrial energy transformation fund are again aimed at larger businesses. Distilleries benefited from £11 million to help them to go green, so I would be grateful if the Minister would consider further steps to help small and medium-sized enterprises such as small brewers to cover the up-front costs of some of those innovations.

I am here because of Midlothian, to fight the corner of its residents and businesses. That is why I have been talking to local businesses over the summer to understand the issues they are facing in the midst of this crisis, and it is why I am standing here today to communicate those messages to the Government. That is how the system is meant to work. It would be a huge failure of the system if the Treasury were to shrug its shoulders and plough on with these poorly thought-out plans regardless.

Midlothian is blessed with many independent brewers, which are a huge asset to the local economy, the community and its culture, but the Treasury’s current proposals for SBR reform seem to put global producers first. They undermine the incentive to grow and do not go nearly far enough to support these valued businesses through the energy crisis, which is existential for many. The back and forth of four years of fiddling with SBR reform simply has to end. We need the Government to act today to give brewers clarity on what reform will look like, to address the concerns about SBR reform benefiting global companies and discouraging innovation, and to deliver urgent support for energy bills and switching to green energy production. That way, I hope that we can continue to raise a glass to our independent brewers for years to come, because they give so much to all our communities.

[Robin Millar (Aberconwy) (Con)]

I congratulate the hon. Member for Midlothian (Owen Thompson) on securing the debate on this important issue. I know that brewing generally is of great interest to many colleagues.

My constituency of Aberconwy is home to some of the finest—I might say the finest—local food and drink producers anywhere in the UK. I am proud to support that industry and sector in my constituency. I welcome the bold reforms to alcohol duty, and the support for pubs and brewers, in the last Budget. I am also proud to SIBA, the Society of Independent Brewers, in its “Make it 20” campaign, which seeks to apply a 5% reduction in beer duty to 20 and 30-litre kegs. I will briefly outline why the campaign is important to small breweries by using the example of the Wild Horse Brewing Co in Llandudno.

The company is in my constituency and sells more than 70% of its annual production in 20 and 30-litre kegs. As it has grown, it has made a significant investment in 600 30-litre kegs. Most of its beer is sold to small independent bars, pubs and restaurants, which rely on smaller containers in order to offer variety and keep the beer fresh. Given that most of the brewery’s beer is sold in 20 and 30-litre kegs, it will not benefit from the 5% reduction in beer duty, and because none of its beers is under 3.5%, it will not benefit from the widening of the lower duty bracket. This is a business that, with support from the UK Government, has overcome the challenges of the pandemic, and has invested in its future and in the town of Llandudno in my constituency. Over the last 18 months, Dave Faragher, the managing director and founder, has increased his team from seven to 10 employees, two of whom originally started with the UK Government’s kickstart scheme.

Breweries and pubs are businesses that are vital to jobs and communities throughout the UK, especially in constituencies such as mine. Llandudno is known as the queen of resorts and is one of the largest resort areas in Wales. It is important that such businesses are supported and their contribution to the economy recognised, yet there can be no doubt that these same breweries and pubs have faced unprecedented challenges over the last three years. The sector bore the brunt of the economic consequences of the lockdowns and the trading restrictions of the pandemic. It now faces the challenge of rising costs of ingredients and energy—issues of huge concern for such an energy-intensive industry.

Just this weekend, small breweries learned of a threefold increase in CO₂ prices and a likely supply crunch at the end of September. Production of CO₂ in Billingham—one of the largest producers, which is responsible for about 60% of UK production—will end and Ensus will stop its production for three weeks. As we know, CO₂ is vital not just for breweries, but for the entire food and agricultural sector, which falls within the purview of the Department for Environment, Food and Rural Affairs. I therefore must take this opportunity to call on DEFRA to take urgent action, as happened last year—it has shown itself able and willing to do so—to secure CO₂ production and supplies, and to reduce costs.

[Jim Shannon]

The crucial factor is that either the small brewers relief scheme is enabled to help small businesses, or there will be closures and job losses, with no money from those wages going into the economy. The Government and the Minister need to enable the small brewers relief scheme in a way that helps those businesses now, as energy rises. It is a straightforward decision—one way or the other.

[Robin Millar]

I thank the hon. Gentleman for his intervention. I think it is fair to say that businesses, and I count breweries among them, are not looking for charity. They recognise that the Government are not here to give recompense for loss of profits and the like. They are looking for the help they need to get through these tough times.

I am deeply sympathetic to businesses that are facing challenges and working to overcome them, day in, day out. I believe that most are not looking for charity or a hand-out. They just want help to get through another set of challenges. I urge the Government to review the arbitrary nature of small brewers relief and to make 20-litre and 30-litre kegs eligible for the 5% reduction in duty. Small brewers and hard-working small businesses at the heart of our communities, such as the Wild Horse brewery in Llandudno, deserve that consideration.

NHS Pensions and Staffing

Jim Shannon Excerpts

Wednesday 13th July 2022 Commons Chamber

[Dr Poulter]

The hon. Lady is absolutely right. There were some further unintended consequences of the Finance Act 2004, which I will come to in a moment, but doctors, nurses and healthcare professionals cannot chose the rate at which they contribute to their pensions—they have to contribute at a fixed rate. There is no choice, so unintentionally, we find ourselves in a situation where senior healthcare professionals are facing punitive, eye-watering annual charges on their pensions worth tens of thousands of pounds. That cannot be right.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on all he does in his position as a doctor, and on securing this debate on a really important issue that affects many of my constituents and those of many other Democratic Unionist party Members. During April this year, 8,902 pension awards were made, compared with 6,932 in April 2021—a year-on-year increase of 28%. Does the hon. Member agree that that is indicative of an increase in staff who simply cannot take the long hours, the lack of support and the soul-destroying pressure that our NHS is fast becoming renowned for, and that it is critical that changes are made urgently to keep staff in place rather than have them bolt through the door at the first possible opportunity? I look forward to hearing the Minister’s response.

[Dr Poulter]

I thank the hon. Gentleman.

Alcohol Taxation

Jim Shannon Excerpts

Thursday 7th July 2022 Commons Chamber

[Alun Cairns (Vale of Glamorgan) (Con)]

I beg to move,

“That this House has considered Alcohol Duty and tax on alcohol.”

I am grateful to the hon. Member for Gateshead (Ian Mearns) and the Backbench Business Committee for selecting this important topic for consideration, and to all Members across the House who supported the case that it should be considered. This debate is hugely important to a large number of businesses across the country—the hospitality sector in general, brewers, vineyards, distillers and retailers, employing hundreds of thousands of people. A disproportionate amount of them will be small businesses with younger employees, so getting this policy right really matters.

I start by paying tribute to the Government for recognising this Brexit opportunity. Taxation and alcohol duty has been needlessly complicated for too long, yet the UK was tied to EU restrictions preventing change. The Government set out their intentions to review the structures in March 2020, followed by a consultation on their proposals in October last year. The Government’s stated aims are to make the system simpler, more economically rational and less distortive, and to reduce the administrative burden. It is fair to say that these positive intentions are included in the thrust of the proposals. The consultation is welcome because it creates the opportunity for hon. and right hon. Members, and the industry, to respond and to further develop the plans. My comments are aimed at encouraging the Minister to refine the proposals further now that the industry, consumers and officials have considered how they would work in practice.

On beer duty, there has rightly been a warm welcome for the lower duty on draught beer. There has also been a recognition that the proposed 5% reduction should also apply to kegs and casks of 20 litres rather than the 40 litres set out. There has been a strong indication from the Treasury that this may happen, and I ask the Minister to confirm her intentions. I would also press for a greater reduction than 5% a pint in order to further support the industry, and pubs in particular. New research published this week highlighted that England and Wales have 7,000 fewer pubs than just 10 years ago. We all recognise the important role pubs play in our community and society at large, and also in providing a watching influence on people who enjoy having a drink rather than their being encouraged by the cost incentive to drink at home.

The plan to widen the reduced rate from 2.8% to 3.4% ABV is also a positive move, but a minor adjustment to 3.5% would resonate much better, and enable the industry to innovate further. To help to protect smaller brewers from the larger operators who may simply adjust their recipes to take advantage, it is important that the relief that they currently receive under the small brewers relief fully applies at this level. It would also make this element competitive with EU directives, and provide further support to small businesses within the industry.

[Jim Shannon (Strangford) (DUP)]

I commend the right hon. Member on bringing forward this debate on an important issue. The past few years have impacted greatly on local pubs, bars and restaurants—they are the ones who have suffered. At the same time, Tesco and Asda, to take just two examples, can sell exorbitant amounts of alcohol with low tax while others are left suffering. Does he feel that with the Government’s proposed steps, which he will speak about later—lowering alcohol taxation and encouraging people to support local—pubs can pick up the business they once had and have lost? Does he agree that that is a positive way forward?

[Alun Cairns]

The hon. Member makes an extremely important point. As I said, some people are encouraged to drink more at home by the discounted prices offered by the large retailers. I would add that in Scotland and Wales—I am not so familiar with the position in Northern Ireland—the retailers receive the extra differential with minimum alcohol pricing, in comparison with what is available in England. That gives some room for the Treasury to react positively to support the pubs and brewers, as he and I seek to underline.

The small brewers relief has been proven to deliver major benefits. It enables small brewers to compete with larger operators and to innovate and generate new options for consumers. It will be replaced by the small producers relief to offer similar or common benefits to the wider sector and to prevent the current cliff edge. Again, the Government’s objectives are positive, but I am concerned that the proposed changes introduce significant complexity to the process. Moving from 5,000 hectolitres at a 50% discount, to a maximum of 2,500 hectolitres at a 50% discount, tapering up to a 100,000 hectolitre maximum at up to 8.5% ABV, along with a cash limit and an average ABV measure, is much more complex than it needs to be. It is hard enough to say, let alone follow the process. It also makes it much more unpredictable for the businesses we are seeking to encourage to innovate, to invest and to create wealth at the smaller end of the scale.

VAT on Defibrillators

Jim Shannon Excerpts

Wednesday 22nd June 2022 Commons Chamber

[Ruth Edwards (Rushcliffe) (Con)]

It must be every parent’s worst nightmare. Last September, Dylan Rich—a talented 17-year-old footballer from Rushcliffe—was playing in a FA youth cup game between his club, West Bridgford Colts, and Boston United at the Colts’ ground in Regatta Way. Out of nowhere a couple of minutes into the match, he suffered a cardiac arrest and collapsed. His brave mother Anna performed CPR on her own son. Dylan was treated with a defibrillator at the scene and an ambulance arrived within 10 minutes. He regained cardiac output and was stabilised in intensive care, but tragically he died three days later in hospital.

Words cannot express the depth of sorrow that his death has caused—to his family, his friends, and the community at West Bridgford Colts. In their tribute to him, the Colts said:

“Dylan was one of those players that team mates love for his commitment, coaches for his attitude and adaptability, and supporters for his reliability. A fantastic club player.”

Tributes followed from Nottingham Forest and Notts County. Ahead of their World cup qualifier against Poland, the England players held up a shirt with “For Dylan” printed on it.

But the tribute that his family and his club most want is to increase the number of defibrillators across the UK, to make them cheaper for communities to buy, and to increase people’s awareness and confidence in using them. Until Dylan’s death, I had never looked at the figures for the scale of cardiac arrests. Sudden cardiac arrest is one of the leading causes of death in young people, and almost never has any prior symptoms. Officially, about 32,000 sudden cardiac arrests occur in England every year. When combined with figures from across the UK, it is estimated that the true number is as high as 60,000. There is an important caveat to this figure: it only includes incidents where resuscitation was attempted. In the UK, only 8% of people survive an out-of-hospital cardiac arrest.

Cardiac arrest can happen to anyone. This was brought home to us again in Nottinghamshire last month, when 13-year-old Samuel Akwasi collapsed from a cardiac arrest during a Young Elizabethan football league game and tragically later died in Queen’s Medical Centre. In fact, only yesterday, as I was writing this speech, I read of an assistant referee, Andrew Jarvis, who suffered a cardiac arrest while officiating at a game in Mansfield last August. Mercifully, he survived. He says he was saved by good-quality CPR, the football club’s defibrillator, and the quick arrival of the air ambulance team.

On average, as I said, a person in the UK has an 8% chance of surviving a cardiac arrest if it happens out of hospital, but this is vastly increased to as high as 70% if a defibrillator is used within the first three to five minutes of the cardiac arrest occurring. Conversely, survival rates drop by 10% for every minute of delay after this time. This further highlights why it is essential to have a defibrillator on every sports pitch and street corner possible—because these machines save lives. Average survival rates for out-of-hospital cardiac arrests vary across the country, ranging from 0.6% to 25%. The Government are doing so much to address regional inequality across the country, but we must also address regional inequality in defibrillator access and survival rates.

The main barriers to accessing defibrillators have been shown to be cost and awareness. In a survey by Vitreous World, 42% of people said that cost was the main barrier to owning a defibrillator, while 62% of people do not know how to use one and 27% are worried about how to do so. Defibrillators vary in cost, but the average unit is about £1,250. This is a considerable expense to many community groups, charities and sports clubs, especially considering that a sizeable portion of it, 20%, is VAT. Clearly, £1,250 is a lot of money for organisations raising funds through cake sales, individual donations and raffles. Some charities are exempt from paying VAT on defibrillators: not-for-profit hospitals, charitable institutions that provide care or medical or surgical treatment for disabled people, and rescue or first aid services. However, most sports clubs and community groups do not qualify.

There are several options for reducing the cost of defibrillators. The first is to apply a zero rate of VAT to all defibrillators in line with that already applied to a range of medicines and medical products, including prescription medicines and drugs. A blanket rate would be a simple and straightforward solution to cover anyone and any organisation wanting to buy a defibrillator.

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Lady for securing this debate. I declare an interest, as I presented the Automated External Defibrillators (Public Access) Bill on Monday, when you were in the Chair, Madam Deputy Speaker, and it will be heard on 9 September. I encourage the hon. Member for Rushcliffe (Ruth Edwards) to come along to support the Bill, if at all possible.

I understand that children’s car seats, children’s travel systems and other safety protections have a reduced 5% rate of VAT. Should not this reduction, at least, be replicated for lifesaving defibrillators? As I know from my constituency, this would save lives.

[Ruth Edwards]

I congratulate the hon. Gentleman on his Bill, and I would be delighted to join him on 9 September. He has come up with an excellent option that is not on my list.

I accept there are many good candidates for zero-rate or reduced-rate VAT, one of which the hon. Gentleman has just outlined, and I am sure the Minister will say that the Government have received £50 billion-worth of requests for VAT relief since the EU referendum, which is a valid point. Our tax base funds the public services on which we all rely, including NHS treatment for victims of cardiac arrest, but surely these lifesaving devices should be a higher priority than, say, e-books, of which I am a great fan but they cannot save a life in the event of cardiac arrest.

There is a good argument that, as paper books already have a zero rate of VAT, extending it to e-books is a necessary tidying up of the system to avoid any legal challenges. That is not 100 miles away from the situation with defibrillators, where some charities benefit from zero-rate VAT but others do not. Surely, whatever the purpose of the charity, the purpose of using a defibrillator is the same.

Another option is to widen the scope of organisations that can purchase a defibrillator without paying VAT. Instead of just covering charities with care, medical, rescue or first-aid missions, could not all charities, not-for-profits and community groups be allowed to purchase a defibrillator without paying VAT? After all, businesses can currently claim back VAT on defibrillators as part of their VAT return forms. Such an approach would direct savings to the people who need them most, while not setting a precedent for the blanket removal of VAT on a specific item. It also simplifies what is currently a confusing landscape in which people are not sure whether they are eligible for this VAT exemption.

Or perhaps we can set up a fund for charities and community groups, either to claim back their VAT or to aid them in buying defibrillators. Maybe a pot of money could be announced in the Budget—I am getting my bid in early. I am sure the creative and clever minds at the Treasury can come up with all sorts of options, and I place on record my huge thanks to the Minister, who I know has asked her team to do just that.

Whatever model we go for, the end we need to achieve is making community defibrillators more affordable, especially at a time when people’s finances are increasingly stretched. Whatever route we choose, we need to publicise it and use the opportunity to address the lack of knowledge and confidence in defibrillator use. I identify with this, as I did not know how to use one until Trent District Community First Responders and Nottinghamshire Fire and Rescue Service kindly offered to train me and my team. In fact they are training all sorts of groups across Rushcliffe, and it would be great if we could offer defibrillator and CPR training to Members and staff here in Parliament. When I asked, I was told there was no course I could do.

Parliament provides many other courses. We have media training, diversity and inclusion training and courses on how to use the Library, and I am told I can be tutored in any foreign language that might be useful for my work. All these are important, but none would teach me how to resuscitate a constituent at my surgery whose life is hanging in the balance.

Any of the proposed options I have discussed would be most effective alongside a big push to increase defibrillator training and a publicity campaign to raise awareness. Many people want to learn how to use a defibrillator and save a life, and many more can already use one and want to share this knowledge with others, so why do we not help to bring them together?

I have one final thought on how to maximise the impact of such a campaign. At present, it is a legal requirement to have firefighting equipment in places of work, residences and public buildings—everywhere really. What people need to have depends on the type of premises, but fire alarms, extinguishers and exit signs are all pretty universal. However, there is no legal requirement to have a defibrillator kept at a place of work. Why not? Some 80% of people believe that defibrillators should be mandated in workplaces, but only 30% of people have a defibrillator in their workplace.

Increasing access to defibrillators is not just the right thing to do; it also makes financial sense. Patients who have had early defibrillation have a significantly reduced stay in hospital and are far less likely to need treatment in intensive care. The average hospital stay is significantly less for survivors when a defibrillator is applied within the three-to-five-minute window and they spend less, if any, time in intensive care. Figures may differ from hospital to hospital, but on average an intensive care unit bed is about £2,300 more expensive per night.

In addition, patients who have a defibrillator used on them quickly have fewer ongoing health problems due to lack of blood and oxygen circulation to vital organs such as the brain. This means they require far less ongoing treatment. In short, we estimate that reducing the cost of defibrillators and increasing the number available for people to use in the community will save the NHS tens of millions of pounds, which is much needed to reinvest as it deals with the elective backlogs brought on by the pandemic.

In conclusion, I first raised this issue in Parliament at Prime Minister’s questions back in March, and I would like to thank both the Minister and the Prime Minister for the priority they have given to this issue since. They both met my constituents Peter Stanbury and Paul Wilson, who are respectively the chairman and the coach of West Bridgford Colts, and I know the Treasury has been working on a number of options to take this forward. I would also like to thank Peter and Paul for coming to see me in my surgery and making me aware of this issue, and for the incredible work the Colts have done to raise money to buy more defibrillators for their training ground.

I would also like to thank Dylan’s family—his mum Anna, his dad Mike and his sister Lucy—for allowing us to tell Dylan’s story and for backing the Colts’ campaign at what must be the darkest time of their lives. Sudden cardiac arrest can tear through the life of any family with devastating results. I am delighted by the energy and commitment the Government have shown to working on this issue, and I hope we can now agree on the best way forward and give it the green light, so that we can get on with delivering these life-saving changes.

I would just like to leave the House with a message from Dylan’s mum Anna, who wrote to me this morning to say:

“I think it helps to emphasise the importance of community defibrillators, in the sense that we did get an output back on Dylan. Sadly, it was ultimately the time he was without adequately oxygenated blood to his brain that led to his death. Without the defibrillator, I don’t think we would have left the football pitch.”

New Wealth Taxes

Jim Shannon Excerpts

Tuesday 14th June 2022 Westminster Hall

[Richard Burgon]

I encourage the right hon. Gentleman to read the report I have here. It is by some top academics and makes a compelling case for a wealth tax in the UK. I will return to that point in greater detail later in my remarks.

[Jim Shannon (Strangford) (DUP)]

It is not about someone getting more money for doing their job; it is about the obscenity of people getting large amounts of money when others are getting smaller amounts of money. People get six-figure dividends when others live on £10 an hour. That obscene disparity is the issue.

[Richard Burgon]

I could not agree more. We are talking about multibillion-pound enterprises with people at the top hoovering up the wealth, while others do not receive anything. Only yesterday, I and colleagues visited a picket line in Wakefield, where bus drivers are on strike; they are calling for £13.40 an hour. Many people will be surprised that they are not already on at least that sum.

To address our rigged economic model, we must first acknowledge that trickle-down economics has been a lie. Wealth is not trickling down; it is being funnelled up into fewer and fewer hands. That is a consequence of 40 years of deregulation, privatisation, outsourcing, driving down working conditions, the weakening of trade unions and lower taxes on the rich. Contrary to what is said by the spin doctors of the right, decades of keeping taxes low for the very rich has not boosted economic growth. In fact, research by the London School of Economics and King’s College London looking at tax cuts over the past 50 years shows that lower taxes on the rich has led to higher income inequality because the top 1% has captured almost all of the gains, while there has been almost no effect on boosting economic growth.

Inequality and hardship are not just at the heart of our system—it is how our system is designed and how it functions. Poverty and inequality are structural and institutionalised. That is why we need a debate on wealth taxes. A wealth tax is an idea whose time has come.

Last year, the Secretary-General of the United Nations called on Governments to consider a wealth tax on those who had profited during the pandemic, to reduce extreme inequalities. The OECD has argued that there is a strong case for addressing wealth inequality through the tax system. The group Patriotic Millionaires has called on the Chancellor to introduce a wealth tax, saying:

“We know where you can find that money—tax wealth holders like us.”

Oxfam has also called for a wealth tax to rein in extreme wealth and monopoly power.

--- Later in debate ---

[Jim Shannon (Strangford) (DUP)]

Thank you for calling me to speak, Sir Edward.

People say times are hard. We have all said it. There is not one person in this Chamber who has not said it, and I am sure the Minister has said it as well—and meant it. Today, times are harder than ever. That is the situation we are living in today. I want to give an example of one person in my constituency to illustrate why we need to consider new means of raising funds through taxation. I support the thrust of what the hon. Member for Leeds East (Richard Burgon) has referred to, which is important.

A healthcare assistant in my constituency works three long days plus whatever overtime is needed on her ward at the Ulster Hospital. She is now paying £400 a month out of her wages for fuel. Her parking at the hospital, which she has to pay for, is £60 a month. Her rent is £750 a month, which is not exorbitant—that is the normal going rate for rental accommodation. Her food bill, while trying to eat healthily, is £500 a month. Her gas went up to £180 a month and her electric is £100 a month. That comes to a princely total of £1,990 just to be warm, eat and get to work, with none of the luxuries that she would probably like to have.

There is no subway for my constituent to get to work and no bus timetable that fits with her shift work. The list goes on. She said to me, “Jim, I want to have a child, but can you tell me how I can afford childcare, afford to dress and feed another person, and live a life?” Can anybody here tell me how to do that? I could not tell the lady. I am sure nobody else could. I have no answer for this lovely young lady. We in this place need to come up with the answer and put it into operation. That is what this debate is about today.

I understand that people have different qualities, experiences and abilities. Those who get a big sum of money, such as a brain surgeon, get a lot more money than the person who drives, with respect, a bin lorry. I understand that. Different jobs pay different moneys. What I object to is the obscene amounts of money that people get for bonuses. I am not saying that they should not, but if somebody gets a six-figure sum or a seven-figure bonus, I despair when I think of the people in my constituency who cannot get it.

The hon. Member for Belfast South (Claire Hanna) said we should tax such people at a level that does not screw them but ultimately means they make a significant contribution to the tax system. We could then put that money into the NHS and into education. All of us in this House would see that as a benefit and a way forward.

This is about how we can raise revenue to benefit families on the poverty line today without their grandchildren paying it off. Those who use tax avoidance legally withhold what they should morally pay. The right hon. Member for Central Devon (Mel Stride), who is not in his seat, named companies that should pay their taxes. If they paid their taxes, the Minister would be in a position to use that money for the benefit of everyone in the United Kingdom.

I read an article last summer that highlighted the fact that eight large tech companies in the UK made an estimated £9.6 billion in profit from sales to UK customers in 2019; yet by moving that money out of the UK those companies ended up declaring a fraction of their profits in the accounts of their UK subsidiaries, radically reducing their tax liability. That is how they can make more money. If they paid their tax, the Government could do more with it. The companies were Amazon, eBay, Adobe, Google, Cisco, Facebook, Microsoft and Apple. They faced UK corporation tax liabilities of £297 million in 2019. That puts the total amount of tax avoided by companies in the UK at an estimated £1.5 billion in 2019, pre-covid and pre the difficulties and the changes that covid brought to businesses. There were £45.4 billion in revenues, £9.6 billion in profits, £296 million in tax paid, and £1.5 billion in tax avoided. Those are the companies that we should go for.

Have the Government estimated the cost of cutting fuel duty, for example, which lowers production and transport costs, saving businesses and consumers money that they can put back into the local economy? This is an issue that we must consider. We must do more to encourage these billion-pound businesses to do the right thing by the consumers from whom they make their money. If ever there was a time to ask and then legislatively demand of businesses that they live up to their obligations, it is now. I ask the Minister, who I believe is a compassionate lady who understands the issues, to put together a team designed to do that. We should not borrow more money for our grandchildren to be paying off over all their lifetime. The time for action is now. Let us change the legislation, make these big companies pay, and use that money for the benefit of everybody.

--- Later in debate ---

[Lucy Frazer]

The Government are making changes to the tax system, including through a number of measures to ensure that those on the lowest pay are paying fewer taxes. The Wealth Tax Commission identified that there would be some advantages to a one-off tax, but it acknowledged:

“although one can point to entirely new taxes introduced within the recent past, there are none on this scale.”

This is not a matter of lack of political will, as the hon. Member for Brighton, Pavilion (Caroline Lucas) suggested. This is not a measure that we would bring forward, for a variety of good reasons. Denis Healey, a Labour Chancellor of the Exchequer, came to understand that later in life, when he wrote of his time in office in the 1970s:

“We had committed ourselves to a wealth tax; but in five years I found it impossible to draft one which would yield enough revenue to be worth the administrative cost and political hassle.”

[Jim Shannon]

In my contribution, I referred to eight companies that have purposely avoided tax, without breaking the law, by moving their money overseas. Amazon, Google, Apple and Facebook are four of those eight. Have the Government any intention to put pressure on those companies to ensure that they pay tax? All the people of the United Kingdom could then get the benefit of that through education, health and betterment.

[Lucy Frazer]

The hon. Gentleman makes an important point. This matter needs international action, and he will know that international action is being taken. More than 130 countries signed up to a new international corporate tax framework in October 2021. That will help to ensure that multinational businesses pay their fair share, with the right companies paying the right amount of tax in the right place.

The hon. Member for Leeds East talked about capital gains tax. We recognise the importance of preserving the incentive for individuals to invest in this country and grow the economy, when they can choose to spend money in any jurisdiction. Having said that, we also recognise the importance of ensuring that a fair amount of tax is paid from assets through capital gains tax.

We have made a number of steps to reform both the dividend tax and the CGT regimes. For example, in 2016, the Government reformed the old, complex system of dividend taxation, simplifying it at the same time as increasing effective rates. In 2018, we reduced the tax-free dividend allowance from £5,000 to £2,000 per annum. In 2020, the Chancellor cut the lifetime limit of CGT entrepreneurs’ relief from £10 million to £1 million.

I would like to touch on the context in which this debate is taking place and the cost of living pressure on families, because those issues are important, as was recognised by many Members, including the hon. Member for Leeds East, the right hon. Member for Hayes and Harlington (John McDonnell) and the hon. Members for Strangford (Jim Shannon) and for Cynon Valley (Beth Winter). The hon. Member for Wansbeck (Ian Lavery) made a passionate speech, recognising the need to look after other people. That is exactly what the Government are trying to do, within the constraints and the global economic position we are in.

We are trying to support other people through our recent announcement of a £37 billion support package. We want to ensure that those who cannot work get support. We are taking a number of measures through the restart and kickstart schemes to ensure that people get into work and can support themselves. We are then ensuring that they are paid properly in work, and hon. Members will know about the increase in the national living wage and our measures to cut taxes to ensure that those in the lowest income brackets get sufficient sums when in work. We are also upskilling people so that they can increase their pay.

UK Gross Domestic Product

Jim Shannon Excerpts

Monday 13th June 2022 Commons Chamber

[John Glen]

I do not think Stoke-on-Trent could have a better advocate than my hon. Friend, with his passionate desire to highlight the successes going on in his constituency. I absolutely agree that it is that positivity, and focusing on interventions that make a real difference to people who live in his community, that people will remember as we move forward.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for his answers. In Strangford, small and medium-sized businesses are the backbone of our society. Some of them are crumbling at present due to high transport costs, which are heightened in Northern Ireland due to the Northern Ireland protocol. Can he confirm whether the Chancellor and the Treasury will follow other nations in substantially reducing fuel duty to aid transport costs as well as disposable incomes for families, so that money can go back into the local economy and everyone will gain?

[John Glen]

The hon. Gentleman makes a reasonable point about the challenges facing the rural economy, of which I know that he has great personal experience and experience in his constituency. That is why, as we made clear, there will be an additional £500 million to supplement the household support fund and bring it to a total of £1.5 billion, so that local authorities can give additional money to those most affected where existing measures have not been helpful.

Economy Update

Jim Shannon Excerpts

Thursday 26th May 2022 Commons Chamber

[Rishi Sunak]

As I have said, the Energy Secretary is extensively engaged with both Ofcom and the industry to make sure that we can support people in the best way.

[Jim Shannon (Strangford) (DUP)]

I thank the Chancellor very much for his statement and for the substantial financial help, which is most welcome. Northern Ireland will directly benefit, as he has said, and I thank him for that. Will the Chancellor confirm that there is a mechanism that ensures the funding goes to the working poor who are on the threshold of universal credit, but do not quite make it? Will he consider realigning the threshold for universal credit with the inflation rate, which would enable those on the border of poverty to stay on their feet and not be knocked over?

[Rishi Sunak]

That is why, as well as the very generous support for those on means-tested benefits, we have put in place universal support to ensure that all households receive an extra £200 on top of the £200 we have announced. That will help those people, as will the discretionary fund that we have established.

Cost of Living: Fiscal Approach

Jim Shannon Excerpts

Wednesday 25th May 2022 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

Thank you for calling me, Mr Twigg. I am very pleased to speak in the debate, and I congratulate the hon. Member for Barnsley Central (Dan Jarvis) on leading it and setting the scene.

I will give some examples of how the cost of living crisis is affecting my constituents. There are people in my constituency who have to choose between putting on their heating and feeding their children. Increasingly, they have to decide whether they can help their widowed, elderly parent to heat their home as well. These decisions are happening in my constituency each and every day, and I have no doubt whatever that they are the same everywhere else.

Inflation has reached its highest rate since 1982, and gas prices have increased by 95%. Consumer prices are up by 9%, electricity prices are up by 54%, and 11% of the working-age population of Northern Ireland live in absolute poverty, so I look to the Minister for help. A constituent has informed me that she pays her gas bill by direct debit, which means that if she does not put the money in, she does not get gas. She has gone from paying £54 a month to £178 a month, and her electricity bill has risen three times in the past year. She and her husband both work full time, and even with her husband’s second job it is impossible to make ends meet. I would probably refer to them as the middle-class poor. She has a seven-year-old, who is a talented young musician. Even if the violin is rented, there is still money to be spent on the girl. My constituent is on the threshold for aid, but the Government have refused to lift the threshold in line with inflation, and she simply does not have the money.

At a time when costs are skyrocketing, people in employment are paying more national insurance than ever before and it cannot be sustained. After the luxury of a music lesson, there is a school visit, the school play or other essential extracurricular activities. The middle-class working poor have been under incredible pressure for the last few months, but they are even more so now. Those currently earning above £25,000 will pay more national insurance contributions and income tax after 2022-23. The Government keep on telling us that they are helping, but would they consider delaying the increased payments for now, given that it would have a significant impact on workers who are already struggling? The Ofgem chief has referred to the energy price cap, which is expected to rise by £830 and reach £2,800 in October. Again, we need reassurances about the long-term strategy to enable us to get beyond the next six months.

No longer are working families saving to go on a foreign holiday or putting in new kitchen cupboards. They are living from hand to mouth. As that is the case, I believe that the Government can and must intercede in a constructive and practical way. I have asked about delaying the increase in national insurance contributions, and I have asked for a six-month strategy to enable people to have some idea of what the costs will be. In the next six months, prices will rise by £600.