Scotch Whisky Industry

Jim Sheridan Excerpts

Thursday 12th February 2015 Commons Chamber

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

I congratulate the hon. Member for Argyll and Bute (Mr Reid) on securing this extremely important debate. Like him, I have many constituents who work in the whisky industry and who benefit from it. I emphasise that the whisky industry is not just a Scottish industry; it is very much a UK industry, and UK workers enjoy quality jobs, permanent jobs and quality pay as a result of the whisky industry.

I also genuinely congratulate the Minister on her work. She has been extremely generous with her time, as she has met the representatives from the Scotch whisky industry. There is all-party support for a tax cut for the industry.

I will not repeat all the statistics around the Scotch whisky industry; I am sure that the Minister is well aware of them. I am not doing a disservice to the people who work in the industry, but we have rehearsed all the arguments with the Minister, and she knows what they are. The only brief comment I wish to make is to reflect what the whisky industry is saying. David Frost, chief executive of the Scotch Whisky Association, met the Minister recently. He said :

“We had a warm and constructive discussion with the Exchequer Secretary to the Treasury…The Minister clearly understands Scotch Whisky’s economic importance and we welcome her interest in the industry. In the UK, Scotch Whisky is under sustained pressure from taxation. 80% of the price of an average bottle of Scotch Whisky is taxation and we hope the government will take on board our concerns about the negative impact of this onerous tax burden.”

He went on to say:

“In last year’s Budget, the Chancellor highlighted Scotch Whisky as a ‘huge British success story’. We hope this year too he will show his support for this world-class manufacturing industry, which adds £5 billion to the UK economy and £4 billion net to the UK trade performance every year. We hope the Government will back us by cutting duty by 2% for Scotch Whisky this year. This would be fair to consumers, send a powerful signal to export markets, support public finances, and most of all promote investment and jobs.”

We hope that the Government can see clearly where they are going with this and I look forward to the day of the Budget when the Chancellor will have a dram at the Dispatch Box as a way of promoting good Scotch whisky.

The Economy and Living Standards

Jim Sheridan Excerpts

Thursday 12th June 2014 Commons Chamber

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

That was the week that was, as we used to say in the ’70s and ’80s. To echo the comments of my hon. Friend the Member for Bolsover (Mr Skinner), this is the last throw of the dice for the coalition Government. The numbers certainly have not come up for the working people of the UK and, in particular, the young people of this country, who are working in terrible environments that should have gone with the bygone years.

There are problems with zero-hours contracts and the minimum wage. Those people do not have a voice in the workplace because the coalition Government have tried to silence the voice of the trade unions as much as possible. That is the coalition Government’s whole agenda.

There is bogus self-employment, particularly in the construction industry, where people are being asked to pay double national insurance—as employees and as employers. That is a complete sham.

I have never openly admitted to being an admirer of the Tory party, but one thing I do admire the Tories for is that when they get into power, they deliver for their own. They do not just talk about that in rhetorical terms; they deliver it. That is what the Queen’s Speech was about—delivering for their friends in the City and elsewhere.

Unfortunately, I have to say that the Labour Government could have done far more for working people in this country than they did in their 13 years in office. With one or two exceptions, they did not fulfil the ambitions that people had for them; they did not have the hunger or the aspiration to take them forward.

I am pleased that the current Labour leader is talking the language that people understand and that people want to hear. I am confident that, if he continues using that kind of language, we will see the return of a radical Labour Government. There is a great appetite out there for change. That was certainly reflected on the doorstep during the European elections, when it pained some of us to be told, “Youse are all the same. There’s no difference between youse.” The days of the Labour party tinkering at the edges are gone, and my right hon. Friend the Leader of the Opposition is taking us in the right direction.

Mention has been made of food banks. Personally, I think that it is a stain on all our characters that there are food banks in this country. When we pose at food banks for press releases, there should be a big sign at the front saying, “I’m sorry.” We have subjected people to using food banks through our policies and we cannot blame anyone other than ourselves.

One of the most positive policies of the last Labour Government was the introduction of the minimum wage. However, we have dined out on that for long enough. We now need to see the living wage. I am proud to say that my local authority, Renfrewshire council, is not only introducing the living wage for its employees, but using its procurement processes to tell its suppliers, “We will no longer give you the contract simply because you employ cheap labour.” It is trying to instil the standards that it upholds among its suppliers.

The other people who are walking free are employers who encourage migrant workers to come to this country to undermine and undercut indigenous workers’ terms and conditions, which causes all sorts of problems in communities. The senior executive members of the big companies go back to their leafy suburbs and leave the rest of us to get on with it. My right hon. Friend the Leader of the Opposition talks about irresponsible capitalism, and that is what we need to stop in this country. We need to stop the exploitation of migrant workers at the expense of our indigenous workers.

Charter for Budget Responsibility

Jim Sheridan Excerpts

Wednesday 26th March 2014 Commons Chamber

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

If my hon. Friend the Member for Hackney North and Stoke Newington (Ms Abbott) did nothing else in her contribution, she exposed the behaviour of the Government during this debate, reminding us that this is about people. The experience today shows that the Tories are at their happiest and their loudest when they are attacking the poor and the vulnerable. I was reminded that the reason I came into politics was to take on such people.

Events shape our lives and our experiences. I say this as someone who was a recipient of benefits for three years, through no fault of my own. I was unemployed, and when I did get a job, it usually lasted a week before the Economic League, which funded the Tory party, caught up with me and I was blacklisted and out of a job again. I was not lying in my bed waiting for the next girocheque to come in; I was desperate for work.

The vast majority of people on benefits are desperate for work, but they are forced into low-pay zero-hours contracts and it is the fault of the employers. Not one single Tory MP today has mentioned the fact that employers are lucky if they are paying the minimum wage and that therefore people are dependent on taxpayers and their handouts. That is what we should be attacking — the employers who are paying the minimum wage and sometimes even below it and forcing people on to benefits.

I was horrified to see the performance of Members on the Government Benches, none more so than our own Mrs Brown, epitomised by the hon. Member for Elmet and Rothwell (Alec Shelbrooke), whose behaviour was somewhat disappointing, shall we say. The Government will argue that a welfare cap is needed to keep social security under control, but they do not understand the root causes of that spending. I have great difficulty even with the position of my own Front Bench on the welfare cap.

Yesterday I spoke about tax avoidance. I draw a parallel. If I were to call the tax office and report Mrs Brown down the road for not paying her tax or wrongly receiving welfare benefits, an official would probably be at her door the next day. Yesterday I highlighted the disgraceful behaviour of Alliance Boots and its tax evasion, and not one single Member on the Government Benches or on the Government Front Bench has asked what Boots was up to. That is a sad reflection of where our priorities lie.

The welfare cap is portrayed by the Tories and the Lib Dems as a fiscal policy. It is a trap laid by the Conservatives to suck in the Labour Front Bench, and I am extremely uneasy about the position we are taking. I recognise a bear trap when I see it and I hope I will not be seduced into falling into the trap set by the Tories. It is a campaigning slogan which seems to demonise the poor and those on benefits.

As I said at the outset, I am probably one of the few people in the House who has been a recipient of benefits. There certainly are none on the Government Benches, and very few on the Opposition Benches. I was proud to get a job and proud of the company that gave me a job and got me back into work. I was not a benefits cheat, as some would have us believe.

National Minimum Wage

Jim Sheridan Excerpts

Wednesday 15th January 2014 Commons Chamber

[Rachel Reeves]

At the Labour party conference, my right hon. Friend the Leader of the Opposition called for the fine to be increased to £50,000, and I support that. It is also important that companies that get out of paying the minimum wage are prosecuted, and we are not seeing that under this Government.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

With regard to the advert about the security guard and the dog, I remind my hon. Friend that the RSPCA refused to allow the dog to work, yet the security guard had to do so.

My hon. Friend is running through a list of the abstentions in the vote on the minimum wage. Please do not leave out the separatists in Scotland, who I think were washing their hair that night.

[Rachel Reeves]

I thank my hon. Friend for drawing the attention of the House to the voting record of other Members of Parliament on that night.

Thanks to Labour Members of Parliament and a Labour Government, for the first time in history, in England, Scotland, Wales and Northern Ireland, British workers had a legal floor below which their hourly pay could not fall. Slowly but surely during the following years the rate rose. It was attacked every step of the way by many Government Members and, in 2003, when the Labour Government announced a 16% increase in the minimum wage over two years, the right hon. Member for Twickenham attacked the policy directly, saying that it would set a dangerous precedent.

The result of the minimum wage was to boost the wages of nearly 2 million low- paid workers, two thirds of whom were women. It helped to lift 1 million children out of poverty and every authoritative economic study concluded that it brought no negative employment effects, despite the warnings of Government Members. No wonder that a survey of academic policy experts conducted by the Institute for Government judged the national minimum wage to be the greatest policy success of the past 30 years. It is now a policy supported by the CBI and the TUC, whose nominees work together on the Low Pay Commission. It is seen by the British people as a vital British institution, underpinning basic rights and decency in the way our economy works.

--- Later in debate ---

[Jim Sheridan]

I thank the Secretary of State for giving way. The national minimum wage is exactly what it says on the tin: a minimum wage. Does he accept the overwhelming evidence that union-organised work forces are paid more and have better conditions than non-union-organised workplaces?

[Vince Cable]

In general, that is the case. However, my experience, from talking regularly to trade unions and employers, is that most of our trade unions, certainly in the private sector, are extremely pragmatic and flexible on wages—indeed, that is one of the reasons why we have had relatively low unemployment. They deserve some credit for that.

Scotch Whisky Excise Duty

Jim Sheridan Excerpts

Wednesday 8th January 2014 Westminster Hall

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

rose—

[Mr Donohoe]

I give way to my hon. Friend, who is the chairman of the all-party group.

[Jim Sheridan]

I want to take my hon. Friend back to the important issue of jobs. One of the significant factors of the Scotch whisky industry is that the jobs that it creates are excellent, well-paid, quality jobs. It is possible to tell that by the turnover of staff, which is very low.

[Mr Donohoe]

I am grateful to my hon. Friend for the point he makes, and it is clear that the issue of jobs is part of the equation.

--- Later in debate ---

[Nicky Morgan]

Mrs Main, I take the hint that you want me back on my feet and moving towards the conclusion of my speech.

I assure the hon. Gentleman that I will give this matter serious consideration in the run-up to the Budget. I shall certainly discuss it with my colleagues in the Treasury, including my right hon. Friend the Chancellor of the Exchequer.

[Jim Sheridan]

Will the Minister give way?

[Nicky Morgan]

I want to make progress and I am keen to get some further points in before the end of the debate, but I will try to take the hon. Gentleman’s intervention if I can.

The hon. Member for Central Ayrshire mentioned that spirit duty had risen by 44% between 2003 and 2013. I should point out that beer duty in that period rose by 56%, while still wine duty rose by 68%. We can trade as many numbers as we want, but I take the overall thrust of the arguments made today.

The hon. Member for Argyll and Bute (Mr Reid) asked about the spirits duty rate having risen by 37%. Duty on Scotch whisky has risen at a slower rate than beer duty over the medium term. The spirits duty rate was frozen between 1998 and 2008, and during that time duty rates on other alcoholic beverages increased. However, between the introduction of the escalator and 2013, the spirits duty rate rose by 37%, while other alcohol duty rates rose by 42%. I just wanted to put that on the record for the benefit of the House.

[Nicky Morgan]

I understand that point.

[Jim Sheridan]

One of the best adverts for Scotch whisky was the long tradition whereby the Chancellor used to take a glass of whisky on Budget day. Is there any reason why that no longer happens?

[Nicky Morgan]

The hon. Gentleman is tempting me down the path of speculating on the Chancellor’s alcohol intake, which I really do not want to go down. Of course, I notice that my glass is not in front of me this afternoon.

I thank hon. Members for this debate and thank the hon. Member for Central Ayrshire for securing it. I will be happy to study the written report of it. I hope that this debate shows the Government’s continuing commitment to the Scotch whisky industry and that we will help it where we can.

Air Passenger Duty

Jim Sheridan Excerpts

Wednesday 23rd October 2013 Commons Chamber

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

I congratulate my hon. Friend the Member for East Antrim (Sammy Wilson) on securing the debate. As usual, the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), who is no longer in his place, blames everything on the Westminster Government. I noticed that a number of right hon. and hon. Friends found that rather funny. But it is not funny to anyone who lives and breathes amongst the people who want to break up the UK. The people of Scotland want a serious Government with serious politicians, and that is what we are hoping for. I do not share the hon. Gentleman’s view that in September next year people will vote for independence. I sincerely hope not.

Several hon. Members have referred to the devolution of APD, which I will keep an open mind on. If it proves to be to the benefit of the people of Scotland, fine, let us go ahead and devolve APD to the Scottish Parliament. But one question has to be answered, and perhaps the Minister will do so when he replies. If it is devolved, what proportion of money will come out of the block grant to pay for that? Someone, somewhere has to tell us exactly what that will cost. If APD is devolved and it is abolished, that money must come from the health service, education or somewhere else. It would be helpful, when we start blaming the Westminster Government for all our ills, if somebody from the separatist party told us where the money is going.

While I am on the subject of other countries, I have a document here that says clearly that in Malta APD was abolished in 2008, and one of the reason given was that it was

“Removed following legal challenge from the European Commission. Tax described as discriminatory.”

It would be helpful to know the reason for that. One aspect of APD that I find particularly discriminatory is that people in the north are being hammered twice. They have a double whammy if they travel through the London hub airports when going on to continental flights or flights to America. Even if there is no agreement to abolish APD, it would be helpful to abolish the double whammy.

Glasgow airport in my constituency contributes a great deal to the Scottish economy, including 5,000 jobs, but it pays more than £7.9 billion in tax. I am particularly annoyed that this will cost Scotland more than 2 million passengers and 5% of long-haul demand may be lost. Like a number of colleagues, I am finding that people in Scotland, particularly the holidaymakers and their families, are now going through Schiphol, Paris and elsewhere, which means that London and Gatwick are losing out. There is some impact on the London airports and it would be helpful if the Minister said how many people are involved.

APD also has an impact on Scotland’s tourism industry. Scotland has a lot to offer tourists. The Commonwealth games are coming to Glasgow in 2014, which many people from various parts of the world will attend. I am sure that they will not want to be affected by this tax either, and hopefully they will want to visit this country again. York Aviation estimates that 148,000 trips and £77 million in visit expenditure could be lost over the next three years and that by 2016 APD will cost the Scottish economy up to £210 million a year in lost tourism. One of the difficulties with this debate is that there is an awful lot of repetition, so I apologise to those in the Chamber and outside for using all these statistics, but unfortunately they have to be repeated. I take the view that the more we repeat something, the better the chance of achieving it.

This is about the whole United Kingdom, not just Scotland. Frontier Economics estimates that there will be around 3 million fewer trips each year to and from UK airports, that spending by overseas residents in the UK will fall by £475 million a year and that our GDP will be reduced by £2.6 billion a year, with the potential loss of 77,000 jobs. I do not think that this Government, or any Government, should contemplate the loss of such a significant number of jobs. A report by PricewaterhouseCoopers has shown that abolishing APD would boost the UK’s GDP by 0.46% in the first year, provide 60,000 extra jobs in the long term and increase revenues from income tax and VAT, with a net benefit of £500 million in the first year.

I make a plea to the coalition Government—unfortunately, the previous Government did not take appropriate action—to listen to what has been said on both sides of the House on the impact APD is having on the aviation industry and take appropriate steps to help our constituents.

amendment of the law

Jim Sheridan Excerpts

Monday 25th March 2013 Commons Chamber

[Danny Alexander]

I disagree with it, for reasons that I will come to. I will now make some progress.

The right hon. Member for Edinburgh South West (Mr Darling) made a characteristically thoughtful contribution to the debate. He has made it clear, not least through his leadership of the Better Together campaign but also in response to an intervention, that the Scottish National party is not being open about the scale of the problems that an independent Scotland would face.

It was not the presence on the Opposition Front Bench of members of the former Government that was most noticed last week. Many Members will have sensed a presence in the Chamber, and looking up they would have seen Lord Mandelson, a former member of the previous Government, looking down. Afterwards, he gave his views on the Budget. He said in a speech the following night:

“I can't quite remember which member of the government it was who claimed to have abolished boom and bust. Well, we abolished boom…The whole argument about whether we’re cutting too far and too fast, it’s in the past. It is rather predictable party political stuff from over the despatch box, and it is a bit tiring to the public.”

The shadow Chancellor would do well to take note. Lord Mandelson then said the following, which is particularly significant in the context of an earlier intervention:

“I don’t think you can really take a chance, I think the markets, whose confidence in us to pay back what we borrow—that confidence is the determining factor. If that was seriously damaged by a lurch in policy I think that would be quite a risk which I would not blame the chancellor for refusing to take.”

That is sage advice from a former member of the previous Government, which Opposition Front Benchers would do well to take.

Last week’s Budget sent a message to hard-working families in each and every constituency up and down the country: if people want to get on in life, this Government will support them. If, in the short term, people want more money back in their pockets, we are taking measures to help them. They will pay less to fill up their car; they will pay less for a pint of beer; and, most importantly, if they earn less than £10,000 they will soon pay absolutely nothing in income tax.

If, in the near future, Mr Speaker, a constituent of yours wants to own their own home, this Government are making that a very real possibility through low-deposit mortgages, through mortgage guarantees and through doubling the affordable homes guarantee programme. For those who, in the distant future, do not want their children or grandchildren to still be paying off this generation’s debts, we are taking the steps to ensure that they will not. We are reducing the structural deficit, creating a tax landscape for economic growth and building an infrastructure for the UK to compete in the global race.

This evening, I want to talk about the steps this Government have taken to build a stronger economy and a fairer society. We are putting our faith in the private sector to help us build that stronger economy. We believe that the best way to do that is to create the most competitive tax regime in the G20. Further reducing the rate of corporation tax, which we announced in this Budget, will not only send a clear message that Britain is open for business, but will increase the return on those businesses’ investments and incentivise economic growth. Meanwhile, our £2,000 employment allowance, welcomed on both sides of the House, will be a real help for small and medium-sized businesses that want to expand and to employ more staff.

The Government know that if we want to see growth we cannot, as our predecessors did so catastrophically, look to one industry or one city. Several Opposition Members mentioned the importance of manufacturing industry, but when in government Labour became over-dependent on one square mile, thanks to the shadow Chancellor’s prawn cocktail offensive. We know that for a stronger, more balanced economy, we need growth across different sectors, and we need growth up and down the country. That is why we are taking forward the measures from the Heseltine review; it is why my right hon. Friends the Business Secretary and the Deputy Prime Minister unveiled our aerospace investment in Bristol before the Budget; it is why we are supporting the asset management sector, which is so important, particularly to the Scottish economy and to Edinburgh; and it is why, as well as supporting renewables, we are developing proposals so that communities can benefit from any shale gas discovered in their area. It is right that local communities see the benefits of natural resources in their locality.

We also need to make sure that our industrial base is broad, as we have seen only too clearly the dangers of over-reliance on one specific sector. That is why my right hon. Friend the Business Secretary is overseeing £1.8 billion of funding to support strategies in 11 key sectors, working to ensure that our economy makes the most of its potential in life sciences, construction and many other areas. While we build this stronger economy, we are also making sure that we build a fairer society. The Labour party likes to portray itself as the party of taking from the rich and giving to the poor, but everyone who was paying income tax at the l0p rate and was then paying income tax at double that rate will soon, thanks to this Government, be paying no income tax at all. That policy comes straight from the Liberal Democrat manifesto to the pockets of millions of hard-working families up and down the country, thanks to this coalition Government.

Of course we recognise that, despite these actions, times are still difficult for many families up and down the country. For that reason, we have taken the decision to cancel this September’s fuel duty increase, which was baked into the public finances by the Labour party. That cancellation has been welcomed across the House, but especially by Members with more rural constituencies such as mine.

I must also congratulate my hon. Friend the Member for Leeds North West (Greg Mulholland) on his tireless and passionate campaigning on beer duty. I know that he has some wonderful pubs and a very good beer shop in his constituency, I know how many excellent breweries we have up and down the country, and I know that our scrapping of the beer duty escalator will be a real boon both for the pub trade and for the brewing industry.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

The Chief Secretary has mentioned the beer tax, but does he have anything to say to the Scotch whisky industry, which is suffering as a consequence of the Budget?

[Danny Alexander]

I say, as I said directly to the Scotch whisky industry, that this Government are giving considerable support to it as it seeks to broaden its reach into export markets across the world. The work of UKTI, in particular, is of great assistance to that industry.

We are building a stronger economy and a fairer society, and we are also helping people who want to get on in life. If you want to get on in life, last week’s was a Budget that will support you. It was a Budget that will give thousands of people the opportunity to step on to the housing ladder or step up the housing ladder. Our £5.4 billion housing package will boost home ownership and kick-start the building of new homes. The intention of the help to buy scheme is to provide help to people who want to get their first home or move home but cannot afford the deposit that today’s mortgages now require. This is a complex policy area, and we are working with the industry to find a practical and sensible way of taking the scheme forward without blunting its radicalism or its reach. I am sure we will achieve that.

Budget Resolutions and Economic Situation

Jim Sheridan Excerpts

Thursday 21st March 2013 Commons Chamber

[Vince Cable]

Why did the Labour party not do that when it was in government? Why was its first proposal for stabilising the budget to cut capital spending, including on affordable housing? If the hon. Gentleman had read the Budget, he would have discovered that, in addition to the housing policies that will affect private mortgages, it included a significant increase in support for affordable housing in the social sector.

The second long-term change relates to money and banking. One of the big features of the post-crisis economies has been the way in which Governments have had to pursue fiscal consolidation—because of the inheritance they received, and ours was worse than most—alongside supportive monetary policy. I made my maiden speech in 1997 in support of the then Chancellor when he made the Bank of England operationally independent. That was an important and good reform. But we have realised over the years that the world has changed. Inflation took no account of the massive asset bubbles that grew up, and the regime was not prepared for the collapse of the financial system and the difficulties we have had rectifying it. That is why it is right that, following on from the very successful, improvised monetary policies that we have experienced, the Chancellor is now consulting on a changed regime, which will be more flexible and take account of the level of unemployment, the level of nominal GDP and other variables that are crucial to long-term growth.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

In the past, the Secretary of State has rightly criticised the banks and bankers for their contribution to the serious financial difficulties we are in. Can he therefore clarify whether he agrees with the Chancellor that bankers’ bonuses should be capped?

[Vince Cable]

There already are regulations that affect bankers’ bonuses, which we introduced long before the European Parliament and which firmly cap the amount of bonuses that can be paid out in cash, as opposed to stock, which is not redeemable in the short run. That reform has already been made in order to stabilise the banking system.

I agree that the banking crisis did enormous damage. As someone who has probably spent more time thinking and writing about it than most people in the House, I acknowledge that I have underestimated the damage that was done by the collapse of the banking system, especially the crippled, semi-state owned banks—to such an extent that even if we now ordered those banks to lend more, they would be institutionally incapable of doing so. What we have realised is that there are two problems. The first is the problem that has arisen from the banking collapse itself and the de-leveraging that followed it. The other is the fact that over a decade ago the bankers stripped out their capacity for local relationship banking. Effectively, they looted their banks and denuded them of the capacity to engage in sensible business lending. Of course, that was anticipated in the Cruickshank report, which the Labour Government ignored, but it has done serious damage that makes it difficult to revive conventional business lending. We are trying a series of initiatives to do that.

On Friday, a new tranche of money will be made available for non-bank lending. Today, we had the advanced manufacturing supply chain initiative, which is helping to fund our supply chains. I put in the Library this morning a written ministerial reply on the business bank, which gives a time profile for how that new institution will support challenger banks and new forms of wholesale financing in the banking sector. The Chancellor’s speech yesterday included a positive initiative on equity capital and helping to relieve some of the burdens on companies going to the alternative investment market on the equity side.

--- Later in debate ---

[Vince Cable]

There is a demand in the economy. When the Government come forward with proposals to stimulate demand, as they did in the housing sector, the Opposition jump up and criticise them.

[Jim Sheridan]

If press reports are to be believed, a banker is about to receive a £17.5 million bonus. If that is correct, what has the cap been set at?

--- Later in debate ---

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

I want to raise an issue that is close to my heart—the Scotch whisky industry—not just because it is an excellent tipple when taken responsibly and because I am chair of the all-party group on Scotch whisky, but, more importantly, because that industry provides hundreds, if not thousands, of jobs in this country.

The Chancellor suggested yesterday that he was cutting beer duty to help boost pubs, yet as 40% of pub sales come from spirits and wine, his duty increases on Scotch whisky and other drinks mean that when it comes to pubs, he has given with one hand and taken back with the other.

[Andrew Griffiths]

Will the hon. Gentleman give way?

[Jim Sheridan]

No, I do not have time.

Like the Chancellor, I wish to see British businesses succeed to help to secure British jobs. The Chancellor talked about the opportunity for UK business that a successful free trade agreement would bring. He talked about backing businesses that are a global success. For the Government and the European Commission, improved market access and reduced discrimination are priorities for the Indian free trade agreement talks. In a spectacular lack of joined-up government, in one speech the Chancellor has attacked Scotch whisky—the one industry that is currently investing for international growth to India and elsewhere—by increasing discrimination against it here at home.

[Andrew Griffiths]

Will the hon. Gentleman give way?

[Jim Sheridan]

No.

What sort of signal does that send to overseas markets? British ambassadors around the world who are trying to help Scotch gain fairer trading conditions will be shaking their heads at the example set by our own Chancellor here in this country. This industry accounts for 25% of UK food and drink exports, generating some £134 a second for the UK balance of trade, yet the Chancellor’s only action is to penalise it in its home market. The UK is the third largest market for Scotch whisky in the world, and some companies depend on the UK market for success.

[Andrew Griffiths]

rose—

[Jim Sheridan]

As I have said, this industry employs people in areas where few alternative jobs exist. The Chancellor threatens jobs in such areas, as the Chief Secretary presumably told him. [Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Mr Griffiths, you have already spoken. The Member does not want to give way and we do not need a running commentary from the Back Benches.

[Jim Sheridan]

Thank you, Mr Deputy Speaker. I have been heckled by better.

Perhaps the Chancellor will explain to pensioners enjoying a dram why they should have to pay 48% more duty for the alcohol they enjoy than their neighbours who prefer a beer. Only three countries in the EU penalise Scotch whisky more than the UK does. It is time to halt the duty escalator for all and to start backing, not penalising, our successful industries.

Let me deal briefly with pensions. Like many of my colleagues here, I have a large number of pensioners in my constituency, and I am concerned that this Budget will do nothing to reduce pensioner poverty, currently standing at 1.7 million people nationally. There are no proposals to help pensioners who are struggling with rising living costs.

Moving on to growth, in a written answer I received on 17 January, the Economic Secretary told me:

“The OBR forecast that real household disposable income will grow in each year from 2013 to 2017.”—[Official Report, 17 January 2013; Vol. 556, c. 866W.]

In December 2010, the Chancellor was equally confident, telling CNBC:

“Britain is on the mend. We got pretty steady and sustainable economic growth forecasts, pretty sustainable increases in employment, a steady decline in the deficit.”

Well, how wrong could this Government be? Real wages are set to fall by 2.4% over this Parliament. The OBR has also halved the growth forecast for this year and downgraded it for next year, too. I ask the Chancellor to see some sense and stop relying on the private sector to provide the boost to the economy that is needed. Millions will be squeezed by another year of capping public sector pay, while the private sector has simply not managed to perform as well as was needed at a time when growth has stalled.

A sensible Budget would have seen an intervention to legislate for a living wage, rather than giving the tax break to millionaires that is coming up in a few days’ time. That would not only be fair on working people, but could help inject the economy with consumer spending power. The most ironic part of this plan is that the Chancellor has not even succeeded in reducing the deficit—the golden goal that we have been suffering these tax cuts in order to achieve. Borrowing is now forecast to be £245 billion more than was planned at the time of the spending review. We will not have balanced books, but we will have low-income families paying the price, while millionaires continue to count their money.

I concur with the views of the TUC, which welcomes the British business bank but is calling for more resources to support businesses on a larger scale and for the bank to be able to raise funds in the capital markets as comparable banks do.

I and, I am sure, my constituents do not see this as an aspirational Budget, but as a desperation Budget.

Economic Policy

Jim Sheridan Excerpts

Monday 25th February 2013 Commons Chamber

[Mr Osborne]

My hon. Friend puts the point powerfully and until we hear that apology from the shadow Chancellor, frankly he will not have the credibility to offer an alternative.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

The Chancellor’s message to my constituents seems to be that things are only getting worse. Will he lead by example and inform the House what personal sacrifices he will have to make as a result of this downgrade?

[Mr Osborne]

My message to all families is that in the markets interest rates remain low and have remained low today. That is the credibility test for the Government’s economic policy, and as I say, for families paying a mortgage or businesses with a business loan, that is crucial.

Corporate Tax Avoidance

Jim Sheridan Excerpts

Monday 7th January 2013 Commons Chamber

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

I rise as a sponsor of early-day motion 867, which deals with the behaviour of Google and its tax avoidance statements. As the sad person I am, over the festive period I took the opportunity to catch up with the work of some of our Select Committees, particularly the excellent work of the Public Accounts Committee, chaired by my right hon. Friend the Member for Barking (Margaret Hodge). Having watching Committee members try to get reasonable answers out of some of the big corporations, I can understand their frustration. In my view, they treated the Committee with contempt, simply smirking when asked any serious question. Likewise, when Google representatives appeared before the Culture, Media and Sport Committee, of which I am a member, the public affairs spokesperson, whom I am reliably informed is a former No. 10 adviser, when asked any serious question, replied, “That’s above my pay grade.”

It seems to me that those large corporations are treating Parliament, and indeed politicians, with utter contempt. We are well aware of the statement by Google, but there is also the statement from the chief executive of WPP, who said that corporation tax paid was largely “a question of judgment” and that it paid it more out of a sense of corporate social responsibility. Experience tells me that we should not hold our breath if we are waiting for corporate social responsibility.

There is a serious problem, and in order to solve a problem we must first look at its size. General corporation tax receipts from big businesses have dropped from £26 billion in 2000-01 to £21 billion in 2011-12, a 20% decline but a 65% increase in profits. In October 2012 companies paid £7.8 billion, down from £8.7 billion in October 2011. The Office for Budget Responsibility predicted that corporate tax receipts would grow by 4% this financial year, but they are actually down by 10%. HMRC estimates that the tax gap—the difference between what should be received and what is received—is £4.1 billion. That would pay the salaries of 153,000 nurses or 164,000 police officers, or for 430,000 nursery places. Indeed, if the Treasury closed the tax gap, it would cover almost a third of the expected deficit for 2012-13. As has already been alluded to, 98% of FTSE 100 firms have at least one subsidiary in a tax haven. The cost of tax havens is estimated at £160 billion annually. That is in excess of all the aid flowing now.

There is hope, hopefully. The Chancellor has pledged more resources for the Organisation for Economic Co-operation and Development to create a levy catching earnings of multinational firms. Indeed, he has announced an extra £77 million a year for two years to fund more HMRC staff to pursue companies that are not paying their taxes. However, his close friend the Chief Secretary to the Treasury, the right hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander), said that we should not name and shame firms that avoid tax as that would breach taxpayers’ confidentiality. To return to a point made earlier, I think that we should be looking at fair tax in the same way we looked at fair trade.

The well-respected organisation Christian Aid has put out a briefing highlighting the headlines of tax avoidance and some statistics to go with it. A recent study has shown that in excess of £13 trillion might be hidden in tax havens beyond the reach of tax authorities. The cost to developing countries is estimated to be £160 billion annually, which is far in excess of the global aid flowing at the moment. A recent UK survey showed that 56% of adults polled believed that tax avoidance was morally wrong and 74% felt that the Prime Minister should be demanding international action to tackle tax evasion and avoidance. We look forward to the G8 summit in Ireland, where the Prime Minister and the Chancellor have promised to take the whole question of tax extremely seriously.

[Caroline Lucas]

I am grateful to the hon. Gentleman for giving way and for his words on fair taxation. Does he agree that transparency is an absolutely fundamental principle at the heart of fair taxation and, in that respect, does he agree that the Government should be supporting country-by-country reporting, as set out in my private Member’s Bill, the Tax and Financial Transparency Bill, in the previous Session? Is that the kind of measure he would support?

[Jim Sheridan]

We need transparency in the system, because if we do not have transparency we will not be able to find out where the problem is, so I would fully support such a private Member’s Bill.

I will move on to what is commonly known as the people’s game: football. The Independent on Sunday has conducted an investigation into “Football’s tax shame”. It states:

“Britain’s Premier League football clubs are awash with money. They pay star players £250,000 a week, and turn over £2.2bn a year. Yet records show they paid only £3m in corporation tax last year… according to analysis of their most recent accounts.”

That money comes from the spectators, the hard-working men and women who buy the products and go to the games. The article continues:

“This is an effective tax rate of 2 per cent. Equally startling is that a profit of £150m made by eight clubs is all that the Premier League has to show for a turnover of about £2.2bn a year. Five clubs, including Manchester United, Newcastle United and Tottenham Hotspur, paid no tax at all, despite a combined surplus of more than £70m. Blackpool, relegated from the Premier League last year, paid just over £100,000 on profits of £21m—a rate of 0.5 per cent. The club was able to pay minimal tax on its substantial profits because of the effects of a £6.7m loss the year before. The club also donated just over £5,000 to charities. Of the other profitable elite clubs, Arsenal had the biggest potential tax bill—£7m on group profits of £36.6m—but paid less than half a million pounds while deferring more than £6m. West Bromwich Albion topped the company tax table, paying £1.8m on £18.9m profits. The club accounts of those that made a profit cover the financial year 2010-11, with the exception of Manchester United and Arsenal, which have both recently published their 2011-12 accounts. None of the clubs has acted illegally and all of them pay big sums in PAYE and other taxes.”

We should not buy the argument about the complexities of the tax system being the reason people do not pay their taxes. There is nothing complicated about saying to big corporations, “If you make and sell your products in this country, you pay the appropriate tax.” That is not too complex, and that is the road we should be going down.