Hot Takeaway Food (VAT)

Lord Mann Excerpts

Wednesday 23rd May 2012 Westminster Hall

[John Mann (Bassetlaw) (Lab)]

Thank you, Mr Scott, it is an honour to serve under your chairmanship for the first time. I congratulate the hon. Member for St Austell and Newquay (Stephen Gilbert) on securing the debate and on his accurate description of the problem that the Government have got him into. I appreciate his panic, because with this betrayal of Cornwall one almost expects Mr Sacha Baron Cohen to appear at the door.

For 100 years, the Liberals have been out of power, then the first time that they can get into a real argument and debate it is on the destruction of the core Cornish industry. One could not make that up. Of course we know why it has happened. When I asked my innocent question of the Chancellor in the Treasury Committee, he was somewhat stumped by the fact that there might be a problem. The reason he was stumped is that he is not a man who pays any attention to detail—that has been proven time and time again. Ask him a factual question, he gives a vague answer. That is a problem for someone who is the Chancellor of the Exchequer meddling with detail. There is good reason why no Chancellor has meddled with such details since 1984—because the detail is so complex that whatever rules they come up with, it is possible to find a way round them. I shall explain some likely scenarios in a minute.

What has been the Government’s stock response, fed to their loyal Back Benchers over the past month or so? Fish and chips. Yet, coming from the country’s heartland of fish and chips, I do not recall anyone in my lifetime who eats fish and chips cold. Unless the Government surreptitiously intend to continue to spread VAT to include cold foods, in which case the nation would like to be informed of the plan, they need to reverse the absurd decision that was made.

Let me give some examples, because it is not only Cornwall that has been betrayed—England has been betrayed. I mentioned Bakewell pudding in the Finance Bill Committee yesterday, and Ministers started muttering about almonds. Attention to detail is everything for Treasury Ministers. When I talk about the Bakewell pudding, I am not talking of a processed derivative created by a Mr Kipling, sold in supermarkets with almonds on top and bearing no comparison to the traditional English Bakewell pudding. The Bakewell tart is an entirely different product and, because it is cold, is zero-rated. No, I am talking about the Bakewell pudding, the quintessential English product made as it has been for many centuries, using traditional methods, of which Prince Charles and many others, myself included, would wholly approve—doing things in the traditional way, passing on the skills needed to create the product. Now, solely because Bakewell pudding is made in the traditional way, it will be taxed at 20%. If the manufacturers of the Bakewell pudding were to use processed ingredients, they would be able to concoct a product—vastly inferior, but in some way with the same name; as I pointed out, a major manufacturer has already done so—which would be zero-rated, but we lose the English tradition, we lose the real food. There are other such examples.

By definition, the businesses involved are small businesses. Those traditions, kept in the traditional way, cannot be transported into some mass-produced product sold in supermarkets throughout the country and the world. That is the point and that is what we will lose if those traditional producers are disadvantaged by being charged 20% VAT under this cack-handed measure.

Let me give another example. There has been a rush to eat pasties among senior politicians, including the Chancellor. The Prime Minister allegedly once ate a pasty on Leeds station—a station I know extremely well, coming from Leeds—but from a shop that had closed two years previously, so it was a time-lapsed pasty which, by definition, must have gone cold in the time. But he ate the pasty.

Let us take a railway station such as Knutsford—let us assume that there is a station there, although I have not been to the Chancellor’s constituency—or think of our own stations. We might have a traditional English baker outside the station, baking away, producing Cornish pasties and the rest. Currently, those products are VAT-free, but they will now have the 20% applied, although the Government are still looking at how to define their new criteria. Inside the station we have a café; the baker passes the baked products on to the café, which sells them, and the Government might say, “Ah, hot product, it has got to be VAT-ed.” But how do we do that? It has been passed on and is no longer baked on the premises, so it must be zero-rated. We must make sure that there is no anomaly.

What about seats? If there are seats, we might apply VAT because it is a café. Yet it is in a railway station, and the railway station decides in this beautiful temperature to have some seats outside the café. The Government have their test of ambient temperature, so we have ambient temperatures inside and outside the café—I hope that hon. Members will go to Bakewell and see the on-street seating available for those who wish to purchase Bakewell puddings there. So, inside and outside, there are different ambient temperatures—ah, clever Government! We might therefore ensure that all the chairs are incorporated inside the café, but it is a railway station and Network Rail has put a couple of benches outside. Will we have different temperatures between the railway bench and the café seats, and between the café seats inside and outside? There is also the baker who serves inside and the baker who has a little hatch and serves outside. Such examples show precisely why since 1984 the concept of ambient temperature has been ducked, as Treasury officials have tried to persuade every single Chancellor since then to extend VAT. Of course, now that has happened, although things could get worse.

I know that the Chancellor likes his football, and the nation groaned during the Champions League final. People support their own team, but the Prime Minister, who is allegedly an Aston Villa fan, was cheering Chelsea. That is a contradiction. As the cup was lifted, the Minister for Sport and the Olympics was, rightly, in his place, and who was alongside him? The Chancellor, the new Chelsea supporter. When politicians are having problems, they pretend to support a football team that is winning. If it loses, they disappear into the hospitality room, but if it wins, they are there, beaming. I know what the nation said when it saw him on their telly screens. The Chancellor’s local team is Macclesfield Town, and I happened to be there for a match in January.

[Sheryll Murray (South East Cornwall) (Con)]

Will the hon. Gentleman explain the connection between hot baked food and football matches? I would be fascinated to hear it.

[John Mann]

I am about to do that. Macclesfield Town’s stadium, like every football stadium, has a pie shop, but the Chancellor does not know that. When he goes to a football match, he is in the corporate hospitality room, so VAT is not an issue because he does not pay, just as he does not pay for his ticket or his travel, but that is another issue. The Chancellor does not pay for corporate hospitality, so whether something is VAT-ed does not matter to him. But I was stood there, hungry, having gone to Macclesfield to watch a cup match between Macclesfield Town and Bolton. I went to the pie stall, where pies are heated up on the premises. Will they be VAT-ed or not? If I buy a takeaway, will it be VAT-ed or not? If I heat it up in a microwave in the corner, will it be VAT-ed or not? If the shop staff heat it up in the microwave, will it be VAT-ed or not? Will there be a fancy process to avoid the VAT? It is fairly obvious how that can be defined.

The Government could introduce criteria for seating, so that if I sit down in the nice seats—there are not many seats at Macclesfield Town—I might pay VAT, but not if I stand up, as I did. Those anomalies will arise whatever way the Government move. My appeal to this out-of-touch, anti-English, inept-on-detail Treasury team and Government is to do their friends the Liberals a favour. They are up 4% in the north of England, and 2% in recent elections in my area, but the Government should give them a fighting chance in the south-west, and do the decent thing for England: get rid of this nonsense, and introduce a system that the country wants, which is no VAT on pasties, and no VAT on Bakewell puddings. Keep things as they are.

--- Later in debate ---

[Simon Danczuk (Rochdale) (Lab)]

May I say “Well done” to the hon. Member for St Austell and Newquay (Stephen Gilbert), who I will call my hon. Friend, for securing this important debate? He has made an exceptionally intelligent contribution to a significant discussion.

I will speak only for a couple of minutes, but I want to register my concerns about the tax under discussion, and touch on the impact that it will have on the high street and hard-working families. As my hon. Friend the Member for North Tyneside (Mrs Glindon) pointed out, it is possible that 300 shops will close as a result of this proposal. The current rate of retail vacancies in shops across our high streets stands at around 14%, and I cannot help thinking that this proposal will have a further impact.

As has been said, we want more bakeries and a diverse range of shops across the high street, yet this proposal puts at risk retailers such as Greggs and Greenhalgh’s in my constituency, as well as independent shops such as Wells bakery on Oldham road in Rochdale, which is a fantastic bakery that makes the best meat and potato pie that people can get their hands on. We want a retail mix and vibrancy, but this proposal creates a real problem and puts a burden on those businesses. It comes on top of the 5.6% increase in business rates—the largest increase in 20 years—that retailers and other businesses have experienced since it was brought in last September and applied this financial year, and we are adding further taxes to that.

In the context of diversity, one point that has not yet been raised is the impact of this tax on other segments of the retail mix, in particular Asian sweet centres. A number of such places in my constituency, particularly on Milkstone road, sell not only Asian sweets but samosas and pakoras. Will the Minister say whether this tax burden will also apply to those products? I have no doubt that my constituents will be interested to hear whether this is also a samosa tax, as well as a pasty tax.

Finally, let me look at the impact of this tax on hard-working families, because I get the impression that the Government do not understand ordinary working people’s lives. Yesterday, the Deputy Prime Minister spoke about snobbery in education, but I believe that snobbery is also attached to pies, pasties and samosas.

Members might be aware of a lady from Rochdale called Gillian Duffy who challenged my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown) during the last general election. Gillian is a very good friend of mine, she occasionally bakes me a cheese and onion pie, which I enjoy. For some unknown reason, The Guardian newspaper got hold of that information and ran a story about it, ridiculing me for eating Gillian Duffy’s cheese and onion pies, as though that was in some way inappropriate. People are snobbish about the fact that people, perhaps in northern towns or in Cornwall, like and enjoy pies and pasties.

[John Mann]

They are all sushi eaters.

[Simon Danczuk]

That’s right; absolutely. In reality, pies, pasties and samosas are part of the staple diet of ordinary people, and we should not forget that. The Government are placing an additional burden on hard-working families. People in Rochdale I speak to think that this tax is absolutely absurd. They laugh at the Government and find it peculiar that such a tax would be applied. It feeds the public perception that the Government just do not get it and are on a different planet, and I urge them to drop these proposals.