Budget Resolutions

Martin Docherty-Hughes Excerpts

1st reading: House of Commons
Tuesday 14th March 2017 Commons Chamber

[Philip Boswell (Coatbridge, Chryston and Bellshill) (SNP)]

I proudly share the mining heritage of the hon. Member for Stoke-on-Trent Central (Gareth Snell), who is no longer in his place. Although I might not agree with quite everything he says, I commend him for his passionate and quite excellent speech, and for his extremely kind and honest words about his predecessor. Stoke-on-Trent certainly has a new champion, and we on these Benches wish him all the very best for his future in this place.

My hon. Friends on these Benches have made numerous salient points about the shortfalls of this Budget, which is noticeably a much thinner document than last year’s pre-EU referendum spring Budget. A thinner document, and yet thinner gruel within. I would like to focus on the glaring issue of the extraordinarily misleading employment statistics used as a foundation for many of the new proposals in this Budget. The Chancellor has claimed that 2.7 million more people are

“enjoying the security and dignity of work than in 2010”.—[Official Report, 8 March 2017; Vol. 622, c. 809.]

I cannot fathom how he can describe as dignified the gig economy that has emerged since 2010, which is filled with zero-hours contracts and insecure temporary work, or the huge growth in the number of individuals who are self-employed through necessity rather than choice. In fact, the working conditions faced by many today are far less dignified than those faced by people a decade ago. Also, many of those workers now face the loss of the minimal remaining employment rights that have been secured by the EU due to the coming hard Tory Brexit.

The Chancellor has stated that he does not want to saddle the next generation with ever increasing debts. I would suggest that he consider addressing that problem by taking a closer look at the funding allocated to the Department for Work and Pensions Work programme. Since 2011, more than £1 billion has been spent on attachment fees, job outcome payments and sustainment payments, all of which are rather nice-sounding euphemisms for what the Government have really been doing: paying off employers—often large chain retailers—to hire Work programme participants to stack shelves or work on shop tills. Not only does this grossly skew the Government’s employment statistics; it also sheds light on the issue of stagnating productivity. It hardly seems a stretch to suggest that if that £1 billion had been used to invest, rather than to aid the UK Government in fudging their employment statistics, productivity might be just a little higher.

I would like briefly to address the Chancellor’s claim that individuals elect to be self-employed, rather than a regular employee of a business, due to the marginally lower rate of national insurance they are required to pay. This point was made very articulately by my hon. Friend the Member for East Lothian (George Kerevan). That might be the case for wealthy consultants in the City of London, but it is certainly not the case for the numerous builders, joiners, electricians and other tradesmen I have spoken to in my constituency, and others all over Scotland.

[Martin Docherty-Hughes (West Dunbartonshire) (SNP)]

On 27 October 2015, when the right hon. Member for South West Hertfordshire (Mr Gauke)—then Financial Secretary to the Treasury—gave evidence to the Public Bill Committee on the National Insurance Contributions (Rate Ceilings) Bill, he stated:

“I remind the Committee of the purpose here. It is to emphasise and underline our commitment not to increase national insurance contribution rates in the course of this Parliament.”––[Official Report, National Insurance Contributions (Rate Ceilings) Public Bill Committee, 27 October 2015; c. 9.]

What does my hon. Friend think went wrong?

[Philip Boswell]

Alas and alack, it appears that word is seldom kept in this place.

The people I was describing often do jobs for the same companies for years on end, but the companies will not hire them as regular employees due to the cost of providing them with basic employee benefits. This means that they do not have maternity or paternity leave, sick leave or paid holidays; nor do they have the security of knowing whether they will be employed in a month’s time. The insinuation by the Chancellor that these individuals elect to give up all those benefits for the sake of saving a small percentage of their income on national insurance payments is absurd and hugely offensive. If the Chancellor would like to address the gap in revenue due to the growing trend of self-employment, I suggest that a fairer and more effective way would be to tackle those companies that hire workers only as self-employed contractors, in order to avoid paying employee benefits, rather than blaming those who are subjected to these unfair employment practices.

The Chancellor has presented yet another Tory Budget that blames working people for the economic problems created by the London-centric elite. It offers nothing new to address the existing economic problems faced by so many; nor will it protect working people from the fallout from this hard Tory Brexit. So much for caring Conservatism!

--- Later in debate ---

[Martin Docherty-Hughes (West Dunbartonshire) (SNP)]

First, Mr Speaker, let me give you an apology for missing Business, Energy and Industrial Strategy questions earlier today. I was suitably admonished by you and by people at home.

I want to focus on a couple of issues: the Chancellor’s assault on the Scottish whisky industry and the ill thought out increases in national insurance contributions for the self-employed. Let me declare an interest as the treasurer for the all-party group on Scotch whisky—a position that has offered me the opportunity to establish a close working relationship with this vital industry, which is very local to West Dunbartonshire.

As I am the Member for West Dunbartonshire—a constituency that is home to two well-known distilleries, Auchentoshan and Loch Lomond, and that has seen massive investment over recent months in a new bottling plant by Chivas Regal—the House will understand why I have strong reservations about the impact of the Government’s decision to increase excise duty on spirits by 3.9%. That money grab has been described by Loch Lomond distillery as a

“spectacularly poor decision by the chancellor”

and by the Scotch Whisky Association as a “major blow” to the industry which will undermine the progress that the industry has made in recent years. I therefore urge the Chancellor to use the opportunity to carry out an urgent review of the UK’s alcohol taxation system to give the industry—described by the Prime Minister only a week and a half ago as

“a truly great Scottish and British industry”

producing “the world’s pre-eminent spirit”—the support it requires to remain competitive in this vital global market.

I turn from the ill thought out increase in excise duty to the potentially disastrous impact on the self-employed of the increase in class 4 national insurance contributions by nearly 11% over the next two years. In my constituency, the local community and economy are built on a strong foundation of small businesses, and I have serious concerns—similar concerns have been expressed by many Members in the House—about the long-term impact and pressure of these increases on small businesses.

In a briefing that it sent to my office, the Federation of Small Businesses Scotland voiced its concerns about the proposed policy and stated:

“The risk that the self-employed face makes them fundamentally different to employees. This is why the proposed National Insurance tax grab on this group is an absolute kick in the teeth, just at a time when we need to create more entrepreneurs, not fewer.”

The fact that Members on the Chancellor of the Exchequer’s own Benches do not support this policy—we hear them in the Lobby all the time—sends a strong message to the Chancellor and the Treasury that the business community must be understood and consulted before any drastic changes are made. There is still time for the Chancellor to see sense and give small businesses the respect and support they deserve. To fail to do so would be a dereliction of duty and a show of no confidence in those who ensure that the economy is built on a strong base.

Finally, the utter failure in the Budget to even mention the WASPI women shows that the Treasury has failed to grasp the reality facing women born in the 1950s: poverty, destitution and a political state unwilling—not unable, but unwilling—to offer them equality in the 21st century.