Oral Answers to Questions
Martyn Day Excerpts(1 month, 1 week ago)
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Nigel Huddleston
If I am hearing correctly, the Labour Front Benchers are announcing fundamental changes to policy that they have not yet costed. They did not object, as far as I am aware, to any of the measures required to support households and businesses during the pandemic, which necessitated increases in taxation. We are now reducing the level of taxation because we have turned a corner. They did not support that. It is interesting that they say one thing but then do not take action. I think they need to explain to their constituents why they failed to support the tax cuts last week.
Martyn Day (Linlithgow and East Falkirk) (SNP)
The Chief Secretary to the Treasury (Laura Trott)
As a result of decisions at the spring Budget, the Scottish Government are receiving around £295 million in additional funding in 2024-25 through the Barnett formula.
Martyn Day
According to the Commons Library, the Government have cut the Scottish Government’s capital funding by 16% in real terms from 2022-23 to 2024-25. The Institute for Fiscal Studies forecasts that there will be a further 16% cut by 2029. After 14 years of austerity, inflation and covid, can the Minister tell me why the Chancellor is taking a hammer to our Scottish public services?
Laura Trott
The hon. Gentleman is aware that the block grant has been going up in real terms. He will also be aware that the Scottish Government can switch resource to capital—unlimited amounts, if they choose to do so. He will also be aware, I am sure, that the Scottish Government can borrow up to £400 million of capital each year if they so wish.
Cash Acceptance
Martyn Day Excerpts(1 year, 1 month ago)
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Hannah Bardell (in the Chair)
Before we begin, I want to put on the record that we are delighted to see so many members of the public in the Public Gallery for this important debate. I ask that everybody’s phones are turned off and that we keep noise to a minimum to allow Members to enjoy the flow of debate and for those watching at home.
Martyn Day (Linlithgow and East Falkirk) (SNP)
I beg to move,
That this House has considered e-petitions 605030 and 622284, relating to the acceptance of cash.
It is genuinely a pleasure to serve under your chairmanship, Ms Bardell. The petitions before us attracted more than 58,500 signatures between them, having closed on 5 July 2022 and 10 March this year respectively. I thank the creators and signatories of the two petitions. Their actions have meant we are here today to debate an issue that is clearly of interest and concern to many people across the UK.
The petitioners call on the Government to:
“Make it illegal for retailers and services to decline cash payments”,
and to:
“Require all businesses and public services to accept cash payments”,
with the exception of internet-based businesses. They argue:
“Not everyone wants a digital trail and others simply cannot pay by card.”
The petitioners expressed concern about cashless payments creating an “enforced dependency on banks” and a
“threat to privacy as people cannot make anonymous payments.”
They stated:
“If we wish to uphold freedom of choice and the right to privacy, it is imperative that we protect the use of cash.”
Margaret Ferrier (Rutherglen and Hamilton West) (Ind)
In response to the Petitions Committee’s online survey, 61% of respondents said that they use cash to help with budgeting and, in the light of the cost of living crisis, by way of tracking their spending. Does my hon. Friend agree that the UK Government must recognise and protect cash as a tool that helps people to survive the cost of living crisis?
Martyn Day
My hon. Friend makes a good point. Indeed, I emphasise that it is essential not only for many people who budget, but for those on lower incomes, the elderly and those with disabilities, who need that facility the most.
Ronnie Cowan (Inverclyde) (SNP)
As my hon. Friend mentioned, freedom of choice is imperative. Currently, we need cash and card. We need to make everyone comfortable with the direction of travel. Does he agree that an education programme is required akin to the one we had back in the day when we introduced decimalisation? Given the average age of people in the room, I may have to explain what decimalisation is.
Martyn Day
I am grateful to my hon. Friend. I am perhaps giving my age away, but I came in with decimalisation. I recall the ready reckoners that my elderly relatives had for me to play with as a toy many years ago. An education programme would be helpful. In 20 to 30 years from now we will be in a different place, but here and now there is a real demand for cash, particularly for many vulnerable groups, such as disabled users who need cash and may not even have their own bank accounts.
Sir Peter Bottomley (Worthing West) (Con)
Just in case the hon. Member for Inverclyde (Ronnie Cowan) was referring to those of us with more experience, I should say there was a time in 1971, when I was selling coin-operated tea and coffee machines, when someone wrote in saying, “The elderly will find the new coins difficult. The elderly don’t live forever; could the change be postponed until they’re all dead?”
The more serious point, which will be shared throughout the House, is that people should not be excluded from being able to buy or pay for things just because they do not have a card or an account. Many people rely on the use of cash. Those businesses that do not need their custom ought to be told, “You should have it because you should not exclude people just because they aren’t up to date or a 14-year-old with a debit card.”
Martyn Day
The Father of the House makes a valid point, and one that I shall echo a number of times as I make progress through my speech—if there are no other interventions.
Zachary Stiling, creator of the more recent petition, told me:
“We must protect the individual’s right to use cash in all physical transactions. While there are many obvious advantages to digital payments, it is not suitable at all times or for all people…There are dangerous political implications with going cashless, as instances of banks and financial service providers closing accounts for political reasons are not unprecedented and are clearly at odds with liberal society’s cornerstone of freedom of belief.”
As we have heard from a number of interventions, freedom of choice is a central tenet of this issue. To be clear, the choice to use cash is still one that many people wish to make. Indeed, 95% of respondents to the Petitions Committee survey ahead of this debate stated that they preferred to use cash to pay for things over other means of payment. I know from my own experience that I would be happier using cash when I am in a pub or a restaurant than when I am shopping. It is different horses for different courses.
Figures from the Royal Society for the Encouragement of Arts, Manufactures and Commerce 2022 cash census showed that 96% of people withdraw cash at some frequency, with 83% having cash either in their wallet or at home. Furthermore, figures from the Financial Conduct Authority’s 2022 “Financial Lives” survey showed that 6% of adults in the UK had used cash to pay for everything, or for most things, over the 12 months from May 2021. That is a significant number of people.
Mr Gregory Campbell (East Londonderry) (DUP)
Last year, I was at a coffee outlet in London City airport that only took cards. A constituent asked me to take up the issue, which I did. A few weeks later, it introduced a process for cash and card. Three months later, the constituent sent me a photograph of a sign saying, “Cards not working today, only cash.” How ironic was that?
Martyn Day
The hon. Member makes a very good point on which I wholeheartedly agree. As I said, 6% of adults use cash payment for almost everything. That figure increases to 9% of those in the most vulnerable circumstances. I shall return later to the impact of cash refusal on the most vulnerable in our society.
Although the covid-19 pandemic undoubtedly affected payment habits, there has been both a sustained, albeit partial, recovery and a stabilisation in trends around the use of cash, as noted by the Bank of England in its third quarter bulletin in 2022. The Bank also noted that the value of bank notes in circulation remains close to an historic high, reflecting the fact that up to 60% of the population are holding more cash as a store of value.
Beyond freedom of choice, there are other clear benefits to using cash. One benefit for retailers is that unlike card schemes, for which they must pay set-up and transaction fees to providers, with cash every penny goes to them. Another benefit that should not be underestimated is the role that cash can play when other payment methods fail, as the hon. Member for East Londonderry (Mr Campbell) illustrated. I am sure that many of our constituents have had the experience of being unable to use online services or cards in the face of card rejection, IT glitches or system outages.
I can give an example from my own life, when I visited a friend who was recovering from surgery in hospital. I stopped for fuel on the way, which was lucky for me because although I had no cash in my pocket, my card was accepted, and when I got to their house I had an email from my bank telling me that it thought there had been a suspicious card transaction so my card had been stopped; had I tried to buy fuel on the way home, I would have had no means of paying for it. Cash is essential.
Margaret Ferrier
Figures show that 70% of people prefer to use cash because they are concerned about the privacy of alternative forms of payments, and 49% said they used cash because of concerns about fraud. Does my hon. Friend understand the worries that a move to a cashless society could militate against consumer privacy and may leave sectors of society more vulnerable to fraud?
Martyn Day
I agree entirely with my hon. Friend’s good points. It appears to be something that concerns very many people. Research from Which? has shown that 82% of Scottish consumers are likely to keep cash in case electronic payments are down.
Patricia Gibson (North Ayrshire and Arran) (SNP)
My hon. Friend is making a powerful case about the importance of having the choice to use cash. Does he agree that access to cash is fundamental to this debate? In order for people to have the choice to use cash, access to it is at the basis of all that we are seeking to do.
Martyn Day
Absolutely, and I will come to that later in my speech. I hope the Minister takes cognisance of that well-made point.
There are also those who have valid privacy concerns about electronic payments. In an age of technology, algorithms, digital footprints and cyber-crimes, it is understandable that some—perhaps many—of our constituents would prefer the financial privacy offered by cash transactions. Some constituents wrote to me in recent weeks to make that point. Many stated that they regard barriers to using cash as a violation of their right to privacy. Cash clearly remains an important and valued part of our transactional landscape. As such, the ability to access and use cash must be protected.
In their response to both petitions, the Government state:
“The Government does not intend to mandate cash acceptance.”
They say that they will instead make provisions through the Financial Services and Markets Bill to ensure reasonable access to infrastructure such as withdrawal and deposit facilities. Of course, the availability of such infrastructure is clearly a concern for consumers and businesses. In Scotland, 53% of bank branches have closed since 2015, and since 2018 some 20% of Scotland’s free-to-use ATMs have closed. In many communities, banks have withdrawn completely, often leaving the post offices as the last place in town to do basic banking.
Damien Moore (Southport) (Con)
The hon. Gentleman is talking about banks closing; the bank on my high street is still open but will not give cash and directs people to the post office. Does he agree that it is appalling that we have banks on our high streets that are not providing the services that customers want?
Martyn Day
Absolutely; the hon. Gentleman makes a good point, for which I thank him. I am flabbergasted that a bank is not dealing with cash—it beggars belief.
The issues raised need to be addressed, but protecting access to cash is not the same as protecting the right to use cash—a right that, for many, amounts to an absolute necessity. For some of our constituents, not being able to use cash is a profound barrier in everyday life. Cash can be a vital means of budgeting. As noted in the 2019 access to cash review, that is especially true for those on lower incomes. The 2022 cash census identified that there are cash users who are highly dependent on cash for budgeting and would struggle to swich to digital payments. It concluded that 15 million people in the UK use cash to budget. That is backed up by the responses to the Petitions Committee survey: 61% of respondents stated that they use cash to budget.
Earlier, I touched on the impact of cash refusal on vulnerable groups, to which I now return. The access to cash review drew a stark conclusion. It identified that more than 8 million adults in the UK
“would struggle to cope in a cashless society. For many people in the UK, using cash is not a matter of choice, but of necessity.”
It highlighted that
“poverty is the biggest indicator of cash dependency”.
Dependence on cash is closely tied to barriers to digital connectivity—for example, for those living in rural areas and those with low or no digital engagement.
In its 2022 policy briefing on the subject, Age Scotland raised the importance of cash for older people. It highlighted that many on low or fixed incomes prefer to use cash to budget. It also noted that
“140,000 adults in Scotland do not have bank accounts”,
and that
“34%...of over 60s in Scotland do not use the internet”.
Furthermore, a 2020 survey by the Financial Conduct Authority explored the relationship between cash usage and factors including education, health and wealth. It noted that 26% of those in poor health use cash to a great extent, and that some people with physical or cognitive disabilities find payment methods other than cash difficult to use.
Margaret Ferrier
My hon. Friend is generous to give way again. It has been reported that about 10% of people have been unable to pay for medical supplies with cash. We know that older people and those with some physical and mental health problems prefer using cash. Is my hon. Friend concerned that certain societal groups may be at risk of being unable to access the medical care they require if they cannot pay with cash?
Martyn Day
That is a valid concern that I hope the Minister will address when he responds to the debate.
Some 8% of respondents to the Petitions Committee survey said that they had a physical or mental health issue that made using alternatives to cash difficult. The issues included bipolar disorder, anxiety disorder, depression, arthritis, visual impairment, cognitive disability and strokes. It is reasonable to conclude, therefore, that the impact of cash refusal is felt acutely by those on lower incomes, those who experience barriers to digital payments, those who are disabled, and those with physical or mental health conditions. Indeed, the Government acknowledge that in their response, stating that they want to ensure that vulnerable people
“have appropriate access to banking”
and payment services.
However, to reiterate my earlier point, protecting access to banking and payment provisions, although important, does not address the issue of cash acceptance. There is growing evidence that cash refusal is becoming a very real issue. The covid-19 pandemic has undoubtedly accelerated the cashless trend. As Which? research has shown, the pandemic led to an increase in the number of retailers that refuse to accept cash. The cash census similarly found that as the economy reopened in the summer of 2020, retailers were increasingly going cashless, with 42% of people reporting that they had visited a shop that did not accept cash in July 2020.
The results of the Petitions Committee’s survey also make for stark reading: 77% of respondents said that a business had refused to let them purchase something with cash, with the most common refusals of cash coming from restaurants, takeaways and transport; and 88% said that cash refusal had a large or moderate impact on them, describing feelings of embarrassment or anxiety as a result.
Our daily lives are filled with examples of the cashless trend as the consumer experience becomes increasingly dominated by technology, from bus companies encouraging people to use contactless payments to card-only self-checkout machines in supermarkets. However, the march towards cashless risks the exclusion of a great many people and a profound and negative impact on their lives.
The Government’s current position of focusing on infrastructure but ultimately leaving the decision in respect of cash acceptance to individual businesses simply does not go far enough. It is essential that gaps in the provision of banking facilities are addressed so that people can access cash easily in their community and small business owners do not have to travel many miles to access deposit facilities. However, that alone does not guarantee cash acceptance. It is a difficult issue for many businesses, especially where the ability to deposit cash might involve lengthy journeys away from their business.
The Association of Convenience Stores advises that 60% of transactions in independent convenience stores are paid in cash, and that 99% of shops in its sector continue to accept cash, with retailers striving to give customers access to their preferred payment options. While supporting access to cash to facilitate financial inclusion, the ACS would rather the decision on what payment methods to accept be left to individual businesses and not mandated by the Government, whereas an overwhelming 98% of respondents to the Petitions Committee survey agreed with the petitioners that shops and services should be required to accept cash. This is clearly an issue that affects and concerns many of our constituents, customers and businesses alike. The Government need a plan to ensure that those dependent on cash are not left behind, and part of that must be about protecting their right to use cash.
The UK Cash Supply Alliance has called for businesses to be required by law to accept cash payments for in-person services equivalent to the maximum value of contactless transactions. In their response, the Government talk a lot about what is reasonable—“reasonable access”, “reasonable provision” and so on. Ensuring that individuals and businesses have easy and convenient access to banking facilities is not only reasonable but essential, and a requirement to accept cash for lower-value transactions is also reasonable. To have the certainty that when we walk into a shop or restaurant our cash will be accepted is reasonable and, for many, vital. The Government can and must act to protect access to cash, the ability to use that cash, and the ability of businesses to easily deposit that cash. Those are very much connected issues, and they must be equally addressed.
This is a complex issue, and I am aware that I have touched on a lot of different factors in a short space of time. Indeed, I could have touched on many other factors, but I look forward to comments from other Members. I have covered some factors in more detail than others, and I look forward to the Government’s response at the end of the debate.
Martyn Day
On behalf of the Petitions Committee, I extend my thanks to all Members who came along today to make speeches or interventions. We have had a reasonable and well-informed debate, which has very much summed up the changing nature of the relationship with cash in our society. This issue goes to the heart of choice, financial inclusion, budgeting and privacy, all of which show how vital the access to and use of cash are for many of our constituents, in particular the most vulnerable. I remain of the view that it would be perfectly reasonable to have a legal requirement for a minimum level of acceptance of cash by retailers for in-person transactions.
Question put and agreed to.
Resolved,
That this House has considered e-petitions 605030 and 622284, relating to the acceptance of cash.
High Income Child Benefit Charge
Martyn Day Excerpts(1 year, 2 months ago)
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Martyn Day (Linlithgow and East Falkirk) (SNP)
I beg to move,
That this House has considered the High Income Child Benefit Charge.
It is a pleasure to serve under your chairmanship, Mr Stringer. I put on record my thanks to the hon. Members who supported my application for this debate, and to the Backbench Business Committee for granting it and the Minister for attending.
I invite the House to consider the unfairness of the high income child benefit charge, and the ineffectiveness of its administration. The high income child benefit charge, which for brevity I will forthwith refer to as “the charge”, has its origins in the 2010 Conservative party conference, when George Osborne—the Chancellor at the time—proposed withdrawing child benefit, a previously universal benefit, from higher-rate taxpayers. One might initially approach that as a reasonable proposal; however, the reality is that the charge has consequences for some who do not consider themselves to be on a high income, as it ignores family size, how many earners are in the household, and what disposable income is available after basic needs such as food, housing and energy costs are all met.
Mr Osborne modified his proposals in the 2012 Budget, and went on to announce that, from January 2013, child benefit would be clawed back from families when the highest earner had an adjusted net income of between £50,000 and £60,000. The detail of how the adjusted net income works after taking account of any gift aid or pension contributions, and how those with a £60,000 adjusted net income effectively lose all entitlement to child benefit, was well set out in Westminster Hall by the hon. Member for South Thanet (Craig Mackinlay) during a debate that he secured on the charge in 2019.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind)
I congratulate my hon. Friend on securing this debate. The high income child benefit charge is too complicated, which leads to many households that are entitled to child benefit not claiming it. What they may not realise is that not claiming means that they do not accrue the national insurance credits that claimants are given until a child turns 12, impacting on state pension and other benefits if one parent is not working. Does my hon. Friend share my concerns about that knock-on effect?
Martyn Day
I do indeed share my hon. Friend’s concerns, and I will come on to them in my speech, although she has summed them up more succinctly than I have in the verbiage I am about to read.
In the previous debate, the hon. Member for South Thanet said that he had
“not found figures for how much the clawback and the lack of take-up of child benefit have saved the Treasury”—[Official Report, 3 September 2019; Vol. 664, c. 60WH.]
but estimated it to be £2 billion to £3 billion a year. I would be interested to know from the Minister whether the hon. Member’s estimate was accurate; I will return to the financial implications of the charge later. The hon. Member went on to say that its administration was
“a salutary lesson in how not to withdraw a universal benefit through the tax system. What we have on the statute book, which runs to many tens of pages of tax law, is the truly mad basis of trying to claw back a benefit. It is not related to overall family income, which many people describe as one of the real drawbacks of the system.”—[Official Report, 3 September 2019; Vol. 664, c. 63WH.]
I have several constituents who agree with the hon. Member—indeed, this goes to the heart of why the charge is seen as unfair. One of my constituents, Andrew Malloy, summed it up when he asked why a family with one parent earning £50,100 could be hit with a tax payback, while a family with two parents earning over £49,000 each was not affected. He has a valid point: a household with a total income of over £99,000 can still receive its full entitlement to child benefit. Shaun Boyle also struggles to understand why that is the rule, as households earning much more than his are entitled to benefits that his household is not. After deliberations, he concludes that
“this cannot be a fair system.”
From my questioning and research, I am inclined to agree with him entirely.
David Stuart is another constituent who stopped his child benefit payments in 2018 after only becoming aware of the high income tax threshold when his second child was born in November 2017. However, that did not stop His Majesty’s Revenue and Customs pursuing him for an overpayment of £6,000 with interest and five years of penalties covering the years from 2016 to 2020 for his two children. I raised David’s case directly with HMRC. It agreed it had made an error both in its assessment and in asking him to contact the child benefit office to get proof of the cessation. The HMRC respondent added:
“I will be providing feedback to the business in order to learn from our mistakes and avoid the same from happening again in the future.”
So far, so good. But David had to contact me again just last month as he had once again been asked to provide proof of how much child benefit had been paid. It therefore appears no action was taken to rectify the failings highlighted in his initial complaint, which HMRC said it was going to address.
David also raised the Wilkes case with me, on which the Court of Appeal ruled on 7 December last year. For those not familiar with the case, it addressed whether HMRC could impose the charge by means of “discovery assessments”, which allow HMRC to demand tax outside of the normal four-year assessment limit. The Court of Appeal conclusively determined that HMRC was wrong to impose the charge by discovery assessments—not just in the Wilkes case but on hundreds of thousands of taxpayers in the UK.
Yet a retrospective change in tax law that was announced by the then Chancellor, the right hon. Member for Richmond (Yorks) (Rishi Sunak), in his 2021 Budget, which was then enacted in sections 97 to 99 of the Finance Act 2022, meant that HMRC ensured in advance of the Wilkes judgment that the hundreds of thousands of other taxpayers who were similarly subjected to the charge discovery assessments could not benefit from the Wilkes case.
As David’s case was delayed awaiting the Court of Appeal judgment, he has now received a further discovery assessment for the charge between the 2016 and 2018 tax years. Understandably, he is “totally miffed” that one person’s case was upheld against HMRC, yet HMRC can continue to pursue others in exactly the same circumstances. In light of the Wilkes case, David hopes that today’s debate will shine a light on the poor handling and unfairness of the discovery assessments.
Another constituent, Stephen Waldron, calls the charge “wholly unfair” because child benefit is a payment to support people with the additional cost of raising a family. Stephen also says the charge is “unjust” because it is not based on a household’s total income. He has questioned why, when people decide to pool their resources and live and raise a family together, does the charge not reflect that? Perhaps the Minister can answer that question for Stephen today.
It was 2006 when Stephen first claimed child benefit. In 2013 he received a letter to advise he was not entitled to it, but it continued to be paid over the next seven years by HMRC, who then reclaimed it and blamed Stephen for not telling it. What really upset Stephen was that the demand for over £8,200 included interest and a 20% penalty for “failure to notify” the tax office to file a self-assessment for all those years, despite HMRC being fully aware of his household’s finances.
The circumstances of Stephen’s experience with HMRC over the charge was robustly argued in the 2019 debate, yet nearly two years later HMRC has not dealt with the previous criticisms of its practices. Things worsened for Stephen and many others as the clawback came in the midst of the covid-19 pandemic at a time when job stability was under one of its greatest threats, and he had to use his “safety net savings” to pay the demand.
I fully appreciate that the abbreviated examples of my constituents that I have highlighted today do not reflect the sense of injustice and stress that they have felt. None the less, it is important that the empirical impact of such an unfair policy is illustrated by individual experiences.
I have been tabling parliamentary questions on the charge since April 2019, after it was first brought to my attention. The answers I received at that time stated:
“If total household income was taken into account, information on the incomes of everyone in each of the eight million households receiving Child Benefit would need to be collected and would effectively introduce a new means test. The Government’s approach withdraws Child Benefit from those on high incomes, whilst having no impact on the majority of claimants.”
That implies that the charge affects only a minority. On means testing, the answering Minister in the 2019 debate stated that this would create
“a substantial administrative burden on both the state and families.”—[Official Report, 3 September 2019; Vol. 664, c. 73WH.]
However, we should not forget that the increase in the number of self-assessments that the charge creates brings its own administrative burden.
Another written answer, which referred to the £50,000 and £60,000 thresholds, said:
“The Government believes these are currently the correct level for the HICBC thresholds, but as with all elements of tax policy this remains under review as part of its annual Budget process.”
Those answers are in keeping with the response to a petition I presented in October 2021, which urged the UK Government to re-examine the charge policy to address the disparities it creates and ensure that any revised threshold was aligned with the basic-rate tax threshold. The basic rate of tax breached the £50,000 threshold on 6 April 2022 and thereby brought basic rate taxpayers within the scope of the charge. It is therefore operating beyond its original policy objective to affect higher rate taxpayers.
After presenting the petition and receiving the Government’s response, I was contacted by a non-constituent who works in financial services, thanking me for presenting the petition as it was
“of national interest to any tax payer who earns over £50,000 GROSS per annum”.
They went on to refer to the Government’s response as seeming to say that it was
“too hard to calculate for little benefit”,
and suggested that indexing the base threshold of £50,000
“would be a simple but effective solution to hundreds of thousands of households.”
I am aware of a letter from the Treasury, dated 26 January 2023, that dismisses the suggestion to index the threshold of the charge as it
“only affects a minority of Child Benefit claimants whilst helping to ensure the fiscal position remains sustainable.”
It appears that the Treasury’s position is somewhat conflicted. On the one hand, it thinks the threshold that was set for the charge 10 years ago is regarded as “high income”, and on the other it thinks it is acceptable for the basic rate tax band to breach this threshold.
Another tax-related conflict arising from the charge is that, although ignoring total household income and focusing on the single or only highest earner, at the same time it breaches the principle of independent taxation. It just does not add up to me.
That brings me back to the financial implications of the charge. When claiming child benefit, an affected individual can receive child benefit payments and pay the charge at the end of each tax year by means of self-assessment, and that is the case even if they are employed and normally pay their tax through pay as you earn. Alternatively, they can claim child benefit, but choose not to receive the payments and hence not pay the charge. That is known as “opting out”, and that is what my constituents David and Stephen, whom I mentioned earlier, have chosen to do. However, opting out impacts tax revenue going into the Treasury, with the most recent available figures showing a £15 million drop between the tax years 2013-14 and 2019-20. If the Minister is able to give figures for how much the clawback and the lack of take-up of child benefit have saved the Treasury, it would be helpful to know that the drop in tax revenue has also been accounted for in any figures that might have been found.
The drop in revenue is surprising when we consider that 7,000 more individuals have declared a liability for the charge over the same period. I would be interested to hear any explanation for that anomaly. The most recent available figures also show that the number of people who opted out of receiving child benefit increased by 252,000 between 31 August 2013 and the same date in 2021. That is 252,000 more families being impacted by the charge over an eight-year period. By my reckoning that is a rapidly growing minority, but a minority is what the Treasury’s response from 26 January still insists it is.
Of course, those figures do not account for those who do not make a claim for child benefit. Not everyone with a gross adjusted net income of £50,000 will go through the process of claiming child benefit, which effectively signs them up to completing a yearly self-assessment for the charge.
The latest data on child benefit from August 2021 shows a decrease of 122,000 families claiming child benefit when compared with the previous year, which equates to 215,000 children. Many people will see claiming child benefit as a complete waste of time and effort for little or no gain, or they will simply not make the claim to avoid finding themselves in a position similar to my constituent David, who was pursued for a period that he had opted out of. Therein lies a danger, because those who do not make a claim to child benefit due to the thresholds of the charge, will lose out on vital national insurance credits that protect their entitlement to contributory benefits, not least the state pension. That situation invariably affects many women.
There is also the scenario that, for various reasons, not everyone is aware of what their partner earns, respecting the principle of independent taxation. That further deters those people from making a claim for child benefit and, again, it is mainly women who lose out. Will the Minister advise me today if there is any way for women, or indeed affected men, caught in those circumstances to make a retrospective claim for national insurance credits? If not, can that be rectified at the earliest opportunity?
Another unintended consequence of not claiming child benefit is that the child is not then automatically allocated a national insurance number when they reach the age of 16. The scale of that future impact can only be imagined if we use the latest data on child benefit that shows that that will affect 215,000 children in just one year.
Referring to the number of families who claim child benefit, the latest child benefit statistics state
“following the introduction of the HICBC in January 2013, these figures decreased sharply…Following the sharp decrease in August 2013, there has been a downward trend in the number of families and children for whom Child Benefit payment is received. In August 2021, the number of children for whom Child Benefit payment is received is at its lowest level since HM Revenue & Customs (HMRC) began producing these statistics in 2003.”
Given the passage of time since its introduction and the constraints of the current economic climate, does the Minister not agree that it is time to address the many failings of the unfair high income child benefit charge? Is it not time to finally review this flawed policy, make it fit for purpose and thereby truly support households with children?
Ultimately, the best solution to meet the needs of families in my constituency is for the full powers of social security and taxation to be in the hands of the Scottish Parliament. Meanwhile, I hope the Minister will join me, my constituents and organisations such as Child Poverty Action Group in calling for making child benefit a universal benefit again, restoring the value of child benefit and increasing the take-up of child benefit. At the very least, will the Minister commit to reviewing the current policy?
Martyn Day
I am grateful to hon. Members who attended and supported the debate. I am grateful to the Minister for her comments. It will probably not come as a surprise to her that I remain convinced—perhaps even more so—that universality is the easiest and simplest way to resolve the problems that the system has.
One way or another, my constituents still face so many anomalies, with the obvious one being family income versus that of the individual. There is also the fact that the rates have not changed in such a long period of time, so something needs to be reviewed. I look forward to becoming a firm pen friend of the Minister as we go further through these debates.
Question put and agreed to.
Resolved,
That this House has considered the High Income Child Benefit Charge.
Economic Update
Martyn Day Excerpts(1 year, 6 months ago)
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Jeremy Hunt
It is because I want to be able to invest in public services like the ones the hon. Member talks about that I think it is so important to take tough economic decisions at times like this. All I would say is that, while she and I have a different viewpoint on many issues, her party has supported the decisions I have taken today, and I think that was the right thing.
Martyn Day (Linlithgow and East Falkirk) (SNP)
After the Chancellor’s televised statement earlier, gilt prices rose and the yield on them fell, thereby reducing their effective interest rate. Does he recognise that the markets have effectively factored in the removal from office of the Prime Minister and what does he think will happen if that does not happen?
Jeremy Hunt
One of the first lessons I was told as Chancellor is never to speculate on why markets do what they do and I am not going to break that today.
Tackling Short-term and Long-term Cost of Living Increases
Martyn Day Excerpts(1 year, 11 months ago)
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Martyn Day (Linlithgow and East Falkirk) (SNP)
I probably should not be that surprised that the Queen’s Speech does nothing to tackle the Tories’ cost of living crisis, because they have done virtually nothing over recent years on the underlying causes. Many of my constituents fall into the groups that are hardest hit—the poorest, the elderly and those in remote parts of the country. They are being hammered by soaring inflation, fuel prices and energy prices, yet the Government have continually dragged their feet over the energy crisis. They have had to be forced to debate fuel poverty and energy price caps, but sadly without any effective outcomes.
The publication of the energy strategy and the announcement of the energy Bill offer nothing either to help with the cost of living crisis or to improve energy efficiency, which would permanently help to reduce people’s bills. The rise in energy prices impacts hardest on the poorest families in our society. The poorest single adult households are now spending 54% of income, after housing costs, on energy. That is simply not sustainable.
The Queen’s Speech is yet another example of missed opportunities. It fails to fix known problems with universal credit, such as the five-week wait, the benefit cap and the two-child limit, pushing more families further into hardship. It does nothing about the appalling state of pensions in the UK. We have the worst pensions in Europe; they are equivalent to 20% of average earnings, compared with the OECD average of 40%. That is utterly appalling, and many of our pensioners now face the stark choice between heating and eating. The abandonment of the triple lock on pensions takes hundreds of pounds out of their pockets at the very time when energy bills are soaring through the roof and they face serious issues over food security and prices.
We should not forget either that, even before the current turbocharging of this crisis, malnutrition in the UK has tripled—I state that again: it has tripled—since the Tories came to power in 2010. One in 20 people in the UK are affected by malnutrition and this Government’s inaction will only make that situation worse.
This week, Andrew Bailey, the Governor of the Bank of England, said:
“It is a very, very difficult place for us to be. To forecast 10% inflation and then say…‘There’s not a lot we can do about 80% of it’”.
I will tell the House what I would do about it: we need an emergency Budget; we need to slash VAT on fuel prices; and we need to impose a windfall tax on the companies that have benefited both through the pandemic and in the current crisis. I say to my constituents in Scotland: if you want joined-up policy making from Government and to tackle these issues, you need to get independence, because we will not get the action here.
Madam Deputy Speaker (Dame Eleanor Laing)
And the prize for patience and perseverance goes to Zarah Sultana.
Yazidi Genocide
Martyn Day Excerpts(2 years, 2 months ago)
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Martyn Day (Linlithgow and East Falkirk) (SNP)
I am grateful to my hon. Friend the Member for Argyll and Bute (Brendan O'Hara) for securing this important debate and for his important work with the all-party parliamentary group, championing this issue over recent years. As we have heard, the Yazidis are a religious minority primarily residing in northern Iraq. Yazidism is one of the world’s oldest monotheistic religions and has survived many genocides throughout history; a figure of 74 genocides has been quoted by the Yazidis themselves.
In August 2014, Yazidis were attacked by Daesh, who then controlled significant amounts of territory in Iraq and Syria. In addition to the attacks against the Yazidis, Christians, Mandaeans, Turkmen, Shabaks and other minorities were also targeted. There was mass slaughtering that wiped out entire villages, forced conversions, thousands of young women sold into slavery and raped and young boys trained as child soldiers. Figures from last year estimate that there were some 200,000 displaced Yazidis, with thousands of women and girls missing, still in Daesh captivity. It is estimated that more than 5,000 were killed, although the actual number is uncertain, as is the number captured or missing. Unquestionably, the treatment of this minority is an atrocity and something that we can all unite in calling out. We can also all unite in our opposition to Daesh, and in sympathy with the plight of the Yazidis.
However, the question is, what can be done about it? What can we do to help, and how can we hold the perpetrators of this violence to account? We have already heard quite a number of constructive suggestions, but so far, very few of the perpetrators have been brought to justice. Recognising the atrocities as genocide, and as crimes against humanity, is therefore a first key step.
In 2016, a UN human rights panel and the US Secretary of State, John Kerry, described the actions against the Yazidis as constituting genocide. A further UN investigative team in 2021 concluded that there was “clear and convincing evidence” of genocide. As we have heard, in April 2016 this Parliament unanimously voted—278 to nil—to recognise the Daesh atrocities against the Yazidis, and others, as genocide. As we know, the UK Government did not recognise it as genocide, instead standing by their policy that determination of genocide is a matter for a competent court to decide, rather than Governments. Competent courts include the International Criminal Court, the International Court of Justice and national criminal courts, so it is significant that the German court found a Daesh fighter guilty of genocide on 30 November 2021—the first genocide conviction of a Daesh fighter in the world.
The UN Investigative Team to Promote Accountability for Crimes Committed by Da’esh/Islamic State in Iraq and the Levant works to prepare evidence to support national authorities’ efforts to bring prosecutions. It has identified 1,444 potential perpetrators of attacks against the Yazidis.
While usually a state only has jurisdiction if crimes happen on its soil, or are committed by its nationals or against its people, the Germans, as we have heard, used the principle of universal jurisdiction—a principle that came into existence following the second world war, as some crimes were considered so grave that they could be prosecuted universally, irrespective of where they took place. That verdict by a competent court must surely now lead to the UK’s recognising the crimes as genocide. I add my voice, and those of my party, to calls for the UK to do that.
There is so much more that I would like to see the UK Government do. Hundreds of thousands of Yazidis now live in displacement camps, and have for seven years. Without a timeline to close those camps, there is no end to the misery and displacement in sight. Kris Phelps, of the British charity War Child—one of the few international non-governmental organisations still working in the Yazidi camps—said:
“Yazidis feel betrayed by their neighbours, forgotten by their government, and the provision of aid is dwindling…It’s really striking to see the surge and ebb in attention the Yazidis have received”.
UK aid should be supporting those desperate and largely ignored families but, as we know, UK bilateral aid into Iraq has all but dried up. We ask, therefore, that the UK Government provide more bilateral aid and improve funding to the United Nations Development Programme’s funding facility for stabilisation, providing some basic services in Iraq.
On top of that form of abandonment, the UK Home Office has so far not taken a single Yazidi refugee. That should be contrasted with the UK Government’s having spent £8.4 billion on military operations in Iraq between 2003 and 2009. More needs to be done. The UK must work with international counterparts to help trace the thousands of missing Yazidis, and to advocate for and better fund the full provision of the Yazidi survivors law, which passed in Iraq in March 2021.
Perhaps the Minister can explain why the UK Government still do not have a whole-of-government atrocity prevention strategy, or why they do not designate the destruction of cultural heritage as an early warning sign of atrocity crimes—something that happened in the Yazidi case—in line with the requirements of the UN framework of analysis for atrocity crimes. It is not good enough. Atrocities are becoming more commonplace across the globe, and there appears to be a rising sense of impunity among the perpetrators. Only one person has been convicted following the atrocities committed against the Yazidi people.
I hope that the Minister will step up to the mark and show willing for the UK to take the lead in rectifying those wrongs. A good starting point is with the recognition of the crimes as genocide. Then, perhaps, the UK Government could press for the use of universal jurisdiction to be replicated by Governments around the world in such cases. We need to improve legislation globally and avoid loopholes through which perpetrators can escape justice. More support from the UK Government must be provided to Kurdish and Iraqi authorities to help them improve their judicial systems. We also need to tackle questions of immunity of senior Syrian officials to make sure that nobody stands above the law. In short, we need firm action—not lip service.
Economy Update
Martyn Day Excerpts(2 years, 10 months ago)
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Martyn Day (Linlithgow and East Falkirk) (SNP) [V]
Last year, when faced with the second wave of covid-19, the Scottish Government called for an extension of furlough as Scotland went into a further lockdown. However, the Tories only extended the scheme when it was clear that the south of England needed to be placed under tighter restrictions. Does the Minister agree that if Scotland is to be treated as an equal partner in the United Kingdom, furlough must be available if and when we need it?
Steve Barclay
The furlough is available—it extends to the end of September—but the hon. Gentleman seems to be suggesting that it is there almost indefinitely, as opposed to being an exceptional measure in response to the exceptional circumstances of the pandemic. Given the wider fiscal cost, not least the £352 billion spent to date, I do not think that that would be fiscally responsible.
Vaccine Passports
Martyn Day Excerpts(3 years, 1 month ago)
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Martyn Day (Linlithgow and East Falkirk) (SNP) [V]
It is a pleasure to participate virtually in today’s debate under your chairmanship, Sir David. I commend my Petitions Committee colleague, the hon. Member for Hartlepool (Mike Hill), for his opening speech on behalf of the Committee. The impressive manner in which he spoke set the scene for the rest of the debate.
This is one of the more interesting debates to emerge from the coronavirus pandemic. It has implications for health and business, and there are serious ethical questions. This is not some theoretical or abstract debate; it has considerable real-world implications for us now. As part of their reviews of easing lockdown restrictions, the UK Government have declared that they will review the ethics and legality of vaccine passports—domestic covid certificates for UK businesses, venues and hospitality.
Saga, which specialises in holidays for the over-50s, says that passengers on its 2021 holidays or cruises must be fully vaccinated. Australian airline Qantas says that travellers will eventually need to prove that they have had a vaccination to board its flights. Some UK businesses have declared that all employees must be vaccinated or face a review of their contracts. However, the legality of that has been disputed by employment lawyers and trade unions. The Justice Secretary has said it may be legal if it were written into contracts.
Israel has developed the Green Pass mobile app to show that a person has received a covid vaccine. It can be used to access indoor seating and restaurants and to attend events in stadiums, among other things. In the US, President Biden announced an assessment of the feasibility of linking covid-19 vaccination to international certificates of vaccination or prophylaxis—ICVPs—and producing electronic versions.
I have asked numerous parliamentary questions over the past year about vaccine passports, as it is an issue that I know interests many constituents, with views both in favour and against. There are many ethical considerations, with arguments that passports are discriminatory. Vaccine hesitancy is more likely in black and minority ethnic communities, and cultural uncertainty exists. Poorer communities are also less likely to be vaccinated. Some people are medically excluded from vaccination. Issues such as whether a child is vaccinated might also be influenced by wealth, parental education or even just the place of residence. Then we have issues around data protection of any scheme, the security of it and the risk of fraudulent or fake certificates, which could undermine the process. There are questions as to how long certificates would be valid.
Taking every step to eliminate the virus needs to be our priority. However, the top priority right now must remain the successful continuation of the vaccine roll-out. While agreeing on 15 January 2021 to further investigate the efficacy and utility of vaccine passports, the World Health Organisation’s Emergency Committee on Covid-19 made the following recommendation to states:
“At the present time, do not introduce requirements of proof of vaccination or immunity for international travel as a condition of entry as there are still critical unknowns regarding the efficacy of vaccination in reducing transmission and limited availability of vaccines. Proof of vaccination should not exempt international travellers from complying with other travel risk reduction measures.”
That is sound advice in my opinion.
In their response to the petition, the UK Government have said:
“The Government is reviewing whether COVID-status certificates could play a role in reopening parts of our economy, reducing restrictions on social contact and improving safety.”
The Scottish Government are also considering the role that a vaccination certificate might have. However, it is too soon to introduce any form of certification. Experts and Ministers still need to know more about the efficacy of the vaccines, their impact on transmission and the length of immunity before it is safe or sensible to introduce a vaccine certificate. To this end, the Scottish Government continue to engage with international developments in relation to covid-19, including on the subject of vaccine certification. This includes consideration of technical details, ethical and equality issues, and of course privacy standards. The outcome of those discussions will guide the Scottish Government’s work in this area. A vaccine certificate could play a valuable role, but there are various issues to work through, not least the significant equalities issues with allowing freedoms only for people who are vaccinated.
It is worth remembering that vaccine passports are really a new name for something that is not a new idea. Indeed, they have been almost universally adopted or supported at various points in history. The first international certificate of vaccination was introduced in 1944 as proof of vaccination against smallpox. Throughout the following decades, it led to a significant reduction in the international spread of the disease, as ever more travellers were required to be vaccinated. After the declared eradication of smallpox in 1980, the smallpox-specific certificate was cancelled, but the precedent has been established and countries have continued to adopt vaccine regulations when a significant risk is posed to public health.
Several countries already have some form of vaccine passports in place, requiring proof of vaccination documented on an international certificate of vaccine or prophylaxis before people enter or leave the country. Indeed, like many others, I already have such a certificate. Polio vaccinations are still mandatory for travellers to and from countries that are still afflicted by this terrible disease, and many countries require proof of vaccination for yellow fever for all arriving travellers. This applies even to those travelling from somewhere not designated by the World Health Organisation as a yellow fever risk country, so we have plenty of examples on which to draw.
With regard to covid, a number of other countries require all international travellers to stay in designated hotel on arrival, generally at their own expense, which has proved effective in minimising the risk of importing new cases. The Scientific Advisory Group for Emergencies has reportedly advised that only a universally applied policy will be effective in reducing the risk of importation, and the joint biosecurity centre has made it clear that a blanket approach to managed isolation is required, as it cannot confidently assess the risk of new variants appearing in other countries.
Unfortunately, the UK Government continue to rely on a targeted approach for international arrivals. As a result, the Scottish Government’s approach goes further than England’s and requires all international arrivals to enter hotel quarantine. This has been managed as part of a four-nations approach, with the UK Government managing the online booking system and the hotel contracts. The Scottish Government continue to press the UK Government to adopt a more comprehensive approach and to quarantine all international rivals. The SNP’s preference is for a consistent quarantine rule across the UK to effectively prevent new variants from entering Scotland and undermining the vaccination programme.
One of the challenges of the certification approach is that experts around the world are still learning about the vaccine’s effect on things such as the transmission of the virus—a challenge that has been recognised by the World Health Organisation and SAGE. The Scottish Government continue to engage in international developments in relation to covid-19, including vaccination certification. These discussions are led globally by the World Health Organisation and will include consideration of technical details, ethical and equality issues, and privacy standards. As I said earlier, it is too early yet to assess whether this is viable, but it is appropriate for Governments to continue to keep the vaccine certification under review, as further evidence around vaccines and immunity emerges.
In conclusion, there may be some merit to certification in areas such as international travel, but we need to be wary of creating some dystopian future where those with a recent vaccination can lead a full and normal life while those without become second-class citizens, with severe restrictions on their freedoms. Of course, neither the Scottish nor the UK Government will have the authority or power to stop other countries from requiring travellers to take the coronavirus vaccine before going to those countries, but what we do here is up to us. Keeping the matter under review is probably the correct position for the time being, so let us stay focused on getting people vaccinated and eliminating the spread of the virus.
Economic Update
Martyn Day Excerpts(3 years, 3 months ago)
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Rishi Sunak
My hon. Friend is right: our innovative companies are a great strength of the UK economy compared with others and they will help drive our recovery. That is why we put in place the future fund, which was an unprecedented intervention to help 1,000 of our fastest-growing start-up companies with match funding. Innovate UK also made available £500 million of additional grants and loans through its innovation schemes, and most recently, we have committed extra funding for our start-up loans scheme next year. Taken together, it is a significant vote of confidence in those innovative companies, and I look forward to hearing from her other ways that we can support them to help drive our recovery.
Martyn Day (Linlithgow and East Falkirk) (SNP) [V]
Last week, when I challenged the Prime Minister over the lack of support for the 3 million excluded, he claimed that they had “not been excluded”, so can the Chancellor spell out what is being done to make the PM’s word a reality, as I did not hear anything today that will give meaningful support to my constituents who have had 10 months of zero income or Government help?
Rishi Sunak
It is just not right to say that people have not been able to receive any support. Obviously, I cannot comment on the individual circumstances of every single person, but we have put in place £280 billion of direct support in a multitude of different ways, and then there is additional support that is not even fiscal—for example, mortgage holidays, which now one in six, or one in seven mortgage holders have taken advantage of. So yes, it may be the case that people have not been helped in the exact way they wanted, but with £280 billion of support in literally 20 different ways, this Government are doing what they can to provide reassurance and security to millions of people and businesses through this difficult crisis.
UK-EU Future Relationship Negotiations and Transition Period
Martyn Day Excerpts(3 years, 4 months ago)
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Penny Mordaunt
I thank my hon. Friend for his question. I do hope that next year, as we hopefully recover from the covid pandemic and make progress on the phased approach to the border and all the other things that we have been working so hard to put in place, we will really be able to turn to how we get economic growth happening across the whole United Kingdom and ensure that communities such as the one that he represents get the investment that they need and the opportunities that they deserve.
Martyn Day (Linlithgow and East Falkirk) (SNP) [V]
Scottish Government modelling of a basic trade agreement of the type that the Government are still trying and, it would appear, failing to negotiate finds that Scottish GDP is estimated to be 6.1% lower by 2030 compared with continued EU membership. That equates to an equivalent cost of around £1,600 for each person in Scotland, and that now looks like the best-case scenario. What assessment have the Government made of the combined impact of Brexit on top of the already severe impact on business and those about to lose their jobs due to the covid crisis?
Penny Mordaunt
What we need to be focusing on is how we ensure that, in every part of the UK, we can get the economic growth that we need and the infrastructure investment that we need. There will be opportunities that come from some of the investments that are being made over the transition period, and I would ask the hon. Gentleman to turn his energy and focus to those issues. We have left the EU. We will hopefully have news of a deal, but we will certainly have certainty for all our businesses and constituents in the coming days. We need to turn and look to the future and how we can help realise our constituents’ ambitions, and I encourage him to do that.