National Insurance Contributions (Secondary Class 1 Contributions) Bill

Patrick Spencer Excerpts

2nd reading
Tuesday 3rd December 2024 Commons Chamber

[Mr Mark Sewards (Leeds South West and Morley) (Lab)]

It is clear to everyone on this side of the House that the measures in the Bill are a vital step towards securing the long-term stability of the public finances. We are not prepared to continue with the fiction that no difficult decisions are required to balance the books. Unlike the Conservatives, this Labour Government are not interested in more decline, more austerity or forcing the poorest in society to pay for the previous Government’s mistakes.

The decisions that we are taking are not easy. Increasing employer national insurance contributions to 15% is not easy. Reducing the secondary threshold to £5,000 is not easy. And, of course, constituents are absolutely right to ask me why this is happening. Well, that question would be best answered by the Conservatives.

The Conservatives crashed our economy, mortgage rates went through the roof, and billions of pounds of taxpayers’ money was wasted on a failed asylum system and on dodgy covid contracts. They promised the victims of the infected blood scandal that they would be compensated, but they did not put a single penny aside for it. They promised the same for the sub-postmasters. They promised 40 new hospitals, but they did not allocate anywhere near enough money to deliver them, and they are still pretending that they would not have given a single penny in pay rises to our public sector workers.

The Conservatives spent the national reserve three times over in the first three months of this financial year, and all before calling an election they expected to lose, so somebody else could clean up the mess. They chose to govern not in the national interest, but in their own interest. Some Conservative Members have been brave enough to come to the House today and remind us of their great legacy, but I have to tell them that 14 years of failure and a £22 billion black hole, leaving our nation on the brink of bankruptcy, is their legacy.

By making changes to national insurance contributions, we will be able to provide the funding to public services that is desperately needed, including, but not limited to, investing £25 billion in our NHS, recruiting 6,500 new teachers and providing local authorities with £600 million for social care.

[Patrick Spencer (Central Suffolk and North Ipswich) (Con)]

On that point, will the hon. Gentleman give way?

[Mr Sewards]

I will not, as I want to ensure everybody gets in.

In addition, we are committed to protecting small businesses by increasing the employment allowance to £10,500. We are blessed in Leeds South West and Morley with hundreds of small businesses, right across the constituency, from Queen Street in Morley, to Wortley, and back again to Ardsley. I can say to many of them that the changes will mean that many small businesses will pay the same or less than they do now.

We will not run away from the difficult decisions—we back our country to succeed. Given the obvious opposition of Conservative Members to the measures, I ask them, how will they pay for our public services? Perhaps I need to give way at this point.

[Patrick Spencer]

I serve on the Education Committee with the hon. Gentleman, and I wonder what he will say to people who work in the education sector, many of whom are low paid and running schools that support teaching assistants to work with children with special educational needs and disabilities. They now face a bigger wage bill because of the measures the Government are introducing. Will the hon. Gentleman address those points?

[Mr Sewards]

In the minute remaining to me, I gently say to the hon. Gentleman that he needs to have a word with the Leader of the Opposition. The simple truth is that she has welcomed the positive spending plans that we have put forward in the Budget, but has rejected every revenue-raising measure we have suggested.

We are going to take the tough decisions, including those set out in the Bill, to fix the foundations of our economy and restore our public finances. The choice is pretty clear: a Labour Government who invest in our country’s future or a Conservative party still obsessed with fantasy politics based on saving the party, not our country. The choice is clear, and I know which side I am on.

--- Later in debate ---

[Dan Tomlinson (Chipping Barnet) (Lab)]

It is good to speak in this important debate. This is an issue of much importance, in part because it touches on trust in politics. We know from looking at the datasets that trust in politics has fallen to a record low in this country. People sadly do not trust politicians any more to deliver on the commitments they set out in their manifestos and to bring the change necessary to improve our public services. That is the data we can see, and we can see it because of the decisions of the Conservative party.

[Patrick Spencer]

Does the hon. Member not think that the fact the Labour party went into the last general election promising not to raise taxes on working people might be part of the problem?

[Dan Tomlinson]

We have stuck to the commitments we made in our manifesto, and that is why the British people will see over the months and years to come that they voted for change and investment in our public services, and that is what this Budget makes possible.

When we came into power in July, we faced a difficult economic inheritance. I wish we had taken power in more benign circumstances, but Opposition Members will know that public sector debt had increased to 100% of GDP—the same size as the economy—and trillions of pounds, constraining our ability—[Interruption.] They are chuntering from the Front Bench, but it is true that public sector debt increased to 100% of GDP—a massive increase on the Conservatives’ watch—making it more difficult for us to manage the public finances in a sustainable way, which is what we want to do and what they failed to do.

We also took over after 14 years of failure on productivity and wage growth. If wages had grown in line with the pre-financial crisis trend, families in my constituency and constituencies across the country would not be £100 or £200 better off a year; each worker would be £10,700 better off a year.

Non-Domestic Rating (Multipliers and Private Schools) Bill

Patrick Spencer Excerpts

2nd reading
Monday 25th November 2024 Commons Chamber

[Adam Thompson (Erewash) (Lab)]

I will focus on the removal of private schools’ eligibility for charitable business rates relief. Before I was elected to the House I was a scientist, but before I was a scientist I trained as a secondary school teacher. In school, I saw at first hand the dedication and resilience of my colleagues, but I also bore witness to the challenges that they faced—challenges that led many, many teachers to leave the profession after only a few years. I left after only my training year, citing the unsustainability of marking books at 1 o’clock in the morning, planning lessons at the weekend and never seeing my family as the reasons why I could not continue in the profession, despite loving being a teacher. I chose to leave the profession to do something that I feel is much easier: to take a doctorate in engineering.

When I trained 10 years ago, teaching had a profound retention issue, but now it is worse. One in 10 new teachers leaves after just one year in the role; one in four leaves after just three years. Little over half of teachers see their career last more than 10 years. Many are outstanding teachers who do not want to leave the profession. Even now, I miss teaching every day.

The picture in our education system gets worse when we look at maths and science, subjects that I know the whole House believes are vital. The maths teacher shortage began in 2012, and in 2023 the intake of new maths teachers was just 60% of the Government’s target. I was a physics teacher, and in 2023 there were six times as many vacancies for science teachers as there were in 2010. In my view, the failures of the previous Government’s education policy led to this abysmal state of affairs, and they are profoundly unacceptable.

[Patrick Spencer (Central Suffolk and North Ipswich) (Con)]

I appreciate that the hon. Gentleman is talking from personal experience about an important part of our education system. He talks a lot about teachers and the previous Government’s failed education policy, but will he take a moment to recognise the vast improvements in our performance in international league tables and the fall in the disadvantage gap in the years leading up to covid-19? Will he at least give some credits to the outputs, not just the inputs?

[Adam Thompson]

I will come to some of those points further on in my speech, if the hon. Gentleman is willing to hang on for a few minutes.

I trained as a teacher when the former Member of Parliament for Surrey Heath was Education Secretary. He made significant changes to the education system during his tenure, as the hon. Member for Central Suffolk and North Ipswich (Patrick Spencer) has just alluded to. Those were changes that I and the vast majority of my colleagues at the time strongly disagreed with. Those changes ignored decades of pedagogical research and favoured the metrification of our children over learning. They harked back to the rote learning of 50 years ago and set pedagogy back decades.

Austerity was already being very much felt in the sector. Teachers were expected to put in the same effort, but with fewer resources and with their pay frozen. Now it is worse. After a decade of Conservative Education Secretaries following in the footsteps of the former Member for Surrey Heath, teachers’ pay has taken a significant real-terms cut. In many ways, he inspired me to enter politics as a Labour Member—a sentiment that I know many of my colleagues on this side of the House share. Opposition Members may challenge me about why I raise these points, but I think they are all part of what the Bill is about. They are about keeping teachers in their jobs, paying them fairly and giving them the resources that they need to give our children the education that they deserve.

The previous Government set a goal that all children should finish year 11 with at least GCSEs in maths and English. That is a laudable goal, which has my full personal support, but last year just 45% of children in England—not even half—achieved it. Only one state secondary school in my constituency of Erewash attained results above that average, and even in that top-performing school, just half their children in year 11 attained GCSEs in maths and English. Every other state secondary school in my constituency was below that 45% average, and at the worst-performing the result was fewer than a third.

I should note that I place none of the blame for those issues on the local schools themselves. I have met several local heads and many teachers, all of whom it is powerfully obvious to me have made incredible sacrifices to deliver excellence in our local education system, and all of whom have been burned by the failures of education reforms introduced throughout the past decade. The people of Erewash elected a Conservative Member of Parliament in 2010, 2015, 2017 and 2019, and in return the previous Government let their children down.

I have been talking a lot about state schools, which is only natural when they are the schools that 94% of our children attend, but I would also like to highlight the major independent school in my constituency, Trent college in Long Eaton. In the run-up to the election and since then, I have been around as many of the schools in Erewash as I can, and Trent college is no exception. I have spoken many times to staff and pupils, and this weekend I attended a show put on by the incredible Wildflower community choir at the school’s chapel. It is a wonderful school, with excellent staff led by the brilliant Bill Penty. The staff provide fantastic opportunities to all the pupils who attend. The facilities are the best I have ever seen in a school and the staff do a huge amount for our community, but it is a simple fact that the vast majority of my constituents cannot afford to send their children to Trent college and that many of its pupils come from outside my constituency.

A great part of what this Bill is about is making sure that the incredible opportunities received by the children at Trent college, and the aspirations that they are encouraged to have, are available to all children in Erewash. I want every child in Erewash and the country to receive the best education they possibly can. This Bill will support the extension of those opportunities to every child in every state school in Erewash and the country.

Business Property Relief and Agricultural Property Relief

Patrick Spencer Excerpts

Thursday 17th October 2024 Westminster Hall

[Patrick Spencer (Central Suffolk and North Ipswich) (Con)]

It is a pleasure to serve under your chairmanship, Dr Huq. I join in the tributes to my hon. Friend the Member for Gordon and Buchan (Harriet Cross) for securing this important debate. Like many Members, I am motivated to engage in it because I represent a rural constituency that is made up of many small and large farm holdings.

Without making this sound like my maiden speech, Suffolk is a beautiful rural constituency with a stunning landscape. It is known for its contribution to our food system, and it is home to many market towns where family-owned butchers, bakers and grocers source their produce from local farms. Even breweries do so. Adnams Southwold is in the next-door constituency, but it sources all the ingredients for its famous beers and other products from farms in the local area. One in seven jobs in Suffolk have some relationship to the food production industry. One only has to go to the Suffolk Show to see the importance of farms, farming and agriculture to our local economy. As a result, we have to take seriously the livelihood and financial sustainability of our farms.

It is worth remembering that farms are, as many Members have said, small businesses with tight margins and high capital costs. One way we could greatly threaten the long-term financial sustainability of farms, which are so integral to our economy and community, is to threaten the owners with a tax if they pass the family farm down to the next generation.

Let me explain why that is a bad idea. First, as with the taxation of many forms of capital, liquidity is being demanded from a resource that is fundamentally illiquid. As we have heard, the Government will fundamentally force many farms to sell off parcels of land, and when farm owners realise that it is hard to sell off small parcels of land, they will be forced to sell their whole holding. Don’t believe me? Eighty-six per cent. of respondents to a poll of farmers conducted by the Country Land and Business Association said that they would have to sell some or all of their land if they were faced with a new IHT obligation.

Secondly, those who can shoulder the cost of a new tax on their farm and business will simply have to reallocate a lot of their capital away from more productive sources of investment, such as cattle, machinery and labour. That has grossly negative economic and social consequences. My next-door neighbour is a relatively well-heeled farmer who also uses his land to provide a wedding venue and rental properties—that is something we have heard about. If we place farmers under more financial stress, they will simply have to close down those businesses. Let us not forget that many of those businesses provide really important jobs and incomes and, fundamentally, pay tax in our economy. We are taxing one half of the equation only to take away from the other.

Thirdly, the proposal will yield an irrelevant amount of money in the long run. We have all read the report from the Institute for Fiscal Studies that says that agricultural relief costs the Exchequer £400 million a year. To put it bluntly, I know that many people in the Treasury and Labour Members see landowners as rich rent seekers who invest in property to avoid IHT. But let us look at the contribution that people such as James Dyson have made to our food production industry by incorporating technology and environmental standards into the sector, or at the incredible impact of the Grosvenor group in restoring peatland and moorlands in parts of Cheshire and Lancashire. That will have a hugely positive impact on wildlife numbers and carbon emissions.

If the Treasury genuinely believes that we should tax farmers in the hope that they will release land to housing and property developers—trust me, we are not going to solve the housing crisis by building houses on farmland in Suffolk. It will be solved by investing in units in towns and cities, where young people really want to live and where footfall already exists. Such an argument ignores all the positive impact that many farmers have made, and it completely neglects the thousands of small families who are not rich and who may be forced to sell their farm despite having tended to the land for generations. The imposition of a new tax on inherited land will have a sad impact on family-owned farms, of which there are too many in my constituency to name. Many have spoken in recent years of the increasing difficulty of running their farms in the current economic climate. They have to negotiate a labyrinth of new environmental regulations, a new post-Brexit payment system, an energy crisis that has pushed their costs through the roof, higher interest rates and increasing competition from abroad.

To remove agricultural and business relief from these small family-owned farms could push many over the edge. What a loss that would be to our economy, to our communities and to the many families who have owned, farmed and maintained their land for generations, and who will continue to do so for generations to come.

[Dr Rupa Huq (in the Chair)]

I call the first Front-Bench spokesperson: Will Forster for the Liberal Democrats.

Winter Fuel Payment

Patrick Spencer Excerpts

Tuesday 10th September 2024 Commons Chamber

[Wendy Morton]

My hon. Friend makes an important point. It comes back to how this is about political choice, and I am here to stand up for my pensioners in my constituency.

I also point out that it was the Conservative party in government that drove up pension credit applications by 73% in just 12 months. It is important that we do not forget that. Pension credit take-up is often an entrenched issue. People in my constituency are often too proud to apply. The process is too complicated: 22 pages, 243 questions and, as we have heard, nine weeks to determine the outcome of the application.

Tackling pension credit take-up is important, but it is not the solution to the crisis that pensioners face today. Only weeks ahead of the winter, they need help now. According to Age UK, across the UK, around 2 million pensioners who badly need the money to stay warm this winter will now not receive it. Losing the winter fuel payment will make it significantly harder for them to keep warm, which undermines their health and wellbeing. As we have heard, pensioners often have serious health conditions and disabilities. Often, they live in older properties, and in the north or in my constituency in the west midlands it is often colder than in other parts of the country. Pensioners are all disproportionately affected, yet there is no sign of an impact assessment, just a Chancellor who, seemingly, storms ahead with her political decision.

[Patrick Spencer (Central Suffolk and North Ipswich) (Con)]

Will my right hon. Friend give way?

[Wendy Morton]

I will continue because I am conscious that others want to get the chance to speak.

There is no time for older people on low incomes to set aside money—if they have it—to help them get through the winter. Being at home in the cold increases the risk of raised blood pressure, stroke, heart attacks and hypothermia. I did not vote for this callous cut earlier today. I will not pick the pockets of those who have worked hard all their lives, doing the right thing by their families and this country. I will continue to speak up for my constituents, who deserve better than this. This is so wrong.

--- Later in debate ---

[Patrick Spencer]

I think all hon. Members are very disappointed not to see a proper impact analysis of this decision. Does my hon. Friend agree that the best way to analyse the impact of such a policy is to speak to the people who sent us to this place, as she is saying, and to hear the utter fear and concern they have about its impact?

[Rebecca Harris]

My hon. Friend is spot on. It is the anxiety that it causes people. They do not know if they will live another 18 months or 25 years. People on fixed incomes, with no ability to raise that income, are very worried about spending money. There is also a large and, sadly, growing cohort of elderly residents who are developing dementia, and one of the early symptoms, often, is financial anxiety, including in people whom we would think of as really quite wealthy. I have known residents who have regressed to thinking that they are still living under rationing because they grew up as a lad in abject poverty, and they will not spend money. Being told, “Here’s £300 for fuel,” makes a world of difference to those people.

I was not a fan of Gordon Brown, who once gave a derisory 75p increase to pensioners, but this policy was a huge success—credit to him. That is why my Government never changed it. For £300 for every pensioner, we give incredible peace of mind that they can put their heating on—

--- Later in debate ---

[Sir Ashley Fox (Bridgwater) (Con)]

I speak on behalf of 19,300 pensioners in my constituency who are set to lose their winter fuel allowance. Some 23% of my constituents are aged 65 or over, which is well above the national average. Many retired people in my constituency have done the right thing: they have worked all their lives, paid their national insurance stamp, and now have a small private pension and modest savings. It is because they have done the right thing that many of those pensioners are not eligible to claim pension credit. This Government are choosing to punish them for the prudent and conscientious choices they made through their working lives by withdrawing this important means of support.

Labour justified the decision to cut the winter fuel allowance by talking about its alleged poor economic inheritance. Let us take a moment to clear up some facts. In 2010, the budget deficit was about 11% of GDP at £157 billion. Today, it is about 4% of GDP. In 2010, unemployment was about 8%, and today it has halved and is about 4%. In May 2010, inflation was 3.4%. Today it is 2%. This is not the worst economic inheritance since the war.

[Patrick Spencer]

I am sure my hon. Friend will agree when I say that the economic inheritance that the Government received is incredible, considering that we had to deal with the covid pandemic crisis as well as the Russian invasion of Ukraine. That put huge pressure on our economy.

[Sir Ashley Fox]

My hon. Friend makes an important point. It just emphasises the fact that when the Chancellor says that it is a tough decision that has to be made, she is actually making a political choice. She has chosen to give train drivers earning £60,000 a year a pay rise of 15%. She has chosen to cut the income of retired people with a pension of £15,000 a year. That was her choice, and the British people will judge her and the Labour party on it.