Supporting Small Business

Paul Scully Excerpts

Tuesday 19th October 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

I thank all hon. Members for their contributions. First, can we celebrate and commend the small businesses up and down the country that have been so hard-pressed during the pandemic, especially in the areas that we have heard about today—hospitality, retail, leisure, tourism and indeed travel?

Businesses have shown incredible resilience throughout the pandemic and it is right that we support them, as the Government have done with £352 billion-worth of immediate financial support through loans, grants, the furlough scheme and various reliefs. That leaves us, as free market Conservatives who do not believe in big interventions but who are the Government with probably the biggest intervention since the war, with 352 billion reasons to get the recovery right and build resilience into our economy.

All I have heard from Opposition Members for nearly three hours is re-diagnosis of the problems. We can all agree that business rates need reform: that is why the Chancellor launched the fundamental business rates review. It is not starting now; we are concluding it now. It is looking at the entire scope of the business rates system, from the multiplier and reliefs for plant and machinery to billing, the administration of the system and alternative taxes. All those matters are being looked at and the report will be coming in the autumn.

I have heard nothing from the Opposition as an actual response. One can say that everything is funded and costed, but saying that does not mean that it is actually there. We have heard pledges from the Opposition to scrap business rates; that is £26 billion, and we have heard nothing about how it will be paid for. We have heard about freezing business rates until the end of the financial year; that is another £6 billion. What are they going to do to pay for it?

We heard from my hon. Friend the Member for Bexhill and Battle (Huw Merriman), who talked about changing high streets, and from my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), who proposed changes to VAT. He made a cogent argument, albeit a controversial one—at least he came up with a solution that he had costed and threw it into the mix. That is the difference between Government Members and the Opposition: we come up with solutions that businesses can understand and that we can debate and work through.

My hon. Friend the Member for Ipswich (Tom Hunt) was accused of talking down his area. Actually, he was talking about the issues that he is tackling and that he is bringing together and convening people to tackle, such as antisocial behaviour. He is doing things like that through the town deal that he is championing. He raised the future high streets fund, which is already bringing empty properties back into use—there is a lot of infrastructure going on and it is already delivering upgrades. He also talked about shopping parades. It is really important that we talk about retail parks and shopping parades as well as high streets: they are part of the ecosystem of our local economy.

[Kevin Hollinrake]

The shadow Chancellor did present a short-term solution: a sixfold increase in the digital services tax. Does my hon. Friend agree that when we implemented the digital services tax, Amazon added that 2% straight on to the prices of the merchants on its site? Does he accept that if there were an increase, it would be passed directly to consumers?

[Paul Scully]

My hon. Friend raises a really important point. We also heard about business rates being scrapped and replaced with a property tax—on a property that would presumably be owned by a business, and I guess we could use our rating system to work it out. Essentially, that is just semantics, not a systematic and effective way of replacing business rates. That is why the fundamental review is so important.

My hon. Friend the Member for Wantage (David Johnston) made a comparison to Chris Hemsworth and talked about the Great British Mead Company, which reminds me of the importance of the hospitality sector as part of the ecosystem of our local and night-time economy and indeed the high street. My hon. Friend the Member for Devizes (Danny Kruger) talked about opportunity and connectivity, which are at the heart of what we are doing to allow high streets to bounce back further.

All I have heard is negativity from the Opposition with no answer, but we are making sure that the 352 billion reasons to allow the economy to bounce back are as effective as possible. Our plan is working. Our unemployment rate is at less than 5% and falling, which is lower than France, America, Canada, Italy and Spain. We have one of the fastest recoveries of any major economy in the world, and GDP is growing. That shows that the Government’s approach is a success and that we have fostered the right environment for the economy to grow.

The Labour party will never admit this, but the UK is a great place to do business. We have the lowest corporate tax rates in the G20, and the kind of lean regulation that puts us in the global top ten for ease of doing business. Next year, my right hon. Friend the Secretary of State for Business, Energy and Industrial Strategy will publish an enterprise strategy which will explain how we want to revive Britain’s spirit of enterprise and help more people to start and scale up a business.

It is easy to see why the UK is consistently home to one of the largest and most resilient economies in the world. All this underlies the reason why it has long been a great place to do business, and why we are seeing so much excitement in the rest of the world about investing in the UK. People are queuing up to spend at the global investment summit that is being held today. In the last 10 months, we have already seen a flurry of spending in the UK: there is to be a gigafactory in Sunderland, Ford and Stellantis are churning out electric vehicles in the north-west, and GE Renewable Energy and others are creating an offshore wind hub in Teesside. Those projects constitute a huge vote of confidence in the UK as a place to do business as we recover from the pandemic.

We have been there for small businesses since the start of the pandemic, we are there for them now, and we will be there for them for as long as they need us. I want to ensure that as we move forward into this area of recovery, we build resilience into our economy as well. We will do that through the fundamental review of business rates and through our enterprise strategy, and by making sure that we stand behind our businesses.

Question put: