Coastal Communities

Polly Billington Excerpts

Thursday 20th March 2025 Commons Chamber

[Steff Aquarone]

I make absolutely no comment on the latter question, but I welcome the hon. Member’s contribution—no advance sight was given of my speech. Her presence here serves to remind us all that it is not just MPs representing coastal communities who have a stake in their prosperity. I thank her for her almost perfectly timed words.

In more recent times we had the 2024 pier of the year in Cromer. The excellent North Cottage in Cromer, run by Andrea and Jerry, was recently awarded self-catering accommodation of the year at the Suffolk and Norfolk tourism awards. Cromer also plays host to a Banksy artwork from his 2021 tour of the east coast. The artwork, of a queue of hermit crabs looking on at empty shells, highlights one of our greatest challenges in coastal communities: second homes and the wider housing crisis.

In North Norfolk we have been plagued by huge numbers of second homes and empty homes. Outside the City of London, we have the highest number of empty or infrequently used homes in all of England. These properties are carving the core out of many small and historical communities, and in too many cases contribute very little back. Our poorest are sitting on ever growing waiting lists, while the rich treat our coastal villages as a setting for a Jane Austen-era summer jaunt, leaving them to suffer for the rest of the year.

In Wells-next-the-Sea, 40% of the town is second homes and holiday lets. In some parts, only one in 10 homes is someone’s main residence. I am delighted that, after years of lobbying, we are able to levy a 100% council tax increase on those second homes. That will bring in £1.7 million for the district council, allowing it to support more affordable housing and provide homelessness services.

[Ms Polly Billington (East Thanet) (Lab)]

Jane Austen mentions not only Cromer but Ramsgate—in “Pride and Prejudice”—although certainly in a less salubrious way than she may have referred to Cromer. Ramsgate and Wells-next-the-Sea share the concerns that the hon. Member mentioned about short-term holiday lets. Does he support the calls that many colleagues and I have made for not just a registration scheme but a licensing scheme for short-term holiday lets, in order for local authorities to be able to control and shape their own local economies?

[Steff Aquarone]

It is not ideological; we must be pragmatic in these things. The right sort of holiday lets can bring in welcome tourism to North Norfolk, but there is a safety issue regarding regulation, which I am very sympathetic to. I would be very interested in talking in more detail about our shared interest in this matter at another time.

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[Ms Polly Billington (East Thanet) (Lab)]

I declare an interest as chair of the coastal parliamentary Labour party and co-chair of the all-party parliamentary group for coastal communities, alongside my hon. Friend the Member for Scarborough and Whitby (Alison Hume). We are in danger of violently agreeing with each other, so I will not repeat much of what has been said—needless to say, much of it also applies to East Thanet.

What I will cover, however, is the potential that coastal communities have to drive economic growth across the country through our people, our heritage and our environment. Take the Government’s mission to build 1.5 million homes; East Kent Colleges Group is working with house builders and construction companies such as WW Martin, offering apprenticeships to develop the next generation of workers. There is a demand for non-graduate jobs in our community, and if we tap into that potential, there is no reason why it could not be workers from coastal communities who build those 1.5 million homes across the country and refurbish our shoddy, draughty and damp housing stock.

It is important that we build on people’s identity and heritage to develop resilient coastal communities. In East Thanet, we have tapped into our artistic heritage of Charles Dickens and J.M.W. Turner—the Turner Contemporary gallery in Margate is a monument to what can happen when energy and resources are focused on regenerating coastal towns. Of course, our natural environment is not just a nice-to-have; it is an integral economic asset. However, we cannot talk about increasing opportunity without first providing people with security. How can people look to the horizon when they are having to watch where they step? This is a mission-driven Government with five missions to transform the country.

[Patrick Hurley]

Does my hon. Friend agree that a strong enabling state, bringing forward those five missions and investing in a progressive industrial strategy, can help our coastal towns thrive in the next decade?

[Ms Billington]

Indeed, we need a place-based approach with that active state. If we want economic growth that reaches all parts of the country, invest in coastal communities. If we want public services that really improve the experience of people who are most alienated because of state failures, invest in coastal communities. If we want to create an environment that works for nature and people, invest in coastal communities. I am speaking not just about financial investment, but about investment of Government time, energy and focus.

When colleagues and I were trying to work out which Department would be answering this debate, we literally did not know. While I am obviously delighted to see the Minister in his place, the issues raised in this House today span all Departments, whether that is Health, Transport, Environment, Education, the Home Office, the Treasury or many others. I simply note that if there is not one Minister who fits the portfolio, there should be one—a Minister for coastal communities who can focus on regenerating our towns and growing our coastal economies.

I will end with a point about the previous Labour Government. In the 1990s, cities were not the places they are today. That Labour Government had a relentless focus on improving them, and the regeneration we have seen is testament to what can be delivered. Coastal towns are in the same position now, and the Labour Government have not only—

[Madam Deputy Speaker (Caroline Nokes)]

Order. Members will be aware that I will call the first Front Bencher at 4.38 pm. That means that not all Members will now get in. They might consider that when making interventions.

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[Edward Morello (West Dorset) (LD)]

I congratulate my hon. Friend the Member for North Norfolk (Steff Aquarone) on securing the debate—although, on a beautiful day like this, I am sure I am not the only one pining for the beach.

Great Britain is an island nation with a proud maritime history. Coastal communities are central to our cultural identity, our national heritage and, of course, our economy, yet time and again they have been overlooked by Governments in London. From under-investment in infrastructure and transport to the devastating impact of water pollution and the broken business rates system, coastal communities face unique challenges that require targeted solutions. It is time for proper investment, fairer funding and a real plan for the future.

My constituency of West Dorset is home to the famous Jurassic coast—a UNESCO world heritage site—and as in many coastal communities, tourism is an essential industry for the area, but it also places increased strains on local infrastructure, public services and emergency response teams. Although Dorset experiences a 42% increase in population during peak seasons, such rural and coastal areas remain chronically underfunded. The current funding formula fails to account for rurality, and for the seasonal population fluctuations that we experience. Rural local authorities face higher service delivery costs, yet the Government’s decision to repurpose the £100 million rural services delivery grant on a new need and demand basis has removed a crucial lifeline for councils trying to provide transport, emergency services and social care in remote areas. That is simply unacceptable.

One of the greatest threats to coastal economies and to public health is the ongoing sewage crisis, and the figures are staggering. In 2022 alone, over 320,000 sewage spills were recorded across England. As a result, England is ranked among the lowest for water quality in Europe. Meanwhile, water companies paid out £1.4 billion in dividends in 2022 alone, and £51 million in executive remuneration between 2020 and 2021, all while failing to invest in critical infrastructure to prevent these spills. It is nothing short of a national scandal. That is why the Liberal Democrats are calling for the creation of a clean water authority to replace Ofwat, as well as stronger regulation, increased funding for water regulators to hold polluters accountable, and a dedicated Minister for coastal communities to oversee regulations on sewage spills and coastal protections.

I must raise the issue of business rates. Small businesses are vital to coastal economies, yet the broken business rates system is holding them back. The Government’s plans to slash relief for retail, hospitality and leisure businesses from 75% to just 40% will be a devastating blow for many small coastal businesses that are still struggling to recover from the pandemic and the cost of living crisis. That is important, because tourism numbers are still down a third on pre-2019 levels. The UK tourism sector directly employs over 3 million people, but it has experienced heightened job insecurity and reduced hiring rates since that time. Our tourism sector needs targeted support, not short-sighted tax hikes.

As Members have outlined, coastal communities are also facing a housing crisis. That is why the Liberal Democrats are calling for a 500% council tax surcharge on second homes in housing-shortage areas, new planning restrictions on second homes and short-term holiday lets to prioritise local housing needs, and a requirement for all holiday let owners to pay council tax, ending the loopholes that let them avoid paying anything at all. These measures will help protect the character of our coastal towns and ensure they remain thriving communities, not just seasonal destinations.

Post-Brexit fishing and farming policies have left many coastal communities struggling. The last Government’s botched Brexit deal threw the UK fishing industry into turmoil, and as we approach the end of the transition period in 2026, uncertainty is growing. Too many fish are exported abroad for processing before being reimported, leading to higher costs, increased emissions and lost job opportunities. The Liberal Democrats are calling for a renegotiation of trade agreements to protect British farmers and fishermen, greater investment in local fish processing facilities to create job opportunities and boost local economies, and a £1 billion boost for the environmental land management scheme to support sustainable and nature-friendly farming.

Healthcare remains a postcode lottery in rural and coastal communities. In West Dorset, only 14 NHS dental practices serve a population of 101,000, leaving many without access to care. People living in coastal communities across the country face stark health inequalities compared with those in other areas. Reports, such as the one by Sir Chris Whitty, consistently show that rural communities experience poorer health outcomes driven by deprivation, limited access to healthcare and persistent workforce shortages. These challenges are not inevitable; they are the result of neglect. The Liberal Democrats are calling for a strategic small surgeries fund to sustain struggling rural GP services, and a dental rescue package to fix the broken NHS dental contract and guarantee urgent dental care for all.

[Ms Billington]

Will the hon. Gentleman give way?

[Edward Morello]

I am afraid I will not, because I am very keen for my hon. Friend the Member for North Norfolk to have time to wind up.

Digital exclusion remains a pressing issue. Many coastal businesses and residents lack reliable broadband and mobile connectivity, impacting everything from emergency response times to economic opportunities. The Government must commit to full-fibre broadband and reliable mobile coverage for all coastal and rural communities.

Coastal communities have long been overlooked. As the hon. Member for Blackpool North and Fleetwood (Lorraine Beavers) and others have eloquently outlined, it is time for a dedicated Minister for coastal communities to ensure that our voices are heard in every Government decision. We deserve clean waters, thriving businesses, secure jobs and infrastructure that meets our needs. It is time for bold action, not just warm words, if we are to secure the future of our coastal communities for generations to come.

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[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Alex Norris)]

I thank the hon. Member for North Norfolk (Steff Aquarone) for securing this debate and for the way he led it. He said that it was his first opening speech—it was an excellent one. I admire both the poise and the clarity with which he spoke in his first Backbench Business debate. There are clearly more excellent debates to come, but he will struggle, I think, to top today’s topic. The official record of this debate will read like a love letter to our nation’s coastal communities—one in which we can all see ourselves and our treasured memories, whether we represent a coastal community or, for Members like myself who do not, spent our childhoods at Southport, Blackpool, Skegness or elsewhere around the country.

The hon. Gentleman set out very clearly the opportunities for our coastal communities—be they tourism, energy or natural beauty—but also the profound challenges, which were echoed in the contributions of a number of colleagues, such as slower economic growth, higher levels of deprivation and real challenges in healthcare. He said that he felt the system does not work. I share a lot of that, and I have some suggestions for how the system might change. The hon. Gentleman was also very clear that he would rather that a dedicated Minister respond to the debate, rather than me—I will try not to take it personally, and will address that directly in a moment.

First, I want to cover a number of contributions from colleagues. My hon. Friends the Members for East Worthing and Shoreham (Tom Rutland) and for East Thanet (Ms Billington) and the hon. Member for Torbay (Steve Darling) spoke about the integral challenge with housing in coastal communities, with too little building for too long. This Government are going to change that, with a million and a half homes in this Parliament. I say to colleagues, and to anybody listening who is passionate about their coastal community, that the way to ensure that is done in the right way—a way that respects local heritage, local demand and areas of natural beauty—is to be involved in the local planning process. That is how to set the blueprint for excellent development in our communities. As my hon. Friend the Member for Scarborough and Whitby (Alison Hume) said, that will bring jobs as well, with opportunity for all-year-round jobs, great careers and skills.

Of course, that conversation on housing includes an important point that was raised by a number of my colleagues, especially my hon. Friend the Member for Truro and Falmouth (Jayne Kirkham), which is the matter of second homes and short-term lets. She and I have spoken about that a lot over the years, along with my hon. Friend the Member for Camborne and Redruth (Perran Moon). This Government are introducing a short-term let registration scheme to protect the spirit of our communities, notwithstanding the importance of short-term lets to the economy. We are abolishing the furnished holiday lettings tax regime to remove the tax incentive that short-term let owners have over long-term landlords. From this April, councils can opt to charge a council tax premium of up to 100% on second homes. However, we recognise that more will need to be done, and we are very keen to have that conversation with colleagues. We are considering what additional powers we could give local authorities to enable them to respond to the pressures created by short-term lets and holiday homes.

A number of colleagues, including—perhaps unsurprisingly —my hon. Friend the Member for Sittingbourne and Sheppey (Kevin McKenna), made important points about healthcare. I would trumpet the Government’s 10-year health plan to reform the NHS, which coastal communities in particular will benefit from. The Minister for Care, my hon. Friend the Member for Aberafan Maesteg (Stephen Kinnock), is sitting on the Bench next to me. With the three big shifts—the move from hospital to community, from analogue to digital and from sickness to prevention—there is a lot in that plan for coastal communities. Again, I encourage colleagues to lean into that.

My hon. Friend the Member for Southend West and Leigh (David Burton-Sampson) draws me on cockles. Osborne’s sounds like it is the real backbone of his community, but, clearly, it is facing some real hurdles. If it is of any value to him, I would be very keen to meet the firm’s representatives and have the chance to have that conversation in full.

My hon. Friends the Members for Blackpool North and Fleetwood (Lorraine Beavers) and for Blackpool South (Chris Webb) touched on partnerships with central Government, local government and local communities. I can point to significant money coming from this Government: £90 million for housing redevelopment in Blackpool, and £40 million for the further education college and the new civil service hub. We believe that Blackpool’s best days are ahead of it, and I am very keen to work with my hon. Friends in that regard.

The hon. Member for South West Devon (Rebecca Smith) talked about the strong opportunities for development in the private sector. I would add to that the £4.4 billion for the naval base at Devonport. We also have the excellent tool of the freeport that we can work on together to draw in investment, which I and my colleagues are very keen to do.

The subject of freeports takes me to the Essex coast and to the hon. Member for Harwich and North Essex (Sir Bernard Jenkin). He wanted to hear from this Dispatch Box a commitment to his community, and I can give him that commitment. Our renewed commitment to freeports, which we inherited from the previous Government, shows that we believe in the potential of his community. There are changes to local government coming, and the possibilities of devolution are outstanding, but I know— I will speak to this point later when I address the matter of a dedicated Minister—that his community has the skills, the knowledge and the experience to shape the area for the better and build it for the days ahead. Our commitment is to give it the power and the tools to do so, and I am very happy to recommit to that today.

[Ms Billington]

Will my hon. Friend confirm that this Government understand that there is a clear distinction between the challenges in rural communities and those in coastal ones? I noticed that the Liberal Democrat spokesman used the words “coastal” and “rural” almost completely interchangeably, and we know that the levels of deprivation and the challenges in coastal communities are significantly different from those in rural communities. Can he give me that confirmation from the Government?

[Alex Norris]

That is an important point. Rural communities can be coastal communities and vice versa, but not always, and their challenges manifest very differently. The challenges that come from being a community at the end of the line can be significant and profound, and we absolutely accept that.

I turn to the point that the hon. Member for North Norfolk made about having a dedicated Minister. As other colleagues have said, I think he is selling himself short. The reality is that this is not about having a Minister in government pulling the lever for North Norfolk, Hamble Valley or anywhere else to transform its community. This is an inside job. The promise from this Government is to shift power and resource from this place to those communities, so that they can change things for themselves. We have made a down payment with our plan for neighbourhoods, which covers Peterhead, for example. I hear some of the frustrations, but giving communities power and resources is a way to rebalance things, and it will enable them to change things for themselves. Of the 75 areas in the plan for neighbourhoods, 25 are coastal, which will mean a £500 million commitment. My hon. Friend the Member for Southend East and Rochford (Mr Alaba) talked about the independent commission on neighbourhoods, and much of its work is reflected in what we have done.

I say gently to the Opposition spokesperson that we want to move away from the broken begging bowl culture of levelling-up funds, where communities were pitted against each other, to more long-term sustained funding based on the needs of a community. The money is one thing, but, for me, the power is the real thing, and it underpins our plan for change. I am talking about the shift of power from this place to our local communities that we are seeing through devolution. We already have five elected mayors representing coastal areas, with two more still to come in May—Hull and East Yorkshire and Greater Lincolnshire. That gives those communities powers over housing, planning, transport, energy, skills, employment support and more, so that they can shape their areas.

Six more areas are coming down the line, including five coastal communities in the devolution priority programme. That is a shift of money and power from this place to coastal communities to take on the challenges that they have had in the past and, in partnership with central Government, to build very exciting futures—be they in tourism, in climate or in housing. That is what this Government offer. That is what the future offers, and that is something to be really excited about.

Oral Answers to Questions

Polly Billington Excerpts

Monday 3rd March 2025 Commons Chamber

[Rushanara Ali]

I thank the hon. Gentleman for his question. Raising standards in the private rented sector could lift up to 550,000 people out of fuel poverty. There are a number of schemes to support landlords to improve their properties, and they can look at their eligibility through gov.uk. In particular, there are schemes such as the boiler upgrade scheme, which offers £7,500 off the cost of heat pumps. We look forward to working in partnership with the sector, because we recognise that it is an important sector.

[Ms Polly Billington (East Thanet) (Lab)]

Some 13% of households in England—over 3 million people—are officially in fuel poverty. Does the Minister agree that the last Conservative Government did not just fail to meet their housing targets, but left a legacy of high household bills?

[Rushanara Ali]

I thank my hon. Friend for the question. We have inherited a massive challenge, and we are working at pace to tackle these issues, so that people can live safely and securely in their home and do not face such high costs.

Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting)

Polly Billington Excerpts

Committee stage
Wednesday 11th December 2024 Public Bill Committees

[Adam Thompson (Erewash) (Lab)]

Q Thank you for joining us this morning, Mr Watson. I represent two towns in the east midlands, Ilkeston and Long Eaton. Both the high streets in our towns have suffered for a long time. We have a large number of small retailers and many have closed over a long period. A lot of work has been done locally, in particular by one member of the community, on regeneration of one of the towns especially—basically, clubbing together a lot of small independent retailers who have worked together to bring the community back up. How will the Bill tangibly affect the community and those small retailers?

Gary Watson: We have the Bill, but all the time we have the small business rate relief, which sits there. Obviously, the issue with that is that it is again limited on rateable values. In one part of the country, rateable values will be higher or lower than for the same type of property in another part. The area that might want to be looked at when the next revaluation takes place is to look at the ceilings on those rateable values. At the moment, for the small business rate multiplier, we go up to £51,000. There is that small business multiplier, so if you are trying to target, once we know what the outcome of the rateable values will be at the next reval, it may well be that the support that you could give would be through uplifting the values, as I said.

On the Bill itself, we have the flexibility of the two lower multipliers. To go back to an earlier question, I think it is right to have that flexibility, so that we can vary it depending on the circumstances. It does give flexibility, but we also need to think about the small business rate relief, and that is there anyway. That might be something to look at, in terms of targeting, when it comes to the next reval. I think that would need more secondary legislation, rather than primary legislation.

[Ms Polly Billington (East Thanet) (Lab)]

Q Thank you for your evidence. It has been very interesting. My constituency is made up of three towns, Ramsgate, Broadstairs and Margate, all seaside towns and very dependent on all the sectors we have been talking about—tourism, hospitality, leisure and so forth. You have been talking about the centrally decided approach when it comes to those sectors. What value might there be in an approach that recognises the geographical challenges of particular areas, so that we do not just have a complete free-for-all with local government picking and choosing how to do it? We could say instead, “Yes, we need to have a particular approach when it comes to the geographical challenges of some commercial centres and the high streets.”

Gary Watson: Yes, I think you could look at the Bill giving a framework. At the moment, you have the standard rate and the small business multiplier, and the flexibility with the two lower ones—one or more, depending on how you want to move those forward. From a local authority point of view, there is that national situation, but you then have to look at each of the individual areas, and no one area is the same as another, as I said. They will not always be the same—things will change—and that is where the local authority comes into play, and where you need to have the relief systems in place.

The one thing you have in the legislation anyway—I am sorry to bore you with legislation—is section 47, which allows the local authority to give relief to any ratepayer that it wants to. The only thing it has to take into account is giving due regard to its taxpayers’ interest—and obviously it is, because the taxpayers are benefiting from having a thriving high street. In a way, that relief system is already there, so I think creating the framework is fine. As I said, yes, there is that concern about the complexities of the whole system itself, but you are trying to direct it to make it more agile—as that term has been used.

There is no reason why the framework can be put together through the Bill, but the relief system cannot then be used, say, in the three towns that you referred to—I am a little familiar with those three towns, because one of my council members is from Thanet, so I know it quite well. As I say, I think the relief system is there. The issue you will have then is whether, when it comes to funding those reliefs, local authorities will have all the funding. That is where I always say that you cannot look at the property tax and local government financing separately. When you talk of reforming council tax or business rate, you also have to consider local government finance—the two always have to be considered together.

[The Chair]

That brings us to the end of the time allotted for the Committee to ask questions. I thank our witness on behalf of the Committee for giving evidence.

Examination of Witness

Paul Gerrard gave evidence.

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[Patrick Spencer]

Q Have you done any analysis of the variation of impact between renters and freehold owners of shops? On my high street, the shops that own the freehold are the ones that have been there for 15 years, so they have not weathered the same problems that other shops have. Surely at the margin there is an impact on shops that own the property.

Stuart Adam: There are a couple of slightly different things there. The first is that you may have a chain of ownership: possibly a very short-term sub-let, a let, a long-term leaseholder and then the ultimate freeholder. How far and how quickly it gets passed up that chain will partly depend on how long term the contracts are, how easy it is to renegotiate and so on.

The second thing, when talking about what happens as rents adjust, is that a minority of businesses, but a sizeable minority, own their own premises. In the long run, they may not be affected in their capacity as tenants, but they are still affected in their capacity as landlords to themselves, as it were. One way to think about it is that it is almost lump sum redistribution across owners of different properties. If you own the property and your business rates bill goes down—there is no rent. You can imagine charging rent to yourself, but the reality is that you just have a lower bill to pay.

That is a one-off gain in the sense that you could sell that property and get more for it in the same way, so you are just better off if your business rates bill has gone down. Someone else looking to buy it would face a lower business rates bill, but they would have to pay more to buy the property in the first place. So yes, businesses that own their own premises would benefit from a business rate cut—or lose from a business rate increase if we are talking about those above £500,000— in their capacity as owners, essentially, rather than their capacity as the business occupying and using the property.

[Ms Billington]

Q We have a 24% vacancy rate on Ramsgate High Street for many of the reasons that Jayne gave in relation to Cornwall. Do you think that the certainty that this legislation brings will have an impact on establishing long-term help for reviving the high street, particularly when it comes to rents and increasing occupancy? The long-term drivers that have been undermining the high streets are new shopping behaviours—not only post-pandemic behaviours but online shopping. If you do not think that this legislation will help, what will?

Stuart Adam: First of all, I do not want to say that it will do nothing to help. It will certainly do something in the short run, and I am also giving the quite extreme case—the very purest—in the long run. Even in the long run, it will not be quite as simple as I am painting it. There will be some help, but as I say, it is more second order than first order. I also agree, as I emphasised earlier, that the certainty will definitely help.

I also think that we can look at other parts of the business rate system. The treatment of empty properties—empty property relief—is one, which is much more important and more directly targeted at actually getting properties back into use. I know that the Government are concerned, as the discussion paper mentions, about exploitation of empty property relief by people cycling in and out artificially and things like that. I also think that a lot of the struggles of the high street are not caused by business rates. Things such as online competition make a huge difference, and are not driven by business rates.

[Ms Billington]

Q Sorry to interrupt, but online competition is genuinely a problem with business rates. Having previously been a councillor in Hackney, I know that we got more business rates from Amazon having its headquarters there than the Treasury did from Amazon’s existence in the first place. So there is a difference.

Stuart Adam: What I am saying is that there is a big difference in business rates, but if the business rates are not changing the overall cost of the premises—rent plus business rates—they are not making much difference to the competition. The fact that people can easily shop online is fundamentally what is driving it, rather than business rates. The fact that high street retailers have to pay rent and rates in a way online retailers do not, at least not to anything like the same extent, is absolutely a driver of the difference, but I am just saying that the business rate component of the cost of the premises does not have that much impact on the overall cost of premises, because of the adjustment to rents.

There is a broader question as to what can and should be done to protect the high street. That is largely outside my area of expertise, but I know other reviews and studies have been done on that. I am largely going to duck it because it is outside my expertise, but there are things that can be done outside tax.

[Adam Thompson]

Q Thank you for coming in, Mr Adam. The argument that you have put forward is predicated on the link that you have established between business rates and rent. A quick Google Scholar search implies that a lot of papers out there suggest that that link is broken somewhat by sluggishness in the rental market. Does that not undermine your argument?

Stuart Adam: I would be interested to see which papers on Google Scholar you have seen—

Non-Domestic Rating (Multipliers and Private Schools) Bill (Second sitting)

Polly Billington Excerpts

Committee stage
Wednesday 11th December 2024 Public Bill Committees

[The Chair]

We can hear them from here. The first Back Bencher who caught my eye was Polly Billington.

[Ms Polly Billington (East Thanet) (Lab)]

Q Thank you, Dr Huq. Steve, I would like to ask you a couple of questions on what you were talking about in terms of threats to the pub industry generally. I represent East Thanet, which is made up of Ramsgate, Broadstairs and Margate, which are heavily reliant on the leisure, hospitality and tourism industries. We have a lot of much-loved pubs in our town centres, but I am aware that many have closed over the last couple of decades. What would you identify as the drivers of the closures of those pubs? What are the numbers, just to put some context on the risks you have identified?

Steve Alton: I think there are a number of factors. We have seen a real evolution of the pub model. Inevitably, in any market, those that do not evolve and keep that connection and relevancy with their customers do, unfortunately, fall by the wayside. There is a natural evolution within the industry. The cost base has fundamentally changed. The profit and loss has changed for new pubs. It is a tight-margin business—tighter than it has ever been.

The two outliers of our model are property and people. We need a place to operate in the communities we serve, and we needs lots and lots of people. Both those have been subject to cost increases during that period. Yes, consumer tastes have changed. We know that, and we have some fabulous pubs that have completely embraced it and are full every day of the week because they are creating events. In fact, we have a major platform with our licensee of the year award, which we do every year, and we have a very proud winner who runs a high street pub in Burnley. Every day of the week—this is a grassroots, wet-led pub in the community—there is a reason for people to go in. She has a real cross-section of the community and would consider that she has got 150 locals; she knows them by name and their family background, and they go in to connect in the community. That is their hub.

[Ms Billington]

Q I am really impressed by the resilience of the pub industry in the context of those external drivers, but what legislative, tax or regulatory changes over previous decades have contributed to the crisis in the pub industry? I want to understand the context in which we are operating.

Steve Alton: As we know, employment costs have been rising disproportionately, as have the employer’s costs of living, so there is the legislation around that. We are subject not only to licensing but a number of other compound issues that we have to deal with locally with lots of different local stakeholders. All these need to be implemented with costs as well. It is the complexity, accountability and safeguarding. All those elements add layers of cost and complexity to the business. It is no longer what it was 20 years ago, when it was a far simpler model to execute, and the cost base has fundamentally changed.

During that period, tax has risen. Look at VAT as a start point. You have to control pricing with your cost base. We cannot just pass through compound inflation running at 20% a year. There is a dynamic issue at play—trade will fall off a cliff. We have seen it on certain high streets: they have just pushed that pricing too far, and consumers, who are subject to their own challenges, have fallen away. They have held that back to make it affordable, which in itself has eroded the margin and ultimately the profitability. It is a compound of all those things in play.

It is a tough business. Running a modern pub, you are full-in. It is a seven-day-a-week business. These guys are not taking minimum wage for themselves right now. You talk about protecting workers: they are workers in their own pubs, and they are not getting the rewards that they absolutely deserve for their efforts. They are willing to invest and look forward, but they need certainty. That is why the Bill is an integral part of a set of measures that need to provide that certainty, so that we do not lose fabulous publicans, licensees and families who know their communities so well and, as you know there are some fabulous pubs in East Thanet.

[The Chair]

Do any other witnesses have anything to add?

Kate Nicholls: Over the last five or six years, you cannot escape the closures due to covid and covid-related debt. That is the backdrop against which these businesses are trying to recover. You have not really had a break from covid to be able to build back resilience in the businesses. It is not just pubs; the broader hospitality sector is also facing the same challenges.

You have had high levels of covid debt, which was Government-issued, to be able to remain afloat during that period. You had two years where you were operating at or below break-even, and one in three of our businesses have no cash reserves because they have not had the ability to rebuild those cash reserves. The resilience in the independent sector in particular is just lacking. Couple that to the significantly increased tax burden—pre-profit taxes in particular—that has been borne over the last six to seven years by our sector; that further erodes the margin.

If we were going into covid in 2019, the tax burden overall was 32% of turnover. It is now 38% of turnover coming out of that. If you do it as a percentage of profit, 77% of our profits go back in one form or another of taxation. I know that taxation funds vital public services, but we are the highest-taxed sector of the economy overall. As a percentage of profit, nobody else pays as much tax as we do, and you cannot get away from that when you are looking at it.

Added to that, factors outside anybody’s control have driven closures over the last six to seven years: there have been 400% increases in energy bills on the back of the war in Ukraine and 20% food price inflation, which again is on the back of the war in Ukraine and tariffs that have come through. Those are significant additional costs that you are bearing in the business that go through to erode the margin and, at the same time, there has been a cost of living crisis, which means that you cannot pass that on to your customers.

You are caught between a rock and a hard place as an operator. The bigger operators just cut their investment fully; that is £7 billion not being invested in our high streets this year to cope with the cost pressures coming through. Those businesses will remain afloat, but the independents do not have that cushion to be able to manage the situation. They run out of road, in essence.

Steve Alton: To give one illustration, small pubs are still handling their covid debt. It can be up to £1,000 a month that these guys are still paying to pay that off, of which the Government debt is obviously a core part. When you are unprofitable, and you are still paying that out, you can imagine the quandary and why we are going to hit a tipping point pretty quickly. That will mean that we lose not only the taxation they generate but the repayment of that outstanding debt as well.

Sacha Lord: Apologies if this was said before I arrived, but my concern is that a pub is not just a place that serves a pint; it is the heart of the community. We know that 64% of people said that a pub is one of the main places that they congregate and that 86% said that when a pub closes, the community suffers. We are anticipating up to 9,000 closures next year with a double whammy in April of the national insurance increase and the business rate increase. I am more concerned about closures in quarter 1 next year than I was during covid.

--- Later in debate ---

[Michelle Welsh (Sherwood Forest) (Lab)]

Q I want to go back to something that Simon said about special educational needs in independent schools, and how in some cases SEN can be met only by independent schools. Can you give further clarification on that?

I spent a long time working with special educational needs in the state sector at every key stage, in both specialised and mainstream state schools. There was not a single case that I saw that was not able to be dealt with in a state school in one way or another. With the further investment this Government are talking about, I think that will change again. I would like some clarity, because if there are such cases, they should be taken up with the local authorities and Members of Parliament—it should not be the case.

Simon Nathan: I am happy to follow up with the Committee on that, because I do not have the specific cases in front of me, but I can obviously go and find that information. I do not think it is an issue on a national scale, but there will be local areas where the independent school is filling the need that perhaps cannot be wholly fulfilled otherwise. I am not saying that the expertise is not there in the state sector; I am saying that the capacity might not always be there.

[Ms Billington]

Q I notice that the fees of private schools in the Independent Schools Council have doubled in cash terms in the last 20 years. I would be interested in the explanation for that rise—the causes behind it—and the impact on both numbers and the composition of the pupils attending those schools.

Barnaby Lenon: I have been on a number of governing bodies, and have been a headteacher of schools where the fees went up quite significantly. It happened particularly in the period between 2003 and 2008, when the fees were driven by increases in state school teachers’ pay, in national insurance and in pension contributions. We did not suddenly all want to build new buildings; it was more or less forced upon us, but you are right that they were quite big increases, and the impact has been that fewer parents have been able to afford our schools.

[Ms Billington]

Q By how much?

Barnaby Lenon: I cannot answer that. We do not know, but I am quite confident that plenty of parents will have found it too difficult.

Simon Nathan: If you look at the number of pupils in independent schools over the last 10 years according to Department for Education data, on the face of it you could say, “Well, there’s 12,000 more,” but that is during a period when the overall school population went up by 800,000. The proportion of pupils educated in independent schools went down from 7% to 6.5%. There has been a proportionate decrease.

[Deirdre Costigan (Ealing Southall) (Lab)]

Q Thank you very much for your evidence. I am a former chair of the governing body of a state school, so this is a really interesting conversation. Mr Woodgate, you mentioned that private schools might need to look at redundancies to absorb the impact of the measure. I understand that the student-teacher ratio in private schools is double that in state schools. It is something like 8.5:1 versus 18:1 in state schools, so there are significantly more teaching staff in private schools. If there were to be redundancies, have you made any assessment of whether the impact would be similar to the impact on state schools?

David Woodgate: Pupil-teacher ratios are increasing anyway. Many schools are much beyond that. That is not a typical pupil-teacher ratio in one of our schools. Many are going up towards 20—the same kind of number that you are talking about in the state sector. Inevitably, if there are redundancies, there will be fewer teachers to go around and they will be teaching more pupils.

--- Later in debate ---

[Vikki Slade]

Q I completely accept the point that a lot of the talk around the Bill is about high streets, because of the particular references to retail, hospitality and leisure. But it is a Bill that affects non-domestic rates and multipliers for businesses. Do you have any thoughts or comments on the fact that there is no reference to manufacturing and how we support manufacturing businesses? Do you think that should be included within the Bill?

Rachel Kelly: Whether that can be included in the Bill, I do not know. But yes, the issue of an uncompetitive property tax system is relevant for lots of industries, and manufacturing is the one that you raised. Ultimately, that comes back to the higher rate of tax across the board. If you are alluding to the higher tax rate for the rateable values above £500,000—yes, it strikes me as an arbitrary threshold, and it will capture lots of different businesses and sectors. Maybe there will be some adverse consequences of that, which might be counter to the policy aims, but I am not sure.

It is a tricky one to balance. Ultimately, if this relief for retail, hospitality and leisure will be funded within the business rate system, our instinct is that it would be better to fund that across as broad a spectrum of the economy as possible, rather than narrow down that tax base even further. For context, the proportion of properties with a rateable value above £500,000 is 1% of commercial property in the UK. If we condense that down even further, it is a very narrow tax base to fund these other changes, so I am not sure that is sustainable. I am not sure we can address the issue of competitiveness for other sectors without addressing the elephant in the room, which is the huge tax rate that we have for everyone else—55%, or 50% for smaller businesses. They are very high tax rates compared with any other business tax.

[Ms Billington]

Q I am grateful for your evidence, and I am interested to hear your puzzlement about the reality of empty shops. I represent East Thanet, where there are three towns—Margate, Broadstairs and Ramsgate —all of which suffer from empty shops to a greater or lesser extent. Ramsgate has a 24% vacancy rate. Can you explain to me how that might be, and what impact the legislation might have on tackling some of the challenges around large property owners resisting taking on tenants?

Rachel Kelly: The reason why we have a huge amount of vacancy on our high streets must be multifaceted. Obviously, we have gone through a huge transition in our retail sector over the last 10 or 15 years, which has had an impact on some of our high streets. The supply of property is relatively fixed, so once there is an oversupply it is difficult to rectify in the short term. Our planning system will play a big role in ensuring that we can reuse those assets for the most appropriate purpose in our current economy.

As far as I am aware, the causational relationship is between vacancy and the disposable income of the residents in a local area. Where there is high disposable income there tends to be lower vacancy; where there is relatively low disposable income there tends to be quite high vacancy. To the point about whether there are, at the margins, people who keep their shops empty, that is not something that a rational investor would do.

[Ms Billington]

Well we must have a lot of irrational investors.

[The Chair]

The Clerk is telling me that we are steering away from the scope of the Bill, so I am being told off for allowing it to continue.

Employment Rights Bill

Polly Billington Excerpts

2nd reading
Monday 21st October 2024 Commons Chamber

[Mark Ferguson (Gateshead Central and Whickham) (Lab)]

I pay tribute to the maiden speech of the hon. Member for Leicester East (Shivani Raja). I enjoyed her reminiscences about her community, and hearing about some of the more lively figures from the recent history of the Labour party. I proudly draw attention to my declarations in the Register of Members’ Financial Interests, which include my former role working for Unison, my membership of Unison, my donation from Unison, and being co-chair of its parliamentary group. Unison is Britain’s largest union, representing public service workers and in particular the low-paid women who will benefit so much from the Bill.

I pay tribute to all those who have worked tirelessly for years to build consensus around these changes—the biggest changes to rights at work in a generation. In particular, I thank those within Labour’s affiliated trade unions, on the Front Bench, and in Labour’s policy team for their hard work and dedication. Hon. Friends, including my hon. Friends the Members for Worsley and Eccles (Michael Wheeler), for Halifax (Kate Dearden), for Birmingham Northfield (Laurence Turner), for Tipton and Wednesbury (Antonia Bance) and for Knowsley (Anneliese Midgley), have been engaged in this work throughout. That is not an exhaustive list; many others on the Government Benches have worked tirelessly to help us to reach this day, and deserve immense credit.

This is the kind of Bill that is at the heart of why we are here. The Labour party was founded upon the idea that working people deserved representation in this place, that we were fit to govern, and that those who put in the bulk of the graft deserved to reap the rewards of their labours. Today is a landmark day in our party’s history, and in the history of employment rights in this country. The Bill is crammed full of improvements that are each worthy of a lengthy speech; however, I am down to my last minute and twenty seconds, so I will not do that. Let me say this instead: if you work, the Bill will change your working life for the better. We know why these changes are necessary. One in five of us is suffering from the effects of insecure work, with low pay, exploitative zero-hours contracts, and little or no sick pay.

[Ms Polly Billington (East Thanet) (Lab)]

My hon. Friend mentions that the measures in the Bill will be good for employees. Does he agree that they will also be good for business? My constituency’s economy is based on the entrepreneurialism of lots of small businesses and individuals creating work for themselves and for others. Does he agree that the Bill will support good employment policies in small businesses, helping with productivity and the retention of staff?

[Mark Ferguson]

I could not agree more. The people who will benefit from the Bill the most are not those who will buy stocks and shares but those who will spend their money on our thriving high streets, which this Government will build.

The care workers and teaching assistants I was proud to represent while working for Unison deserve pay and conditions that match the task of looking after us when we grow up and grow old. Stronger rights to collective bargaining through the school support staff and adult social care negotiating bodies are essential for recruitment and retention in those overlooked sectors. Could the legislation go further in those areas and in others? Of course—that is the nature of any Bill. The work of change is never done, but we should be in no doubt that this is the biggest, boldest and most welcome set of employment rights changes that all but the most experienced of us in this Chamber have considered. I know that the Government are committed to consulting widely with unions and businesses alike to ensure that.

This is what having a Labour Government means—rights from day one: banning exploitative zero-hours contracts; ending fire and rehire to lift employees from the insecurity felt by those working in the foundations of our economy; taking action on sick pay, and maternity and paternity rights; and holding unscrupulous employers to account through a genuine and comprehensive enforcement body. The Bill is pro-business, pro-worker, and focused on the challenges that millions of us face every day. It is one of the greatest honours in my life to have been involved with it, to speak on its behalf, and to vote for it this evening, mostly because I know the impact that it will have on my community in Gateshead Central and Whickham. The task of rebuilding Britain after 14 years of Tory rule is great, but our ambition for this country is greater still.

--- Later in debate ---

[Saqib Bhatti]

I will not.

What businesses want is less government, less regulation and more freedom. When making employment decisions, they require certainty and flexibility so that they can hire more people, but the Bill threatens to undermine the agility of businesses in ensuring that their workers maximise productivity. It does not encourage businesses to take risk, hire a budding new employee and reap the rewards; in fact, it does the complete opposite. The Federation of Small Businesses calls this legislation “clumsy and chaotic” and suggests that it will “increase economic inactivity.”

Let us be clear: the Bill is not really about employment rights or better conditions. Its focus is on repealing the 10-year ballot requirement on political funds, removing the opt-in default for trade union political funds, removing the need for proper consent to form a trade union, and so on. It is not the Employment Rights Bill; it is the trade union appeasement Bill. The Government are not prepared to stand up to the unions. We have seen them cave in to train drivers and give sweetheart deals without any savings for the taxpayer.

[Ms Billington]

Will the hon. Gentleman give way?

[Saqib Bhatti]

I will not.

We have seen the unions hold the Government to ransom at the expense of hard-working taxpayers. That is why the Bill is bad for small and medium-sized businesses—those arguments have been made already. Our SMEs cannot afford dozens of French-style regulations that bolster the power of the trade unions and threaten to increase the cost of employment by over £1,000. I am speaking to raise the concerns of many small and medium-sized businesses in Meriden and Solihull East about this legislation. It is rushed—businesses have not been properly consulted—and it gives more power to the trade unions. It will fail to maximise productivity and will severely weaken the case for businesses to hire new employees. It is a flawed Bill serving a flawed ideology.

Short-term Lets: Regulation

Polly Billington Excerpts

Thursday 12th September 2024 Westminster Hall

[Ms Polly Billington (East Thanet) (Lab)]

It is a pleasure to serve under your chairship, Mrs Harris. I thank my hon. Friend the Member for Cities of London and Westminster (Rachel Blake) for securing this debate.

My constituency is made up of three towns that symbolise English seaside holidays: for more than two centuries, people of all classes have visited Margate, Broadstairs and Ramsgate to take the fresh sea air and enjoy our marvellous beaches and amazing microclimate. Where and how people stay has changed over the years. As boarding houses, holiday camps and large hotels have declined, short-term holiday lets have opened up the chance for many to take a short trip to the coast; but that is not without its drawbacks for many in our community.

Hotels and places offering bed and breakfast are regulated and licensed, which ensures good standards of safety and environmental health for customers, and means that the services the council needs to provide for such establishments can be planned for. Appropriate business rates also mean that the services can be provided. None of that happens with unregulated short-term holiday lets, facilitated by platforms optimistically set up as part of the sharing economy. Instead, as the popularity of British holidays and short breaks has risen, not least since the pandemic and Brexit, so have property prices in places such as East Thanet, as people buy homes as a second place for them to stay at weekends and then rent them out when they are not there. Data compiled by VisitEngland suggests that there has been a 75% increase in short-term holiday lets since 2019: more than 2,000 properties are available for short-term let this year.

[Helena Dollimore (Hastings and Rye) (Lab/Co-op)]

My hon. Friend and I both represent beautiful coastal constituencies. Does she agree that we must get the balance right between the contribution that short-term holiday lets make to the tourism and hospitality economies in our constituencies and the need for affordable homes for locals, to address the acute housing crisis that both our constituencies face?

[Ms Billington]

I could have not said it better myself.

The large increase in short-term holiday lets has left whole streets dark and empty for months on end as the days shorten, with perhaps a small glimmer of light and activity over Christmas and new year. One of my constituents said in an email only today:

“We don’t have any neighbours: they are all Airbnbs…Our lives are being hugely impacted by huge parties each weekend!”

The problem affects the community in many ways. How can primary school places be planned for when family homes do not hold families? How can the council prepare for waste collection and disposal from effectively commercial premises when it does not know where they are or when they are occupied? How do the police deal with the increase in antisocial behaviour that follows from the proliferation of party flats when they are not licensed or regulated? How does a whole community deal with spiralling property prices, driven by an increased appetite to make money from homes rather than live in them?

If Members search on Zoopla or Rightmove for rental prices in Thanet, they will find 140 flats and houses available for less than £1,000 a month. Then if they search Airbnb for Margate, Ramsgate, Broadstairs or equivalent places to stay, they will find more than 750 short-term lets next spring for £100 or more a night. There can be no doubt that such a mismatch is helping to drive house price inflation, rent inflation and the shortage of housing availability in Thanet where, during the summer months, a flat can be rented out as a short-term holiday let for potentially three times or more the rent it would fetch as a home for someone.

We are a seaside community made up of holiday resorts. We are proud of our heritage and know that it will and should be part of our economic future. Yet the beauty and attraction of the place that people come to visit needs to be underpinned by a strong community, with decent services and affordable homes for those who live there all year round. There must be a balance.

I am confident in my advocacy for regulation, not just because of the concerns raised by residents but because voices within the industry in my community also see the impact of rising house prices and stretched public services on their families and employees. The Minister should be in no doubt: East Thanet is ready for regulation and licensing to support our holiday industry and our community. I only urge that the package of measures really is designed with communities like ours, not imposed on them. Ideas on how to license, introduce and enforce standards, plan services and facilitate a process that works for those who offer the service, as well as those who use it, should be taken on board from those who are already living with the consequences of an unbridled market with few, if any, checks or balances.

We know we are not alone in Thanet. Many of my colleagues along the Labour Benches also represent coastal communities. This debate shows that the unregulated nature of the market is blighting a host of communities where people rightly go to enjoy themselves and contribute to the local economy. I urge the Minister to consider how the package of powers and tools can support our coastal communities in particular to thrive.