Finance Bill

Richard Foord Excerpts

2nd reading
Monday 28th November 2022 Commons Chamber

[James Cartlidge]

I am grateful to my hon. Friend. Of course, he was in the Department and has a business background, so he knows the detail and the importance of R&D tax reliefs. I am sure that my hon. Friend the Financial Secretary to the Treasury will have a chance to look at that later. I believe that we will be having a meeting about a separate issue of concern—a certain railway project that matters to him—when we can also discuss these points.

I turn to the specific detail. For expenditure on or after 1 April 2023, the research and development expenditure credit rate will increase from 13% to 20%. The small and medium-sized enterprise additional deduction will decrease from 130% to 86%, and the SME scheme credit rate will decrease from 14.5% to 10%. That reform will ensure that the taxpayer support is as effective as possible. It improves the competitiveness of the RDEC scheme and is a step towards a simplified RDEC-like scheme for all.

That means that Government support for the reliefs will continue to rise in cost to the Exchequer—from £6.6 billion in 2021 to more than £9 billion in 2027-28—but in a way that ensures value for money. To be clear, the R&D reliefs will support £60 billion of business R&D in 2027-28, which is a 60% increase from £40 billion in 2020-21. The Government will consult on the design of a single scheme and, ahead of the spring Budget, work with industry to understand whether further support is necessary for R&D-intensive SMEs without significant change to the overall cost.

[Richard Foord (Tiverton and Honiton) (LD)]

It was indeed welcome to hear the Chancellor talking in the autumn statement about additional money for research and development, but what seemed to be lacking was investment in skills. He talked about skills only loosely, and actually there was not one mention of colleges. Will there be any additional money for colleges as a result of the Bill?

[James Cartlidge]

I am grateful to the hon. Gentleman. In raising education, I hope he will have noted and strongly welcomed the fact that, despite the tough fiscal situation, the Chancellor was able to find additional spending for education—indeed, £2.2 billion this year and next year for our schools. I hope he agrees that that is crucial.

[Richard Foord]

Colleges?

[James Cartlidge]

The hon. Gentleman is right to raise further education. We also announced in the statement that there will be a review by Michael Barber looking at the many positive initiatives that the Government have in place for training and increasing technical and vocational skills—T-levels, for example. We want to see maximum support for such schemes, so we will be reviewing them to ensure that we deliver them as effectively as possible. He makes an important point.

I turn to the measures on personal taxation. We know that difficult decisions are needed to ensure that the tax system supports strong public finances. To begin with, we are asking those with the broadest shoulders to carry the most weight. The Government are therefore reducing the threshold at which the 45p rate becomes payable from £150,000 to £125,140.

Autumn Statement Resolutions

Richard Foord Excerpts

Monday 21st November 2022 Commons Chamber

[Richard Foord (Tiverton and Honiton) (LD)]

In spite of what the hon. Member for South Cambridgeshire (Anthony Browne) says about the Conservative mini-Budget from two months ago, the very least we can say about it was that it accelerated massively the pace at which the cost of borrowing went through the roof in this country. In my few minutes, I want to relate that to how, in Devon, the council services, the healthcare services and dentistry have been affected, according to some of my constituents.

Let me turn to the situation facing local councils. Facing rising costs and watching inflation erode their spending power, council leaders were looking to the Chancellor to throw them a lifeline last Thursday. What did he do? He left them to flounder. The Conservative Leader of Devon County Council, Councillor John Hart, recently highlighted the scale of the challenge facing the council as it struggled to deliver vital services. Facing a £75 million black hole, Councillor Hart told local media that, because of the measures announced last Thursday, he is forced to choose between hiking council tax, at a time when many can least afford it, or making deep cuts to services. He writes:

“Devon has always been known for its careful and prudent financial management, but the strain on us all is becoming intolerable.”

That is the Conservative Leader of Devon County Council, and I agree with him.

Across Devon, we are seeing the effects of these decisions play out, as functions such as children’s services, which were already teetering on the brink, will not be able to cope. The Chancellor cannot simply expect councils to keep raising council tax to fulfil their statutory obligations. That will hammer local people, but will never be enough to fill the gap. Many of these people are struggling to make ends meet as it is.

Just recently, I received an email from a 10-year-old constituent. Louis Lighthouse wrote that he is worried about how rising costs will see families struggle this winter, yet the Chancellor’s solution is that Devon families should see their council tax bill rise.

Secondly, I wish to highlight the pressure facing our NHS, particularly frontline ambulance and A&E services. We already know that winter is a time when the NHS comes under extreme pressure, and we are going into this winter woefully under-prepared. In Devon there are 158,000 people on NHS waiting lists, unable to get the care they need, and I am sure that number will increase in the months to come. This problem is compounded by a lack of social care provision, with vital capacity being absorbed by people who could be discharged if there was somewhere for them to go.

Our ambulance services are on the brink. Almost everyone I speak to in my constituency has a story of a loved one waiting hours, sometimes in agony, for an ambulance to arrive. We need to end the scandal of ambulances stacking up outside A&E, unable to discharge their patients. However, given that the word “ambulance” was mentioned just once in the autumn statement, I am not sure that this Government truly understand the scale of the challenge. Perhaps that explains why it has been reported in the press today that the Chancellor is keen to cut all but a handful of NHS targets.

The final thing to mention is NHS dental services. In September; the BBC reported that not a single dental practice in all of Devon was taking on new NHS patients, and earlier this year Honiton Dental Surgery was forced to cut back on the number of people it could see, due to a shortage of staff. Nor is the issue isolated to Devon; there were no dental practices in Wokingham taking on NHS patients during the summer, and only two practices in the whole of Gloucestershire.

Our hard-working NHS staff are working flat out to deliver the best care they can, but the situation is spiralling out of control on this Government’s watch. It is clear that this autumn statement is a façade for spending cuts that will be left to the next lot, from a Government who are out of touch and out of ideas. It fails to address the serious issues people face right now and will leave us all paying the cost of Conservative chaos for years to come.

Autumn Statement

Richard Foord Excerpts

Thursday 17th November 2022 Commons Chamber

[Jeremy Hunt]

We always keep our funding formula under review, but I am absolutely certain that the person whom the hon. Lady has quoted will have welcomed the fact that there was a £4.7 billion increase in the money for social care, which is the biggest financial pressure for local authorities.

[Richard Foord (Tiverton and Honiton) (LD)]

Thanks to recent Conservative chaos, people are now facing both higher taxes and underfunded local services. More than 150,000 people across Devon are currently on an NHS waiting list. For example, Ann Newbury from Honiton had to wait more than three years for her operation. Can the Chancellor tell me that the Government will recruit enough new NHS staff to ensure that people in Devon will not have to wait so long for operations?

[Jeremy Hunt]

The hon. Gentleman may have heard me say that we are going to have an independently verified long-term workforce plan to ensure that we are training enough doctors and nurses in Devon and, indeed, all over the country, and I think it is incredibly important for us to do that.

Vehicle Taxation Reform

Richard Foord Excerpts

Wednesday 19th October 2022 Westminster Hall

[Wera Hobhouse (Bath) (LD)]

I beg to move,

That this House has considered reform of the vehicle taxation system.

I am delighted to bring this matter to Westminster Hall for debate. There is an urgent need for reform of our vehicle taxation system, for both fiscal and environmental reasons. The public understand that change must come; they look to the Government for clarity on the path to be followed. I hope that the Minister will be able to aid that process today. She will recognise that the future of travel is changing every year; Britain’s transport networks and habits are moving into the net zero era.

Electric vehicle ownership is rising, as people try to help the planet and their wallets. Battery electric vehicles, or EVs, made up 14% of the new cars sold so far this year, and more electric vehicles were sold last year than in the previous five years combined. 2030, the year in which polluting vehicles will no longer be produced or sold, is fast approaching. The Government must act to reform road tax if they are to avoid yet another huge black hole opening up in their finances.

No form of change will be easy, but the sooner change is made the easier it will be. The main form of vehicle tax in the UK is fuel duty, which is nearly 53% added to every litre of fuel paid for at the petrol pump. Fuel duty raises approximately £28 billion a year for the Treasury. That is alongside the 28% VAT that is paid on fuel sales.

[Richard Foord (Tiverton and Honiton) (LD)]

I thank my hon. Friend for securing this debate. The issue of how we tax road usage is very important, but I am deeply concerned about what is happening right now. In rural areas such as mine, where cars are essential to get around, we see people being hammered at the fuel pump. In part, that is due to limited competition and because there are fewer forecourts. Does she agree that we need to expand fuel duty relief for rural communities, so that it brings down prices immediately and eases the cost of living in the short term?

[Wera Hobhouse]

Absolutely. We see that people are facing great problems in rural communities and it is important to make short-term interventions to help them. However, I am really talking today about what vehicle taxation will look like in the long term, once we transition to net zero. Nevertheless, I fully take the point made by my hon. Friend.

On the other hand, drivers of electric vehicles pay no fuel duty. The Government need to continue incentivising the use of electric vehicles for environmental reasons. However, there are many ways in which that can be done without subsidising fuel duty. One option is to increase the number of public electric vehicle charging points. So far, the UK has only 31 electric vehicle charging points and only six rapid charging points per 100,000 people. If the Government are serious about encouraging the uptake of electric vehicles, they must ensure that the infrastructure is there. That would be of great benefit to my constituents in Bath and to the wider south-west, as our region is the second largest in the country for electric vehicle uptake.

Other incentives could include providing grants for electric car conversion. The conversion of old cars has significant benefits. For example, the carbon footprint of producing a new car is far higher than that created by continuing to use an old car. Currently, buying a new electric car is not an easy option for many people who do not have off-road parking or their own charging facilities. The conversion of older cars would help lower-income families who are struggling with the cost of living crisis, while also being part of the movement to less carbon-intensive transport options.

If we are to transition to net zero sustainably, the Government must find a way to fill the taxation income gap caused by declining fuel duty. The Government’s own net zero strategy from 2021 states that the taxation of motoring must keep pace with electric vehicles. I understand that the Treasury has said in the past that the level of income from motorists should stay about the same in future, but how can that be achieved?

The Growth Plan

Richard Foord Excerpts

Friday 23rd September 2022 Commons Chamber

[Kwasi Kwarteng]

This is not the Soviet Union’s Gosplan. I cannot predict what the average wage will be, but I know that one way to destroy the economic productivity of this country is to raise taxes in the way she campaigned for over many years during her Corbynista days, or whatever. That is not the way to grow this country’s economy.

[Richard Foord (Tiverton and Honiton) (LD)]

I remind the Chancellor that security is the first responsibility of Government. How will today’s changes to corporation tax serve to reverse the cut of 10,000 soldiers, making the Army the smallest it has been since the Crimean war?

[Kwasi Kwarteng]

Corporation tax has not been changed; it is being kept at its current level. On defence spending, the hon. Gentleman will know that my right hon. Friend the Prime Minister has committed to a defence target of 3% of GDP by 2030, recognising the changing nature of the threats and the real importance of our armed forces.