Income Tax (Charge)

Debate between Richard Fuller and Ed Miliband

Thursday 28th October 2021 Commons Chamber

[Edward Miliband]

My hon. Friend is completely right and I will come to that point in a moment. The Government will no doubt have all kinds of excuses, but this is a sin of commission, not just omission, in the sense that the Government are actually doing things to make the problem worse.

The problem is that the Chancellor could not bring himself to admit any of this yesterday. Here is the issue: it is not just that he did not say any of this, but it is like the Government actually believe their own rhetoric, and the Budget is the result. Yesterday we saw raid upon raid on the living standards of working people: council tax hikes, hidden in the Budget document—not announced by the Chancellor; a stealth raid on the self-employed worth £1.7 billion over the coming five years—not announced by the Chancellor; and of course the national insurance hike on ordinary families confirmed.

Maybe I am a bit old fashioned in this respect, but let us remember that this is a direct breach of the promise that every Conservative Member made to their constituents at the general election. What did they call it in their manifesto? Alongside a picture of the Prime Minister—drawing on his long and unblemished record of truth telling and candour—it said:

“My Guarantee… We will not raise the rate of income tax, VAT or National Insurance.”

I look forward to them all explaining at the next general election why they have broken that promise. The hon. Member for North East Bedfordshire (Richard Fuller) is nodding. Perhaps he would like to explain why they have broken their promise.

[Richard Fuller (North East Bedfordshire) (Con)]

I have been goaded into intervening by the right hon. Gentleman, who asks a very direct question. I think the honesty will be that we will say that we wanted to protect the public finances, and that post covid, given the choice of either borrowing more money or asking those with the broadest shoulders to bear the burden to cover those costs, we decided that we should do the latter.

[Edward Miliband]

It is certainly not those with the broadest shoulders who are being affected, and I thought the reason that the Government raised taxes was for social care. It is yet another guarantee from the Prime Minister that is not worth the paper that it is written on.

The IFS tells us this morning that taxes will be £3,000 more per household than when the Prime Minister came to power. As my hon. Friend the Member for Leeds West (Rachel Reeves) said in her excellent speech yesterday, this is about the choices that the Government are making. Also buried in the Red Book is that the Chancellor saw fit to cut taxes on the banks by more than £1 billion because he was so worried about the burden they were facing, just like last year when he made the choice to cut stamp duty for second home owners because he was so worried about them. He was obviously less concerned about the burden of higher energy prices facing millions of British people, because he refused to cut VAT on fuel as he should have done.

In a way, the most shameful part of the Budget is the Chancellor’s refusal to reverse his £1,000 cut to universal credit, which hit 6 million families. For all the smoke and mirrors, this morning we know the truth about universal credit. According to the Resolution Foundation, three quarters of families on universal credit will be worse off, even after the changes to the taper. It says that the taper changes

“will be overshadowed by last month’s £6 billion cut to entitlement: three-quarters of families on UC will lose more from the £20 cut than they gain from the Budget changes. Even if we also take into account the…National Living Wage, the poorest fifth of households will still be an average of £280 a year worse off overall.”

The fact that Conservative Members were wildly cheering a policy yesterday that sees millions of working families far worse off shows, I am afraid, that they do not get it either.

Advanced Research and Invention Agency Bill

Debate between Richard Fuller and Ed Miliband

2nd reading
Tuesday 23rd March 2021 Commons Chamber

[Edward Miliband]

We shall look forward to the Secretary of State getting a satisfactory result. I am not sure that I always got a satisfactory result with the Treasury, although I was in the Treasury at one point, at least as an adviser. This is very important and, as I say, people’s jobs and livelihoods and the scientific base of this country, of which we are all so proud, depend on it.

Let me come to the Bill, which we support. The Bill is important—the Secretary of State said this—because there is incredible work going on in the scientific community, but there is consensus that there is a lack of a mechanism to identify, build and fund truly ambitious, high-risk, high-reward programmes. We recognise the case for an independent agency that operates outside the established research funding mechanisms, but we feel that the Bill requires improvement.

I guess our concerns cohere into a different view about the role of Government and the lessons of DARPA, which my hon. Friend the Member for Cambridge (Daniel Zeichner) talked about, on which in some broad sense—maybe not in the Secretary of State’s mind, but in others’ minds—ARIA is modelled. It is impossible to ignore what we might call the spectre of Dom in this debate. He was at the Science and Technology Committee—chaired by the right hon. Member for Tunbridge Wells—and he does rather hang over this Bill. He is its sort of governmental godfather. In his telling, DARPA’s success—I think this is important—is simply because the Government got out of the way and let a bunch of buccaneering individuals do what they liked. It is definitely true, as I understand it, that DARPA has important lessons about the need for the culture that I talked about, including higher reward and, of necessity, a higher chance of failure, but it is simply not true that DARPA was somehow totally detached from Government. DARPA had an obvious client—the Department of Defense—a clear mandate around defence-related research, a clear synergy in its work with the procurement power of the US DOD and, incidentally, abided by laws on freedom of information.

I want to suggest that there are two different views about ARIA: one is that we should let the organisation simply do what it wants, relying on the wisdom of a genius chair and chief executive; and the other subtler and, in our view, more sensible approach—one more consistent with the lessons of DARPA—is that Government should set a clear mandate and framework for ARIA and then get out of the way and not interfere with its day-to-day decision-making. I also believe there is a democratic case, because the priority goals for the spending of £800 million over this Parliament should be driven by democratic choices; not about the specific items that it funds, but about the goals and mission.

That takes me to the three points that I want to make: first, about the mandate for ARIA; secondly, about its position in the wider R&D system; and thirdly, about accountability. I will try to emulate the Secretary of State’s brevity—perhaps not exactly his brevity, but as much as I can.

The deputy director of DARPA says about its success that

“having national security as the mission frames everything.”

The Secretary of State said to the right hon. Member for Tunbridge Wells at the Science and Technology Committee:

“If I were in your position, I would be asking what the core missions of ARIA are.”

I think the point that Dominic Cummings made, or I am sure would have made, is that this will be a job for the people we hire who are running the organisation. The Secretary of State went on:

“It will be up to the head of ARIA to decide whether he or she thinks the organisation should adopt what the innovation strategy suggests…or reject it.”

I really understand the wish to give freedom to ARIA, but surely it is for Government to shape and not shirk the setting of priorities, and it is not just DARPA where we can learn that lesson. Moonshot R&D—the Japanese agency established in 2019 to fund challenging R&D—has seven specific moonshot goals set by the Japanese Government, and my understanding from the evidence taken by the Science and Technology Committee is that the UK scientific community agrees with that idea.

I notice the hon. Member for North East Bedfordshire (Richard Fuller) putting his head in his hands. He has done that before when I speak, but let me just make this point in seriousness: £800 million is not in the scheme of things a huge amount of money, certainly when compared with UKRI’s budget. The concern is that unless, as the Select Committee said, ARIA focuses on a single or a small number of missions, it will dilute its impact.

Take the net zero challenge. I believe it is a challenge of political will and imagination, but it is also a technological challenge. If it is the No. 1 international challenge, as the PM said last week, and if it is the No. 1 domestic challenge, as I think it is, why would it not be the right mandate for ARIA for at least its first five years? Indeed, Professor Richard Jones and Professor Mariana Mazzucato, who perhaps have even greater claims than Dom to being godfather and godmother of this idea, said that climate change would be an ideal challenge on which an agency such as ARIA would focus. To be clear, providing a mandate does not mean micro-managing decisions, and it would be grossly simplistic to suggest otherwise.

[Richard Fuller (North East Bedfordshire) (Con)]

The right hon. Gentleman tempts me to my feet, first, because I think he does a tremendous disservice to Dominic Cummings. Without his inspiration, this Bill would not be before this House. Secondly, I do not know whether the right hon. Gentleman is aware of the chart that Mr Cummings showed while giving evidence to the Select Committee. It showed a large circle of areas with potential for people to investigate and a smaller segment of that, which is where all of the foreign Governments and our Government focus their research, precisely because they are driven by the political decisions, frameworks and missions that politicians set. Does the right hon. Gentleman not think there is some opportunity for us to do something slightly different and without the sticky fingers of Government interfering?

[Edward Miliband]

The hon. Gentleman and I have a respectful disagreement on this: I think it is for the Government of the day and this House to say what are the massive national priorities. Then it is for an organisation such as ARIA to fund the research in the high-risk, high-reward way that I mentioned. That is simply a difference of view. Without a clear policy mission, we risk a fragmented approach.

I will make this other point, which is that the chair and chief executive will be in the somewhat unenviable position of having to decide which Government Departments to prioritise. Of course they can work with different Departments, but let us set a clear challenge for the organisation.

The second point is not just about the question of mandate, but how it sits in the life cycle of technological innovation and how it works with other funding streams. ARIA is born of a frustration about the failure to fund high-risk research. We do not disagree with that thinking, but that makes it especially important that it does not duplicate the work of existing funding streams. Let me give an example. Innovate UK, part of UKRI, is supposed to be a funding stream to turn ideas into commercially successful products. I do not know from reading the Government’s statement of intent what Innovate UK would fund that ARIA would not and what ARIA would fund that Innovate UK would not.

The vagueness of the mandate for ARIA is matched by vagueness about where in the innovation cycle it sits. I was not doing Mr Cummings a disservice on this score by the way, because I support the Bill, but he said to the Select Committee:

“My version of it here would be…to accelerate scientific discovery far beyond what is currently normal, and to seek strategic advantage in some fields of science and technology…I would keep it broad and vague like that.”

He went on to say that he would say to the agency:

“Your job is to find people…with ideas that could change civilisation completely”.

I am sorry, but that is too vague, and I do not believe it unreasonable to say that there needs to be greater clarity about where in the life cycle ARIA sits.

National Security and Investment Bill

Debate between Richard Fuller and Ed Miliband

2nd reading & 2nd reading: House of Commons
Tuesday 17th November 2020 Commons Chamber

[Edward Miliband]

I really appreciate the hon. Gentleman’s point. These are not Christmas tree baubles that I have suddenly raised now. In 2010, there was the issue of the Kraft takeover of Cadbury. In 2014, there was the threatened takeover by Pfizer of AstraZeneca that had deep implications for our science base. I have felt for a decade that our legislation is not fit for purpose—and I acknowledge completely that this legislation was put in place by the Labour Government. These are deeply serious questions about the future of our industrial strategy and industrial base.

I do not pretend that these issues are easy to resolve. Of course there are dangers on both sides of the ledger, and we have to strike a balance between those two dangers, but we have enough experience with Kraft-Cadbury and with Pfizer and AstraZeneca— which did not happen, but not because of any powers of Government—to be anxious about Nvidia-ARM. If, as I believe, the whole basis of this legislation is to say that other countries are taking this action when it comes to national security and so should we, the logic applies here as well. It is not straightforward, it is not simple, and I completely acknowledge that to the hon. Gentleman, but I see the case for change.

[Richard Fuller (North East Bedfordshire) (Con)]

The right hon. Gentleman used the phrase “I feel” and then talked about confectionary, then about how he felt about pharmaceuticals and about semiconductor chips that are used in mobile telephony. That is the problem, is it not, Mr Deputy Speaker? His feelings are not an appropriate way to interfere in the development assets of private capital. What could he provide to those businesses to protect their development from the vagaries of his feelings from time to time?

[Edward Miliband]

It is interesting; I believe the hon. Gentleman supports this Bill—I may be wrong—but on national security, the Government will apply some tests and we could apply some tests when it comes to our industrial base. Let me make this point to him: it is not just France, but Germany, Australia, Japan and the United States. It is all of the other major industrial economies that say, “Well, no, we do have a strategic interest in certain industries.” Of course, if we decided to go down that route, we would have a debate in this House about the specific areas in which we wanted to be able to intervene. We would have to look at exactly the criteria, and it is not just about whim, but the question is: is the status quo adequate?

I say to the hon. Gentleman that the status quo is not adequate, and we do not just have 10 years or more of experience to suggest that the status quo is not adequate; we also have a real situation now with Nvidia and ARM. If anyone in the House wants to get up and say, “We think it is fine. We think this should just go ahead. We are not concerned about what that means for our tech sector”, then fine, but everybody I speak to in the tech sector who knows about this issue, including my hon. Friend the Member for Newcastle upon Tyne Central, says that there is a real worry. Why have we not developed enough of these world-leading companies in this country? Why do we want to see ARM taken over?

Business and Planning Bill

Debate between Richard Fuller and Ed Miliband

2nd reading & 2nd reading: House of Commons
Monday 29th June 2020 Commons Chamber

[Edward Miliband]

My hon. Friend in her customary eloquent way anticipates my next point. We have seen—and I am grateful to my hon. Friend the Member for Croydon North (Steve Reed), the shadow Secretary of State for local government, for giving me the exact figures—£10 billion of costs loaded on to local authorities during this crisis, and only £3.2 billion provided by Government, despite the Secretary of State for Housing, Communities and Local Government saying that the Government would stand behind councils and give them the funding they need. We have another Bill that puts yet more pressure on local authorities, but with no clear plan about how they will be reimbursed, and our new clause 5 speaks to that issue.

We also welcome the changes to transport licensing and the removal of the unfair relationship provision in the Consumer Credit Act to ensure that bounce-back loans are more easily accessed.  I am grateful to the Secretary of State for the detailed discussions that we had about that particular provision.

Those are the main provisions of the Bill and, as I said, there is cross-party agreement on them. Obviously, there will be detailed discussions in Committee. However, I have to say to the Secretary of State and the House that we are under an illusion if we think that the measures in this Bill will go much of the way towards addressing the crisis that we face: 4 July represents a reopening of pubs and restaurants, but it does not represent recovery.

It is important to note that many sections of our economy employing hundreds of thousands of people, including gyms, leisure centres, live entertainment venues, beauty salons, conference facilities, night clubs and swimming pools, will still not be able to open for public health reasons. We support those public health decisions. Other parts of our economy will open only with severe restrictions, including large parts of our hospitality industry, which employs 3 million people or one in 10 of the whole workforce. The British Beer and Pub Association says that 25% of pubs will not be able to reopen even at 1 metre. The Government themselves acknowledge, in the scientific assessment of the change to 1 metre, that the hospitality industry will lose 25% to 40% of its revenue even at 1 metre distancing. That revenue translates into a risk to hundreds of thousands of jobs. Live performance remains prohibited, which affects the theatre sector, employing 290,000 people. Manufacturers, too, are reeling from the fall in domestic and worldwide demand.

I say all that not to cast doubt on the public health measures being taken or to speak against the Bill, but to point to the wider context, which is that the Government are taking a one-size-fits-all approach to the furlough, for example, demanding an employer contribution from August and a cliff edge at the end of October. The shadow business Minister, my hon. Friend the Member for Manchester Central (Lucy Powell), received this letter from a venue in Manchester in the past week: 

“As the Government furlough scheme draws to a close, I will be making very difficult decisions this week so that I can give notice during the period of 80% furlough contribution to commence a redundancy consultation with the majority of my venue staff. With zero income and no appropriate financial Government support, I have no choice but to make these decisions.”

We are not asking the impossible of Government; we are saying, “Look at what other countries are doing”, whether that is Spain, Italy, New Zealand, France or Germany. They are taking a sectoral approach to the furlough. They are saying that specific sectors are more affected by the public health measures and that, therefore, the economic measures have to match that.

[Richard Fuller]

The shadow Secretary of State will be aware that the Government measures taken across the economy, which he has welcomed, already raise issues of fairness between those who fall one side of the line and those who fall on the other side. What is his proposal for those sectors? Some businesses will fall just to one side, but who will be the expert to understand who fits where? I am all up for it if he can reconcile that, but there are risks, are there not?

[Edward Miliband]

Of course there are, but just because we cannot do everything does not mean that we should not do anything. The grants programme that the Government introduced was done by sector—retail, hospitality and leisure. The hon. Gentleman makes an important point about boundaries, and some business organisations would raise that issue, but I worry that technical concerns about boundaries, which have been overcome for the grants scheme, stop us doing something that makes real sense.

Corporate Insolvency and Governance Bill

Debate between Richard Fuller and Ed Miliband

2nd reading & 2nd reading: House of Commons
Wednesday 3rd June 2020 Commons Chamber

[Edward Miliband]

My hon. Friend is a brilliant champion of those industries and other industries in his constituency, and I agree with him. I will come on to the particular sectoral challenges that the Secretary of State and the Government are facing.

Let me mention the areas where we would like to see improvements made to the Bill. First and most importantly, the Government’s case on the restructuring plan provision is that it could have benefits in enabling companies to restructure and not go into liquidation and in stopping large creditors from forcing companies to do so. I accept the case. I think I am right in saying that the cross-class cram-down provisions—it is not a very beautiful phrase—apply across the EU under EU law and apply in the United States as well. What is important about the provisions is that they mean that even if a class or classes of creditors object to a rescue plan, it can still go ahead providing they are better off than in the other most likely scenario, which is often going to be liquidation. That is why protecting those without power—creditors and others—is so important.

What cannot be allowed to happen—I know the Secretary of State agrees with this—is for the RP provision, which has wide scope and is not just for companies that are insolvent, but for those who fear they might become so, to be used to ride roughshod over the rights of employees, including their pensions. Given the nature of the crisis we are in, it is essential that there are proper safeguards.

To give an example, the Secretary of State will have heard earlier the deep concerns across the House about the actions of British Airways, including sacking its employees and apparently offering worse terms and conditions. The RP provision cannot become a charter for more of that sort of action, and it is our mutual responsibility to make sure it does not become so. I know the Secretary of State shares that view.

[Richard Fuller]

I am extraordinarily grateful to the right hon. Gentleman for raising this point, because he will be aware that when a company is in a crisis situation and has so many wolves at the door, it has to make rapid decisions to salvage the assets and the business and continue, hopefully, to trade profitably. He is putting his finger precisely on the issue of what the rights of employees in that circumstance are and what protection there is for their pension benefits in the long term—that is a fundamental part of this issue. I am interested in his new clause on employee representation, which refers specifically to trade union representation; would he be prepared to broaden that out to include some broader sense of employee representation?

[Edward Miliband]

I welcome what the hon. Gentleman says, and the answer is yes, because lots of businesses do not have trade unions, and the question is what rights employees will have in those circumstances. The US experience is quite informative: I mentioned the US hazard provision, and at American Airlines and General Motors we saw employees lose out very significantly. The hon. Gentleman’s point about pension provision is absolutely part of this. I very much hope—this is the spirit in which we are approaching the Bill—that the Government will seek to improve the protections that are in place. Our new clause 5, to which the hon. Gentleman referred, seeks to ensure mandatory discussions with the trade unions once a company enters a restructuring process. That will ensure that employees are provided with all the information made available to the court and fully consulted on any restructuring plan, and the court could then take that into account. There may be better and more comprehensive ways to build in such protection, but it is essential that we do so. Perhaps the Minister can come back on that in his winding-up speech and, indeed, in Committee.

Secondly, we are concerned about similar issues when it comes to insolvency. Unsecured creditors are left to bear most of the risk of insolvency, so they are often at the back of the queue when it comes to being protected. The protection of unsecured creditors, or the greater protection of them, could be provided through strengthening the ring-fencing of the proceeds of sale of assets when a company becomes insolvent, increasing the proportion of the proceeds reserved for them to 30%, and removing the financial limit, which is what we propose in one of our amendments. We also believe that pension schemes—this goes to the point that the hon. Member for North East Bedfordshire (Richard Fuller) made—should be made a priority creditor in the event of insolvency so that they get to have a role as a class, because currently I do not believe that they necessarily will.