Royston Smith
Main Page: Royston Smith (Conservative - Southampton, Itchen)
Royston Smith (Southampton, Itchen) (Con)
I do not intend to take all of my time, because I am nowhere near as qualified as the right hon. Member for Kingston and Surbiton (Sir Edward Davey) and my hon. Friend the Member for Aberdeen South (Ross Thomson), who have done a fantastic job in getting us here to this debate, so that we can make representations on our constituents’ behalf. I, too, pay tribute to the Minister. He has been very helpful in responding to all my queries and those of my constituents. Of course, not all responses have been to their liking, but he has always been available and I pay tribute to him for that. I hope he is as accommodating today as he has been so far.
My hon. Friend the Member for South Suffolk (James Cartlidge), who is not in his place any more, argued that people who use public services should pay for them. If we are talking about evasion versus avoidance then of course he is absolutely right, but self-employed contractors have a different tax regime from people who work with PAYE; they have a different structure. They will look to see whether they can make the best use of their tax situation, because they do not get sick pay or holiday and nobody is paying their pension for them. They will therefore look for the most efficient way to deal with their tax. Some of these schemes have been shown to be that for them. They asked the questions and we all know they asked the questions. There are very few people caught up in this who we think went deliberately out of their way to avoid tax.
Sir Henry Bellingham (North West Norfolk) (Con)
I endorse what my hon. Friend said about the Minister, who has been extremely receptive, and we hope that he will take action. Is my hon. Friend aware that many of these people are well into their late 50s and many are over 60, and they have no chance of ever recovering their financial position? Some of my constituents specifically asked the Revenue whether everything was in order and correct and proper. They were told categorically that it was, and it allowed them to take out future schemes in future years.
Royston Smith
My hon. Friend makes a very good point. That is exactly what my constituents have been saying to me. Some of them are nearing retirement with absolutely no chance of paying back what they are told they owe. Furthermore, they tell me that these schemes still exist—I hope that the Minister will confirm whether they do—and that people are still promoting very similar schemes. If that is the case, it is incumbent on HMRC and the Government to be shutting them down and going after the people who did them.
Robert Courts (Witney) (Con)
My hon. Friend makes an excellent point. I have a great number of constituents who are very distressed about this. People cannot be treated and approached in a technical way, because this affects people’s real lives. The Treasury must bear some culpability, given that it has at least allowed these schemes to be used when everyone else has acted in good faith in investing in them.
Royston Smith
My hon. Friend is absolutely right. I think that we are finding a consensus across the House, in that we all agree with that. People did ask these questions. They were convinced by those who promoted the schemes that sometimes it was the only thing that they could do, but that the schemes were legal. Some of the people asked these questions of HMRC.
The worst of it is that it looks very much like we sometimes just go after the low-hanging fruit. It is easy to chase such people rather than those who promoted the schemes and landed them in this trouble. Everyone has said—I will say it too—that these are real people. When people affected first came to see me in my constituency, I did not know very much about this, but when they told me about it and the figures that they might have to pay, it was devastating. I could not believe what they have been told might happen to them. I thought, “What if that was me? What if someone came to me and said, ‘You owe tens of thousands of pounds’?” Frankly, I would have no way of paying that amount without a significant change to my life. Fine—maybe if I deserved it I would have that coming, but if people did not know that, why should their life have to change so much, to the point where some have now felt that their life is no longer worth living? Driving people to bankruptcy is not the answer. We should be finding out how this happened and discovering who is culpable, including HMRC.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Does the hon. Gentleman agree that it would be a clear injustice if anybody innocently caught up in this, having sought advice for one of these schemes, were to lose their main home or indeed be made bankrupt as a result of this action?
Royston Smith
It would be an absolute tragedy. That is why I am very grateful to my hon. Friend the Member for Aberdeen South for securing this debate, enabling us to air this issue publicly. If anybody is made bankrupt by something that is not of their deliberate doing, it would be a travesty.
I do not propose to take much more time; I know that a lot of people are waiting to speak. It is not a great ask to the Minister to pause this, to review it independently and to give my constituents and everyone else in this House a bit of respite, so that they know that what has happened to them is right.