Debate on the Address

Debate between Sammy Wilson and David Davis

Tuesday 10th May 2022 Commons Chamber

[Mr David Davis (Haltemprice and Howden) (Con)]

It is a privilege to follow the hon. Member for Rochdale (Tony Lloyd), as I have done many times over the years. While I may not always agree with him, he always speaks with level-headed common sense, and that is a privilege for the House.

The proverb tells us that the good die young, and in this House that could not be more true than it has been this year; three of our most valued Members—David Amess, James Brokenshire and Jack Dromey—left us before their time. David Amess was a particularly close friend of mine, so it is a privilege to speak after his successor, my hon. Friend the Member for Southend West (Anna Firth), who gave a storming maiden speech. When she was telling her Mackintosh joke, I was reminded of a maiden speech made about 30 years ago by an Opposition Member. A rather striking redheaded Scot Nat made an absolutely stonking maiden speech, and John Smith, I think it was, jumped up and said, “That was no maiden speech; that was a brazen hussy of a speech.” The speech that my hon. Friend the Member for Southend gave was too elegant for that to be said about it, but I will say this, and it is perhaps the greatest compliment I can give her: David would have been proud of her.

There is a great deal to welcome in the 38 Bills in this Queen’s Speech. Those who have been pooh-poohing them perhaps ought to wait until they see the details. There is mention of tackling economic crime; embracing the freedoms that Brexit offers, though that is too late; reforming and securing our energy supply; and resolving the Northern Ireland legacy issues. These are all massively important issues, and there are many others like them that the Government are addressing, and on which they should have our undying support.

There are some issues—those on the Front Bench would be disappointed if I did not say this—that perhaps require more careful handling. For example, the Online Safety Bill is very necessary and well-intentioned, but it is so complex that it will have dozens of unintended consequences, including, possibly, that of curbing free speech. We have to make sure that we give that enough time to be looked at carefully. Similarly, the national security Bill is undoubtedly necessary, but we will have to handle it carefully because it replaces the Official Secrets Act, and while it protects the state from its enemies, we must make sure that it does not curb the rights of honourable whistleblowers.

A Queen’s Speech is built on sand if it is not underpinned by strong economic foundations. Indeed, this Queen’s Speech says that the Government

“will drive economic growth to improve living standards and fund sustainable investment in public services”,

but taxes today are too high, so we need to get some fundamentals right. High taxes do not deliver growth; they stifle it. Low taxes deliver investment and higher productivity, and therefore growth, and they are the pre-emptive answer to stagflation, which is the biggest threat on our horizon in the coming year.

I rather agree with the points from some on the Opposition Benches about the need for an emergency Budget, but I do not agree with the argument for windfall taxes, which would be self-defeating. There is certainly a need to act quickly. The Prime Minister talked about deploying our “fiscal firepower”, but we need to do that now, when our constituents need it, not after they have suffered the increases in prices that they face, and the further increases that they will face in the latter part of the year. This is a good Queen’s Speech.

[Sammy Wilson]

The right hon. Gentleman is absolutely right that having lower taxes puts money into people’s pockets—money that they can spend on things that they find it difficult to afford at present. Is he worried that the decision to use this firepower in a couple of years’ time, when we are coming up to an election, rather than using it to deal with the issues that are hurting people badly now, will be seen as cynical?

[Mr Davis]

The right hon. Gentleman is exactly right. If we increase national insurance for a large part of the population, and so increase their suffering and their inability to eat and to heat their house at the same time, but drop income tax one year before an election, I am afraid that would be seen in the working men’s clubs of Yorkshire as a cynical deployment of state power. I suspect it would be the same in Belfast and the rest of Northern Ireland, where, as we have heard already, the problem is even bigger than in the rest of the United Kingdom. He is right, and that is why we should give the people their money back now. My right hon. Friend the Member for Wokingham (John Redwood)—

Finance Bill

Debate between Sammy Wilson and David Davis

Report stage & 3rd reading
Monday 24th May 2021 Commons Chamber

[Mr Davis]

The right hon. Gentleman is right. The first phase of IR35 was about contractors for Government, so the whole wild west that I have described was actually created for public services.

To come back to my point about illegitimate contractors forcing the legitimate ones out of business, it is quite understandable that ordinary contractors will be attracted to a scheme that seems to offer them the best terms, yet they will be unaware that in doing so they risk unwittingly entering unintentional tax avoidance schemes. That is one of the problems that troubles me most.

These contractors, remember, are not fat cats, big bankers or city slickers. They are hard-working, decent people such as locum nurses and supply teachers—contractors whose work is vital. To take up the right hon. Gentleman’s point, the FT reported that NHS locum workers returning during the height of the pandemic were targeted by firms mis-selling these schemes. Ordinary and comparatively low-paid workers do not have the advantage of expensive tax advisers. They cannot be expected to navigate the minefield of extremely complex tax law if we allow these predators to play unfettered within it.

[Sammy Wilson (East Antrim) (DUP)]

Does not the situation get even worse once these tax avoidance schemes have been identified and shown to be illegal? It is very often the people who were conned into operating with umbrella companies who are penalised, while the umbrella companies walk away with no investigation and there is no means of holding them to account.

[Mr Davis]

That is entirely right. Indeed, one of the flaws that HMRC exhibits is that although it very often has real-time information on the issues, it acts only much later. That doubles or quadruples the problem for the ordinary person who is effectively a victim of these schemes, who suddenly finds years later that they have vast sums to meet—and, indeed, the shame of being held up as a tax avoider, if not evader.

The Government should take action to clean up this wild west, for example by providing guidance and templates for the preferred model of working. This is not so difficult. Why cannot we lay out a template for ordinary contractors and legitimate umbrella companies that says, “This is how you should do it, and this is what we expect”? Failing that, my amendments give the Government and Parliament three clear and simple options.

Ideally, the Government will take note and enact new clause 31. It would review—it does not require law to do this—the whole operation of umbrella companies and off-payroll working. For me, that is the de minimis position. My preferred option is that the Government should introduce regulation into this problematic sector to clear up some of the most egregious aspects, including mis-selling and malpractice. They should require—this deals with the Companies Act point to some extent, but it is the simplest way of doing it—umbrella companies to meet five strict requirements: they should pay all holiday pay due; maintain all employment rights; ban kickbacks to third parties; end the skimming off of excess profits through sleight-of-hand tactics; and, finally, ensure that the worker himself has no material interest in the umbrella company. That would not deal with the propriety issues of the Companies Act, but it would deal with the main, most socially damaging aspects of the wild west we have now.

Budget Resolutions and Economic Situation

Debate between Sammy Wilson and David Davis

Wednesday 3rd March 2021 Commons Chamber

[Sammy Wilson (East Antrim) (DUP)]

First, may I welcome the Budget, and welcome the reminder that the Chancellor gave at the very end of his speech that this Budget, and indeed the actions taken by the Government over the past year, demonstrate the value of the Union? We can look at the details in the Budget paper: in Northern Ireland, over a quarter of a million people are having their wages paid through the furlough scheme; 200,000 self-employed people are having their income supported as a result of the scheme; £1.5 billion in loans has been made available to businesses in Northern Ireland; and the Northern Ireland Executive have benefited by over £3 billion in Barnett consequentials, which has enabled them to put in place bespoke schemes in Northern Ireland. For anyone listening, this debate serves as a good reminder that being part of the fifth largest economy in the world has economic benefits, and they are economic benefits which cannot be replaced through any other arrangement.

The second thing I want to say is that I welcome many of the measures in the Budget. It is a difficult time for the Chancellor to present a Budget, but I am glad that many of the measures that we as a party had written and spoken to him about have been reflected in the Budget. The hospitality industry, which is very important in Northern Ireland, lobbied heavily for the 5% VAT rate to be maintained, and I am glad to see that it is being maintained, albeit not for the whole year. I represent a rural constituency, and many of my constituents were concerned about the impact that an increase in fuel duty would have on the cost of living, so I am glad to see that duty has again been frozen. Many businesses looking at their overheads wanted to ensure that they would not be subjected to rates again; the business rates relief is important for them.

However, there are many challenges as to how we pay off the debt, and the Chancellor was upfront about that. He made it clear that some painful choices would have to be made. The Budget papers illustrate how painful some of those choices will be. For example, by freezing the thresholds for income tax, over the next five years the amount of money taken from people across the United Kingdom in income tax will go up by 25%. Some of that will be as a result of the 3% increase in employment, but much of it will be through a stealth increase. As thresholds are not moved up, there are inflationary increases on wages, and people pay more.

Like the last speaker, the right hon. Member for Haltemprice and Howden (Mr Davis), I am worried about the impact of the corporation tax increases. While the Chancellor has indicated that they will not come in immediately, over the period for which we have figures the corporation tax take will increase by 112%. That will have an impact on investment, although we hope that the allowances that have been granted will ensure that some of the profits will be ploughed back.

[Mr David Davis]

Is it not a fact that when you put up corporation tax like that, it does not deliver the arithmetic outcome: you actually get less back and it suppresses your business as well?