National Insurance Contributions (Secondary Class 1 Contributions) Bill

Simon Hoare Excerpts

Committee of the whole House & 3rd reading
Tuesday 17th December 2024 Commons Chamber

[Gareth Snell]

No—I will give way in a second. Savana is the provider of the rape and sexual advice service in Stoke-on-Trent. It gets all its money from the Ministry of Justice; it is essentially running a Government service by virtue of contracts, yet it will now see an increase in its national insurance contributions of something between £16,500 and £17,000, which will reduce the number of people it can support with independent domestic violence advisers and independent sexual violence advocates. The other half of its money comes from the Home Office via the police and crime commissioner. Again, that is essentially public money providing a public service that just happens to be provided by a charity that is not covered by the rebate provided to other organisations.

Disability Solutions helps those who are entitled to additional support to access it. That charity brings millions of pounds a year into the city, which has a cumulative economic benefit, because the money brought in is spent on our high streets and in our local economy. The people it helps are not the wealthiest in my city; they quite often have very little in their pockets, and every penny that is given to them is spent in the local economy. They do not hoard it in a savings account, put it into the Cayman Islands or use it as a downpayment on a new car or furniture; they go out and buy food, shoes and school uniforms for their children, or they use it in one of the local entertainment venues.

North Staffs Mind faces an impact of £55,000. That organisation is specifically designed to help people with their mental health, which the Government have rightly identified as a huge inhibitor to economic growth, because if people cannot get their mental health sorted, they cannot get back into work. Another mental health organisation, Changes, wrote to me to say that these changes to national insurance would be unsustainable for them. Finally, the Dove Service is a bereavement counselling service that faces a cost of £2,000. All those organisations are filling a void in state provision in my city.

[Simon Hoare (North Dorset) (Con)]

In essence, the hon. Gentleman has described what we on the Conservative Benches would have called the big society some years ago. Does he share my concern, however, that that huge bank of volunteers who often prop up and form the supports for the organisations he has described are likely to drift away as their organisations come under pressure? Not only will there be a financial pressure, there will be a pressure on the resource of people who are volunteering, because they will just say, “If the Government are not prepared to help us this one little bit, why should we help?”

[Gareth Snell]

I actually do not agree with the hon. Gentleman’s assessment, because in my city of Stoke-on-Trent, when there is need, people arrive to offer help. It is one of the things that people often say; we are a friendly, welcoming people, and if someone is in need, we roll up our sleeves and get stuck in.

However, I agree that although dedicated volunteers are excellent, they are not a replacement for staff. In particular, they are not a replacement for the highly trained staff who provide very bespoke services, such as some of the ones I have mentioned. There are thousands of volunteers across Stoke-on-Trent, and I thank every single one of them for every moment of their time that they donate, but as the hon. Gentleman will know from his constituency, we sometimes talk about voluntary organisations as if they have no costs associated with staff, because they are entirely volunteer-run. I think everyone across this House would recognise that that is simply not the case; if it were not for the cadre of professionals who help co-ordinate those volunteers, things would fall apart.

Although I have set out the challenges faced in my city, I am not necessarily drawn to some of the proposed amendments that would set differential rates for charities or other organisations. That is not because I do not believe those organisations should not be protected from the national insurance increase that is coming, but if we are saying that they should have a differential rate, why should that rate not be zero? Why should we not just exempt them entirely? I am also not convinced that we would not see people seeking to reorganise their own businesses to try to claim charitable status and reduce their own liabilities. Fundamentally, I believe that paying tax is a patriotic duty—if someone should, then someone must.

There have been record levels of settlements for the NHS, and I accept the points that have been made about hospices and GPs. I sincerely hope that Staffordshire and Stoke-on-Trent ICB will make use of the better care fund, putting some additional money into that fund to pay for the social care that could help offset some of the national insurance increases that will make those jobs much more difficult. However, many of the organisations I have mentioned receive their operating budgets from Government, albeit passported through funds, a local council or another public body. They are essentially running Government services—they are running a public service on behalf of the Government. Is it not incumbent on us to make sure the services we ask them to provide are provided at the level we expect, and that we resource them efficiently? I would like to think that the difference between this Government and the previous one is that we value the work sufficiently that we will pay those organisations correctly and accordingly. If the Minister could address those points when he sums up, I would be most grateful.

Finance Bill

Simon Hoare Excerpts

Committee of the whole House
Wednesday 11th December 2024 Commons Chamber

[James Murray]

Local authorities and schools already have processes in place to support pupils who move between schools at any point in the academic year. Analysis carried out by the Department for Education under the previous Government suggests that each year, almost 60,000 secondary school moves take place not at normal transition points or over the school holidays. We fully expect the majority of moves to take place at natural transition points or in the school holidays, rather than within the school year.

I have been clear that ending these tax breaks for private schools has been a difficult decision, but it is necessary to secure additional funding that will help us to fulfil the commitments we made to improving education for all.

[Simon Hoare (North Dorset) (Con)]

The Minister continually refers to tax breaks. They are not tax breaks. Why can he not just be honest with the House and admit that this is the first time that any Government in a civilised democracy has imposed a tax on learning and education?

[James Murray]

Let me explain to the hon. Gentleman how public finances work. Funding a tax relief or a tax break is equivalent to public spending, because it is money that cannot be spent on something else. The Conservatives have committed, through their new leadership, to repealing this policy if they win the next general election. That implies cutting state education—cutting the investment in education for all that we are prioritising.

[Simon Hoare]

rose—

[James Murray]

I will not give way because I am making a clear point. We have to make choices in politics about what to prioritise. We have said that the VAT tax break for private school fees is not something that we want to prioritise. We want to spend that money instead on improving state education for all children.

[Simon Hoare]

I am grateful to the Minister for giving way a second time, and I am so grateful for the public finance lesson. Surely he has to accept that as no tax is placed on learning in any sector in the educational landscape across the United Kingdom, this measure is not a tax break. It is not that there is a tax break for one sector while others have a tax imposed. This is an imposition of a new tax in the educational sphere. It is not a tax break because no educational establishment pays VAT.

[James Murray]

Given the record of the Conservatives over the past 14 years, I do not think it is ridiculous to assume that they might need some education on how public finances work, with the mess that we inherited and the desperate need for us to restore fiscal responsibility to public finances. Restoring that fiscal responsibility requires us to take decisions that are difficult but necessary to raise the finances to fund our priorities. We have taken the decision that we will not support a VAT exemption for private school fees and that we will invest the money that we raise in state education to ensure that the aspirations of every parent across this country can be fulfilled. That is a decision I will defend every time I am in this Chamber.

--- Later in debate ---

[James Wild]

I will make a little progress, if the hon. Gentleman does not mind.

Sadly, this cruel tax, which is being imposed midway through the academic year, will damage the education of thousands of pupils. It is sadly typical of the ideological approach that we have seen the new Government take on education, where they are trashing the record of schools, pupils, teachers and governors over the past 14 years when we rose up the international league tables.

[Simon Hoare]

Given that there are many on the Government Benches who had almost as their life’s work the destruction of the private school system, is my hon. Friend as shocked as I am that for this flagship policy, which the red flag has so often demanded, the Government Benches are so underpopulated? I thought that they would be there to cheer the Minister on.

[James Wild]

My hon. Friend makes an important point. He will have been here throughout many of the debates on the Finance Bill, the national insurance and jobs tax Bill, where very few Labour Members have made contributions to defend their first Budget for 14 years. I think we all know why.

Clause 47 removes the exemption for private school fees and spells out what Labour’s education tax will mean from 1 January. As my right hon. Friend the Member for Hertsmere (Sir Oliver Dowden) said, doing that mid-year is a cruel measure.

Farming and Inheritance Tax

Simon Hoare Excerpts

Wednesday 4th December 2024 Commons Chamber

[Victoria Atkins]

rose—

[Simon Hoare (North Dorset) (Con)]

On a point of order, Mr Speaker.

[Mr Speaker]

I have a point of order—from the shadow Minister’s good friend, of course.

[Simon Hoare]

This point of order is spontaneous, unlike that intervention. [Interruption.] I am Mr Spontaneity.

Mr Speaker, you are entirely right that many right hon. and hon. Members read their speeches almost verbatim, but surely it is just rude and discourteous to the House for the hon. Member for Scarborough and Whitby (Alison Hume) to read a supposedly spontaneous intervention as if it had just come into her mind. She managed to find a typewriter and a printer in order to write down two pages of intervention.

[Mr Speaker]

As I expected, spontaneity did not make it a point of order.

--- Later in debate ---

[Mr Speaker]

We do not have much trade with the Chagos islands.

[Simon Hoare]

My right hon. Friend is right to highlight the devastating effect of this policy and to highlight the incredible rounding-up exercise on the Treasury account books of the contribution that it will make to NHS expenditure. With the Labour party having a serious foothold in rural constituencies for the first time since 1945, does she not find this rather inept politics, which is perhaps not surprising from such a London-centric Front Bench? The policy shows a wilful ignorance of rural life and a deliberate attempt not to understand the pressures and is, in essence, selling those rural Labour MPs down the river.

[Victoria Atkins]

I thank my hon. Friend for that point. There is some interesting polling coming out today, which I will deal with. Of course, Mr Speaker, I very much accept your point about trade, but we are genuinely concerned about the national security implications of the Chagos islands deal.

--- Later in debate ---

[James Murray]

I reassure the right hon. Gentleman, for whom I have a lot of respect personally, that we carefully considered how to calibrate the policy to ensure that significant relief from inheritance tax is still available to family farms, while at the same time fixing the public finances in as fair a way as possible.

[Simon Hoare]

I am very grateful to the Minister for giving way. He has just referred to his analysis of four years of data which led him and the Government to this position. That is an incredible thing to ask the House to believe, because just a few months ago his right hon. Friends the now Prime Minister and Secretary of State were specifically ruling out these policies to audiences of farmers and landowners. If the data of four years’ standing told him that this was the right policy, why were those now Ministers economical with the actualité when they spoke to the farmers themselves?

[James Murray]

The data we did not have before the general election was the £22 billion black hole that the hon. Gentleman’s party left in the public finances. He knows that, because it is acknowledged by the Office for Budget Responsibility that the full information was not shared with it. It has said that its forecast would have been “materially different” had it known that that was the case. We have had to take a number of difficult decisions.

--- Later in debate ---

[Daniel Zeichner]

Thank you, Madam Deputy Speaker. I am not sure that Conservative Members do want to listen, really.

As a result of the anxiety that we know people are feeling, it is right that the Prime Minister, the Environment Secretary and I have all met with the NFU president Tom Bradshaw to talk about the proposed reforms. The Government have and will continue to engage with the NFU, the CLA, the Tenant Farmers Association and other stakeholders. The reforms will not be introduced until April 2026, so there is plenty of time for people to plan for change and to get, as they always should when running major businesses, professional advice about succession planning.

Let us be honest: last month’s protests were not just about APR. Rural communities have felt ignored and let down by this place after decades of failure. The Conservatives sold out British farmers in trade deals with New Zealand and Australia. I listened to the shadow Secretary of State, the right hon. Member for Louth and Horncastle (Victoria Atkins)—did we get any apology for the trade deals? Not a word; no contrition. They have learned nothing. They left farmers facing spiralling energy bills because they refused to invest in cheaper home-grown British power—a decision that sent fertiliser and animal feed costs soaring.

The Conservatives were so incompetent that they failed to get £300 million earmarked for farmers out the door, leaving farmers out of pocket as the money sat idle in Treasury coffers. The disastrous kamikaze Budget crashed Britain’s economy and sent interest rates and mortgages skyrocketing, at massive cost to our farmers and rural communities. As a result of all that, public services are broken; hospital waiting lists are at record highs; schools in rural areas are crumbling—if Conservative Members use them, of course—and roads across country areas are cratered with potholes.

Rural communities are rightly feeling ignored and left behind. This Government will not accept that. These reforms will disincentivise the wealthy from buying up agricultural land to shield their wealth from inheritance tax, and they will also raise the money needed to fix those public services. This is a turning point for national renewal. The Budget also commits £5 billion to agriculture over the next two years.

[Simon Hoare (North Dorset) (Con)]

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.

Question agreed to.

Question put accordingly (Standing Order No. 31(2)), That the original words stand part of the Question.

Finance Bill

Simon Hoare Excerpts

2nd reading
Wednesday 27th November 2024 Commons Chamber

[Connor Naismith]

My apologies, Madam Deputy Speaker. I am about to move on to points covered by the Finance Bill.

My constituents want to live in a country that levels the playing field and ensures that working families have as much opportunity at all stages of their life, regardless of their postcode or their background. That is why I support the Government’s decision to end VAT relief on private schools, aiming to equalise educational opportunities. I know that many families work hard to send their child to private school, but I have never met a constituent who does not work hard just to make ends meet, and their children also deserve the very best education that our country can provide. [Hon. Members: “Hear, hear!”] Conservative Members say “Hear, hear!” but we do not often hear them advocating for state schools.

[Simon Hoare (North Dorset) (Con)]

As a former state school pupil with three daughters in a state school, let me assure the hon. Member that, despite the caricature that sometimes he and others like to paint, not all Conservative Members are privately educated. I say to him quietly that it is not a choice of either/or; we want to see excellence and choice in education right across the board. It is not one against the other.

[Connor Naismith]

I thank the hon. Member for making that intervention. He says that it is not a choice between one and the other, but for 14 years under the previous Government we heard his side talk about state schools having to make difficult decisions and tighten their belts. As the husband of a state schoolteacher, I know that our state schools were severely underserved by the previous Government. The money generated by ending the VAT relief on private schools will be vital to recruit the 6,500 more teachers that we need in our state schools and to roll out free breakfast clubs across the country, to ensure that no child in education goes hungry.

VAT: Independent Schools

Simon Hoare Excerpts

Tuesday 8th October 2024 Commons Chamber

[James Murray]

I have made clear the reason why we are proceeding with this policy to a January 2025 date, which is that we want to raise the money as soon as possible to invest in our improvements to state education. There will have been five months for parents and schools to prepare for the change.

[Simon Hoare (North Dorset) (Con)]

Will the Minister give way on that point?

[James Murray]

I am still responding to the hon. Member for Hinckley and Bosworth (Dr Evans), so please let me come back to that point. HMRC is putting in place bespoke guidance, and it is standing by to make sure that schools are properly registered for the change. All the evidence we have seen from the IFS and so on suggests that the impact on the state sector will be very small, which means that it will not have a material effect on children’s education.

--- Later in debate ---

[Simon Hoare (North Dorset) (Con)]

Let me reiterate to the Minister the asks that the Opposition have. In an ideal world we would prefer this policy not to go ahead, but the mathematics of this place indicate that whatever the Government wish to do, they will secure.

This change should be delayed until September 2025; that would allow for sensible planning. Clearly, those with SEND and the children of serving military people or those in our diplomatic service should also be exempt. I would also like, on behalf of many of the schools in my constituency that have raised this, to know whether VAT will be applicable to summer schools and other events that are put on.

Bryanston school in my constituency has a fantastic relationship with Blandford high school. Unlike the Treasury Minister who opened the debate, I have no skin in this game; I was not privately educated, nor are my three children. But North Dorset is not a particularly wealthy constituency. Seven hundred and ninety-two jobs are linked to Bryanston school. The soft power that the schools provide in the international environment also need to be taken into account. Bryanston school alone makes a contribution of £24 million a year to the local North Dorset economy.

My asks are quite small in comparison to the ask that my Labour opponent would have been making of the Government had he won in July. Because when Richard Jones, the head teacher of Bryanston, at a church hustings, set out all the good work that Bryanston does in the community, its contribution to the economy and the jobs that it creates, my opponent said he was fantastically interested, and would table an amendment to the legislation to secure an exemption for Bryanston school. So if the Labour Front Benchers could not even convince their own parliamentary candidate in North Dorset of the merits of this policy, they have signally failed to convince the many parents and others who work very hard to send their children to school in the independent sector.

My final words are for the Secretary of State for Education, after the terrible tweet that she put out a couple of days ago. She is the Secretary of State for the education of all children, irrespective of which sector they are educated in. She used divisive words, referring to “our children” versus theirs. That is them and us. She has aided the Government’s case and argument not a jot. She is the Secretary of State for the education of all children; I wish she would take her responsibilities a wee bit more seriously.

--- Later in debate ---

[Nigel Huddleston (Droitwich and Evesham) (Con)]

It is an honour to follow Citizen Smith over there.

In the large number of contributions today, we have seen the importance of this issue and the alarm felt by many Members and their constituents about the Government’s proposal. I am sorry to say that we have also had a lot of 1970s politics of envy today. We believe in evidence-based decision making, and as many Members have pointed out, it is becoming increasingly clear that Labour’s planned education taxes—removing VAT and business rate exemptions from independent schools— will not do what is claimed.

I will move on to the details in a moment, but may I first congratulate those who have delivered their maiden speeches today? I thank them all for making gracious comments about their predecessors. I learned something about each of them today. The hon. Member for North East Derbyshire (Louise Jones) spoke eloquently and lovingly about her beautiful constituency, as did my hon. Friend the Member for Isle of Wight East (Joe Robertson), who brought back many holiday memories for me. The hon. Member for Glasgow East (John Grady) gave us all good advice on naming children in Glasgow. The hon. Member for Tipton and Wednesbury (Antonia Bance) may or may not be aware that we share something in common, as we were both student union sabbatical officers, although in my case a few years earlier. The hon. Member for Horsham (John Milne) gave perhaps the most eclectic speech today, mentioning Daleks, potholes and Ann Widdecombe all in one speech.

I am afraid that I will not be so gracious about some other comments we have heard today from Government Members, who still do not seem to realise that they are now in government and their job is to talk the country up. They have constantly talked down not only the country, but the education system. Let me remind them that when we left office, education standards were going up and per pupil funding was at record levels. In contrast, when Labour was in office, we were falling in the league tables. What a brass neck Labour Members have, when we look at Labour’s record in Wales. We have been backing our brilliant teachers, and I would hope that they would do the same.

The motivations behind this policy are clearly questionable. The impact assessment is non-existent and the savings illusory. There are so many potential unintended consequences and uncertainties around these policies that, at the very least, the Government need to postpone implementation, although it would be better to scrap the plans altogether. They are also moving away from a long-held principle that we used to agree on across the House that educational services are not taxed at all. It is a terrible thing that they are now bringing in.

We have five key categories of concern: the impact on state schools; the impact on Government finances; the timing of the proposals; the consideration of exemptions; and the impact on SEND and EHCPs. I will not repeat all my comments from the debate we had earlier, but it is so clear that this policy will not only have a detrimental impact on the independent schools sector, but negatively impact the state sector, because the imposition of a 20% VAT hike overnight will mean that some families will no longer be able to afford the fees. Inevitably that will mean children leaving the private sector and moving to the state system, putting an additional burden on many local state schools, some of which do not have the capacity. As I said this morning, it is not fearmongering or scaremongering; it is happening already and we are already seeing it in schools. According to some forecasts, instead of the predicted £1.5 billion saving, this policy could cost the taxpayer money.

How extraordinary to choose this policy area to try to eke out some cash when so many other options are available, if the Government were brave enough. Out of total Government spending of more than £1.2 trillion, is this really the policy that they want to prioritise?

On the topic of overall Government finances, we have not yet heard clearly whether the Department for Education will get more funding from the Treasury if the number of state school pupils exceeds expectations. Will they be expected to pay it out of existing budgets? Have the Government set aside capital for additional school spaces if it is needed?

Regarding the timing of the proposals, many Members have mentioned that it is beyond belief that the Government are bringing in this policy in the middle of the school year, when schools are simply not ready for it. It is not fair on the independent sector to expect schools to get their heads around new legislation, register for VAT and implement new systems and processes in literally a matter of weeks and before Christmas. That will not happen. We have also not heard whether the Government will create exemptions or special considerations for all these areas: military families, students on music and dance schemes, children attending small schools, language schools or religious schools, those paying low fees or on bursaries, and children in exam years who may have to move to another school that does not offer their curriculum.

What are the Government doing about pupils with special educational needs and those with an EHCP or in the process of gaining one? If, as many predict, there is a displacement of children with SEND and EHCPs into the state sector, is there the capacity for that? Is there adequate additional funding support planned for local authorities to deal with that predicted increase in demand?

I wish to make a couple of other brief points before concluding. As a Conservative, I believe in choice, and I will not criticise choices made by parents about their children’s education. I have no qualms, however, about criticising hypocrisy. The irony that I stand here as a proud product of a state comprehensive education defending independent schools while the Exchequer Secretary to the Treasury who spoke earlier, a product of a private education, is pursuing a policy that could undermine independent schools is not lost on me or others. Many Government Members attended independent schools or sent or are sending their own children to them, and yet they are determined to increase the costs on others, depriving many families of the choice they themselves had.

I am glad to see the Secretary of State for Education now in her place after being conspicuously absent. Perhaps she will take the opportunity to apologise for the tweet. Parents who send their children to independent schools pay twice for their children’s education and deserve better than to be treated with contempt by their Government’s Education Secretary. The divisive tweet that she put out last weekend was shockingly ill-judged and ill-informed, sneering and smirking about embossed paper and swimming pools. Does she really not understand or recognise that not every independent school is like Eton or Harrow? It betrays an incredible lack of awareness and poor knowledge of the facilities and financial status of many independent schools. It demonstrated that the policy is being promoted not on evidence but on envy and spite—ill-informed and misplaced envy at that.

[Simon Hoare]

I agree entirely with what my hon. Friend has said. Will he add to the indictment of the Secretary of State the fact that she failed signally to realise that she is the Secretary of State for all pupils, whether they are in the independent or the state sector? The divisive language that she used was a very rude signal of two digits to those families who take a decision that she does not like.

[Nigel Huddleston]

My hon. Friend puts it well. I do not have to add to his comments.

This is a rushed and ill-judged policy that will not raise the money the Government assumed it would, undermine the viability of many independent schools, put immense pressure on the state school system and put in jeopardy the education prospects of thousands of students, including many with special needs. We implore Ministers to reconsider.