Exiting the EU: Sectoral Analysis

Debate between Steve Baker and Caroline Lucas

Tuesday 7th November 2017 Commons Chamber

[Caroline Lucas (Brighton, Pavilion) (Green)]

Does the Minister recognise that, with his statement today, he really has turned farce into a new art form? When he asks what side we are on, I say that we on the Opposition Benches are on the side of the 29 million workers whose livelihoods absolutely depend on the impact of Brexit on the UK economy. Will he recognise that he is treating not only this House but the British public with contempt?

[Mr Baker]

I will tell the House what is turning farce into an art form: it is blogging about the Greek debt crisis under the hashtag #thisisacoup and then supporting our continued membership of the European Union, as the hon. Lady has done. That is what takes the public for fools. I say to her that we are all on the side of the British public. The UK took a democratic decision to leave the European Union, and we will now carry through that decision.

Oral Answers to Questions

Debate between Steve Baker and Caroline Lucas

Thursday 7th September 2017 Commons Chamber

[Mr Baker]

I am extremely grateful to my right hon. Friend; of course I agree with him. I am invigorated and excited to find that Parliament is reawakening to the need for full and proper scrutiny of secondary legislation.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Does the Minister recognise the risk of an impending governance gap with regard to environmental legislation? At present, the Commission and the European Court of Justice perform the vital role of both monitoring and enforcing laws. Domestic mechanisms like judicial review simply do not go far enough. What new institutional mechanisms is he going to look at to make sure that he leaves the environment in a better state than he found it?

[Mr Baker]

I am grateful to the hon. Lady for reminding the House that we are committed to leaving the environment in a better state than we found it.

[Caroline Lucas]

How will you do it?

[Mr Baker]

She asks how we will do it. The Bill makes provision for Ministers to bring forward statutory instruments that will correct deficiencies that would otherwise arise as we bring EU law into UK law. I very much look forward to the debate on the particular instruments.

European Union (Notification of Withdrawal) Bill

Debate between Steve Baker and Caroline Lucas

Tuesday 31st January 2017 Commons Chamber

[Caroline Lucas (Brighton, Pavilion) (Green)]

I am pleased to speak today on behalf of my Brighton constituents and indeed of anyone else who continues to be desperately concerned about the enormous risks to this country from the Government’s approach to Brexit. To my mind, the bottom line is this: the Prime Minister has no mandate for the extreme Brexit she is pursuing. It was not on the ballot paper, and I see no contradiction between respecting the outcome of the referendum, which I do—we are leaving—and withholding consent to trigger article 50 tomorrow, when the kind of Brexit that has been set out is so profoundly damaging to the people of this country, and when it is being pursued in profoundly undemocratic ways: with the absence of a White Paper, an absence of safeguards for our economy and with no guarantees for our key social and environmental priorities, either.

I have to say that it is a little surreal to hear so many hon. Members acknowledge that extreme Brexit will be a disaster, yet then announce that they are going to go ahead and vote for it anyway. Very cleverly, the Government have managed to morph a narrow vote in favour of leaving the EU into an apparently overwhelming mandate to leave the world’s biggest trading zone and be cut off from the EU and its agencies. The Government seem increasingly desperate to make deals with any despot they can find—we saw an arms deal with Turkey last weekend, and a trade deal with a divisive and dangerous US President to whom the Prime Minister has already clearly demonstrated she is entirely either unable or unwilling to stand up. That is not what the people voted for.

Nobody voted in the referendum to scrap environmental protection, consumer standards or workers’ rights. Nobody voted to undermine the rights of UK citizens living in other EU countries, or indeed EU citizens living here in the UK. Nobody voted for future generations of young people being denied the right to travel, work and study at a level at least equal to what they enjoy now. And nobody voted for the UK to become a tax haven floating off the coasts of Europe, clinging on to the coat tails of Trump’s America. Yet triggering article 50 under the terms set out will set us on a course that will cause all those things to happen, because they are the logical consequence of the Prime Minister’s extreme version of Brexit.

The Prime Minister’s agenda is essentially about sacrificing the many benefits of the single market on the altar of ending free movement. It may be unpopular to say so, but it needs to be said that free movement has benefited our country in numerous ways. It has benefited British people by giving them the opportunity to work, to study, to live and to love in 27 other countries. It benefits our public services, especially the NHS, and it benefits our economy as a whole because EU nationals contribute more to our public finances than they take out. We would be a poorer country without the taxes EU nationals pay and the work they do in our hospitals, our care homes and our councils—and, more importantly, our societies and our communities would be immeasurably the poorer as well.

The Prime Minister’s agenda will also see us abandon the customs union, and it threatens a new economic model defined by a race to the bottom on corporate taxation—a model that, despite the Prime Minister’s pledge to unite the country, will likely see inequality in Britain rise, as spending on vital public services such as the NHS is eroded yet further. Again, nobody voted for that on 23 June, either. On the contrary, many voted for more money to be invested in the NHS. I seem to recall £350 million a week—yet, just last week, Ministers released official figures showing that they will be cutting the NHS budget per head in real terms in 2018-19.

Let us challenge this idea that these other trade agreements are somehow going to make up for the difference if we leave the single market. Research has shown quite clearly that even if we manage to do deals with the US, the EU, China, Russia, Canada and New Zealand, they would not anywhere near compensate for the loss to the economy of withdrawing from the single market. For voters who support leaving the EU only if they are not personally worse off, that, I think, is crucial information.

The Government have been forced grudgingly to allow Parliament a say on triggering article 50, but it is massively insulting to squeeze this resentful scrap of a Bill into a timeframe that is entirely disproportionate to the immensity of its consequences—and doubly so when the Bill throws us off a cliff edge.

[Mr Baker]

I am just enjoying a blog post on a website of 13 July 2015, in which the hon. Lady comments on the Greek situation under the hashtag “ThisIsACoup”. She describes the IMF, the eurozone and the European Central Bank as “the forces of darkness”. She finishes her post by writing:

“It’s time that politicians here in Britain, no matter where they stand on the economics of the Greek situation, take a stand for the simple right of a nation to manage its own affairs.”

Does she still believe what she wrote back then?

[Caroline Lucas]

I do not see any contradiction between what I wrote back then and the position I am taking now. I have always been critical of certain actions of the ECB and I will continue to be so. That does not mean that we throw the baby out with the bathwater. Only someone who was enormously reckless would think that was a sensible way forward.

What is reckless is a Bill that is going to throw us off a cliff edge, entirely unnecessarily, because it fails to include any mention, let alone give any details, of any transitional arrangements. That means that once the clock starts ticking—once article 50 has been triggered—if negotiations take longer than those two years, we will suddenly be thrown into a world of WTO-only tariffs, and I can assure the hon. Gentleman that his constituents will not thank him for that. I do not believe that democracy is well served by such recklessness.

In the last few moments available to me, I want to say a few words about the environment, an issue that has been conspicuous by its absence during most of the debate over the past few days. I am especially concerned about the need for guarantees—real guarantees—to maintain environmental regulation that is at least as strong as current EU regulation. An environmental protection Act—crucially, with its own court of arbitration —might be one way of delivering that, but we also need to ensure that there are clear ways of retaining our relationships with important European agreements such as REACH, on the registration, evaluation, authorisation and restriction of chemicals, and with the European Chemicals Agency.

We need UK environmental regulators and enforcement agencies, ready to step into the shoes of the EU institutions that currently perform such roles. Those institutions must be properly funded when the EU is no longer funding them. We need to ensure that the principles that underpin our environmental regulations, such as the precautionary principle, are not lost. At present we have no guarantees, and we deserve to have guarantees before article 50 is triggered. About this, as about so much else, there is no information.

Leaders of the leave campaign famously talk about taking back control. If that means anything, it surely means that control must be not just about our departure, but about our destination. Democracy requires that Parliament has ample opportunity to scrutinise the terms of the Brexit deal that will emerge from negotiations, but it also requires the country to have the right to continue to be given a say in the form of a referendum on the proposed deal. I cannot vote for a Bill that fails to provide those safeguards.

Tax Avoidance and Evasion

Debate between Steve Baker and Caroline Lucas

Thursday 13th September 2012 Commons Chamber

[Steve Baker (Wycombe) (Con)]

I congratulate the right hon. Member for Oldham West and Royton (Mr Meacher) on securing this debate. He has introduced it with the highest standards and in the finest traditions of the House. I know that he feels he is on the moral high ground, and in many ways he is. I hope that the whole House will join me in wishing him the speediest of recoveries from his injuries.

On evasion, Parliament is absolutely entitled to expect the law to be obeyed and its will must be expressed in law. If people are able to behave lawfully but other than in accordance with the spirit of the House, the law should be changed, which is a point that my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) has made on numerous occasions. I am prepared to accept the possibility that I am the only Member who does not know the tax code from one end to the other. I see that you are nodding, Mr Deputy Speaker, so perhaps I am alone in that regard.

About 12 years ago, when I worked as a software engineer servicing HMRC, I recall setting up electronic checking for certain pay-as-you-earn, end-of-year returns. It simply was not possible to submit a valid expenses and benefits return in 2001. We had to go to some lengths to persuade HMRC that it had to change its rules if it was to have an internally valid submission. Since then, the tax code has lengthened infamously. I may be alone in not understanding the tax code, but it appears that in some instances, HMRC has not understood it either.

My first point is that Parliament’s will must be expressed clearly in the law and that people should obey it. I object to the most complex tax avoidance schemes for two reasons. First, as was set out by the right hon. Member for Oldham West and Royton, if people are setting up sophisticated schemes to avoid the clearly expressed will of Parliament, they are shifting the tax burden on to others who are less able to pay. I agree with him about that.

My second reason was not given by the right hon. Gentleman. My most profound objection is that people quit the moral high ground when they engage in such schemes. They make it more difficult for those of us who believe that low taxes are in the general interest to make our case. They open the door to another industry—not merely the tax avoidance industry—that uses the complexity in our tax system, its opaqueness and its openness to various interpretations to construct a case that discredits not only our tax system, but the rule of law. For those two reasons, I object to the sophisticated schemes that we all know so well.

I will move on to the scale and the breakdown of the tax gap. We had an exchange earlier about the figures. The total tax gap in 2009-10 was £35 billion. Of that, £5 billion or 14% was due to avoidance and £2 billion due to error. The remaining categories were broadly equal. Criminal attacks, evasion and the hidden economy all involve breaches of the law and ought to be pursued in the usual way. I am grateful to the Minister for acknowledging that. The other three categories were a failure to take reasonable care at £4 billion; non-payment, which includes insolvency, at £4 billion; and legal interpretation at £5 billion. Although those figures sound large, we need to bear it in mind that avoidance and legal interpretation, which is a potential source of avoidance, make up £10 billion of the total of £35 billion stated by HMRC.

[Caroline Lucas]

I share the hon. Gentleman’s opposition to the level of tax evasion and avoidance. Does he agree that it is therefore regrettable that his Government are cutting the number of people working at HMRC by about 7,000? The very people who could be chasing after tax avoidance and evasion are being sacked by his Government and we therefore do not have the resources to go after it. Is that not the worst kind of false economy?

[Steve Baker]

To return to my earlier remarks, having serviced HMRC as a technical consultant on and off for a very long time, I could give the hon. Lady lengthy examples of enormous waste, partly through people not being given adequate skills. I will not bore her with the technical details, but a job that I could have done in about two days with software was going to be done over the course of six months by a team of 20. That kind of nonsense has to stop. They were doing something by hand that ought to have been done using software. The level of work that people were doing was almost degrading. People must be upskilled so that such nonsense can be brought to an end. I therefore support the Government in their drive to increase efficiency at HMRC.

We all know why tax avoidance happens: people desire to pay less tax. The Government know that. Through forms of tax avoidance that are barely worthy of the name, such as individual savings accounts and pensions, the Government have always deliberately incentivised certain behaviours by creating tax breaks. That is not really the subject of the debate. I mention it only to demonstrate that we all understand that everybody would like to pay less tax. I would be grateful if the Minister confirmed for anybody who is watching, listening to or reading this debate by what mechanism they can make voluntary payments to the Treasury, not because I wish to make one, but because I think that it ought to be established how one could make a voluntary payment if one so wished.

The heart of this debate is the question of altruism. My feeling is that Members of all parties often feel that people constructing sophisticated avoidance schemes are insufficiently altruistic. There is a wide range of perspectives on that. Rarely in this country do we hear the cry, “All tax is theft”, but at one extreme there is the rather childish hysteria of objectivism, which totally rejects all altruism, and at the other there is the altruism of the state collective.

As it happens, I believe that having the state collective as the basis of all altruism is extremely dangerous. I am a great believer in individual altruism, so I say to the wealthy that they should not only pay their taxes as Parliament intends but be altruistic and engage in philanthropy wherever they can. Let us win the moral high ground for lower taxes so that people can give more voluntarily and demonstrate that voluntary individual altruism is a better basis for society than coercion. I believe that liberty is the proper context for all virtue. There is very little virtue in obedience to an inescapable authority or in simply submitting to the pay-as-you-earn tax system, but there is a great deal of virtue in someone making their fortune and choosing to give it away.

There seems to be a suggestion inherent in the debate that people who are wealthy have in some sense done something wrong. If somebody in business has at every step created value for other people without force or fraud, they are justly wealthy. If people believe that wealth has been obtained by criminal acts of force or fraud, criminal prosecutions should be pursued. If people are wealthy because they have made a just profit and created value for society, they should be applauded. If we are to have a free, just and prosperous society, we must reconcile ourselves to the notion that profit is a social good.

An enormous amount of damage is done by misinformation. The Tax Justice Network, which was mentioned earlier, has been discredited in another report, and we could go to and fro arguing about who is right and who is wrong, but it is important that people do not discredit the tax system unnecessarily.

My next point is about the rule of law and the general anti-avoidance rule. I initially ranted about that to the Attorney-General, and he related a case—I cannot recall which right now—indicating that there is a long-standing tradition of HMRC being able to interpret the law in a particular way in order to apply Parliament’s will. I am extremely sceptical of anything that allows the law to be applied retrospectively so that people cannot predict how their actions will be interpreted.

Having visited sub-Saharan Africa, Egypt and Pakistan since my election, I am absolutely convinced that the primary reason for poverty in those places is that they lack the rule of law. We interfere with the rule of law at our peril, and if we are really serious about the prosperity of the poorest, we must ensure that it continues to be possible in our country to invest capital productively to raise real wages. That requires certainty and the rule of law.

What, then, is to be done? I will not even be able to attempt in one minute and 50 seconds to enter into evidence the 2020 Tax Commission’s report on the single income tax, but I encourage the Minister to proceed with radical tax simplification. I believe that much of what we are discussing could be dealt with if taxes were both simpler and lower. At this stage, with the mess that we have been handed, it seems to me that there is no chance of low taxes before the election. I would be astonished if the Government were able to deliver them. However, I encourage them to do everything possible to simplify taxes so that they can be applied equally to all and we can end the discrediting of the law and Parliament that happens when people engage in schemes that are obviously mendacious. I am grateful to the right hon. Member for Oldham West and Royton for securing the debate and hope that we will have a productive exchange of views.

Procedure Committee Reports

Debate between Steve Baker and Caroline Lucas

Thursday 13th October 2011 Commons Chamber

[Caroline Lucas (Brighton, Pavilion) (Green)]

I warmly welcome this debate and congratulate the right hon. Member for East Yorkshire (Mr Knight) on his Committee’s work. I support the Procedure Committee recommendations on Select Committee amendments and handheld devices, but I shall focus on the motion on explanatory statements to amendments. That might sound like a very dry, technical and abstract issue, but I believe it goes to the heart of exposing something that is rotten about the way this place works. When I first arrived in Parliament as a new MP last year and started voting on legislation, I was shocked to discover that, due to lack of time, some Government amendments go through on Report “on the knife”, with neither debate nor explanation. That effectively means that legislation is being passed with no scrutiny whatever.

It is equally scandalous that many MPs frequently have no idea what they are voting on when they file through the Lobby. The Procedure Committee has done excellent work in trying to address that problem and has offered the simple solution of explanatory statements. I addressed this issue last year in a report entitled, “The case for parliamentary reform”. Following that report, I was able to secure a lively and well-attended Backbench Business Committee debate in Westminster Hall, which was held on 3 February.

During that debate, I was heartened by the degree of cross-party support that there was for the idea of explanatory statements for amendments taken on the Floor of the House. That was supported because the public would be rightly outraged were it to be widely known that legislation is being passed undebated and that many MPs are simply not in a position to know what they are voting on.

[Steve Baker (Wycombe) (Con)]

Given the sheer volume of legislation that passes through this place, the truth is that none of us can be fully familiar with all of it. Surely the hon. Lady could be a little more generous-spirited to the rest of the House?

Academies Bill [Lords]

Debate between Steve Baker and Caroline Lucas

Wednesday 21st July 2010 Commons Chamber

[Caroline Lucas]

I thank the hon. Gentleman for his intervention, because it absolutely proves the case that education is a key way of ensuring that we do not have a huge number of unwanted teenage pregnancies. Education does not lead young people suddenly to think of doing things that they might not have thought of doing were they not to have had that education. On the contrary, education is one of the best forms of contraception.

The British Humanist Association has asked, legitimately, whether a new, state-funded, Catholic academy would be allowed not to teach sexual reproduction in biology lessons, let alone wider and more objective sex and relationships education. Again, as far as we can see, nothing in the new, deregulated system proposed by the Bill would seem to prohibit that from happening.

These are not the only concerns, because despite this being paid for by the taxpayer, sponsors of academies have enormous powers to dictate how and what pupils learn more generally. I read today with horror that one academy is apparently installing a “call centre” so that pupils’ “aspirations” can be raised by training for this type of work. In Manchester and Birmingham, for example, a range of academies are being planned, each specialising in preparing pupils for employment in specific industries or commercial activities. I read that Manchester airport, which is one such prospective sponsor, has overtly stated that the principal purpose of its academy will be to provide employees for the airport. That is a pretty reductionist interpretation of the purpose of education. That is why we must ensure that academies do follow the national curriculum, which is what my amendment seeks to do.

[Steve Baker (Wycombe) (Con)]

As the hon. Lady mentions the subject, may I say that that does seem an absurdly reductionist approach to academies? Could she explain what she believes the purpose of education is?

[Caroline Lucas]

I am grateful to the hon. Gentleman for giving me the opportunity to expand more widely on this point. I believe that the purpose of education is to enable the potential of every human being to be properly fulfilled, whatever that might be in—it might be in a very academic, artistic or practical way. What education is not about is giving very narrow training for a specific job that has somehow been set up already by the time a child goes into an academy at a young age. We risk dumbing down in a worrying way for the pupils who come through our schools if that is what we think education is about. Education should be for life. It is about fulfilling people’s potential and is not about becoming a narrow cog in a wheel.