Oral Answers to Questions

Tim Farron Excerpts

Tuesday 11th December 2018 Commons Chamber

[Mr Hammond]

The answer, of course, is to ensure that we leave the European Union in a way that supports our economy across the United Kingdom. That means a negotiated deal that allows us to have a smooth exit and retain a close trading partnership with our European neighbours in the future.

[Tim Farron (Westmorland and Lonsdale) (LD)]

Some 51,000 shops on the UK’s high streets closed in the past year. Local businesses in even successful places such as Kendal and Windermere struggle because they are forced to pay huge taxes while mega-online retailers get away with paying next to no tax at all. Will the Chancellor give a well-deserved Christmas present to the high street by halving business rates there paid for by taxing internet firms on the basis of their turnover, not just their profits?

[Mr Hammond]

I am not sure whether the hon. Gentleman was in his place for the Budget, but I did in fact announce a digital services tax based on turnover. I also announced a reduction of one third in the business rates for independent retailers. I am very happy to have a meeting with him and explain the changes in detail.

Eating Disorders

Tim Farron Excerpts

Tuesday 16th October 2018 Westminster Hall

[Wera Hobhouse]

I thank the hon. Lady for that contribution. We do not really understand eating disorders deeply enough and we need to start a lot earlier. We need facilities for people younger than 17; we need to get into the issue at a much earlier age. It is all about understanding what the problem really is. We are a long way from properly understanding the deep-rooted causes. The more treatment available and the earlier we can intervene, the better.

[Tim Farron (Westmorland and Lonsdale) (LD)]

I congratulate my hon. Friend on securing this important debate. Early intervention is hugely significant. Many eating disorders can be prevented from developing to their full extent with proper preventive care. Is she aware that the Government enable public health bodies in Cumbria to spend only 75p per head for children in the county on preventive treatment? Does she agree that that is a disgrace and that we ought instead to be investing in, for instance, having a mental health worker attached to every single school, to ensure that we prevent people getting to the later stage?

[Wera Hobhouse]

Across the board, and particularly when it comes to public health, prevention is so much better than picking up the pieces afterwards. We can save so much money if we do something early rather than only intervening when somebody is already in crisis. That is particularly true for mental health, and the challenge here is that eating disorders are still not very well understood.

[Wera Hobhouse]

Anybody who has had a close family member in such a situation will understand the hon. Gentleman’s point, but families are often pretty helpless too, if they do not really understand what can be done and how they can help their family member to get out of the problem. It is a form of addiction, and like with any other addiction, family members are co-sufferers. They want to help but do not really understand the deep-seated problems. Family members are important, but we need the professionals and their understanding to help families get through together. The hon. Gentleman is absolutely right that families are incredibly important.

Eating disorders define large periods of people’s lives. How can we shorten that time? We need people to be okay with saying, “I’m not okay.” We need to tackle the stigma around eating disorders, and the message needs to get through to a lot of people. More than 1 million people in the UK have an eating disorder; three quarters are women and one quarter are men. That is a very large number, plus there are the friends and family who suffer with them. So many people with conditions such as anorexia and bulimia blame themselves. It is not their fault and we need to make sure that they know that.

When I announced on Twitter that I was holding this debate, I received a wave of emotional responses and personal stories. Yesterday, a local doctor dropped into my office a book that she had written, which described her fight with eating disorders since the age of 13. That shows how early it can start.

I also got an email from a young woman called Lorna, who experienced serious anorexia while studying in my constituency in Bath. This is what she told me:

“I ended up with an initial diagnosis of anxiety and depression, and was started on antidepressants. I suspended my studies and worked as a carer in my local village, living at home with my mum and brother. People I’d known all my life began commenting on the weight I’d lost, and telling me how good I looked. This is when my anorexia began to take full hold.

I stopped eating completely, lying to my mum and saying I’d eaten at work, began over-exercising compulsively, and remember pacing the corridors at work to burn extra calories. I became obsessed. I weighed myself up to 12 times a day.

My mum was terrified, and didn’t know what to do. Eventually she came with me to my GP and I told him everything. I told him I was petrified of putting on weight, exercising excessively and skipping nearly every meal. His response was ‘Oh, that’ll be your antidepressants.’ He took me off a high dose, there and then. Cold turkey.

Each time...I told him how out of control I felt with my eating. He’d force me onto the scales, shaking and crying, and then tell me my BMI was ‘healthy’ and I didn’t meet the diagnostic criteria. I was devastated. I had opened up and was denied help. I never got diagnosed with anorexia, despite going from a size 16 to a size 8 in less than a year.

I went through the monthly humiliation of being dragged onto scales and told I wasn’t thin enough to be helped yet. And not having that formal diagnosis is hard. When I tell people I was anorexic, they never quite believe me, as even doctors didn’t. I think they always assume I was being dramatic, or ‘it wasn’t that bad then’. Today, I am weight-restored, although struggle with now being overweight.

It took me 3 years to recover. 3 years of misery and obsession. I was dangerously unwell, but not sick enough to get an ounce of support.”

When I read that story, I am amazed by how brave Lorna is. She was brave to ask for treatment and even braver to put her trust into the medical system a second time, even after she did not receive the treatment that she really needed. She was very brave to tell her story. Lorna has gone on to campaign for proper treatment for eating disorders. She is here in the Chamber, and I want to thank her personally for letting me share her story—Lorna, thank you. I am so sorry that you had to go through such an awful experience. I know your words will help others, and I desperately hope that together we can improve the treatment and care of those with eating disorders and end the stigma for good.

We cannot ignore the medical failings in Lorna’s story. We need to use them and the figures that prove that Lorna’s experience is not an isolated case. First, we need to break the stereotype that all people with eating disorders are underweight. Hope Virgo’s campaign to “Dump the Scales” was also a response to being told that she was not thin enough to receive support. She is calling on the Government properly to implement the eating disorder guidance delivered by clinicians, a call that I strongly echo along with over 60,000 signatories to her petition. To judge an eating disorder simply by BMI is not good enough; rather, we need to look at the trend and rapidity of weight loss and the story that sufferers tell.

We know that the Department of Health and Social Care knows this is an issue. We know that if we fail to take action, people not only suffer but, in some cases, lose their lives. When questioned on waiting times, the Minister often says that the Government do have targets, but he ignores the fact—or he does not tell us—that there is none for adult services. On average, adults wait twice as long as people under the age of 19. The Government must do everything to remove barriers to treatment. In particular, young adults are incredibly vulnerable. At our autumn conference, the Lib Dems called for the Government to ensure that all young people can access young people’s mental health services up to the age of 25, because from the age of 18 many young adults move out of home, go into further education or start their first job, all of which can be stressful when they no longer have support from home. We must also introduce waiting times for adults to ensure that they receive help as quickly as possible.

The Minister is likely to mention that in 2015 the Government allocated £30 million of extra resources per year for five years to improve the NHS treatment of eating disorders for teenagers. However, in some cases that is not reaching the frontline, because the funding is not ring-fenced and can be diverted to other priorities.

[Tim Farron]

Leading on from that point, my hon. Friend will be aware that in 2016 the Government pledged money for a specific one-to-one eating disorder service for children and young people under the age of 18. Yet two and a half years on, that service does not exist in Cumbria, and people who present with eating disorders often go through the struggles that she has just talked about, because the people that they see are not specialists.

[Wera Hobhouse]

I will come to that. The lack of proper training is really at the heart of what my hon. Friend describes.

Racehorse Protection

Tim Farron Excerpts

Monday 15th October 2018 Westminster Hall

[Mike Hill]

I take the hon. Gentleman’s point and will come to it later. I have heard the voice of the BHA and it has tried to effect change.

According to the petitioners, nearly 200 horses are killed on racecourses each year. Others are taken away injured and die later, but do not appear in any industry figures. Horses are whipped as normal practice. Rule-breaking abuse with the whip runs to more than 500 offences a year, committed by 260 jockeys or more. That alone is a damning indictment of the BHA’s failings, and there are other issues, which I will come to. A point of progress noted by the BHA at our meeting was the fact that it now counts horses that have died off the racetrack.

The BHA has lacked urgency and has failed to take pragmatic steps when horses have been killed. If racing has a bad name in the media, that has been brought on by a failure to acknowledge and act. Let me read just a few headlines that expose the deficiencies: “‘Record’ number of thoroughbreds being slaughtered for meat”, “Jockey banned after…punching horse”, “Three horses die within 30 minutes at Hexham races leading to calls for an inquiry”, “Worcester Racecourse is among worst venues for horse safety”, and “Plumpton described as ‘death trap’…six horses died in just nine days of racing”. Of course, there was also the recent Cheltenham incident. Such headlines are written because of the public interest in animal welfare, which is ever growing—a point that the petition’s signatories have made clear.

[Tim Farron (Westmorland and Lonsdale) (LD)]

The hon. Gentleman is making extremely good points. Many people, including me, think that the BHA has many qualities and many good people, and serves an important role. However, does he agree that the BHA has so many responsibilities, of which animal welfare is only one, that it is very hard for it to exercise that responsibility as well as it might? Put bluntly, the conflict of interest between promoting the sport and protecting animal welfare ought to lead us to conclude that there should be an independent body.

[Mike Hill]

Yes. The petitioners’ point is that there is a conflict of interest.

Homelessness among Refugees

Tim Farron Excerpts

Tuesday 17th July 2018 Westminster Hall

[Kate Green]

I am grateful to my hon. Friend for raising that matter. It cannot be right that we allow anyone to be destitute in this country, whatever circumstances they find themselves in.

Mohsen’s story is far from untypical and the situation is even more dire for families with children, sometimes creating serious safeguarding issues. Asylum Matters told me about Bao, who was originally trafficked from Vietnam and received refugee status in November 2017 after going through the national referral mechanism. Less than one month later, his daughter was born. The family survived on £35 per week in asylum support, but that stopped and he did not know how to apply for benefits. When he tried to find a home, the council told him he would need to find private rented accommodation. The private landlords all wanted a deposit or guarantor, which he could not provide because he had no savings. An integration loan could have helped him, but he was refused a loan by the Home Office, which claimed he was already integrated because he had been here for such a long time. That meant he could not secure a private tenancy because he had no money to pay for the deposit. He and his baby daughter were destitute for nearly four months, forced to survive on the charity of friends for food and milk and somewhere to sleep—on their floor.

Such cases are cause for enormous concern. I am glad that the Government have accepted that there is a problem and have attempted a number of measures to deal with that, but although it is a pleasure to see the Minister in his place this afternoon, I am a little disappointed that the debate is not being answered by a Home Office Minister as I requested. Fundamentally, we need cross-governmental action to address a mismatch of policies across different Government Departments and the failure of any one Department to own the problem. I believe the Home Office should be taking the lead in joining up policy and procedures. I hope the Minister will share the breadth of my concerns with all of his ministerial colleagues.

[Tim Farron (Westmorland and Lonsdale) (LD)]

The hon. Lady is making some excellent points. Does she accept—I am sure she does—that a contributory factor to refugees being in severe hardship once they have been awarded status is that they are not permitted to work during the time that they are here? Would it not be better, not just for them and their families, but for the country, if they were able to potentially build up savings and contribute and pay taxes during the time they are waiting for their asylum case to be heard, so that they are ready to be fully fledged members of our society at the point at which they are given status?

[Kate Green]

I am grateful to the hon. Gentleman for making that point. I strongly support the right of asylum seekers to work when the Home Office has singularly failed to meet its own obligations to process cases and make a decision within the given timescale. As the hon. Gentleman says, allowing them to do so would enable them to maintain their skills, build up some savings and remain connected with the wider community. Although that may not be a matter for today’s Minister to address, it is certainly one that I strongly support.

Let us consider what action has been taken to date by the Government, because some initiatives have been welcome. The Home Office is rolling out the post-grant appointment service to smooth the referral to Jobcentre Plus for making an initial benefits claim. That follows a pilot in two regions last year, but there were some reports of problems. During a two-week period in February, the refugee support team at the British Red Cross asked 20 individuals in South Yorkshire about their experience of the warm handover pilot. Only one individual stated explicitly that they had received a phone call from Migrant Help, which provided the service. Eight individuals said they had not received any contact, while 11 were unsure whether they had. It may be that those are isolated cases, or that problems have since been resolved, but in a parliamentary answer to Baroness Lister on 29 June, Baroness Buscombe refused to publish the results of the Government’s evaluation of the pilot.

Although the commitment to provide advice and support to new refugees in the move-on period is a welcome addition to the new advice, issue resolution and eligibility contract, charities have seen communication from the Home Office that suggests that the support will be limited to operating the post-grant appointment service only. Advice and guidance in the move-on period must be more comprehensive if it is to address the issue of refugee destitution. In particular, closer working between the Government and third-sector providers is needed. I urge the Minister to encourage ministerial colleagues to publish the evaluation report on the post-grant appointment service pilot and to ensure that the lessons about the wider advice needs of refugees are acted on.

Of course, I am pleased that 35 asylum support liaison officers are now being appointed in a number of local authorities, funded by the controlling migration fund, but it is not clear how their work will be monitored and evaluated. I hope the Minister will say more about that this afternoon. The Government’s integrated communities fund is also intended to provide support for refugees, but again there is little detail as yet on how it will do that. Perhaps the Minister will be able to enlighten us.

It is welcome that national insurance numbers will now be included on the biometric residence permits that refugees receive. Usually, though not invariably, they arrive within a matter of days. That is helpful, because a national insurance number is required for payment of universal credit, although it is not necessary for making an application. The payment is essential for new refugees to pay for, among other things, their accommodation.

Significant problems continue with the issue of national insurance numbers. Some 65% of the new refugees seen by the British Red Cross in South Yorkshire over a two-week period in February during the move-on period had not had an application made to the Home Office for a national insurance number. Those who do not have one must complete the application process over the phone, which often takes 40 minutes. Apparently, 10 questions are asked at the start of the process before the individual is offered the services of an interpreter. Following that phone conversation, the new refugee has to attend a face-to-face appointment before the national insurance number is issued.

Those who lack a national insurance number include people who have joined a partner in the UK under the Dublin rules on refugee family reunion. The result is that sometimes quite large families are struggling to survive on the income from one single parent’s jobseeker’s allowance claim for six weeks or more, while their partner awaits their national insurance number. I have raised this issue previously with Home Office Ministers, but the problem remains unresolved.

Ultimately, this all places unnecessary barriers in the way of enabling new refugees to settle, receive benefits or wages and access suitable accommodation. Can the Minister say anything about what conversations are taking place across the relevant Government Departments to streamline and support refugees and to ensure that national insurance numbers are always issued swiftly and smoothly?

The Minister will be glad to know that I am now firmly in his ministerial territory. The Homelessness Reduction Act 2017 should be helpful, but its operation needs to be clarified and extended for refugees who are homeless or at risk of homelessness. Under the Act, from this October public authorities will be required to refer those at risk of homelessness to the local authority. That provision should be extended to cover providers of asylum accommodation.

Oral Answers to Questions

Tim Farron Excerpts

Tuesday 29th November 2016 Commons Chamber

[Mr Hammond]

Absolutely, Mr Speaker. I agree with Mario Draghi that a reduction in openness would be very bad for the economy of Selsey Bill, and my right hon. Friend is right to draw attention to that. I entirely agree that the best way for the Government to protect the UK’s economy is to argue for the most open possible trading relationship with the European Union after we leave.

[Tim Farron (Westmorland and Lonsdale) (LD)]

The coastal communities of Cumbria were deeply affected by Storm Desmond last December. The River Kent, which meets the sea at Morecambe bay, is one of Britain’s fastest-flowing and shortest rivers, and when it flooded last December, untold damage was caused to communities and the economy throughout the county. In last week’s autumn statement, the Government went back on their word from last December to fund the resilience of bridges to help prevent future flooding. Will the Chancellor apologise to the flood-hit communities of Cumbria for that betrayal, and, even at this late stage, will he change his mind?

Budget Resolutions and Economic Situation

Tim Farron Excerpts

Tuesday 22nd March 2016 Commons Chamber

[Mr Osborne]

I am going to come on to speak about the disability benefits and our way forward, but I have made it very clear—I have just said it—that where we have made a mistake, where we have got things wrong, we listen and we learn. That is precisely what we have done. Where is the apology from the Labour party for the things that they got wrong? Why don’t they take a leaf out of that book? Why don’t they get up and apologise for the countless decisions that added to the deficit—that bankrupted our country?

The progress we have made on social justice did not happen by accident. It happened because we in this Government set out to turn our economy around, to control spending, to back business and, yes, to reform welfare.

[Tim Farron (Westmorland and Lonsdale) (LD)]

Will the Chancellor give way?

[Mr Osborne]

I will give way in a moment to my former partner in the coalition Government that undertook many of these welfare reforms. The reform has meant difficult decisions to strengthen the incentives to find work and the sanctions for not doing so; to make sure that every hour extra that people work is rewarded, instead of seeing them trapped in dependency; and to cap benefit payments so that our welfare system is fair both to those who need it and to those who pay for it. It has not been easy, and it has often been opposed, but the truth is that many of the acts of progressive social change that we seek to achieve in government are difficult and they are opposed. In any democracy, you have to fight to make lasting improvements in society, and that is what we have done.

[Tim Farron]

I thank the Chancellor for giving way, and I want to associate myself with the remarks that he made earlier about the appalling situation in Brussels.

Does the Chancellor agree with me that the one thing that is more dangerous for our economy than his remaining Chancellor is that we might leave the European Union; and does he agree that his being called out by his former colleague as acting not in the economic interests of the country, but in a short-term political way, introduces a risk that the referendum will be a referendum on him, not on the future of our role in Europe? Will he act in the national interest and resign?

[Mr Speaker]

May I remind Members that interventions should be brief? We want to hear from both Front Benchers, and I want to hear from dozens of Back Benchers. I repeat that interventions should be brief.

--- Later in debate ---

[John McDonnell]

We supported the welfare cap. I find it ironic that that point is being made on behalf of a Government who are not meeting their own welfare cap. They are breaching it and then moving it up. They are moving the goalposts again.

Let us be clear that the £4.4 billion black hole in the Chancellor’s Budget means either further cuts in departmental budgets and to benefits, or stealth taxes. No solution has been announced today. We are told that all this will be resolved by the autumn. Between now and then, no public sector job, benefit or service will be safe.

[Tim Farron]

The hon. Gentleman is right that the Chancellor has a £4.4 billion black hole that needs to be filled by cuts to public services or by stealth taxes, but that is in existence only because the Chancellor has set himself a false target. Does the hon. Gentleman agree that the real problem at the heart of the Chancellor’s credibility is the fiscal charter?

[John McDonnell]

I am grateful for the hon. Gentleman’s intervention and I will come back to that point in due course. I realise we are under pressure of time, Mr Speaker, so I will try to be as brief as I can.

The Chancellor’s political manoeuvring has real consequences. The drama over Budget week has clouded a further astounding revelation about his behaviour. His former Government colleague David Laws revealed at the weekend that the Chancellor pressurised senior officials to reduce their estimates of the funding needed to maintain the NHS. We discovered that the Chancellor had forced through a cut of almost half the funding—this was independently assessed—needed by the NHS. The result is that the NHS and hospital trusts around the country cannot plan. They are facing a crisis: waiting times are rising, staff are under intense pressure and morale is at rock bottom. At the start of the year, the NHS recorded its worst ever performance as services struggled to cope with demand. It is now facing its biggest funding crisis for a generation and that is putting patient care at risk.

Budget Changes

Tim Farron Excerpts

Monday 21st March 2016 Commons Chamber

[Mr Gauke]

Yes; my hon. Friend is absolutely right. There has been strong support from small businesses for the contents of this Budget. This is a Government who are backing small businesses and ensuring that they can provide the growth and employment opportunities that the British people need.

[Tim Farron (Westmorland and Lonsdale) (LD)]

I regret the chaos that one tends to get with these unstable single-party Governments, but not half as much as I regret the failure of the Chancellor to be here to answer for himself. His Budget will leave the richest 10% of people £260 better off, and, until he was found out this weekend, that was going to be paid for by punishing the disabled. Does not all that conjuring just show that the Chancellor’s choices are driven by cynical politics, and not by economic necessity? Should not the fiscal charter, which is now utterly discredited, be scrapped?

[Mr Gauke]

Let me point out to the House that 28% of income tax was paid by 1% of taxpayers in 2013-14. Under the policies that we are pursuing, the highest earning 20% will now be paying more than half of all tax revenues. That would not have happened had we stuck with the tax system that we inherited in 2010.

Budget Resolutions and Economic Situation

Tim Farron Excerpts

Wednesday 16th March 2016 Commons Chamber

[Tim Farron (Westmorland and Lonsdale) (LD)]

My party—the Liberal Democrats, or those of us who are left—still feels very proud of the part it played in getting this country this far. The Chancellor said he wanted to abolish the Liberal Democrats, and given that he has failed to meet every other Budget target, that is the best news I have heard in months. In his more generous moments—I am sure he has some—he will acknowledge that Britain is in a stronger economic position today because of the choices we made.

Britain is now at a crossroads. The structural deficit will be gone next year, so the Chancellor is choosing to make unnecessary cuts to meet an unnecessary target. It is his choice to remove support from people with disabilities. It is his choice to cut universal credit. It is his choice to stand by as child poverty increases. The Liberal Democrats got this country to the crossroads, with the Government now, but the Chancellor has chosen the path into the mire.

An awful lot of what the Chancellor said today we have heard before: big promises from the Dispatch Box that are never met—less long-term plan, more short-term scam. This is a microwave Budget reheated again. We have transport projects delayed and abandoned, and housing projects stalled and unfunded.

Not only are flood-hit communities such as mine left desperately holding out their hands for urgent support, but the Chancellor is asking flood victims to pay, through their premiums, for the defences he should have built in the first place. Actions speak louder than words.

The cost to Cumbria of the infrastructure destruction from the floods in December is £500 million—the Government have given £2 million. The main road that connects the whole Lake District is still closed. Never mind that it costs small businesses and big businesses across the Lake District £1 million every day the A591 is shut—this Government care little about the north. They will make grand announcements, but they will achieve nothing.

Not a penny of the £125 million in EU solidarity funding the Government were dragged kicking and screaming to apply for has been dedicated today to the north or to any of the communities that are reeling and recovering from the floods that hit us in December. There has been no mention at all of fully funding any of the flood relief projects mentioned in the Chancellor’s speech.

The Chancellor says that this is a Budget to help young people. He says he wants to increase the length of the school day, but what good is a longer school day when there is no one at the front to teach? Those of us who do not have tens of thousands of pounds to send our children to private schools have more sympathy for those working in the state sector—more sympathy for the teachers who teach our children. I do not want my children’s teachers to be put under ever greater pressure. I want more teachers. I want them to be paid a fair wage. I want them to have the time and the space to create, to inspire and to teach. If the Chancellor wants schools to lengthen the school day, he must give teachers the money they need to do that properly.

This is a repeat of the seven-day-a-week NHS. What the Health Secretary is doing to junior doctors, the Chancellor now wants to do to teachers—teachers who are underpaid, overworked and undervalued by the Government. Every school knows that there is a massive recruitment and retention crisis, which is absolutely and totally ignored by the Chancellor.

[Mr Mark Williams (Ceredigion) (LD)]

As a former teacher, I agree very much with what my hon. Friend says. How will the drive towards academies enhance teacher confidence and, indeed, standards in schools?

[Tim Farron]

My hon. Friend makes an excellent point, based on real, first-hand experience. We know that the drive to compulsorily move all schools to academies is about centralisation, not localisation; it is about rearranging the deckchairs, making life harder for headteachers and teachers, and listening to special advisers, rather than teachers. It is hugely damaging for our educational system and our children.

The fundamental problem in schools across the country at the moment is the recruitment and retention crisis, and the Government are today choosing to put teachers under extra pressure. Instead, the Chancellor should pay our teachers more.

Perhaps the Chancellor knows young people who have the ability to save £4,000 a year, but I do not, so let me enlighten him: the lack of an ISA scheme is not the reason young people are not saving; it is the debt and soaring house prices that he is heaping on them.

This Chancellor’s ambition is not to devolve power but to devolve debt. His decision on business rates is a good one for business and one that we have been calling for, but he refuses to pay for the devolution of business rates, and that will be disastrous for the communities in which these businesses are located. He is moving his tough decisions on to local government. Social care, local transport and rubbish collections will all be under much greater threat. With his changes to public sector pensions, our schools and hospitals face a further bill of £2 billion. That is a stealth tax on education and health—not a headline for the Chancellor but a massive headache for headteachers, doctors, and nurses.

This is the Chancellor’s sweet and sour Budget. He makes bold claims that never materialise, masking real pain. There is no serious immediate investment in transport, broadband, housing or green energy, just far-off plans that exist only on a Whitehall spreadsheet—plans written by political advisers no doubt high-fiving each other in the boardroom over grand announcements that will never actually materialise, ignorant of their impact on real people.

The Chancellor talks about fixing the roof when the sun is shining. There are 0% interest rates. The sun is shining yet he chooses to knock holes in the roof. This would be the moment to be ambitious and to invest in the infrastructure for the long-term economic future of our country. On the one side, we have a Government choosing to attack the very fabric of our communities, and sadly, on the other, an Opposition too focused on themselves to be able to stand up for the real people in this country. We owe our constituents, and we owe Britain, better than this. It is time that we had a Government who showed a little more respect to the people in this country who care for us, who teach our children, and who keep us safe. Britain deserves better.

[Several hon. Members rose—]

UK Film Investment (Tax Relief)

Tim Farron Excerpts

Tuesday 16th December 2014 Westminster Hall

[Sir Nick Harvey]

I entirely agree with what the hon. Gentleman says. I think that this policy was a success and that one can visibly judge the tangible uplift in small film producing in Britain during the period that the tax relief existed. I think that the then Chancellor was right in March 2004 when he observed—this is widely recognised—that a minority of partnerships were abusing the tax relief, but they were a minority. This is the point: it is completely inexplicable and totally unacceptable that 10 years later, HMRC is treating the whole lot of them as though they were crooks, and when the Prime Minister gets up to respond at Prime Minister’s questions, he has in his folder a brief that says that all those involved were involved in abuse, and that they knew at the time that they were engaged in it. That is completely different from the experience of the Movision partners to whom I have talked and of my own constituent on whose behalf I have taken an interest in the subject.

[Tim Farron (Westmorland and Lonsdale) (LD)]

Does my hon. Friend agree that the important thing is to consider the future of the film industry and particularly the young people who are involved in it? Whatever is the case, it is certainly not the fault of young people looking for a future in the film industry. I spoke to a young man—a Kendal college film student—called Emilio Methven on Friday. He did a survey of his fellow students over the weekend, and they want investment in the film industry going forward and more apprenticeships. They want the UK Government to demonstrate that in backing the UK film industry, they are going to back UK film students. They do not want a sense of there being a retrospective potential attack on the film industry that makes their future much harder to establish.

[Sir Nick Harvey]

My hon. Friend makes a series of very good points. These small films are something that Britain is good at. We have an international reputation in it and the developing creative industries in this country are something that we should celebrate, and yet investment in film is an inherently precarious thing to do. If it had not been, it would not have been necessary to contemplate these sorts of tax reliefs in the first place. The reality is that this scheme was almost too much of a success. It ended up costing more in tax reliefs than had been anticipated at the outset. However, as my hon. Friend says, young people up and down the country are engaged as students and as workers in the early stages of careers in the creative industries, and it would be a very backward step if the UK Government, the Treasury and HMRC were seen to be having a crusade against this industry at the very time when we should be encouraging it further and trying to ensure that more jobs are created in this area in years to come.

Anyone who has looked at this matter will understand that a minority of those involved had, arguably, been seeking to avoid tax rather than to invest in film. There are companies—for example, Icebreaker and Eclipse 35—that have been ruled to have abused the reliefs. Rulings have been made and money has been clawed back. However, I believe that the majority, including Movision, acted in good faith, and they are now being tarred with the same brush in the eyes of HMRC, which is refusing to give them the reliefs and challenging the availability of them to those that claimed them.

HMRC’s current position is that all compliant Movision partners who entered into investment in terms of their tax returns are under inquiry for all years ending from 5 April 2003 onwards. Hon. Members will be aware of how rarely retrospective legislation is passed, yet in effect that is what HMRC is doing by applying regulations in such a way that they are having a retrospective impact on these genuine film partnerships, as they were formed and invested in before 2007, and the abolition of section 42 and 48 relief. However, the sticking point is that HMRC will not engage with the partnerships either to discuss the rationale behind its position or to engage in any meaningful settlement talks. Many of its actions could even be viewed as obstructive. HMRC’s inquiries into Movision have been going on for 10 years—since 2004. When HMRC asked Movision how it incurred 100% production expenditure on films, Movision responded in detail on 11 December 2006. HMRC did not respond to that until June 2013—more than six years later. That is completely unacceptable.

It subsequently transpired that HMRC had had a resolution discussion embargo in place from 2010 to 2013, but had chosen not to inform anyone about that; none of the partnerships was aware of it. Why was that? What was the purpose of the embargo? What benefit did it afford to HMRC or the taxpayer?

In 2013, HMRC trialled an alternative dispute resolution and found it to be successful. Following that, it offered a 55% settlement to all partners. Many phoned back and at first were told that HMRC would get back to them after 10 days. Those who phoned later were told six weeks and then two months, and those who rang after that were told that the settlement team had been disbanded—with no explanation.

Movision has made two settlement offers to HMRC: one for £2.4 million and another for £3.95 million. It was told by HMRC that its offers were unsatisfactory, but not why, which obviously makes it very difficult for it to negotiate. The latest development, in the last fortnight, is that HMRC has issued a new embargo on discussions with film partnerships if the partnership has investment in films via anything similar to sale and leaseback. Sale and leaseback is a perfectly conventional method of generating financing whereby the owner of an asset sells the asset but then leases the asset back from the inquirer, thus freeing up some capital. It is commonly used in financing films, and HMRC recognises it in its own business manuals. It is unclear why the embargo has been issued, but it will certainly delay even further any meaningful discussions.

As I said at the outset, there remains a misapprehension about film tax relief. I fully understand the importance and, indeed, the necessity of putting a stop to tax avoidance. That is more pressing than ever in the current financial climate. It is clear that a light needs to be shone on these partnerships. HMRC needs to take immediate steps to identify those who were genuine investors as opposed to those who cynically abused the tax system. The Treasury must be clear that film partnerships that applied the correct legal procedures before 2007 are and remain eligible for the tax reliefs that they were promised by Her Majesty’s Government. With 65,000 cases of tax avoidance identified and a record 27,000 tax disputes waiting to be heard at tribunal, it seems clear that HMRC should be either prosecuting or moving towards a settlement with partnerships.

As I said, for the 500 partners involved in the Movision scheme, the average individual subscription was just £50,000. We are not talking about the super-rich; we are not talking about pop stars and footballers, who are advised on how to seek opportunities for aggressive tax avoidance. With every year that passes, the impact on some of the partners, with the HMRC sword of Damocles hanging over them, will worsen. Many have already become ill, suffering nervous breakdowns and stress-induced illnesses, and have seen marriages and businesses fail. That is a very high price to pay for responding to the call of “Cool Britannia”. Furthermore, it will no doubt make investors less likely to make use of current tax reliefs to invest in industries that the Government want to grow, of the sort that the hon. Member for Huddersfield (Mr Sheerman) suggested, and let us not forget that that is how this whole business started.

HMRC should stop prevaricating and engage with the film partnerships to resolve the inquiries. That should include the aim of either settling or prosecuting within two years, because this has already gone on long enough. I hope that the Minister will consider the steps needed to bring clarity out of the current chaos and rectify unfairness caused to genuine partnerships and investors.

Oral Answers to Questions

Tim Farron Excerpts

Tuesday 24th June 2014 Commons Chamber

[Mr Osborne]

Housing starts are now at their highest since 2007, and we have seen an increase in housing starts and planning permissions this year. I was with the hon. Gentleman in his constituency just the other day, talking about what we could do to get more housing going in his part of London on a brownfield site that he knows has been left derelict for many years. He was working very co-operatively with me then, but perhaps the Chamber of the House of Commons brings out a more adversarial encounter.

[Tim Farron (Westmorland and Lonsdale) (LD)]

My right hon. Friend the Chancellor is right to say that meeting demand with supply is absolutely critical. Given that meeting that demand means 3 million new homes over the next 10 years and that the private sector built only 180,000 houses a year, at best, during the height of the housing boom in the 1990s, does he agree that public investment is needed in social rented housing, in the private sector and in the public sector, if we are to meet the 3 million target?

[Mr Osborne]

I do agree with my hon. Friend. We need to ensure that planning is reformed, and we have done that. It was a controversial decision, but as a Government we have pushed that through, and planning permissions are up. We need to create incentives for the private sector to build homes, and Help to Buy has done that. But we also need to go on building social housing, and as he well knows, the coalition Government are delivering the largest programme of social housing for a generation.